Phoenix, Arizona
Economic Impact Report

This Economic Impact Report quantifies the delta between two defined system states: State A (Phoenix's current feedstock disposal system as assessed in the Feedstock System Assessment, March 2026) and State B (the ACM deployment as defined exclusively by the Circular Advantage Proposal EIR Input Block, March 2026). This report does not re-diagnose State A. It does not independently derive State B values. Its sole function is to model the difference between them across fiscal, economic, environmental, and structural dimensions.

State A values originate in the Feedstock System Assessment. State B values originate exclusively in the Proposal EIR Input Block. Any figure not traceable to those two sources is a reporting error.

§1.2 — Decision Summary Table

All State B figures from Proposal EIR Input Block. State A annual disposal cost modeled from FWDC $105/ton x 146,000 TPY. All ESTIMATED. EST

Source: Feedstock System Assessment, Phoenix, March 2026. No new diagnosis in this section.

§2.1 — Feedstock Volume and Disposition

§2.2 — State A Cost Structure

FWDC basis: gate rate (VERIFIED) + modeled components. Annual figures based on Phase Initial 146,000 TPY. Full addressable 803,000 TPY State A annual cost = ~$84.3M at $105/ton.

§2.3 — State A Cost Trajectory

Three mechanisms drive rising State A costs: (1) Rate escalation — April 2026 City Council direction will embed a multi-year residential rate increase without structural change to disposition economics; (2) Capital reinvestment pressure — deferred vehicle replacement and infrastructure maintenance create a growing backlog at the two transfer stations, SR-85 Landfill, and compost facility; (3) Absence of competition — with no contracted alternative to SR-85, Phoenix holds no leverage against operating cost increases.

§2.4 — State A Environmental and Structural Position

State A perpetuates landfill methane generation, no PFAS elimination pathway for the 91st Avenue biosolids stream, accreting environmental liability from five closed landfills (including the 19th Avenue EPA Superfund site), and a diversion rate of 33.3% against a 50% target by 2030 and a Zero Waste 2050 commitment. State A does not improve structurally — it deteriorates on all four dimensions unless a contracted alternative replaces the current disposition pathway.

Source: Circular Advantage Proposal — EIR Input Block, March 2026. All State B values locked. No independent derivation.

§3.1 — Inherited Flags (State B)

All State B values carry the confidence classifications defined in the Proposal EIR Input Block: FWDC MODELED; Beneficiation Fee MODELED; volumes ESTIMATED; site PROVISIONAL; timeline Carbotura standard. These classifications are not modified in the EIR. The EIR treats them as inputs, not as findings to re-derive.

§3.2 — Deployment Configuration

§3.3 — Economic Terms (From EIR Input Block)

§3.4 — Residual Obligations

ACM produces no residual stream requiring landfill disposition. The City's residual obligation under State B is the Beneficiation Fee per ton delivered — a per-ton operating cost, not a disposal cost. Environmental liability for ACM facility operations falls on Carbotura under the BOO structure. City of Phoenix retains its existing closed-landfill monitoring obligations for the five legacy sites regardless of ACM deployment (State A liability, not State B).

§3.5 — Timeline Anchoring

Phase Initial COD = T0+24 months. First Circular Royalty™ payment = T0+37 months (13 months after Phase Initial COD). The pre-royalty period is exactly 13 months from first feedstock delivery to first royalty receipt. April 2026 City Council rate direction = the named external deadline that creates the decision window for LOI/MOU execution.

§3.6 — Phase Delta Map: State A → State B

State A infrastructure (current disposal system) mapped against the State B ACM Priority 1 candidate site. Click a panel item to pan the map; click a map marker to highlight the panel entry.

State A infrastructure: City of Phoenix Public Works; ADEQ records; phoenix.gov. Operator names verified March 2026. State B ACM site: Proposal EIR Input Block — P1 candidate, PROVISIONAL pending Term Sheet phase verification. PROVISIONAL

Gross cost displacement and Circular Royalty™ cash flow are quantified separately.

• 1. Gross cost displacement: The reduction in State A disposal cost attributable to redirecting feedstock to ACM. Calculated as (FWDC − TMC Fee) × TPY. For Phoenix Phase Initial: ($105 − $100) × 146,000 = $730,000/year. This component exists independently of the Circular Royalty™.
• 2. Circular Royalty™ cash flow: Cash received by Phoenix from Carbotura beginning Month 13. Calculated per Royalty(m+13) = TMC(m) × Royalty_Rate(m). Year 2 onset: $120/ton × 146,000 TPY = $17.52M/year. This component grows annually with compounding escalators.
• 3. Residual obligation: Zero for State B under the BOO structure. ACM produces no residual requiring disposal. Phoenix's residual obligation in State B is the Beneficiation Fee obligation only — a known, capped, per-ton cost with no uncapped liability tail.

§4.2 — Phase-by-Phase Comparative Table (Year 2 Steady-State Onset)

State A cost = FWDC $105/ton × TPY. Y2 Royalty = 120% × Y1 TMC $100/ton = $120/ton. Y30 Royalty = 148% × Y29 Beneficiation Fee/ton. All ESTIMATED. EST

§4.4 — 30-Year Gross Cost Displacement (Phase Initial)

Gross cost displacement diminishes as Beneficiation Fee escalation (2.5%/yr) exceeds FWDC escalation (~2.5%/yr baseline assumption). This underscores the primary driver: Circular Royalty™, not cost displacement. FWDC trajectory ESTIMATED.

§4.5 — 30-Year Circular Royalty™ Table (Phase Initial — 146,000 TPY)

At steady state, the Circular Royalty™ is designed to exceed the Beneficiation Fee on a per-ton basis. Circular Royalty™ payments begin 13 months after corresponding Beneficiation Fee payments and ramp to full run-rate on a rolling basis. All ESTIMATED. EST

Note: Employment and economic impact figures represent regional economic effects — not City of Phoenix fiscal receipts. These are categorically distinct from the fiscal delta reported in §4.

Employment scaled from Carbotura standard 400 TPD baseline parameters. Economic impact modeled at standard regional multiplier. All ESTIMATED. Direct and indirect employment figures are designed-performance projections, not guarantees. EST

§5.2 — Environmental Delta

Environmental figures represent designed-performance projections at the stated throughputs. Actual results will be confirmed through facility commissioning.

§5.3 — PFAS Structural Delta

The 91st Avenue WWTP (SROG) biosolids stream (150 TPD / 54,750 TPY) is currently managed via agricultural land application under Class A beneficial reuse designation. EPA's National Primary Drinking Water Regulation for PFAS (finalized April 2024) and emerging PFAS Superfund designations create escalating cost exposure for this program. ACM eliminates PFAS compounds at processing temperatures exceeding 1,200°C — complete elemental dissociation. State B (Phase Expanded) eliminates the SROG PFAS land-application liability structurally. State A does not.

§5.4 — No-Fallback Analysis

State A contains no contracted fallback for the SR-85 Landfill whose remaining service life is not publicly disclosed. If SR-85 approaches capacity within 15–20 years, Phoenix requires a contracted alternative regardless of ACM deployment. State B provides that alternative and generates positive fiscal returns. The absence of State B does not eliminate the structural need — it merely leaves it unaddressed at increasing cost.

§6.2 — Feedstock Variability ±20%

The CSA structure is not volume-sensitive within this range at Phase Initial scale.

§6.3 — FWDC Sensitivity — Sign-Change Threshold

§6.4 — Royalty Escalator Sensitivity (0 / +1 / +2 pp)

The +1pp base case produces ~$342M. All ESTIMATED. EST

§6.5 — Timeline Slippage (T0 Delays)

• April 2026 City Council rate direction. Named external deadline. Once a multi-year rate escalation is adopted and embedded in service contracts and residential billing cycles, it cannot be retroactively displaced by a CSA signed afterward.
• SR-85 Landfill remaining capacity. DATA GAP. If remaining life is under 20 years (consistent with ~3,500 TPD intake from a facility opened January 2006), capital planning for a post-SR-85 system is required regardless of ACM deployment — and ACM deployment becomes the leading candidate for that successor system.
• Solid Waste Fund depletion (FY2027-28). The fund's near-zero trajectory creates an emergency action forcing mechanism within 18–24 months that is more disruptive than an orderly CSA authorization process beginning now.

§7.2 — Decision Window Table

§7.4 — Optionality Matrix

No new figures in this section. All values trace to preceding sections.

§8.1 — Fiscal Effects (Three-Period Distinction)

At steady state, the Circular Royalty™ is designed to exceed the Beneficiation Fee on a per-ton basis. Gross cost displacement and Circular Royalty™ cash flow are quantified separately. Circular Royalty™ payments begin 13 months after corresponding Beneficiation Fee payments and ramp to full run-rate on a rolling basis.

§8.2 — Regional Economic Effects

The following are regional economic effects — not City of Phoenix fiscal receipts. They do not appear on the City's GASB balance sheet.

§8.3 — Environmental Effects

Environmental figures represent designed-performance projections.

§8.4 — Structural Effects

• State A: no contracted post-SR-85 alternative; Solid Waste Fund trending to depletion; diversion rate 33.3% against 50% target; five closed landfills generating monitoring obligations without mitigation.

§8.5 — Unresolved Data Gaps

These are data gaps — not structural model failures. Each is resolvable through Term Sheet phase verification.

State A vs. State B — Phase Cost Comparison