### Exhibit3 

# STATE OF CONNECTICUT DEPARTMENT OF ENVIRONMENTAL PROTECTION

The State ofConnecticut Consent Order No. 1626 

### vs. Borough of Naugatuck

A.With the agreement of Borough ofNaugatuck ("Respondent") I the Commissioner of Environmental Protection ("Commissioner") finds the following:


### 1. Respondent owns two Nichols**multiple~hearth** 

### sewage sludge incinerators ("incinerators'''),,'.pennit nos. 109- 0001 

### ("west incinerator") and 109-0002 ("east incinerator") located at 500 Cherry Street, Naugatuck, Connecticut ("facility"). Respondent currently has a contract with Naugatuck Treatment Company ("NTC"l to 

### operate the incinerators at the facility.

2. The incinerators are subject to Section 22a-174-22 of the Regulations of Connecticut State Agencies ("Regulations"). On and after May 31, 1995, Section 22a-174-22(e) of the Regulations requires that the incinerators emit nitrogen oxides 

### ("NOxH ) at a rate no greater than 0.33 pounds per million British thermal units ("lbs/MMBtu") of heat input.

3. During emissions testing conducted in November, 1991, the incinerators' NOx emission rates were less than 0.33 lbs/MMBtu ofheat input, the subsequent Section 22a-l74-22 of the Regulations regulatory limit.

4. Pursuant to Section 22a-l74-22(kl of the Regulations, emission tests are to be conducted at least once every five years after performing the initial emission test to ensure continued compliance with the allowable NOx emission rates set forth in Section 22a-174-22 of the Regulations.

5. Respondent conducted its initial emission tests in November, 1991. Pursuant to Section 22a-174-22(k) of the Regulations, Respondent was required to complete its next subsequent emission tests no later than



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# P Respondent's Initials:79

### BOROUGH OF NAUGATUCK 2 

### CONSENT ORDERNO. 1626
November, 1996. Respondent failed to conduct these 

### tests until April, 1999.
6. By virtue of the above, Respondent violated Section 22a-174-22(k) of the Regulations.

7. Respondent is required to conduct its next subsequent emission tests by November, 2001, and at least once 

### every five years thereafter ifRespondentmaintains**e~ssion** sources subject to Section 22a-174-22 of tne 

### Regulations.

8. During emissions testing conducted in April, 1999, the west incinerator emitted NOx at an 

### emission rate of 0.47 Ibs/MMBtu of heat input and the east incinerator 

### emittedNOx at an**e~ssion** 

### rate of 0.44 Ibs/MMBtu of heat input, both in excess of the allowableNOx emission rate of 0.33 

### Ibs/MMBtu ofheat input.

9. By virtue of the above, Respondent violated Section 22a-174-22(e) of the Regulations.

10. During the April, 1999 emissions test, the east incinerator was tested at 87.8% ofdesign capacity. Section 22a-174-22(k) of the Regulations requires that sampling shall be conducted when the source is operating at or above ninety percent (90%) ofdesign capacity.

11. By virtue of the above, Respondent has violated Section 22a-174-22(kl of the Regulations.
12. Respondent proposes to use approved emission reduction credits ("ERCSH) to offset excess NOx emissions at the facility,'until Respondent complies with'the emission limitation in Section 22a-174-22{e) ofthe Regulations.

13. On March 1, 2000, Respondent purchased thirty-one tons of approvedNOx ERCs (eighteen tons non-ozone season, thirteen tons ozone season). On April 27, 2000, Respondent purchased fifty-seven tons ofapprovedNOx ERCs (thirty-five tons non-ozone season, twenty-two tons ozone season). For the period April 1, 1999 through February 29, 2000, Respondent emitted 24 tons of excess NOx emissions from the incinerators. 

# M1"

__ Respondent'S Initials: Date:BOROUGH OF NAUGATUCK 3 CONSENT ORDERNO. 1626

14. By agreeing to the issuance of this consent order, 

### Respondentmakes no admission of fact or lawwith respect to the matters addressedherein other than the facts asserted inparagraphs A.1. andA.2.
B.With the agreement ofRespondent, the Commissioner, actingunder Sections 22a-6, 22a-171, 22a-174, 22a-177, and 22a-178 of the 

### ConnecticutGeneral Statutes, orders Respondent as follows:

1. On and after the date of issuance of this consent 

### order, andprior to May 1, 2003 oruntil Respondent achieves compliance with the emission**sta~dards** in 

### Section 22a-174-22(e) of the Regulations, whichever occurs earlier, Respondent shall have in its possession required, approved**ERCs~** . 2. On and after the date of issuance of this consent order, and prior to May 1, 2003 or until Respondent achieves compliance with the emission standards in Section 22a-l74-22{e) of the Regulations, whichever occurs earlier, Respondent shall document and record the amounts of all sewage sludge and number 2 oil (collectively referred to as "fuel-) and ERCs usedby the incinerators eachmonth, andprovide such records in accordance with the following and Section 22a-l74-22 of the Regulations:

a. Before the first day of eachmonth, calculate projected ERCs required for the next calendar month for the incinerators as follows:

West Incinerator

.., ERCs (tons)

- (Estimated Fuel Use in MMBtu x (0.52 lbs/MMBtu

- (0.95 x 0.33 lbs/MMBtu))) • 2000 pounds;

East Incinerator ERCs (tons)

- [Estimated Fuel Use in MMBtu x (0.48 lbs/MMBtu

- (0.95 x 0.33 lbs/MMBtu))] + 2000 pounds;
b. Document that sufficient approved ERCs are available for the incinerators no later than the first of each calendar month to assure compliance for, at a minimum, that calendar month. ERCs required shall be adjusted
Respondent's Initials: Date:

### BOROUGHOFNAUGATUCK 4 CONSENTORDERNO. 1626 upwards by 100% 

### ifapproved ERCs are not in Respondent's possessionprior to use. However, based on the gravity of the noncompliance, the Commissionermay require additional upward adjustment;

c. No later than the tenth day of eachmonth. 

### calculate ERCs used in thepreceding calendar month for the incinerators as follows:
West Incinerator ERCs (tons) ; [Actual Fuel Use inMMBtu x (.52 1bs/MMBtu

- (.95 x .33 1bs/MMBtu))J + 2000 pounds;

East Incinerator 

### ERCs (tons) 

## =[Actual Fuel Use 

### inMMBtux (.48 1bs/MMBtu

- (.95 x .33 1bs/MMBtu))J + 2000 pounds;

d. Document and record monthly consumption of fuel and 

### ERCs;

e. No later thanMarch 1 of eachyear this Consent Order is in effect. include with its annual emissions report to the Commissioner, the monthly rate of fuel consumption for the incinerators and ERCs usedby the incinerators for the previous calendaryear;
f. Retain records and supporting documentation as described in this section for a minimum of five years, commencing on the date such records were created;

g. Maintain documentation to**attest·~o·the** fact that ERCs used during the ozone season were generated during the ozone season. The ozone season is fromMay 1 through September 30 in any calendar year. Generator certification of this fact shall be sufficient; and
h. Provide the records specified above to the Cornfidssioner within thirty (30) days of receipt of a written request from the Commissioner.
3. a. Respondent shall immediately retire forty-eight (48) tons ofNOx emissions to offset excess**~Ox** emissions from
Respondent's Initials: Date:

### BOROUGH OF NAUGATUCK 5 

### CONSENTORDERNO. 1626

April 1, 1999 through February 29, 2000 (24 tons for the excess NOx emissions from April 1, 1999 through February 29, 2000 and 24 tons as a 100% "premium" for 

### not having the requiredNOxERCs on handprior to the
occurrence of the excess emissions). Twenty-two (22) 

### tons shall be ozone season ERCs and twenty-six (26) tons shall be non-ozone season ERCs.


### b. Respondent shall acquire and retire the approvedNOx ERCs calculatedin accordancewith the following calculations for the periodof time fromMarch 1, 2000 and up to the date of issuance of this consent order:

West Incinerator ERCs (tons)

- (Actual Fuel Use in MMBtu.x {.47 1bs/MMBtu

- (.95 x .33 lbs/MMBtu))J + 2000 pounds;


### East Incinerator ERCs (tons)

- [Actual Fuel Use inMMBtu x {.44 1bs/MMBtu

- (.95 x .33 lbs/MMBtu))] + 2000 pounds


### ERCs required shall be adjustedupwards by 100% 

### if approved ERCs are not inRespondent's possessionprior to use. AnyERCs used during the ozone season shall have been generatedduring the ozone season.
4. 

### Prior to May 1, 2003, 

### Respondent shall limit sewage sludge throughput of the east incinerator to 1.18 

### dry tons/hour. However, ifRespondent is unable to limit sewage sludge throughput of the east incinerator to 1.18 

### dry tons/hour, Respondent shall conductNOx emissions testing of the east incineratoron orbefore sixty (60) 

### days after'exceedance of the 1.18 dry 

### ton/hour throughput limit in accordancewith the following:

-

a. Respondent shall submit to the Commcissioner for his review andwritten approval an Intent-To-Test**("ITT~)** 

### protocol not less than thirty (30) 

### days prior to the emissions testingrequiredpursuant to paragraph 4 

### of this consent order. The ITTprotocol shall include at least:
1. The Department ofEnvironmental Protection's Bureau ofAirManagementTest FormNo.1, "Intent to Test";

Respondent's Initials: Date:

### BOROUGH OFNAUGATUCK 6 CONSENT ORDERNO. 1626
2. System operating parameters indicative ofproper operation, including, but not limited to, sludge throughput, auxiliary fuel firing rate, NOx 

### emissions rate, and incinerator operating temperature.


### The ITTprotocol shall provide that Respondent shall perform testing as specified in Sections 22a-174-5 and 

### 22a-174-22 of the Regulations, including operating the incinerator at not less than ninety percent (90%) of 

### its maximumpermittedcapacity.
b. Respondent shall performall testing requiredby paragraph 8.4. in accordance with the approved ITT protocol.

c. In conducting andperforming the testing required by paragraph B.4., and in analyzing the results of such testing, Respondent shall adhere to methods specified in Sections 22a-174-5 and 22a-174-22 of the Regulations and as approvedby the United States Environmental Protection Agency ("EPAH) and the Commissioner.

d. Respondent shall schedule all emissions testing so as to allow the Commissioner to be present during such testing and to independently verify facility operations, air pollution.control equipment parameters, and testing procedures.

e. Within 30 days after completing any emissions testing required by this consent order, Respondent shall submit to the Commissioner a written report. providing the results of such testing; within 15**day~** of a notice from the Commissioner indicating any deficiencies in such report, Respondent shall submit a'revised report.
f. 

### If the results of the testing required by paragraph B.4. show that the actual NOx emission rate of the east incinerator is higher than the full load emission rate ("FLERH ) of the east incinerator specified in paragraph B.2., Respondent shall immediately substitute the higher NOx emission rate for the FLER in the ERC calculations in paragraph B.2., and Respondent shall acquire ERCs in accordance with the revised calculations. Respondent shall adjust any ERCs not in Respondent's possession prior to the occurrence of the
excess NOx emissions upwards by"100% from the date of
Respondent's Initials: Date:

### BOROUGH OFNAUGATUCK 

### the emissions test until thepurchase 

### 7 CONSENTORDERNO. 1626 conductedpursuant to paragraph 3.4. of said ERCs.

g. 

### If the results of the testing required by paragraph 

### B.4. show that the actual NOx emission rate of the east incinerator is lower than the FLER of the east incinerator specified inparagraph B.2., 

### Respondentmay submit awrittenrequest to the Commissioner, for his review and written approval, to substitute the lowerNOx emission rate for the FLER in the 

### ERe calculations inparagraph B.2.


### 5. Pursuant to paragraphA.7., Respondent shall conduct**ern~ssion** 

### tests ofboth incinerators on orbeforeNovember 2001. Said emission tests shall be conducted in accordance with the procedure set forth in paragraph B.,,4.a. through 

### B.4.e; provided that if the east incinerator is tested at 90% of its maximumpermitted capacity, the 1.18 dry ton/hour sewage sludge throughput limit specified inparagraph B.4. shall no longer apply. Respondent shall conduct emission tests of any emission sources subject to Section 22a-174-22 of the Regulations at least once every five years after November 2001.

a. If the results of the testing requiredby this paragraph show that the actual NOx emission rate(s) of
one orboth of the incinerators is/arehigher than the full load emission rate(s) ("FLER") of the incinerators specified inparagraph B.2., 

### Respondent shall immediately substitute the higherNOx emission rate(s) for the FLER{s) in the ERe calculations inparagraph B.2., 

### andRespondent shall acquire ERCs in accordance with the revised calculations. Respondent shall adjust any ERCs not in Respondent's possessionprior to the
occurrence of the excess NOx emissions upwards by 100% 

### from the date of the emission tests conductedpursuant to paragraph B.4. 

### until the purchase of said ERCs.

b. 

### If the results of the testing requiredby this paragraph show that the actual NOx emission rate{s) of
one orboth of the incinerators is/are lower than the FLER(s) of the incinerators specified inparagraph B.2., 

### Respondent may submit a written request to the Commissioner, for his review and written approval, to substitute the lowerNOx emission rate(s) for the FLER(s} in the ERC calculations inparagraph B.2.


### 6. 

### On and after the date of issuance of this Consent Order, and


### Respondent's Initials, Date:

### BOROUGHOF NAUGATUCK 8 CONSENT ORDERNO. 1626 prior to May 1, 2003, Respondent shall comply during 

### operation on sewage sludge andno. 2 fuel oil with an enforceablemaximumFLERof 0.52 Ibs ofNOxperMMBtu of heat input for the west incinerator, and 0.48 Ibs ofNOxper 

### MMBtu ofheat input for the east incinerator, averaged on a 24-hour basis.


### 7. No later thanMay 1, 2003, Respondent shall complywith the requirements of Section 22a-174-22(d) (2) of the Regulations. 

### However, after full programreview of the Emissions Trading Program and, 

### if determined

## to be appropriate, the 

### Commissionermay grant a written extension of this Consent Order.
8. Full compliance. Respondent shall not be considered in full compliance with this consent order until all actions required by this consent order have**been~completed** as approved and to the Commissioner's satisfaction.

9. Approvals. Respondent shall use best efforts to submit to the Commissioner all**docQ~ents** required by this consent order in a complete and approvable form. If the Commissioner notifies Respondent that any document or other action is deficlent, and does not approve it with conditions
or modifications, it is deemed disapproved, and Respondent shall correct the deficiencies and resubmit it within the time specifiedby the Commissioner or, ifno time is specifiedby the Commissioner, within 30 days of the Commissioner's notice of deficiencies. In approving any document or other action under this consent order, the Commissioner may approve the document or other action as submitted or performed or with such conditions or modifications as the Commissioner deems necessary to carry out the purposes of this consent order. ':Nothing in this paragraph shall excuse noncompliance or.delay.

10. Definitions. As used in this consent order, "Commissioner"
means the Commissioner or a representative of the Commissioner. The date of**~issuance"** of this consent order is the date the consent order is deposited in the U.S. mail
or personally delivered, whichever is earlier. "Approved ERCs" are defined for purposes of this consent order as those for which the Commissioner has providedwritten authorization for use in compliance with Section 22a-174-22 of the Regulations.

11. Dates. The date of submission to the Commissioner of any document required by this consent order shall be the date
Respondent's Initials:

# o Date:

### BOROUGHOFNAUGATUCK 9 CONSENTORDERNO. 1626 such document is receivedby the Commissioner. The date of any notice by 

### the Commissionerunder this consent order, 

### including but not limited to notice ofapproval or disapproval ofany document or other action, shall be the date suchnotice is deposited in the U.S. mail or is personallydelivered, whichever is earlier. Except as 

### otherwise specifiedin this consent order, theword -day· as used in this consentordermeans calendarday.**k~y** 

### document
or actionwhich is required by 

### this consent order to be 

### submittedorperformedby a date which falls on a Saturday, Sunday or a Connecticut or federal holiday shall be submitted orperformedby thenext day which is not a Saturday, Sunday or Connecticut or federal holiday.
12. Certification ofdocuments. Any document, including but not limited to anynotice, which is required to be submitted to the Commissionerunder this consent order shall be signed

### by Respondent or, ifRespondent is not an individual, by Respondent's chiefexecutive officer or a duly authorized representative of such officer, as those terms are defined in Section 22a-430-3(bl

### (2) of the Regulations ofConnecticut State Agencies, andby the individual(s) responsible for actuallypreparing such document, and·Respondent or Respondent's chiefexecutive officer and each such individual shall certify inwriting as follows:
"1 havepersonally examined andam familiar with the information submittedin this document and all attachments thereto, and 1 certify, based on reasonable investigation, including my inquiry of those individuals responsible for obtaining the information, that the submitted information is 

### true, accurate and complete to the best ofmy knowledge and belief. 1 understand that any false statementmade in the submitted information is punishable as a criminal offense under Section 53a-l57b of the**Co~~ecticut** 

### General Statutes andany other applicable law.-
13. Noncomoliance. This consent order is a final order of the commas;ionerwith respect to thematters addressedherein, and is nonappealable and immediately enforceable. Failure to complywith this consent o+dermay subject Respondent to an injunction andpenalties.
14. False statements. Any false statement in any information submittedpursuant to this consent order is punishable as a criminal offense under Section 53a-l57b of the**Co~~ecticut** 

### General Statutes andany otherapplicable law. 

# MT Respondent's Initials, Date:

### BOROUGH 15.



### 16.

17

.



### lB. 

### OFNAUGATUCK 10 CONSENT ORDERNO. 1626 Notice of transfer; liability of Respondent. 

### Until Respondent has fully compliedwith this consent order, Respondent shall notify the Commissioner in writing
no later than 15 days after transferring all or any portion 

### of the facility, the operations, the site or the business which is the subject of this consent order or after obtaining 

### a newmailing or location address. Respondent's obligations under this consent order shall not be affected by the passage of title to any property to any other person or municipality.

Commissioner's powers. Nothing in this consent order shall 

### affect the Commissioner's authority-to institute any proceeding or take any other action to prevent or abate violations of law, prevent or abate pollution, recover costs and natural resource damages, and to impose penalties for past, present, or future violations of law. ··If at any time the Commissioner determines that the actions taken by Respondent pursuant to this consent order have not successfully corrected all violations, fully characterized the extent or degree of any pollution, or successfully abated or prevented pollution, the Commissioner may institute any proceeding to require Respondent to undertake further investigation or further action to prevent or abate violations or pollution. Respondent's obligations under law. Nothing in this consent order shall relieve Respondent of other obligations under applicable federal, state and local law.

No assurance by Commissioner. No provision of this consent order and no action or inaction by the Commissioner shall be construed to constitute an assurance by the Commissioner that the actions taken by Respondent pursuant' to, this consent order will result in compliance [or prevent or abate ·pollution]

. 19. Access to site. Any representative of the Department of Environmental Protection may enter the facility without prior notice for the purposes of monitoring and enforcing the actions required or allowed by this consent order.


### 20. No effect on**r~ghts** neither creates nor municipalities that of other persons. affects any rights
are not parties to This consent order of persons or this consent order.

21. Notice to Commissioner of changes. Within 15 days of the date Respondent becomes aware of a change in any information submitted to the Commissioner under this consent order, or Respondent's Initials: Date:

### BOROUGHOFNAUGATUCK 11 CONSENTORDERNO. 1626 that any such informationwas inaccurate ormisleading or that any relevant informationwas omitted, Respondent shall submit the correct or omitted information to the Commdssioner.
22. Notification ofnoncompliance. In the event that Respondent becomes aware that it 

### didnot ormay not comply, or didnot or maynot comply on time, withany requirement of this consent 

### orderorofanydocument requiredhereunder, Respondent shall immediatelynotifyby telephone the individual identified in the nextparagraph and shall take all reasonable steps to ensure that anynoncompliance or delay is avoided or, 

### if unavoidable, is minimized to the greatest extent possible. Within five (5) days of the initial notice, Respondent shall submit inwriting the date, time, andduration of the noncompliance and the reasons for the noncompliance or delay and propose, for the reyiew andwritten approval of the Commissioner, dates bywhich compliance'will be achieved, and Respondent shall complywithany dates which may

### be approved inwriting by the Commissioner. Notificationby Respondent shall not excuse noncompliance or delay, and the Commissioner's approval ofany compliance dates proposed shall not excuse noncompliance or delayunless specifically so statedby the Commissioner inwriting.

23. 

### Submission ofdocuments. Any document required to be submitted to the COmrrUssionerunder this consent order shall, unless otherwise specified in this consent order or inwritingby the Commissioner, be directed to: WendyJacobs Department of Environmental Protection Bureau ofAirManagement Compliance andFieldOperations Division



### .., 79 

### ElmStreet Hartford, Connecticut 06106-5127

Respondent's Initials: Date:

### BOROUGHOFNAUGATUCK 12 CONSENTORDERNO. 1626

Respondent consents to the issuance of this consent order without further notice. The undersigned certifies that he/she is fully authorized to enter into this consent order and to legally bind the Respondent to the terms and conditions of the 

### consent order.

RESPONDENT Mayor

Date

Issued as a final order of**the~~mtssioner** of the Department of Environmental Protection on , 2001.



### BOROUGHOFNAUGATUCKLAND RECORDS MAILED CERTIFIEDMAIL, RETURNRECEIPTREQUESTED Certified Document No. 1625 0561



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