Having withdrawn the exemption last November that allowed this autoclaved waste to be used for agricultural purposes, the EPA has been paying the cost of shipping the material from Englands Rd in Coffs Harbour to Tamworth where it is land filled.

Now it has announced this arrangement will cease as at February 28 next year and is asking for submissions on a proposed $6.5 million transition package as a first step in considering new and future uses for general household waste.

The submission period closes on November 28.

General Manager Michael Coulter said the package was "pathetically inadequate".

"The State will earn many times that funding every year in additional waste levy charges which are $82.70 per tonne here and around $200 per tonne in Sydney*," he said.

"Whereas the termination of the current funding will see a council (Coffs), or by agreement councils (Coffs, Bellingen, Nambucca), slug rate payers an estimated extra $3 million per annum for their mixed waste disposal.

"Nambucca and Bellingen are party to an agreement (until 2027) with Coffs Harbour City Council wherein we are required to deliver our mixed waste to Englands Road in Coffs Harbour at which time it becomes the property and responsibility of CHCC who have a contract with Biomass to process the mixed waste."

The mayor Rhonda Hoban said she was angry that ratepayers would be forced to pay waste charges that were originally designed to avoid landfill and enable the development of alternative better uses.

"We will certainly be making a submission both individually and jointly with the other councils," Cr Hoban said.

"Our primary focus will be to ask the EPA to either pay out the waste contract of the three councils to give us a clean slate or to cover the transport and land filling costs for the remaining life of the contract."

Mr Coulter said that given the enormous financial implications of terminating the current funding next year, the consultation period was quite limited (six weeks).

"The General Managers and waste staff of the three councils have had two meetings and other discussions over the past two weeks with an all day workshop planned for Monday," he said.

An EPA spokesperson said they had met with Nambucca Shire Council, including a briefing on 22 October, and invited input into the development of a transition package.

He stressed the current consultation was just the first step to considering new and future uses for general household waste, with significant work underway to improve the management of waste in NSW through the development of a 20-Year Waste Strategy which will also include a consultation process.

"Since stopping the use of MWOO in 2018, the NSW Government has provided support to minimise the risk of disruption to kerbside collections and additional costs being passed on to councils or ratepayers," he said.

"This includes an exemption from the waste levy for MWOO being sent to landfill so no extra landfill fees are being collected."

He said the original EPA exemption decision was the result of a major research program commissioned by the NSW Government and included a seven-year, independent research investigation conducted from 2011-2017 by a number of institutions including the CSIRO, the Department of Primary Industries, the University of Sydney, the University of New England and the Office of Environment and Heritage.

* The NSW Government earned $772 million from the Waste and Environment Levy in the last financial year. This amount is estimated to be around $802 million by 2022-23.

An EPA spokesperson said these funds were used in part for the nine-year $802 million Waste Less, Recycle More initiative of which, to June 2019, $419 million had been awarded to 2,219 projects.

"This has helped increase waste processing capacity in NSW by an estimated 2.2 million tonnes a year," they said.

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