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Wednesday, 14 September 2011 13:15

Haywood closes in on deal to privatize landfill

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Haywood County is inching closer to exiting the landfill business, with plans to hand over the county’s White Oak landfill operations to a private company who will sell space to out-of-county haulers.

County commissioners will vote next month whether to enter into a contract with Santek Environmental to run the landfill.

The county would pay Santek a flat fee of $127,000 a month to run day-to-day operations of the landfill. Santek would also make money by selling space in the county’s landfill for trash from other places. Trash would only be accepted from other places in Western North Carolina, not other states.

Santek would get to keep the money from selling space in the landfill. If and when the landfill hits a threshold of 396 tons per day — including the county’s own trash as well as trash from elsewhere — the county would get a 5 percent cut of the money made by selling landfill space.

At that point, the county would no longer pay a flat fee and instead pay $22.25 per ton.

Once Santek hits the magic number of 396 tons a day, economies of scale would kick in, allowing Santek to reduce what the county pays to dump its own trash as well as share a cut of the revenue from selling landfill space.

The landfill currently takes in about 150 tons of trash a day from households and businesses in Haywood County. Trash from other places would exceed the county’s own volume of trash if Santek hits the 396 tons-a-day mark.

If hired the company will answer to the county’s current Solid Waste Director Stephen King.

David Francis, the county tax administrator who has also been spearheading the landfill project, laid out the proposed contract with the Tennessee firm at a commissioners’ meeting last week.

The central selling point made by Francis is the cost savings to the county. The county is projecting a yearly savings of $417,136 if Santek takes over the place.

That number includes some operational savings, but also includes about $1.1 million in what they’re calling “capital improvements,” big projects like new truck scales and a new scale house, a wheel wash station and mechanisms to keep the public off the face of the landfill.

In the past, the necessity of such improvements has been debated, but Francis says that he sees the measures, especially those limiting access to the active face, as essentials.

“Putting that drop off there prevents the public going out to the face of the landfill. I think it’s a genuine public concern,” said Francis, who recalled a 2009 incident in which a man died while dumping his trash. “I don’t think it’s a wish list, I think it’s a necessity.”

Of those improvements, the county would contribute $75,000 to the wheel wash, which Francis said will stop complaints from the N.C. Department of Transportation about the trash and mud tracked back into the environment from trucks departing the landfill.

Extra equipment like new heavy machinery and trucks are not included in the calculations.

Though talk of cost savings often means job cuts, county staff said part of the deal with Santek is that hourly employees at White Oak would be offered jobs with the new company at their current pay scale. King would also stay on and other employees would likely be brought in by Santek to make the upgrades and run the dump.

The greatest savings, however, are not in operations, but that day years in the future when the landfill is eventually closed down, said Julie Davis, county finance director.

Closing the landfill and maintaining it for years after its closure is an expensive proposition, and the county is currently on the hook for it.

“Currently, the county has a liability for these costs of over $5 million,” said Davis.

The county also has to pay to expand new sections of the landfill as the existing cells fill up. The county just spent $4.5 million opening up a new section of the landfill.

Under the new contract, Santek would build all future cells to house the county’s trash. And after reaching the 396 ton-per-day threshold, it would be responsible for closure and post-closure costs.

Getting to that threshold, said Francis, would likely take several years of trucking in out-of-county trash, something that raises the hackles of opponents to the plan.

 

Selling landfill space

White Oak now takes trash from this county alone, but under Santek, any of the 17 other western counties can find a home for their trash there.

Francis and King assured commissioners that the outside trash would be only household and commercial — nothing hazardous, nothing toxic, no construction trash — and nothing from other states.

Opponents to the plan have voiced concern that the county’s landfill — built at great expense to county tax payers — would get filled up with trash from other places too quickly, leaving the county with nowhere for its own trash a few decades from now.

The landfill was thought to have 30 years of life left, and Santek has contractually assured the county that it will still get 30 years out of it.

But the question hanging in the air from commissioners is how is that enforceable?

Santek will give the county up to $1.5 million in performance bonds that they’ll meet that three-decade goal, and the county will likely hire an engineering firm to regularly check that it’s not filling the place too fast.

The concern remains, however, that it would result in a too-little-too-late scenario. Sure, the cash would be nice, but siting the White Oak landfill was an onerous task. Finding another suitable landfill location would be nigh upon impossible, even with a few million in hand.

Francis said they won’t let it get that far.

“We’re going to do this year on year,” said Francis. “One of these things as a county that we’re not going to let happen is get to year 21 and say, ‘Man, we’re out of space.’”

Commissioner Michael Sorrells, however, wanted a clearer explanation of how such a situation would be prevented.

“That’s a very important issue to the public that we are protected in that 30-year life, and I think that probably needs to be explained more thoroughly how that’s going to be done,” said Sorrells.

Commissioner Kevin Ensley questioned the savings to the public. Davis estimated that the county would save $29.1 million at White Oak over the 30-year life of the contract. But would those savings be passed on to the citizens?

The answer was yes and no.

The $92 fee per household tacked on to residential property tax bills each year probably wouldn’t go down. But it probably wouldn’t go up, either.

Francis said that to keep running waste like the county is today with privatization, the cost to households could jump to $150. That, however, includes that $1.1 million in “capital improvements.”

One population who will not be saving in the plan is residents of Waynesville and Canton. Those towns will no longer be able to haul their trash to the centrally-located transfer station but will have to truck it directly to the landfill in far-flung White Oak.

The cost of trucking that waste out to White Oak will now fall on towns. But that will happen whether Santek comes in or not.

The transfer station in Clyde, known as the Materials Recovery Facility or MRF, would still be open to the general public wanting to drop bulky items or metal without driving to White Oak.

County Manager Marty Stamey emphasized that joining with Santek shouldn’t mean giving up total control at White Oak, but he maintained that the county couldn’t continue running it alone without upping the costs for consumers.

“We needed a public-private partnership,” said Stamey. “We didn’t want somebody coming in here and strong-arming us. We needed a good fit and Santek is that good fit for us.”

A public hearing is scheduled for 5:30 p.m. Monday, Sept. 19, at the next commissioners’ meeting. The issue will likely be voted on at the board’s Oct. 3 meeting.

 

Want to weigh in?

A public hearing on whether to contract with an outside firm to run Haywood County’s landfill, including selling space in the landfill, will be held at 5:30 p.m. Monday, Sept. 19, at the historic courthouse.

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