Go with the Flow

Dallas city council approved a flow control measure to direct waste to its city landfill, with Organic Energy Corp. proposing to build a recycling facility using the waste.

The council voted in favor of the ordinance on Sept. 28 by a 9-6 vote. The National Solid Wastes Management Association (NSWMA), which opposed the measure, proposed postponing the vote to create a task force to consider other options. That proposal lost by one vote.

NSWMA and individual haulers in the area are considering legal action to fight the decision, says Tom Brown, NSWMA chapter president who also works for Progressive Waste Solutions Ltd.

Organic Energy wants to invest nearly $100 million in a recycling facility at the city’s McCommas Bluff landfill that it says can capture 95 percent of the recyclables from the city’s annual waste of about 1.3 million tons. The company said it could mean between $5 million and $20 million in revenue for Dallas. The company said the city would commit the waste to fuel the facility.

“The council sees the immediate benefit of capitalizing on the waste stream,” says Mary Nix, director of sanitation for the city. “In general, securing the waste stream now will give any private partner a greater ability to show a profit.”

NSWMA opposed the measure, saying it will be more costly than the current situation where the waste flows to about a dozen geographically dispersed landfills, including three operated by Republic Services Inc. and two by Waste Management Inc.

“It’s very disappointing,” Brown says. “We thought they had several possible solutions.” The city could have sold the landfill or leased it out. Dallas also could have privatized its residential collection, which would have saved $15 million. And the city still could have had the recovery facility.

“They linked the two,” says Brown. They never should have been linked.” He said Dallas Mayor Mike Rawlings was particularly passionate about wanting flow control.

Brown says the move will add $19 million in costs from disposal, transportation and logistics. “We believe our costs are going to go up 20 percent,” he says. “We can’t absorb that kind of a cost increase without passing it on to our customers.”
Brown says the haulers in the area independently did research on how much the measure would end up costing, and all the players came up with roughly the same estimate.

“The big hit will be when they pass along all these cost increases,” Brown says. “That’s when reality will settle in. This is kind of like the calm before the storm.”

Organic Energy says NSWMA’s concerns are based on financial self-interest. “They’re upset because it would take revenue away from the private haulers they represent,” says Barney Gorey, vice president of public affairs for the company. He adds that the proposed facility would put more in the commodities market, “making businesses more viable in south Dallas and putting those revenues to work in south Dallas.”

Lori Scozzafava, deputy executive director of The Solid Waste Association of North America (SWANA) said in a statement in part, “SWANA recognizes flow control as an effective and legitimate instrument of integrated municipal solid waste management. ... Flow control can be implemented without unduly interfering with the free movement of municipal solid waste and recyclables across jurisdictional boundaries.”

The ordinance takes effect Jan. 2, 2012. Brown says the city is talking of forming a task force to figure out the specifics of how to implement flow control. The city is considering issuing a request for qualifications early next year and a request for proposals later in the year. Ideally, construction on a new resource recovery facility will begin in 2013. He says he’s skeptical about the Organic Energy proposal coming to pass.

And Brown expects huge traffic issues as well, particularly as hauler traffic will all be traveling south during busy traffic time.

“There’s going to be problems,” he says.