The Colonie Landfill Exploratory Committee has concluded a private partnership is likely the best way for the town’s struggling landfill to survive, as stated in a report presented to the Town Board Thursday, Sept. 23.
The committee has met six times since its inception in late June and explored several options when looking to see what changes need to be made for the town’s landfill to compete with other municipalities nearby.
Jack Cunningham, director of the Department of Public Works in Colonie and member of the committee, stressed the difficulty the town’s landfill faces when competing with nearby solid waste management facilities, as many of them have entered into a Professional Operating Agreement partnering with a private landfill operator. He also added the pressures handed down by the U.S. Environmental Protection Agency and the New York State Department of Environmental Conservation with various regulations for protecting the environment from landfill contaminates increases the operating costs, hurting small facilities such as the Colonie Landfill.
The solid waste management industry has grown into a multi-million dollar, multi-national economy and our landfill is a very small segment of that industry, said Cunningham during the presentation. `Competing in that type of industry would be like running a single, privately owned hardware store when you’ve got Lowes and Home Depot on either side of you. It’s very hard to compete with the rates our competitors are setting.`
He added he had spoken with a local waste hauler who said he would not bring his waste to the landfill as it was cheaper to ship it to Rochester as opposed to driving down Route 9 and dumping waste into the town’s site.
Other options that were explored were to continue running the facility as it is, sell to an independent operator or shut it down entirely, all options Cunningham said would be costly.
The report published by the committee states the hauling fees for facilities in western New York dropped to $18 per ton, which was due to a decrease in the amount of waste flow. Cunningham said Colonie is not able to be so flexible since it must come before the Town Board to ask for a reduction in rates and would have to solicit its tonnage to bidders.
Cunningham cited the lack of town reserves and the accumulation of a large amount of debt at the landfill, which he said is currently the reason the landfill is not as profitable. The actual value of the landfill, as reported by Moody’s Investor Service at the end of 2009, is negative $7.7 million, which is an improvement from 2007 when it was valued at negative $8.1 million.
The report shows the landfill contributes an average annual amount of $3.1 million to Colonie’s general fund budget, but considering the post closure costs and depreciation the facility actually brings in $459,000.
These factors are what forced the committee to realize that continuing to run the facility as it currently does would hurt the Town of Colonie’s credit rating and would also prevent the landfill from seeing real profit.
Closing the landfill was ruled out by the committee as Cunningham noted it would be eliminating an `asset` to the town and jobs would be lost due to closure.
The committee also rebuffed the idea of selling the landfill, stating that while it would relieve the town of any closure expenses and provide an immediate influx of cash from the sale, it would take the town out of the solid waste management business and the property would sell at today’s value.
`The industry is growing as technologies are coming out,` Cunningham said, `and so the future value of that landfill may be greater than we realize today because new technologies extend the life of that landfill.`
With a private partnership, the report said the landfill would be able to obtain the funding needed to upgrade to new technologies so it can `compete in the global municipal waste industry.` Cunningham added the partnership would provide the revenue stream the town has been looking for.
By joining in a partnership with private landfill operator Colonie would still have `a degree of control,` said Town Supervisor Paula Mahan, who added it is important for the town to invest in new processes.
`The new technology out there is unbelievable,` she said. `These bigger companies, they’re very progressive and they do have the funds to invest in a lot more opportunities.`
The committee has already begun looking into the partnership option and is in the process of drafting a proposal that would be ready for review at the next Town Board meeting.
If accepted, the draft proposal would be made available for a 60-day public comment period and then the town will have another 10 days to act on the proposal.
`Right now, this option has the most potential upside,` said Cunningham.“