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Presque Isle Landfill Seeks to Absorb/
Restructure Tri-Community Landfill
By: David Deschesne
Fort Fairfield Journal, July 19, 2017
The cost-prohibitive and mismanaged Presque Isle landfill has entered into a discussion with Tri-Community Landfill to entertain the idea of a merger between the two facilities. So far, public resistance has been noted against the idea that would give two votes on the new board for the organization that brought Presque Isle landfill customers the “pay as you throw” boondoggle and excessively high landfill fees.
Tri-Community Landfill (TCL) is located in Fort Fairfield and is co-owned by the city of Caribou and towns of Fort Fairfield and Limestone. TCL is a very efficient, extremely well-run facility with top notch board members who make financially responsible decisions that have historically kept the rates down for the communities it serves while ensuring the long-term viability of the landfill. This begs the question by members of those communities, why would such a well-run facility want to merge with a fiscally irresponsible entity, give it two votes on their board and open up the possibility of suffering under more of their ridiculous, irresponsible and destructive business decisions. After all, “a little leaven will leaven all the dough.”
Mark Draper, Solid Waste Director at TCL introduced the merger idea to the Fort Fairfield town council at their June meeting.
“Tri-Community Landfill and the City of Presque Isle have signed a letter of intent to merge solid waste operations. That's the extent of any real action that has occurred. Most of what we can tell you right now is very general and very conceptual. The letter of intent spells out a number of concepts that both parties have agreed to.”
Control is the crux of the issue. “Is the city of Presque Isle going to take control of Tri-Community landfill and dictate how we're going to operate and how we're going to do things? The answer is no,” said Draper. “Obviously that was one of the very first issues and concerns that were expressed from the town of Fort Fairfield and the town of Limestone in particular, given that they're smaller in size compared to Caribou and Presque Isle. The concept that we're operating under would give the city of Presque Isle two votes on the board of directors at Tri-Community Landfill. Currently, the city of Caribou has two votes, the town of Fort Fairfield has one and the town of Limestone has one. We're also contemplating changes to our inter-local agreement which would describe certain types of decisions that would require a 'super majority' vote - three fourths majority for example. That may include things like borrowing money; before the entity borrows money you would need this super majority vote that would then require at least the town of Fort Fairfield or the town of Limestone to go with two of the other larger communities so that some of that control and power is retained within the smaller communities.”
It has been suggested that since Presque Isle has had their chance, tried and failed miserably at efficiently and cost-effectively running a landfill, they shouldn't be allowed any votes on the new board at all. Instead, Presque Isle’s board members should be excluded from the meetings altogether while the grown-ups at Tri-Community make the important decisions. Some believe just by giving Presque Isle a voice at the table is enough to skew the otherwise efficient and practical business mindset Tri-Community currently enjoys toward the failed and busted model Presque Isle landfill customers currently suffer under.
“The proposal that we're talking about here is to add the city of Presque Isle as a co-owner of Tri-Community Landfill. Currently Tri-Community is owned by Fort Fairfield, Limestone and Caribou. We would simply add Presque Isle as an additional owner of the facility. By doing that we would then take ownership of their landfill that they're currently operating. In the future, the new entity would own and decide the fate of both those facilities.”
It is then conceivable that Presque Isle could begin to infiltrate the board with members friendly to increased landfill rates and ultimately double the amount of money the current community-owners of Tri-Community Landfill are paying.
Draper says the addition of Presque Isle Landfill's customers will not significantly impact the capacity or usability of TCL. “The city of Presque Isle's lanfill has about the same amount of capacity as the landfill we have here in Fort Fairfield. In a sense, if you think about it, it's actually doubling the landfill capacity that will be available to us. The important part of this is that we will be able to operate those facilities and utilize that capacity much more efficiently. With the two landfills under the control of one entity we're still going to have capacity for decades to come so that shouldn't be any significant concern.”
Again, critics of the proposal are quick to point out that “Presque Isle” and “more efficiently” are oxymoronic and mutually exclusive ideas.
The current tipping fee for contracted customers - those municipalities and commercial haulers that have signed contracts with TCL - is $88.50/ton. “That tipping fee includes all costs for the landfill, including debt, operations, and reserves. There are no additional charges,” explained Draper. “The TCL owners, who hold the perpetual responsibility and liability for the landfill facility, pay based on a different formula, which currently works out to about $41/ton.”
That means the communities of Fort Fairfield, Limestone and Caribou only pay $41.00 per ton for trash disposal for their respective inhabitants' trash. The current fee arrangement for the P.I. facility is significantly different. “As I understand it, all seven municipal users pay a tipping fee of $82.00 per ton, but that tipping fee does not include debt service, which is apportioned separately on an annual basis to all users based on tonnage.”
This means the tipping fee under the Presque Isle landfill model is double that of Tri-Community's plus additional charges for debt service, making Presque Isle's landfill disproportionately more expensive for citizens in the communities that utilize their service as opposed to the reduced rates enjoyed by those of Tri-Community. Some inhabitants in the Tri-Community service area have expressed concerns that Presque Isle's “big city” mindset will overtake the Tri-Community Landfill board and increase expenses to the rate structure that Presque Isle landfill's administrators are used to levying.
Draper also noted that by combining landfills, the increased volume could potentially attract new technologies, such as bio-gas, to the area to deal with trash volume. “Looking long term, solid waste management is a volume-based business. The more volume you have, the better you can structure your rate structure. So, looking into the future, there a number of potential technologies that are out there. Those types of technologies go where the trash is, they go where the volume is. Putting more of the volume under the control of one entity will make the future development of those technologies more likely.”
On the financial side, as the concept is currently constructed, Draper says the merger would not result in any increased costs to the town of Fort Fairfield, any of the other owners or any of our contract communities. “Hopefully, by combining the entities and being more efficient we can actually lower costs going forward and that's certainly the goal as we move forward.”
Other than the “super majority” vote concept, however, Draper did not disclose any other ideas on how to reign in Presque Isle's historically bad decision making when it comes to running the business of a landfill when their members take two seats on the new board.
Fort Fairfield town council member, John Herold asked Draper about potential liabilities at Presque Isle and how they may affect Tri-Community. “I know that Tri Community is very well operated, you've got great systems in there. Also, you've got budgets for equipment, replacement and so forth. I was just wondering, is the Presque Isle facility in a similar situation or are there things that may have to be done to bring it up to standard so the costs would fall maybe on all four entities or maybe they would be reserved disproportionately for the previous entity?”
“One of the key concerns that we had going forward with this is liability for closure and post-closure care - something that we look at constantly, making sure that we are not leaving a situation for future generations to have to deal with,” Draper answered. “Looking at the city of Presque Isle's landfill we had that concern. The timing is good right now. One of the aspects of that is the city of Presque Isle just closed a significant portion of their landfill at their expense. They did get some cost-share money from the State but that has been done so that liability for closure and post-closure care for the remaining small portion of the landfill that is currently active is very small. And, the agreement that we are operating under would require the city of Presque Isle to contribute an amount of money to cover that current liability. So, we're not taking on any new, unfunded liability. We're comfortable that has been addressed.
Draper says there have been discussions off and on between the two landfill boards for several years. “More aggressively probably over the past year or so and certainly conditions have aligned themselves that this is the right time to do this. Our goal is to have an agreement in place and finalized by the end of this year.”