Wednesday, April 6, 2005

Waste firm asks state for money

Tax-exempt bonds would pave way to improve, expand Michigan landfills.

By Joel Kurth / The Detroit News

At a glance Waste Management Inc. serves 1.7 million Michigan residents, employs 2,091 full-time workers here and has a Michigan payroll of $80 million. The Texas company has asked for $68 million in bonds to expand landfills. It's a request some consider absurd but others contend could lower landfill fees and keep jobs in the state. In years past, the company received $110 million in similar bonds. Error processing SSI file Comment on this story Send this story to a friend Get Home Delivery

Michigan officials this week may consider a request to use taxpayer money to help bring more trash into the state.

Texas-based Waste Management Inc. has asked the Michigan Strategic Fund for $68 million in tax-exempt bonds to improve or expand 13 landfills, including the state's busiest, Pine Tree Acres in Macomb County's Lenox Township.

It's a request that's infuriated environmentalists, stoked the ongoing debate about imported trash and prompted questions about what economic value, if any, dumps bring to the state. Mostly, it's igniting fears that bigger landfills would bring even more trash into Michigan, already the nation's third-biggest importer of out-of-state waste.

"This is one of the most appalling things I've heard in all my life," said state Rep. Herb Kehrl, D-Monroe, who is sponsoring legislation to extend a moratorium on landfill expansions from 2006 to 2010.

"State bonds should be used to create good jobs, not more trash heaps. What kind of use of tax dollars is this?"

It's a proposal that became murkier late Tuesday. Tom Horton, Waste Management's government affairs director in Michigan, said the company may withdraw the proposal because it doubts money is available.

However, the request is still on the agenda for the Michigan Strategic Fund board of directors' meeting at 9 a.m. Thursday, said Diane Cranmer of the Michigan Economic Development Corp.

If the plan proceeds, Michigan would issue the tax-free bonds and Waste Management would repay them. Taxpayers only would be on the hook if Waste Management, which boasted $12.5 billion in sales in 2004, couldn't make the payments.

Waste Management is the nation's largest and most profitable solid waste disposal company.

In the past 10 years, Waste Management has used $110 million in tax-exempt bonds for improvements.

Kehrl and some environmentalists said the state shouldn't go out of its way to bring in more trash. The bonds Waste Management seeks usually are reserved for projects that create jobs. Waste Management's investment would retain 2,091 jobs statewide, but create none, according to analysis from the Michigan Strategic Fund, a state agency that works to create jobs.

"The use of tax-exempt financing will assist in the downward pressure of collection and disposal rates of residential and commercial customers," the report states.

That could be good news for residents in Dearborn, Livonia, Royal Oak, Farmington Hills and Southfield, which contract Waste Management for garbage collection.

It's bad news for the state, argued Brad van Guilder, a community organizer for the Ecology Center of Ann Arbor. Low landfill costs are the primary reason Michigan is so attractive to its neighbors. Toronto sends all its trash to a landfill in southern Wayne County. All told, more than 400 trucks carrying Canadian waste enter the state every day.

The request comes as Michigan lawmakers debate bills to boost tipping fees from 21 cents a ton to $7.50.

Even if Waste Management withdraws its bond request, the company still will proceed with plans to buy more land at Pine Tree Acres, Horton said. That's sure to generate controversy in Lenox Township, which fought the creation of the facility more than 10 years ago.

Created to handle Macomb County's long-range needs, the 450-acre landfill has accepted so much Canadian waste in the past few years it will reach capacity in nine years, according to state records. Nearly 80 percent of the trash dumped at the landfill in 2004 came from Ontario.

According to state documents, Waste Management plans $18.2 million in upgrades, including $1.76 million for land acquisitions.

"The residents will be furious," said Jodi Keith, the township's clerk. "No one wants the landfill to expand. It's big enough now. I'm half a mile away and can look out my window and see it now."

Resident Rodney Gilbert, 65, noted that township residents rely on well water. He worried about what would happen if the landfill leaks.

"It's bad enough if you have Michigan trash next to you, but there's more Canadian trash trucks coming in here right and left," he said.

Horton said most of Waste Management's Michigan landfills don't accept out-of-state waste. Pine Tree Acres' imports "look a lot worse than they actually are," he said.

You can reach Joel Kurth at (313) 222-2610 or jkurth@detnews.com.