L.A. County Purchases Peace of Mind

By the end of 2000, the Sanitation Districts of Los Angeles County, Whittier, Calif., hope to complete a deal that will provide the county with more than 100 years of disposal capacity. Foreseeing the closure of the 12,000 tons per day (tpd) Puente Hills landfill, the Districts have signed agreements to purchase two rail-accessible desert landfills for $41 million each.

“We've avoided the unknown,” says Don Nellor, assistant head of the Districts' solid waste management department. “If we were not able to acquire [these new landfills], we might have found ourselves with very limited options when we really needed them.”

Unlike the Sanitation Districts, the developers have mixed emotions about avoiding the unknown.

“Our investors were disappointed at not having the opportunity to run the landfill,” says Bob Filler, general manager for Mesquite Regional Landfill, Imperial County, Calif. But Filler concedes that investors would rather recover some value up front than wait until 2006, when the Sanitation Districts will be ready to use the sites.

With the purchase of Mesquite in Imperial County and Eagle Mountain Landfill in Riverside County, Calif., the Districts have bought the luxury of a slow transition from local disposal to rail disposal, Nellor says.

To help with the transition, the Districts will construct a materials recovery facility (MRF) by 2002 at Puente Hills. Initially, this MRF will serve as a truck transfer station, but it will be built to accommodate future rail movements. Between 2006 and 2013 (when Puente Hills is expected to reach capacity), the Districts will implement a one-train system carrying approximately 4,000 tons of waste per day to the new landfills. As the demand for rail transfer increases, so will the number of trains.

To pay for Mesquite and Eagle Mountain, the Districts will use savings designated for this purpose. Since the late 1980s, the Sanitation Districts have set aside a portion of all tipping fees and landfill gas revenues to purchase future disposal capacity.

Consequently, the Districts' only financial concern is the costs to open and run the new rail system. Puente Hills will share these costs, Nellor says. Beginning in 2006, haulers tipping at Puente Hills will pay a higher fee of approximately $27, and haulers tipping at the transfer station will pay the same blended fee. This blending will allow the Sanitation Districts to keep costs low and continue to compete for private haulers' business, Nellor says.

Although both Mesquite and Eagle Mountain can accept up to 20,000 tons of waste per day, these sites probably will lie dormant until 2006, according to Nellor.

“We don't see any jurisdiction that could deliver enough waste to justify opening costs right now,” he says. However, “if a jurisdiction came to us with at least 4,000 tons per day, we certainly would consider [opening the landfills] sooner.”

While the developers of both Mesquite and Eagle Mountain have received all of the necessary environmental and local permits for operation, the official transfers of ownership will not occur until Imperial County and Riverside County officials have approved the conditions of the transfers.

The largest barriers to the purchase already have been overcome, Nellor says. “Both sites were litigated, and the developers succeeded in overcoming the opposition,” he says.

Opponents of the Eagle Mountain Landfill warn that the fight is not yet over, but Nellor says the Districts are not concerned about opposition.

“The costs of litigation come out of the seller's pockets. We're indemnified,” he says, adding, “these sites have been so scrutinized that [the Districts] are confident the developers will prevail.”

Meantime, the Sanitation Districts also have just completed the purchase of the 5,000-tpd Downey Area Recycling and Transfer Facility, Downey, Calif., and it is negotiating a joint powers agreement with the city of Los Angeles for a MRF to be built within Los Angeles' city limits.

These projects, along with the impending closure of Los Angeles County's 10,000-tpd Bradley Landfill, will increase the demand for the new waste-by-rail facilities, Nellor says.

Los Angeles County creates more than 36,000 tons of waste per day, and the Sanitation Districts now are in a position to offer low-cost disposal alternatives as this number increases, he adds.