Snag could erase savings

A snag in the impending takeover of Jefferson Parish’s landfill by Texas-based IESI Inc. could erase a sizable chunk of the savings the parish was projected to receive in the first year of its $67.5 million deal with the company.

Parish officials are negotiating with IESI and Waste Management over who is responsible for “slope failures” at the Waggaman landfill and who will pay for repairs at the site. In a recent letter to the parish, IESI expressed concern that the issue could jeopardize its ability to move forward with the March takeover of the landfill.

“This letter is to notify you of a situation that exists that could potentially affect IESI’s ability to perform the contract,” IESI Vice President Phillip L. Smith wrote to parish officials on Jan. 14.

Smith noted that there have been two “slope failures” at the landfill since October and blamed the problems on improper techniques used by Waste Management Inc. during its operation of the landfill. A slope failure is when the side of one of the mountains of debris that make up the landfill collapses. He quotes one parish official as saying that additional slope failures could jeopardize the landfill’s ability to accept waste.

Smith claims that IESI was prepared to come in and make repairs to fix the problem but was stymied by stipulations belatedly requested by Waste Management. Two of those stipulations were to exempt Waste Management from all liability for its work at the dump and to have IESI complete all of Waste Management’s remaining contract obligations, according to the letter. In addition, IESI wants to use existing solid waste to stabilize problem areas, and that has been met with some resistance.

Which materials are used to fix the problem is a significant issue because different materials have substantially different costs, said Jacques Molaison, an administrative assistant for Parish President John Young. Costs could range from $50,000 to $300,000, depending on whether IESI uses solid waste, dirt or river sand, he said. When parish officials signed the new contract with IESI, they were projected to save nearly $300,000 annually compared to what they were paying Waste Management to operate the landfill.

Molaison said it’s also crucial that the parish determine what caused the slope failures and what should be done to address them. Both the parish and IESI have retained engineers to examine the landfill, but that process could take weeks.

“What we are going to do is first of all figure out the cause of the slope failure,” Molaison said.

Once a determination is made, then the parish can figure out who is responsible for paying for the repairs.

Under its deal with Waste Management, the parish has a three-year warranty on work the company did at the landfill once Waste Management’s contract ends, Molaison said. However, he said that the slope failures should not jeopardize IESI’s takeover of the landfill because the problems can be addressed once the company is operating the site.

“They’re taking over March 3 regardless,” Molaison said.

The Jefferson Parish Attorney’s Office also expressed confidence that things will proceed normally, when questioned about the issue by Councilman Mark Spears recently.

In a response letter to IESI, Deputy Parish Attorney Ed Rapier noted that it’s the responsibility of IESI and Waste Management to figure out how to make things work, not Jefferson Parish.

“Lastly, IESI is complaining that Waste Management is not cooperating with IESI. I again refer you to the request for proposal and the contract between Jefferson Parish and IESI,” Rapier wrote. “While Jefferson Parish would hope that Waste Management and IESI would work with each other to make this transition as smooth as possible, both of those documents unmistakably state it is the duty of IESI to cooperate with Waste Management to ensure a seamless transition.”

The parish, IESI and Waste Management have had a complicated relationship for years, after parish officials chose to award the landfill contact to IESI despite Waste Management presenting a cheaper proposal in 2011. Waste Management ran the landfill for 25 years, but nearby residents blasted the company’s operations because of persistent odors.

However, Waste Management and the parish are essentially partners in a federal lawsuit challenging a controversial contract with River Birch Landfill negotiated by disgraced former Parish President Aaron Broussard.

That contract is at the heart of multiple federal corruption investigations that led to several convictions, but also massive upheaval in former U.S. Attorney Jim Letten’s Office.