Portsmouth officials voice concerns on SPSA bailout

PORTSMOUTH

As municipalities vote this month on a bailout plan for the troubled regional waste agency, leaders of the city that hosts the Southeastern Public Service Authority's biggest assets - two large trash plants - say they have some major concerns.

Portsmouth officials claim they haven't been properly reimbursed in the past for hosting SPSA's waste-to-energy and refuse -derived fuel plants.

They also worry that if the facilities are sold, as SPSA hopes, they could become magnets for out-of-state trash that the city would have little control over.

"There's no assurance that more trash wouldn't come in and we don't know what manner it would be delivered," Vice Mayor Bill Moody Jr. said.

Portsmouth's City Council is scheduled to vote tonight on a regional bailout plan for SPSA.

The plan, which requires the agreement of all eight member jurisdictions, would grant SPSA nearly $33 million in savings and new revenue from the refinancing of some existing debt and a new line of credit, all to be backed by the municipalities.

That would provide SPSA 15 months to fix its troubled finances. Trash authority officials have said they hope to sell assets - including the waste-to-energy plant in Portsmouth - during that time.

But the proposal also would raise tipping fees in Portsmouth, Norfolk, Chesapeake, Franklin, Isle of Wight County and Southampton County to $170 per ton of garbage from $104.

Those increases would be passed on to consumers in some cities. In Portsmouth, that would likely be an increase of $9, to $41 per month.

As Portsmouth leaders have considered the bailout, they've also sent a letter to SPSA detailing why they believe the authority owes the city money.

City Attorney Tim Oksman maintains that SPSA should have been making payments to the city in lieu of taxes since 1983 as part of its agreement with the city. The city has never received those payments, he said.

Last year alone, that payment should have been more than $200,000, Moody said.

Under the law, the city is entitled to go back five years, which could mean more than $1 million for the city, he said.

"We're going to go to great lengths to collect what we feel our citizens are owed," Moody said.

Bucky Taylor, SPSA's executive director, said the agency had gotten a legal opinion that the agency does not owe Portsmouth money under Virginia law.

"That's the way SPSA has operated," Moody said. "It pays some of its bills and not some of its others."

During a City Council meeting last week, Moody and a city resident also expressed concern that a new trash plant owner could bring out-of-state garbage into the city.

Covanta Energy Corp., one of the companies that submitted a bid for the plants, proposed that idea several years ago in conjunction with SPSA, but the deal fell apart amid public criticism.

The two trash facilities, which straddle Victory Boulevard, are located near the Cradock neighborhood.

Joanna Hall, president of the Cradock Civic League, said the neighborhood would have the same concerns with any new owner that it did when it opposed the Covanta deal several years ago.

She said the civic league's main concerns are: the potential for the importation of out-of-state trash, the need for beautification and trash pickup along Victory Boulevard, the desire for a curtain to conceal some of the operations at one of the plants, and the wish that the city maintain its citizen advisory committee to the regional trash authority.

A Covanta executive could not be reached for comment Thursday. But a representative of the company has said the company has no plans to import trash from out of state.

A representative for Wheelabrator Technologies Inc., the other company whose bid for the plants SPSA is considering, could not be reached for comment.

A third company, ReEnergy Holdings LLC, has submitted an unsolicited bid for all SPSA's assets. Executive Officer Larry D. Richardson said "there is more than sufficient waste in the region to satisfy the system requirements under our ownership."

But he stopped short of agreeing that a provision barring out-of-state trash would be part of any sales deal, though he said the company would certainly consider it.

Taylor said current negotiations do not restrict waste coming into the region. He said the board has not taken a position on the issue.

Jen McCaffery, (757) 446-2627, jen.mccaffery@pilotonline.com