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Archive for the ‘Cedar Rapids/Linn County Solid Waste Agency’ Category

Solid waste agency huddles; talks possible litigation to retrieve troubled $6-million investment

In Cedar Rapids/Linn County Solid Waste Agency, City Hall on March 19, 2008 at 5:50 pm

The check isn’t in the mail.

Three weeks ago, there was optimism from the finance committee of the Cedar Rapids/Linn County Solid Waste Agency that the agency would recoup all of its $6 million from a short-term, “commercial paper” investment in a financial entity, Rhinebridge LLC.

Rhinebridge LLC, which had invested in mortgages and other investments, defaulted in October, unable to pay its investors.

On Tuesday, the agency’s finance committee met in closed session to discuss “potential litigation that deals with the whole Rhinebridge situation,” Steve Tucker, Linn County finance director and chairman of the agency committee, said after the meeting. Tucker characterized the meeting as an update. No decisions were made, he said.

At its meeting Feb. 25, the agency’s finance committee, at the request of the city of Cedar Rapids, discussed the prospect of adopting a more formal policy to direct how agency investments are handled.

Tucker said the agency’s finance committee and board of directors have depended on the city of Cedar Rapids, which handles the agency’s finances, to make decisions regarding the investment of the agency’s funds.

One option now is for the agency board to formally adopt an investment policy that mirrors that of the city of Cedar Rapids. The city’s policy, not unlike those of some other jurisdictions, permits investments in commercial paper, which is known in the financial world as a “structured investment vehicle.” State law lists commercial paper among allowed investment options for Iowa cities.

Even so, some on the agency’s board have noted that any agency policy could exclude investments in commercial paper in the future.

At the finance committee meeting Feb. 25, Sue Vavroch, the city of Cedar Rapids’ treasury operations manager, reported that the agency’s investment in Rhinebridge LLC is positioned in a “secured credit group” that has “most senior” standing among investors trying to get what is left of Rhinebridge LLC’s assets.

“There’s a possibility it (the agency) won’t lose anything,” Vavroch said.

She has noted that the city made the Rhinebridge LLC investment through a Wells Fargo brokerage.

The city of Cedar Rapids also has its own $2 million investment in commercial paper through Wells Fargo tied to another troubled entity, Golden Key Ltd. Golden Key Ltd. also has defaulted and was unable to pay on Dec. 5 what it owed the city.

The $6 million solid waste agency investment in Rhinebridge LLC represents about one-quarter of the agency’s cash and investments, the agency’s finance committee said in February.

Linn County’s Tucker has said Linn County does not invest in commercial paper, though it could. Finance directors in Dubuque and Iowa City also have said they do not.

Allen McKinley, finance director for the city of Des Moines, said in February that the city of Des Moines had 4 percent of its $186-million investment portfolio invested in commercial paper, none of which is in default. However, he said he suspected the city would stop investing in commercial paper for a time once its current investments mature this spring.

The Cedar Rapids/Linn County Solid Waste Agency, formerly known as Bluestem, is a multi-jurisdictional entity with a board comprised of six city of Cedar Rapids representatives, two Linn County ones and one from the city of Marion.

Tom Podzimek, Cedar Rapids City Council member, is the board chairman.

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Zapping garbage can’t hold a candle for now to landfill at Cedar Rapids/Linn County Solid Waste Agency

In Cedar Rapids/Linn County Solid Waste Agency, City Hall on March 19, 2008 at 12:30 am

It’s unclear how much if any discussion would have taken place about zapping garbage in Cedar Rapids and Linn County in recent years if the city and county could have found a new landfill site without an ordeal that stretched over nearly nine years, at much cost of time, money, energy and emotion.

Finally, at the end of 2005, the cities of Cedar Rapids and Marion and the Cedar Rapids/Linn County Solid Waste Agency Board brokered a deal that permitted the expansion of the agency’s landfill north of Marion. The agreement came with an understanding that the communities and board would continue to explore technological options to placing garbage in landfills so that by the time the present landfill is full it won’t need to be expanded again.

On Tuesday, though, a Minnesota consultant advised the solid waste agency board to embrace its landfill for now while taking a “wait and see” approach for up to five years on a variety of waste-to-energy technologies, many of which have not proven viable to date in the United States.

Employing any of six alternative technologies — which heat, burn, gasify, zap or otherwise manhandle garbage and turn it into energy — would cost those dumping garbage at the landfill here four to five times as much as now, Curtis Hartog, a senior technical consultant with Foth Infrastructure & Environment LLC, Lake Elmo, Minn., told the solid waste agency board on Tuesday.

Many of those haulers would simply go to other landfills elsewhere in Iowa or Illinois if the local agency tried to raise fees in such fashion to employ new technology, Hartog said.

“Considering the relatively low tipping fees for landfills in Linn County and the region, it is unlikely an alternative technology could be developed by the (Cedar Rapids/Linn County agency) unless some form of flow control was enacted to ensure waste deliveries to the plant,” Hartog concluded in his report Tuesday to the agency.

One of the six technologies he studied, plasma arc, has been of particular interest to some in Marion and elsewhere in the metro area, and Charlie Kress, Marion’s representative on the solid waste board, is an advocate of the technology. 

Hartog put the cost to garbage haulers at $100 to $150 a ton to build a plasma arc facility in Linn County, where the solid-waste agency’s current per-ton fee to haulers is $23.42 plus additional costs to pay for the agency’s recycling and composting operations.

Kress told the board that Hartog’s numbers were too high for plasma arc. But Tom Podzimek, board chairman and a Cedar Rapids City Council member, and board member Pat Ball, the city of Cedar Rapids’ utility director, called Hartog’s number “a real number” based on a working plant in Japan. Kress disputed the suggestion his own numbers were speculation.

Many of the examples cited by Hartog of current waste-to-energy alternatives for garbage were in more-densely-populated Japan and Europe where per-ton fees for garbage can be five to 10 times as high as the fee at the Cedar Rapids/Linn County agency, he noted.

The City and County of Los Angeles is looking at the technology, but he noted that the per-ton fee there is five times what it is locally. Two cities in Florida also are exploring options, but they can’t bury trash in the ground because the groundwater table is so near the surface, Hartog said.

He told the board to continue to keep its eyes on plasma arc projects in St. Lucie County, Fla., and Ottawa, Canada.