City’s One Bin proposals raise financial, technology concerns

Houston Chronicle Photo by Cody DutyKatherine Driessen
Houston Chronicle
Original article here

The fate of the city’s cutting-edge “one bin” waste system that would feature a privately built, $100 million sorting facility is becoming increasingly uncertain, as sources familiar with the company proposals say there remain significant operational and financial concerns.

It’s no secret that the One Bin review has taken longer than expected. As a specially appointed advisory committee began meeting last summer, officials said they would send a recommendation to City Council by the end of the year. Last week, city spokeswoman Janice Evans said she could not assign “a specific time for a decision.”

With Mayor Annise Parker nearing the end of her final term, the timeline to select a bidder, garner approval from a skeptical City Council and begin construction on a system that has never been built on such a massive scale is becoming increasingly daunting.

“Certainly, the project won’t happen on my watch,” Parker said of getting the facility built. “We’ll either say ‘not quite there’ or here it is and here’s how you do it and let the next mayor carry it forward.”

It’s not clear precisely where the bidding process stands, but Evans said it has taken longer than expected only because the project is complicated.

Sources familiar with the proposals, who requested anonymity because of the bidding, said two proposals among the final five raise serious questions about how the technology would work and whether they could meet the city’s price requirement. The city has long pledged that One Bin would not cost more than current trash and recycling efforts. If the numbers didn’t add up to a cost-neutral figure for the city, other cities could use the One Bin template and see if they had the financing to make it work. The city snagged a coveted $1 million Bloomberg grant to come up with that blueprint in 2013, promising a revolutionary change to how the city handles the more than 600,000 tons of municipal waste that Houston residents generate each year, not including recycling.

“This cost-neutral, technological innovation is a paradigm shift, changing how people think about waste and recycling,” the city said in its Bloomberg application. “The concept of ‘trash’ will be extinct and replaced by an understanding that all discarded material has value and can be recycled.”

For Houstonians, who recycle just 6 percent of their waste and divert another 13 percent in yard clippings, a successful one-bin program would mark an incredible turnaround: The city has set an initial goal of diverting 55 percent of residential waste away from landfills, eventually increasing that to 75 percent. Houston’s recycling rate lags far behind the national rate of about 34 percent in most major metropolitan areas across the country.

Up-front sum

In order to make One Bin work without costing the city extra, officials outlined a public-private partnership model that hinges on a company agreeing to pay a huge up-front sum and assume most of the risk on the back-end.

The company would finance the $100 million, first-of-its-kind facility that would allow residents to mix their trash and recyclables in one bin, using advanced technology to sort and resell recovered materials.

A piece of that sales revenue along with processing fees, akin to tipping fees at a landfill, is supposed to help the company cover the expense of the ambitious undertaking and eventually turn a profit. The scale of the Houston project and the combination of new technologies required is unprecedented. It would be a dramatic success if it works, or a huge financial loss for the company if it fails. The failure of One Bin would also be a political and logistical nightmare for city officials. Though the city can guarantee only residential waste, the project would get a significant boost from added commercial streams.

But the two final bids raised significant unanswered questions about whether the plan could work, sources close to the process said.

The project likely would require a greater investment on the city’s end and possibly more stability in the recycling commodities market to match or beat the relatively cheap landfill fees in Houston.

Environmental critics who have pushed back on the proposal said the lapsed timeline is likely proof of what they have long argued: The technology simply isn’t there – and neither is the financing. Critics have encouraged the city to allow its still relatively young cursbide recycling program to mature.

“We’ve known the whole time that this was not a good idea,” said Melanie Scruggs, Houston program director for the Texas Campaign for the Environment. “So we hope, and it would make sense, that the delay means the city is coming around to the same idea that one bin is not the solution.”

But even as those close to the process have conceded the project is unlikely to be built, Sustainability Director Laura Spanjian has remained persistent about making One Bin work, sources said.

In late February, after years of residents lamenting not having recycling bins, the city rolled out its final wave of curbside recycling to single-family homes, a major milestone that even One Bin critics praised. But Spanjian was still touting One Bin.

“Doing all we can to increase HOU recycling,” she tweeted. “After this milestone onto more success, increased diversion w/ #1bin4all.”

Project ‘complexities’

The two bidders were selected from five finalists that ranged from small local companies to an established industry giant. A letter from the Attorney General’s Office to the Texas Campaign for the Environment denying a One Bin-related records request was copied to five companies: Republic Services, Mustang Renewable Power, Abengoa Bioenergy, WCA Waste Corporation and EcoHub-Houston.

“A delay leaves the impression that we’ve made a conscious decision to hold off the process,” Evans, the mayoral spokeswoman, said in an email. “That is not the case, the process to get to a decision is just taking longer due to the complexities of the project.”

Fracking bills in Legislature fuel city-control debate

Dallas Morning News Photo by Jim TuttleDallas Morning News
Marissa Barnett

AUSTIN — It was standing room only at a House hearing on two bills that would restrict how cities can regulate oil and gas activities.

The bills would prevent cities from passing oil and gas ordinances that are not “commercially reasonable” and require them to make up tax revenue lost because of oil and gas restrictions.

Opponents view the legislation as part of a slate of bills this session aimed at limiting local control, but supporters say otherwise.

“Local regulations must be reasonable and ensure that property owners have the regulatory certainty that they will be able to access their minerals,” said Todd Staples, head of the Texas Oil and Gas Association.

“The threat to Texas and our state’s biggest economic driver — oil and gas — is real and it is urgent,” said Staples, who is also a former state agriculture commissioner.

The bills, which are pending, emerged in response to a hydraulic fracturing ban Denton voters overwhelmingly approved in November.

House Energy Resources Chairman Rep. Drew Darby, R-San Angelo, and about 50 co-authors sponsored legislation that would prohibit city limits on oil and gas that are deemed not commercially reasonable, or are otherwise pre-empted by state or federal law.

Cities raised concerns about potentially ambiguous terminology in the bill that they said would dissuade cities from proposing ordinances or would lead to expensive litigation when they do.

“This bill will have a chilling effect on smaller cities, and they will elect simply not to regulate oil and gas,” said Bryn Meredith, an attorney representing 25 cities in the Barnett Shale region.

Oil and gas industry representatives — and lawmakers — said the legislation would not strip cities of their authority to establish “reasonable setbacks and limitations on nuisances such as traffic, light or noise.”

Another bill, written by Rep. Phil King, R-Weatherford, would require cities to make up tax revenue lost to the state for schools as a result of oil and gas ordinances. Cities also would be required to get a fiscal impact note from the Legislative Budget Board that details the proposed action’s effects on taxes.

Darby said his bill intended to avoid “patchworks of inconsistent regulations that undermine safe, efficient production of oil and gas.”

Sharon Wilson, an Earthworks Texas organizer who advocated the fracking ban, called the legislation the “very definition of big government.”

“When it comes to oil and gas development, HB40 would make the Railroad Commission … the city council of every city in Texas,” she said of Darby’s bill.

Much of the early part of the hearing came down to one question: How do you decide what is commercially reasonable?

Attorneys representing North Texas cities testified that ambiguity in the law could prevent cities from considering ordinances.

But Darby countered that the bill provided that setbacks, traffic and noise ordinances would be allowed, but restrictions that could limit or stop production would not be.

“We recognize that cities have the right to do ordinances; they must be reasonable,” Darby said.

“Everybody’s fear is a lack of understanding as to what ‘commercially reasonable’ is going to be,” replied Bill Lane, an attorney for the city of Mansfield. “I don’t think it’s as black and white as you think it is.”

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