Incinerator update: Deal could end up in court

Jul 2, 2009 at 6:25 pm

Earlier today I was at the studios of WDET, where I listened to an interview with Charlie Beckham, the chief administrative officer for Detroit Mayor Dave Bing. Beckham, speaking earlier in the day to Detroit Today host Craig Fahle, said it looks like the city is locked in to using the massive incinerator on the city’s east side for the next 12 years.

But the City Council isn’t so certain. The council, by a 6-2 margin, decided Tuesday to go to court and seek an injunction to stop sending city trash to the incinerator. As with almost everything regarding the incinerator, nothing seems to be certain, including the strength of any possible case the council might have.

(Beckham's interview as well as an interview with me is available below.)

Key to the whole issue is a contractual obligation that supposedly compels the city to continue using the incinerator — which produces steam and electricity — as long as the facility’s owner can meet or beat the best price offered by a landfill.

The opinion of Miller Canfield attorneys working for the Greater Detroit Recourse Recover Authority — the quasi-public agency charged with overseeing disposal of Detroit’s municipal waste — is that the city is locked into the agreement. But attorneys in the council’s Research and Analysis Division (RAD) report that the stipulation is “arguably unenforceable.”

However, it’s not clear whether the council has a viable case. In part, the council needs more information from GDRRA.

Questions are also being raised about the way the landfill bidding process was structured. It’s so convoluted, and confusing, “relevant comparisons are extremely difficult to make,” according to a May 18 report RAD submitted to the council.

Bottom line, according to the report, is that the process appears to have given a “distinct advantage” to the incinerator operators.

The credibility of GDRRA — and by extension the Bing administration, since the mayor appoints GDRRA’s board members — is also an issue.

At the June 18 GDRRA meeting, GDRRA Director John Prymack denied informing council that a decision regarding the winning bidder was supposed to be announced that day, even though a RAD report quoted him stating that in a letter. At the same meeting, council member JoAnn Watson, who has been spearheading efforts to have the incinerator shuttered, asked Beckham if GDRRA’s decision to allow Covanta to become a part owner of the facility further committed the city to using the facility. Covanta has been hired to operate the facility since the 1990s. The majority owner of the incinerator is an outfit called Energy Investor Funds.

Beckham, as another RAD report points out, responded by saying the action would “not impact” any attempt by the city to stop using the facility. That statement was made before RAD staff saw the Covanta resolution. Once RAD did, according to its report, Beckham’s statement seemed to be “directly contradicted by explicit conditions in the resolution. ” Specifically, in addition to giving Covanta the OK to buy part of the incinerator, passing that resolution also appears to have laid the groundwork for the city to continue sending its trash to the incinerator for at least another six years.

But this is all shifting ground, with more information needed before anything is certain — including a decision by council to actually take the issue to court.

We should have more to report in next week’s issue of the paper. So, as they say in radio, stay tuned.