Government, Real Estate, and Sustainability

Kent trash reuse project worth $500M

Park is meant to help DPW reach its goal of reducing landfill waste by 90 percent by 2030.

August 10, 2018
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Landfill
This aerial photo shows a large portion of the proposed sustainable business park property in the foreground. Looking northward, the South Kent Landfill is in the distance and US-131 is on the right. Courtesy Kent County DPW

Kent County’s plans for a trash sorting and reuse facility will produce a significant economic impact.

The 106-page draft of the Department of Public Works “sustainable business park” master plan estimated a $500-million direct private capital investment, with waste sorting and processing alone creating 150 jobs and an annual economic impact of $130 million.

The new estimates come from 23 responses, representing 30 companies, to an RFI issued in March regarding the park master plan.

As the Business Journal reported in November, the plan is to build a facility on 250 acres of land (an increase from the initial idea of 200 acres) in Allegan County just south of the current South Kent Landfill.

The county would own the park and lease land to private companies, with 100 acres committed to removing the many high-value items from the trash. The remaining land would ideally be for companies that could convert recovered materials into new products, such as a combined heat and power plant.

The park is meant to help the DPW reach its goal of reducing landfill waste by 90 percent by 2030.

This will help create a “circular” economy, in which used goods are reused rather than wasted, as in the “linear” model, said Jennifer Porter of Gershman, Brickner & Bratton, the solid waste management consulting firm that compiled the draft.

“It is possible to get to this 90 percent reduction in landfill waste,” said Steve Faber of Byrum & Fisk Advocacy Communications, who has been working with the DPW on the project.

But to do so, he said the community needs to get on board.

“If we could get every Kent County resident to stand on top of our South Kent Landfill,” Faber said, “(they’d) have a different understanding of our waste in our community.”

County residents and businesses recycle about 8 percent of their waste, he said, though many believe that number is higher. Another untruth is organic materials decompose in the landfill — they don’t.

Of the nearly 500,000 tons of yearly waste in Kent County, an estimated 75 percent could be reused.

In West Michigan, the estimated value of that discarded material — such as wood, metals, plastics and organics — is $56 million, and recovering and selling those valuables could create 370 jobs, according to a 2016 study by the West Michigan Sustainable Business Forum.

In Michigan, that equates to $386 million and more than 2,600 jobs.

Without action, the South Kent Landfill will be at capacity by 2029, and a new landfill would need to go on that 250 acres.

“I don’t believe Kent County can continue to perpetuate the idea that landfilling is the option for this community,” said Darwin Baas, DPW director.

Sustainable business park plans

The drafted plan outlines three possible concepts for the 250-acre site.

Baas’ preferred option includes mixed-waste processing, organics processing, construction, demolition materials processing, multiple industrial sites, and a site for development of fuel and energy using trash that cannot be recycled, such as the annual 20,000 tons of low-quality plastics.

He said this plan leaves more space open for later development to accommodate possible growth.

“We think it can grow substantially,” Baas said. “We’re not necessarily going to meet just Kent County’s needs. We can meet West Michigan’s needs.”

The park is meant to complement existing facilities — a landfill still will be needed but, hopefully, to a lesser degree, Baas said. The Recycling and Education Center and the Waste to Energy facility will continue being important aspects of the DPW.

There are “low-hanging fruit projects” that could divert up to 25 percent of waste he said should be completed first — ash mining, construction materials processing and an organics management facility.

Based on the RFI, the county believes there is an “immediate need for more organic waste management capacity in the region.”

Two organic waste management companies, Zeeland-based Spurt Industries and Holland-based Cocoa Corporation, have shown “immediate interest” in developing an organic waste management facility within the park.

Baas said this will require a new collection system with better source separation. The draft said this might require ordinances that could result in increased collection costs.

These waste materials can be processed into compost and renewable natural gas, which could be used to produce thermal energy for use in greenhouses located within the park and as fuel for natural gas-fueled vehicles, Baas said.

The Waste to Energy facility, which burns refuse to create electricity, has generated over 1 million tons of combustor ash and another 1 million tons is expected to be produced in the next 25 years.

Valuable metals leftover may have a value near $1,000 per ton.

He said the DPW will be working with one of two interested companies to build and operate facilities to recover metals from new ash and the ash landfill. The company will pay the county for the metals.

Costs and funding

The engineering firm Fishbeck, Thompson, Carr & Huber estimates the public infrastructure improvements necessary to facilitate the park may cost between $10 million and $15 million.

Currently, it costs Kent County $10.1 million to operate the North Kent Transfer Station and the South Kent Waste and Recycling Center. With a net tipping fee — which the DPW charges trash pickup companies to dump in the landfill — of $36.60 per ton, the system generates $12.4 million in revenue, contributing about $2.3 million to overhead funds.

New system operations would cost an estimated $19.6 million annually. To generate the same amount of overhead, the tipping fee would need to be an estimated $64.50 per ton, assuming the park is completely privately financed.

The tipping fee, plus the company’s service charge, is what determines trash and recycling pickup costs for residents, said Kristin Wieland, DPW communications and marketing manager.

Granger Waste Services’ John Van Tholen, who is representing waste haulers in stakeholder meetings on the project, would not comment on how this may affect customers.

Wieland said the DPW’s goal to keep those fees as low as possible, but creating this system will cost everyone more money in the end because landfilling is “really cheap,” she said.

“As a community, we have to see the value in not building a landfill,” Wieland said.

These operations numbers do not reflect possible leasing to private companies, which could offset costs.

The draft detailed multiple possible funding options for the project, including public funding through bonds, state or federal loans, private grants and private equity.

A DPW board member also suggested possible company sponsorships, similar to those at the Gerald R. Ford International Airport.

The draft said if the county financed the estimated $75 million for the waste processing facility through a cash bond for 25 years at a 5 percent interest rate, the capital charges for the park system would be reduced by approximately $4 million per year, or almost $12 per ton.

If bonds are used, it is estimated that revenue will exceed debt by the start of 2030, with repayment beginning in 2031.

These funding sources assume county ownership of the park, though public-private options for ownership and contracting might emerge as plans develop.

Baas said the DPW does have some funds to help kick-start the project.

The draft said service costs need to be forecasted, keeping in mind costs, savings and revenue generated by new facilities.

Timeline and next steps

The proposed timeline shows development completion and 90 percent waste conversion at the end of 2030, with on-site development beginning at the end of 2021.

Funding should be secured by 2021, with operational off-site development and established on-site plans between 2020 and 2022.

The first tenant should be in operation at the end of 2023, diverting 20 percent of the waste stream. Continued tenant agreements and build-outs are proposed from 2024 to 2031.

Low impact facilities, such as composting, may take only 24 to 36 months to complete, while complex technologies could take more than five years to finish, the draft outlined.

Wieland said the goal is to seek approval by the end of the year.

There still are several private properties to be acquired before the plans can be carried out.

A 10-member stakeholder review committee, chaired by former Kent County Commissioner Dick VanderMolen and representing a variety of perspectives, is providing feedback regarding the plan.

Theodore Vonk, Kent County commissioner and DPW board chair, said he would like to move slowly on the matter to ensure the best outcome.

The DPW board is holding a work session on the plan Sept. 6. Baas hopes to have the final plan next month.

Kent County Commissioner Dave Bulkowski said it’s likely the county board of commissioners won’t agree on how to proceed, but he believes the need for action is immediate.

“We need a 10-9 vote on something hugely aggressive and assertive,” he said.

In reference to the landfill, Kent County Drain Commissioner Ken Yonker said, “If anyone has a problem with this direction, give them a tour to the top of that mountain of crap.”

Bulkowski said the creation of the Van Andel Arena was not a unanimous vote in the county commission, but now the county is reaping the benefits.

“Let’s go,” Bulkowski said. “Let’s make the changes; let’s make them significant because our grandchildren will really thank us for it.”

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