Oct. 10, 2003 – No one opposed the creation of a territorial waste management authority at a Senate committee hearing on the subject Friday on St. Croix, but some of those testifying expressed reservations about the bill now before the Legislature to bring such an entity into existence.
The bill would establish the V.I. Waste Management Authority as an independent instrumentality to manage all public facilities for the collection, treatment and disposal of wastewater and solid waste in the territory. It also would authorize the agency to establish an environmental impact user fee.
Friday's Planning and Environmental Protection Committee hearing was the second of three on the bill planned by the chair, Sen. Louis Hill. The first was held Oct. 1 on St. John (see "Committee chair favors waste authority bill"). The third is set for Oct. 16 on St. Thomas.
Gov. Charles W. Turnbull has tried repeatedly throughout his two terms to get the Senate to approve the creation of such an authority. He also has selected Caribe Waste Technologies to build and operate a solid-waste processing system for the territory. CWT says the undertaking is economically feasible only if the Water and Power Authority purchases electricity and water to be generated as byproducts of its gasification system, at an estimated cost of $10 million to $12 million a year over 30 years. WAPA officials remain adamantly opposed to doing so, arguing that the utility is capable of producing all the energy and water the territory needs.
Hovensa opposes basis for user fee
In testimony Friday, Alexander A. Moorhead, Hovensa vice president for government affairs and community relations, took issue with the bill's provision having to do with user fee. According to a release from the Legislature, he said the refinery opposes the idea of basing the fee on the total weight of goods produced in or imported into the territory.
"What correlation exists between the total weight of goods that an individual or business produces in or imports into the territory and the amount of services of the Waste Management Authority that will be used by that individual or business?" he asked. His own answer: none.
"The user fee as defined by the bill would be a tax," he told the committee. "The tax will fall on most businesses, merely because they produce or import the goods used by consumers … This will occur regardless of the volume of waste these businesses disposed of in the solid-waste landfills and the sewage-treatment system in the territory, compared to other generators of waste who do not produce or import goods."
Moorhead noted that Hovensa imports numerous tons of crude oil and petroleum products and manufactures many tons of such products monthly. But, he said, none of the material that it imports or produces ends up in the territory's solid-waste disposal or sewage-treatment systems. Further, he said, the petroleum refining process creates waste that will not end up in the system to be operated by the authority.
Finally, Moorhead said, application of the user fee to Hovensa "would violate the tax and fee exemption provisions of the agreement between the government of the Virgin Islands and Hess Oil Virgin Islands, as amended, that has been in existence since 1965."
SEA says political, financial autonomy essential
Bill Turner, executive director of the St. Croix Environmental Association, noted that there have been repairs and improvements recently in St. Croix's sewage system which demonstrate the government awareness of the island's problems "and an ability to effectively address them."
However, he said, "as of October 2003, solid waste and wastewater management issues remain at a crisis stage in the Virgin Islands. Sewage evacuation still suffers from planned and unplanned bypasses … In spite of repeated warnings by the Federal Aviation Administration, the Anguilla landfill remains outside of compliance parameters for a landfill so near to an airport. The wastewater treatment and evacuation system still places the health of many citizens at risk. Secondary waste treatment, while awarded, remains a largely theoretical ideal."
A waste management authority is needed, Turner said, but it can succeed only if its board is free from political pressures and "is given autonomy in decision-making and composition." If not, he said, the board "will be little more than another layer of bureaucracy added to an already overburdened decision-making process." Also, he said, financial autonomy is critical "to ensure that funding is not appropriated outside of its scope of operations."
With those concerns in mind, he said SEA objects to the bill's provision for members of the governor's cabinet to sit on the board. "The members of the governor's cabinet already discharge important duties. To add to that list service on an additional board would deprive that board of the attention that it needs and deserves," he said, suggesting that "a board consisting of members of the community with business and waste-management experience would be more capable of effective decision-making."
SEA recognizes that "the days of free waste disposal are over," Turner said. "The citizens of the territory must begin to pay for these services if we are to expect efficiency in the performance of these services. However, we also believe that the fee should have liberal exemptions for those businesses that import products that do not add immediate burden to the waste-management system."
Cost considerations
Noting that the bill would empower the authority to float bonds of up to $450 million per issue, he suggested that the territory could manage its waste stream at a cost of about $13 million annually, including capitalization costs associated with waste-treatment facilities. "We believe that one such bond could completely modernize our waste management system," he said.
But Turner said SEA opposed the administration plan to have Caribe Waste Technologies contract with WAPA for the purchase of water and electricity. If the government intends for the proposed authority to complete negotiations with CWT, "$450 million will be only a fraction of what it will ultimately spend for a questionable system that is grossly impractical for the Virgin Islands," he charged.
SEA would like to see the bill specify a user fee to support "one bond issue that would completely modernize our waste management system." The current language, Turner said, "leaves open the opportunity to create yet one more cycle of debt and impracticality."
He also said the competitive bidding provision of the bill is critical, and that SEA believes that, in addition, the Legislature "should retain the right of nullification of corporate resolutions in the bidding process." And he further suggested that language be added "to set a goal of zero waste in the management of the waste stream" by seeking out methods of resource recovery and thereby lowering costs.
Ann O'Neal, Planning and Natural Resources Department attorney, suggested revisions and clarifications to the bill mainly providing for DPNR to share responsibility for promulgating rules and regulations, the release from the Legislature stated.
According to the release, also testifying were Public Works Commissioner Wayne Callwood; Public Works senior manager Sonya Nelthropp; Hollis Griffin, director of DPNR's Environmental Protection Division; Julia Renfo, president of the Christiansted Restaurant and Retail Association; and Fred Laue, president of the St. Croix Hotel and Tourism Association.
Hill made the point that the bill is a working document, even though the proposal has been around for several years, and that his committee welcomes input from all sectors of the public.
The only other committee member present Friday in addition to Hill was Sen. Almando "Rocky" Liburd. Not present were Sens. Roosevelt David, Adlah "Foncie" Donastorg, Carlton Dowe, Shawn-Michael Malone and Ronald Russell. Also present were Sens. Emmett Hansen II, Norman Jn Baptiste and Usie Richards, who are not members of the committee.
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