Plans for recycling plant postponed

October 02, 1993|By Ted Shelsby | Ted Shelsby,Staff Writer

Plans for the construction of a $30 million trash recycling and composting plant in Prince George's County were put on hold by F&E Resource Systems Technology Inc. after its sole supplier of municipal waste suddenly withdrew from the project.

Expressing concern over the economics of its involvement in the project, Browning-Ferris Inc. in Linthicum backed out one day before yesterday's scheduled closing on a $26 million state bond issue that was being underwritten by Alex. Brown & Sons.

"That's pretty incredible," said a frustrated Ronald W. Pickett, president of the Baltimore company referred to as FERST. "They withdrew at the 11th hour, 59 minutes and 59 seconds after we had worked on this [project] for 2 1/2 years."

He added: "When the source of the waste was eliminated, the financing collapsed."

The plant in Brandywine was to have been a smaller version of FERST's facility in Curtis Bay that opened earlier this year.

Construction of the Brandywine plant, designed to process 340 tons of trash a day, was scheduled to be completed by next spring.

It was to sort 95 percent of the trash into materials that could then be sold. The plastic, aluminum, metals and glass was to be sold to companies for recycling. Foodstuff and other forms of trash, including newspapers, was to be composted and sold to farmers and garden shops.

Neil R. Davis, a vice president of Browning-Ferris, said his company withdrew as a result of a "threatening market condition" within the solid waste industry.

He explained that under its arrangements with FERST, Browning-Ferris was to pay a "tipping fee" for each truckload of trash it took to the Brandywine plant. Under terms of a 15-year contract, he said, the company was to pay "a relatively high fee," which was to increase 5 percent a year.

But, noting that tipping fees have been on the decline over the past six months in the mid-Atlantic area because of increased landfill capacity, Mr. Davis said the arrangement with FERST represented "a very risky venture. We thought it would be a mistake to go forward."

The bulk of the financing for the Brandywine plant would have been covered by a bond issue by the state's Department of Economic and Employment Development.

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