Katahdin landfill bill OK’d despite claims of ‘corporate blackmail’

The Dolby landfill along the banks of Dolby Pond near GNP's former East Millinocket facility.
BDN file photo
The Dolby landfill along the banks of Dolby Pond near GNP's former East Millinocket facility.
Posted June 16, 2011, at 3:42 p.m.
Last modified June 16, 2011, at 8:51 p.m.

AUGUSTA, Maine — A bill authorizing the state to acquire an East Millinocket landfill received final approval Thursday, but not before some lawmakers compared the controversial deal aimed at saving two shuttered paper mills to “corporate blackmail.”

A lopsided, 34-1 vote in the Senate Wednesday morning belied the consternation some lawmakers felt as state officials — in their quest to salvage two Katahdin Paper mills and hundreds of jobs — prepare to potentially take over an aging landfill tied to the mills.

The Dolby Landfill has, for decades, received paper-related sludge, pulp and other waste from the two paper mills in Millinocket and East Millinocket. Nearly full, the landfill is now regarded as a liability and an obstacle to finding a new buyer for two mills that a few years ago employed roughly 600 people.

As a result, Brookfield Asset Management — the parent company of the mills’ owner, Katahdin Paper LLC — has left state officials with a predicament: either assume ownership of the landfill, thereby enabling the mills to be sold, or Katahdin Paper will permanently dismantle the mills in order to pay for the costs of closing and cleaning up the landfill.

Toronto-based Brookfield is reportedly negotiating with a Hong Kong-based investment firm that purchased the former Domtar mill in Baileyville last year.

Lawmakers’ discomfort over the choice was evident during Senate debate.

“Do I want jobs? Yes,” said Sen. Elizabeth Schneider, D-Orono. “But I do not like having a gun pointed at my head as an out-of-country, multibillion dollar corporation says, ‘Well, we are just going to treat you like garbage and stick you with our landfill — a landfill that we don’t want responsibility for — if you want those jobs.’”

Schneider added that there are no guarantees in the bill that a new buyer will continue making paper in the mills or employ the hundreds of workers who lost their jobs when the mills closed. And Sen. Cynthia Dill, D-Cape Elizabeth, called the measure “nothing more than corporate blackmail.”

But Sen. Thomas Saviello, the sponsor of the bill, countered that changes made to the measure will require any new buyer to submit a business plan before the state agrees to take ownership of the landfill. Additionally, the State Planning Office will consider imposing a cap on the state’s financial liability regarding the landfill.

Ultimately, Saviello said, the bill does not require the state to acquire the landfill but is a necessary step to preserve the possibility of bringing back an estimated 400 jobs.

“This is about jobs. That is what this is about,” said Saviello, R-Wilton. “We have to do this if we are going to help the people in Millinocket and East Millinocket.”

If enacted, this would not be the first time Maine took over a landfill to save a paper mill. Back in 2004, the administration of Gov. John Baldacci, a Democrat, negotiated a deal to purchase a landfill in order to keep the Georgia-Pacific Corp. mill in Old Town operating.

Today, the state still owns Juniper Ridge Landfill and Casella Waste Systems operates it under a long-term contract negotiated as part of the G-P deal. But G-P closed the mill in 2006 despite shedding the landfill.

The Old Town facility now operates under different owners and a different business model but has never regained all of the 400 jobs lost when G-P moved out.

During her floor speech, Schneider cited the G-P deal as a precautionary tale, explaining that the surrounding communities — which are part of her district — lost mill jobs and inherited large numbers of trash trucks rumbling through their towns en route to Juniper Ridge.

Schneider urged her colleagues to learn from past mistakes and not to rush into another paper mill-landfill deal in the final days of the legislative session just because the administration is saying a sale hangs in the balance.

“Don’t buy it. It’s not coincidence,” Schneider said. “It is orchestrated so we move quickly just like they did in Congress to bail out big corporations. And they did so without putting in enough provisions, in my opinion, to protect the taxpayers of the United States.”

But Sen. Seth Goodall, a Richmond Democrat heavily involved in committee discussions on the bill, said it was important to at least give LePage the authorization he needed. The burden would then be on the administration to ensure the state’s interests are protected.

“This today is about saving union jobs and the Millinocket region,” Goodall said.

Another issue raised Thursday was the level of contamination at the landfill. In a letter to the Attorney General’s Office, the Conservation Law Foundation pointed out that the landfill has struggled to receive a permit renewal from the Maine Department of Environmental Protection “due to continuing problems with leachate discharges and landfill stability issues.”

CLF suggested Maine would be taking ownership of a landfill in violation of state and federal laws and also raised questions about the deal’s constitutionality on financial grounds.

But Saviello, a former environmental manager for paper mills, said the state’s own data show that the majority of contaminants in Dolby landfill are things such as calcium, magnesium and bicarbonate. He also that although the DEP has not issued a new permit, the landfill continues to operate under the existing permit.

Dan Whyte, vice president of Brookfield Asset Management, declined to respond specifically to the allegations of “corporate blackmail” but was nonplussed about the comments in the Senate.

“I understand that folks have to vent but in the end people voted for it,” Whyte said.

The Senate voted along party lines to reject an amendment by Schneider that would have restricted the landfill to only accepting waste related to the paper-making process, which Saviello said was redundant under the current license.

In the end, Schneider, Dill and most others who raised questions about the landfill deal voted for it. The only dissenting vote in the Senate was from Sen. Richard Woodbury, an unenrolled lawmaker from Yarmouth.

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