G-P, state closing in on landfill purchase Transfer will help regain jobs at mill

OLD TOWN – Georgia-Pacific Corp. is trying to transfer ownership of its 64-acre landfill located off Exit 52 of Interstate 95 to the state of Maine. The switch is a key piece of a three-part plan to regain 140 of the 300 mill jobs the paper company cut in early April.

A.D. Pete Correll, chief executive officer and G-P board member, said the company and the state have partnered on the transfer to retain good-paying Maine jobs.

Pending a review and approval by the Legislature, the state of Maine will purchase the G-P landfill with the agreement that the company can use it in the future at reasonable fixed costs.

“We haven’t finalized it yet but we have had discussions to the value of it and they are ongoing,” said Jack Cashman, senior policy adviser to Gov. John Baldacci, on Monday. “It’s a very good proposition for the state as well as Georgia-Pacific.”

Baldacci played a big role in forming the multifaceted plan that helped change the company’s decision to permanently shut down tissue production at the plant, Cashman said. G-P plans to restart a tissue machine and eight corresponding converting lines beginning next week.

“When the announcement was made [to shut down the machines], we were a little disappointed that we didn’t get a chance to work with them,” Cashman said. “We approached them. They didn’t approach us. The governor called Mr. Correll and asked if we could alleviate these problems.”

The company’s biggest problems are energy costs and the funds needed to make the plant more efficient, Cashman said. He said that is why the landfill is so important.

“This takes care of their operating expenses at the landfill and helps them come up with money for energy costs,” the governor’s senior adviser said. “It’s expensive to run that landfill and they [G-P] really don’t want to be in the business.”

G-P is considering spending between $10 million and $15 million at the Old Town mill to address energy efficiency problems, according to officials.

There are two options for purchasing the landfill, Cashman said. He said the state could pay for the facility in full or could pay a reduced price and in turn offer G-P a reduced price when using the facility for the company’s own needs. Cashman said the state is leaning toward the latter.

“It helps us because we wouldn’t have to come up with as much money to buy it,” he said. “Obviously, it’s a valuable asset. It’s going to cost us. Landfills are very expensive.”

The exact cost is still undecided but Cashman, who is an Old Town resident, said the state is considering using revenue bonds to pay for the purchase.

“We would have to use the revenue stream [from the landfill] to pay them off,” he said. “This is a real win-win, and it’s a real positive thing for the state and G-P as a company.”

David Lennett, director of the DEP’s Bureau of Remediation and Waste Management, said the landfill is a good deal for the state.

“The facility was built in 1996 and very little of the capacity has been used so far,” he said. “One of the issues with the purchase agreement is how to allocate the liability of the site and I think the state will assume the liability.”

Because of the age of the landfill, liability issues are not really a problem, Lennett said.

“It’s a state-of-the-art landfill,” he said.

Lennett said the only time the state would have to pay liability costs would be if “something bad happens.”

In 1989, the Legislature passed a law that said all new commercial landfills would be owned by the state. Cashman said this law was passed for several reasons, but ensuring that out-of-state materials were not deposited in Maine is one of them. The G-P landfill will be the first state-owned landfill. Land for a future landfill for the state has been purchased in Township 2 Range 8, just west of Lincoln.

“The Carpenter Ridge land is not [ready],” said Lennett. “But it’s licensed to be used as a landfill.”

There are two commercial landfills in the state, in Hampden and Norridgewock, that were in operation before the 1989 law passed.

If the state does purchase the landfill, it will get years of use out of the facility, said Cashman.

“The current capacity would probably run another 25 years or so,” he said. “There is some capacity for expansion in the future. If there is land on the site that is suited for expansion, it would last longer than that.”

Only 64 acres of the 800-acre site is licensed and being used as a landfill.