Originally created 07/12/00

Company might sue over sludge disposal



A Texas company whose contract to dispose of Augusta's sewage sludge was not renewed last month wants city commissioners to reconsider - or face possible legal action.

Synagrow, based in Houston, was hired 2´ years ago to haul 9,000 dry tons per year of Augusta's sewage sludge to agricultural fields in Richmond, Burke and Jefferson counties.

However, city commissioners - at the recommendation of Utilities Director Max Hicks - decided last month to fire Synagrow and give the business to OMI, the company hired in August to manage Augusta's wastewater plant.

Synagrow's $1.6 million annual contract involved hauling sludge mixed with water to fields authorized to receive the material.

According to OMI's proposal, the city would save $337,000 per year by building a $3.3 million dewatering facility that would reduce the volume of waste hauled to those farms.

OMI also was chosen to build and operate the dewatering facility, according to a letter from Mr. Hicks to Synagrow President Randall Tuttle.

"Because of this change, Augusta will not renew its contract with Synagrow," Mr. Hicks wrote.

Synagro, however, disputes OMI's cost-savings estimates and says commissioners acted unethically by diverting more business to OMI without competitive bidding or any discussions.

"We believe OMI has convinced the city of the propriety of making this change with inaccurate analysis that will result in the city spending significantly more taxpayer dollars than if the current program would have been continued," Mr. Tuttle wrote last week in a letter to Mr. Hicks.

According to Synagrow, OMI's proposal will cost $400,000 more per year than the current program - not including the $3.3 million dewatering facility OMI plans to build and operate at taxpayer expense.

Mr. Tuttle wrote that the cost of hauling sludge - the material left over after sewage is treated - is based on the percent of solids in the liquid material.

The higher the percent of solids, the less liquid sludge is produced, and the transportation and disposal costs go down.

Mr. Tuttle claimed OMI failed to meet the 4 percent solids goal outlined in its contract, which should have resulted in the company paying penalties for non-performance.

"But instead of discussing penalties, they are discussing changing the program and forcing out a potential dissenting voice - that of Synagrow's," Mr. Tuttle wrote.

If OMI were held to its commitment of producing sludge with 4 percent solids, the current $1.6 million a year disposal costs would be reduced by $400,000 and there would be no need for a $3.3 million dewatering site.

However, Paul Tickerhoof, Augusta project manager for OMI, said the contract's performance goal has a target of 3.5 percent solids in sludge, which OMI surpassed in recent months.

The 4 percent level would earn OMI bonuses, he said, but the 3.5 percent is a vast improvement.

"What I see in their letter is that it's inaccurate and represents some sour grapes on their part," Mr. Tickerhoof said.

Synagrow also has binding non-compete contracts with local hauling contractors and a major landowner in the sludge application program, Mr. Tuttle wrote.

"Pending your response to this letter, we will consider filing an injunction to prevent the city or OMI from doing business with these subcontractors," he wrote.

Mr. Hicks said Synagrow is still welcome to propose hauling the sludge for OMI if it can do the job cheaper than whoever OMI has contacted.

"If Synagrow can haul cheaper than OMI, all they need to do is make that proposal to OMI," Mr. Hicks said.

OMI's proposal to build a dewatering facility to improve treatment and reduce volumes of sludge appeared to be sound, he said.

"I reviewed it," he said. "It was simply a case that OMI was at the plant, doing the work. It was time for Synagrow's contract to be up - renewed or go to someone else. A decision was made to give OMI the whole package.

"The city got, what we see anyway, as several hundred thousand dollars in savings," he said.

Reach Robert Pavey at (706) 868-1222, Ext. 119, or rpavey@augustachronicle.com.