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Legal Fight Looms as City Refuses to Take Trash Plant

September 28, 1989|BETTINA BOXALL | Times Staff Writer

LONG BEACH — The city headed toward a prolonged court fight over its new trash-burning plant this week by again refusing to accept the Terminal Island facility from the builder, insisting that the plant is still not running the way it is supposed to.

The company that built the trash-to-energy plant, Dravo Corp. of Pittsburgh, Wednesday reacted to the rejection by filing a claim against the city for construction costs, signaling its intention of suing the city.

Dravo Chairman William G. Roth denounced the city's rejection of the $107-million plant as "ill advised, inadequately considered, and highly regrettable. . . . The city has left Dravo with no choice but to file a substantial claim and to prepare for extensive litigation," Roth said.

The plant has been burning Long Beach's refuse since July of last year, but Dravo and the city have been engaged in an ongoing dispute over the plant's performance.

Round of Tests

The city refused to accept the facility last September, setting off a round of tests and repairs. This month, Dravo told the city that it was satisfied the plant was operating up to snuff and indicated it wanted to hand the facility over to the city.

"We did what we said we would do," Dravo spokesman Ron Sommer said. "The plant is out there and the trucks are taking trash out there every day and the plant is burning the trash and producing electricity."

But looking at the same test information as Dravo, city officials have concluded that Dravo has not met all of its contract obligations. They say the plant is still plagued by defects and is not producing the amount of electricity and revenue called for in the contract.

"Our goal is to get a plant that works," Assistant City Manager John Shirey said, adding that Dravo's claim was not altogether a surprise. "I guess that was to be expected."

"Obviously the city will pay whatever is due under the provisions of the contract and not a dollar more," Shirey said.

In addition to the $107 million in construction costs called for in the contract, Dravo claims that the city owes it another $40 million for additional work completed during the past year and other costs.

Some of Fees Paid

The city has paid Dravo some of its contract fees, but neither Shirey nor Dravo could say how much money Dravo has thus far collected.

Despite their problems with Dravo, city officials continue to defend the plant, saying it is a visionary facility that will be of enormous benefit to the community once the kinks are worked out. "It's not that the plant . . . can't eventually be the kind of plant we expected it to be all along . . . but right now, they haven't completed their assignment," Councilman Evan Anderson Braude said at Tuesday's council meeting, when the council unanimously voted not to accept the facility from Dravo.

Known as the Southeast Resource Recovery Facility, the plant is one of the few of its kind in the Los Angeles Basin. It is designed to burn 1,170 tons of garbage a day and generate enough power to provide electricity for 45,000 homes. It is expected to produce $60,000 a day in electricity sales to Southern California Edison.

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