The racetrack--which cost Penske about $100 million to develop--is the best example of the company's game plan. Kaiser spent $7.5 million to clean up 525 acres of its land, then swapped it for a stake of about 12% in Penske, a company that owns tracks in Pennsylvania and Michigan in addition to the new California Speedway.
"We got the permitting and we did the remediation work on the land," Stoddard said. "But when it comes to car racing, we knew we couldn't deliver the races here and we preferred not to be the ones building a track. So we got together with Penske, who could do those things."
The company used a similar technique to develop a 30-acre materials-recycling site. The $10-million facility is under construction across the street from the California Speedway and will be operated by Burrtec Waste Industries of Fontana when it opens next year.
For a while, it looked as if Kaiser would be able to pull off the same plan with its largest project, the proposed Eagle Mountain landfill.
The site, a gaping hole left by 40 years of iron ore mining, consists of 4,000 acres in the Mojave Desert about 80 miles east of Palm Springs. It would receive garbage sent by train on existing rail lines. The trash would be gathered at existing materials-recovery facilities on rail lines in Los Angeles County, where solid-waste companies truck the garbage they collect.
The site could eventually swallow a staggering 325 million tons of trash--20,000 tons a day for 50 years. (Southern Californians produce about 48,000 tons a day.)
The project, proposed in 1988, had been scheduled to be built by 1993. But it has been tangled in controversy and litigation that has sent the fortunes of Kaiser investors on a wild ride. Kaiser's stock value jumps when Eagle Mountain's outlook brightens--it rose to nearly $20 a share at one point--but sinks when it suffers setbacks.
Initially, Houston-based Browning-Ferris Industries planned to develop the site while paying Kaiser royalties on the land--$200,000 a month during the planning stage and more when the site opened.
But in 1994, San Diego County Superior Court Judge Judith McConnell handed the project what amounted to a three-year delay when she ruled that an environmental impact report was incomplete. (The case was moved to San Diego County because Riverside was a defendant in the lawsuit.)
McConnell told Kaiser to readdress issues ranging from the landfill's effect on the desert tortoise, which the federal government has classified as a threatened species, to the danger of contaminating ground water. Exasperated by the delays, Browning-Ferris bailed out in 1994 after having made $6 million in payments to Kaiser and spent millions more on the project itself.
With Browning-Ferris gone, Kaiser was forced to take over the project and to begin using its own cash. The company has budgeted $7 million for the project, Stoddard said.
After spending millions of dollars and several years on planning, there might finally be light at the end of the tunnel. On the heels of the Planning Commission's positive recommendation in May, Riverside County supervisors began public hearings last week for Eagle Mountain, setting up a vote for later this summer.
Though Kaiser needs about 20 permits from various government agencies before the landfill can be built, county approval has long been considered the biggest hurdle.
The company is optimistic despite facing an entirely reconstituted Board of Supervisors. Their approval would clear the way for the project to be returned to McConnell's courtroom. Her support could allow the site to open in 1999.
Along the way, some Riverside County residents are determined to persuade either the supervisors or the courts to dump the dump.
"It's so irresponsible to think that you can just send all of L.A.'s garbage to the desert and that it just will go away," said Dan Roman, a member of the Eagle Mountain Landfill Opposition Coalition.
Roman, who lives in Indio, said the project would foul ground water in the Eagle Mountain area and the desert air, and would disrupt Joshua Tree National Park, which comes within 1 1/2 miles of Eagle Mountain land.
Landfill organizers say that those issues have been addressed and that the dump's remoteness from major population areas makes it a good solution to the region's trash troubles.
If Kaiser succeeds in the political and legal arenas, it will seek a partner to construct and operate the landfill, Stoddard said.
The dump's value depends on how many waste firms agree to put trash on trains and how many other new garbage repositories become available during the next decade.
If successful, Eagle Mountain will dwarf the company's other operations, said analyst Seth Feinstein of Crowell, Weedon & Co. in Los Angeles.
"Kaiser's water, land and its racetrack holdings are nice businesses, but I see Eagle Mountain as something much larger," Feinstein said.