The city's law department has drafted a tentative contract with the broker.
WARREN -- The city could be close to inking a deal to bring hundreds of tons of sludge daily from New York City to Warren, where it would be turned into fertilizer -- and $1.6 million in annual revenue.
The announcement came Thursday as Tom Angelo, city water pollution control director, was under fire from city council's sewers and water pollution control committee about why the city's bio-solids business, which markets Nature's Blend, isn't a money maker.
In fact, council was "shocked and amazed" last year that the income was so small, said Councilman John Homlitas, D-3rd, committee chairman. Committee members were told that sales for all of last year totaled $18,635.
Angelo, however, said Tully Environmental Inc., a broker for New York City's solid waste, including 10 boroughs, contacted the city last June. It brought material from four of the boroughs to Warren last October through December for a trial run. The trial run was to assess odors and to be sure the city can handle the truck traffic at its facility.
"They want to do business with the city of Warren and Nature's Blend," he said. "They want to bring material to us to process."
The outcome of the trial "was very good, acceptable to New York, acceptable to us, acceptable to the farmers," Angelo added.
A deal with the company would make use of excess capacity at the city's bio-solids facility at the Water Pollution Control Department on Main Avenue Southwest.
The city's law department has drafted a tentative contract with Tully that the city's administration will discuss Monday, said Safety-Service Director William Franklin.
Tully is a full-service environmental and construction services company with offices in New York, New Jersey and Pennsylvania.
At the current rate of $39 per ton, and 168 tons daily by truckload, Warren's revenue per year would be $1.6 million, minus the cost of hauling the product to farmers or to market, maintenance and allowing for any down time. Angelo said an "extremely conservative" estimate is a net annual return of $500,000 to $600,000 the first year.
He noted that to date this year the city has revenues of $21,829 from processing New York City sludge, already exceeding 2004's total revenue.
Warren has a capacity for 240 tons a day and, by itself, produces only 40 tons a day. Its bio-solids facility was built in 1998 at a cost of $7.2 million; Nature's Blend is the city's registered trademark.
New York needs space
New York City currently landfills its wastes in many states at an even greater cost, having been banned from the practice of dumping it in the ocean, Angelo noted.
Councilman Filipe Romain Jr. questioned what would stop New York City from simply building its own profitable facility.
"The city of New York has no real estate they are going to use for building a facility for this," Angelo said. "It's going to be cheaper for New York City to send it out and have it done, because they would never be able to build one facility to handle all they generate."
Angelo said Tully wants a nine-year contract -- the same amount of time remaining in its contract with New York City. During that time, the city could negotiate increases to the $39 per ton charge, he noted.
Angelo said he requires a complete chemical analysis of materials sent to the facility to check for metals and other potential hazards.
Nature's Blend is sold at Giant Eagle, some area Wal-Marts and at other local landscaping, garden and floral shops. The fertilizer is made from reconstituted human waste using a heat pasteurization process.
The New York news puts a new light on the city's fertilizer business. Warren was told in a performance audit by the state, requested by the city in 2000, that selling Nature's Blend may not be cost effective.
Funding the department
Angelo maintained then and now that the product wasn't intended to make a profit but it has helped fund the department. Eliminating the cost of shipping the waste to a landfill, fees from other municipalities to treat their waste and sales of the product have substantially reduced expenses, he said.
Image has been a problem. "We knew we were going to have an uphill battle to find a home" for this product, Angelo told the committee, noting that marketing and educating people have helped, along with eliminating several chemical issues that held back the product's quality in recent years.
Last year, 729 35-pound bags were sold; 6,859 6-pound potting soil bags were sold; and about 180,000 yards of leaf mulch was delivered for a charge.
"The future is we have to renew customer confidence in the product," he stressed, noting this means working with golf courses, landscapers, farmers' demonstration plots and others to sell it -- along with increasing use of the plant's reserve capacity.