Republic Services to add cleaner-burning trucks

Wednesday, Dec. 26, 2001 | 8:44 a.m.

Availability of funds and a need to provide the local waste disposal company with cleaner-burning garbage collection trucks have paved the way for Republic Services of Southern Nevada to land $25 million in tax-exempt bond money.

"Although it was not the overriding factor for Republic getting approved, it was a factor that the money is in part to be used to obtain cleaner-burning vehicles," said the person who oversaw the bond process, Doug Walther of the office of Business, Finance and Planning for Nevada.

"Given the governor's priority for energy conservation and use of alternative fuels, this was important to us at the state level. The bottom line was that the money was available and there was a need."

Walther and Republic spokeswoman Lee Haney admit that cleaner-burning garbage trucks are the only kind being manufactured, and thus are the only type of vehicles available to replace older models. Still, Republic says it has long been environmentally conscious.

"We plan to purchase 21 new vehicles with this money," Haney said. "This is part of an ongoing process (to replace old garbage trucks). We spend $13 million to $18 million a year on new containers, vehicles and other such equipment."

The money represents much of what is left of the $187 million in private activity revenue bonds that was made available to Nevada this year from the federal government.

Nevada's Board of Finance approved last the bonds' issuance last week of the bonds, which are exempt from federal income tax. That exemption should result in savings for the company, which holds the contract with Clark County for solid waste disposal -- savings that can be passed on to customers, the Nevada Department of Business and Industry says.

Haney warns, however, that does not necessarily mean there will be a rate reduction. She said rates rise and fall based on the Consumer Price Index. The cost savings from the bond money may not be significant enough for rates to drop, but it could help keep current rates stable, she said.

This is not the first private activity revenue bond money to go for cleaner-burning fuel projects in Nevada this year.

"The Housing Division also was approved for these bonds, and one consideration was that the homes that are being built not only have to be affordable but also will be energy efficient," Nevada Department of Business and Industry spokeswoman Amanda Getzoff she said.

The bonds also serve as a funding pool of tax exempt authority, Walther said, noting that Republic also will be allowed to use some of the bond money to reimburse itself for some projects it already has financed this year.

Haney said $4.8 million spent since July will be recouped from the bond money and another $2.25 million will be used to create a new 20-acre cell at the Apex landfill that will hold 2.5 million tons of solid waste.

Over the next two years about half of the bond money will be spent on cleaner-burning vehicles and the other half will go toward costs incurred for expansion and improvement of existing recycling facilities and for development of the Overton drop-off point for solid waste, officials said.

The bonds will be sold to private investors and do not create an obligation for the state of Nevada.