A legislative analyst and state environmental official this past week recommended maintaining the company's state tax and fee structures at their current levels, saying the Tooele County radioactive waste landfill is paying its fair share compared with similar facilities in South Carolina and Washington.
Addressing members of the Hazardous Waste Regulation and Tax Policy Task Force, analyst Bryant Howe and Department of Environmental Quality Deputy Director Bill Sinclair told lawmakers that the tax surcharge levied on Envirocare three years ago has essentially leveled the field for both the state and the company.
"We see no need for a fee increase at this time," Sinclair said. "In fiscal year 2004, we saw significant improvement in our revenues [from Envirocare], enough to meet our appropriations.
"We had a problem, we made some fixes, and as a result, we feel good about it."
Envirocare pays 78 cents per cubic foot of waste in state and local taxes. That's far lower than the rate paid at radioactive waste facilities in Richland, Wash. ($19), and Barnwell, S.C. ($446). But Howe says the taxes and fees Envirocare pays in terms of the radioactivity level of its waste - a measurement called a curie - is much higher than the other two landfills (an average $885 compared with $254 at Richland and $81 at Barnwell).
Sen. Curtis Bramble, R-Provo, the task force co-chairman, also pointed out that both Barnwell and Richland accept the hotter, and higher-taxed, B and C waste. State law limits Envirocare to lower-level Class A waste.
"That drives a lot of this," he said.
But that sentiment was not shared by Envirocare watchdogs, who decried what they call a tax giveaway by the state at the expense of its residents.
"In the past, Envirocare's argument was that this [surcharge] was going to drive them out of business," said Jason Groenwald, director of the Healthy Environment Alliance of Utah (HEAL). "Now they're taking record amounts of waste. Utah has done nothing to deter Envirocare from taking higher volumes of waste. In fact, they're taking more."
The task force made no formal recommendations; those are expected in a report next month from Bramble and his co-chair, Rep. Stephen Urquhart, R-St. George. But questions were raised by task force members regarding the veracity of Envirocare's revenue reporting and the types of waste that still isn't taxed.
Rather than simply going by gross receipts and taking Envirocare at its word, Sen. Greg Bell, R-Fruit Heights, says he would like to see more specifics on the waste levels and types the company reports.
"It would be nice to attach a tax volume to these [revenue streams]; volume by type, tax by type," he said.
Sen. Patrice Arent, D-Holladay, also wondered why some mixed types of waste Envirocare accepts - accounting for up to 10 percent of the company's revenue - remain exempt from tax collections.
"If there was no specific reason to exempt it, then it shouldn't be exempted," she said. "It's a loophole that should be closed."
Envirocare Vice President Tim Barney told legislators that the state's current tax and fee structure is high enough, arguing that the company's tax burden doubled between 2003 and 2004 - in part because the tax has eliminated many of the grandfather clauses that used to shelter different types of waste from taxation.
"There are other facilities we compete with for this material," Barney said.
In a related matter, Sinclair told task force members that DEQ was prepared to act on the recommendations of a recent audit that called for the department to tighten up its oversight of Envirocare.
The task force passed those recommendations, including a revamping of the Division of Radiation Control's split groundwater sampling, raising the maximum violations penalty from $10,000 to $13,000 and implementing a system that makes it "crystal clear" that the highest fee will be charged for radioactive and hazardous waste.
jbaird@sltrib.com
