TBO.com - TBO is Tampa Bay Online

Highlands Today

County To Begin Asphalt Production

ADVERTISEMENT

By Jim  Konkoly | Highlands Today

Published: September 19, 2007

Highlands County government is going into the asphalt production and paving business.
In a 3-2 vote Tuesday, county commissioners decided to build the first government owned and operated asphalt plant in Florida.

Commissioners Guy Maxcy, Edgar Stokes and Andy Jackson voted to borrow $3.3 million to build the plant at the county landfill. All three cited the need to maintain roads better, and the estimate of $700,000 savings per year on current road resurfacing costs made by county Solid Waste Director Ken Wheeler.

Opposition to the county plant came from the asphalt industry, both local and statewide, in claims that Wheeler's cost estimate is way off base and questions about a local government's proper role.

Commissioners Barbara Stewart and Don Bates voted against the asphalt plant, citing doubts about the projected cost savings and opposition to the county taking over a traditional role of private enterprise.

Taking business away from the private sector doesn't make sense, Stewart argued, when "we spend a lot of money trying to get companies (to locate) here."

Maxcy and Stokes said the county can't keep up with road maintenance now and must cut costs to do more. Failure to do so, they said, will eventually lead to horrible road conditions.

"There's a cliff coming, folks, and I'm not sure when it will be," Maxcy said about the county now resurfacing half as many miles of roads as it should. If road resurfacing can't be increased, he said, "we're going to be faced with major problems in this county."

Stokes noted the county has about 1,200 miles of paved roads to maintain.

"We're in a 40-year cycle now," Stokes said about the county's road resurfacing schedule. "We should be in a 20- or 25-year cycle."

Asphalt industry spokesmen disputed Wheeler's cost-saving calculations.

"We maintain to this day that Mr. Wheeler's cost figures are flawed, they are too low," said John Skidmore, president of the Central Florida division of APAC Southeast, an asphalt paver with a plant in Avon Park.

Jim Warren, executive director of the Asphalt Contractors Association of Florida, traveled here from Tallahassee to warn commissioners that while some government operated asphalt plants have worked in other states, others – in Pennsylvania, Kentucky, Mississippi and Delaware – have failed miserably.
"I think the citizens of this county are going to be stuck with a really bad deal," he said. He said he was "disappointed" by the commissions decision.

Wheeler said his study, backed up by the consulting firm of PBS&J, shows the county can produce and lay asphalt down on roads for $67.35 per ton – a savings of $22.65 per ton over the county's current contract price.
Based on producing 31,000 tons a year – for Sebring, Avon Park and Lake Placid as well as the county – that comes out to a savings of just over $700,000 per year. Wheeler called his cost-saving projections more than realistic.

"We believe we can do better," he said. "The numbers we are showing you are very conservative," he told commissioners.

Skidmore said his company's costs to produce and install asphalt, at no profit at all, come out to $86 per ton, which was the company's bid price on a new one-year paving contract with the county.

APAC bid a no-profit price, he said, "because we knew we had to be as low as possible to make our case" against the county building its own plant. He said the county's price advantages, mainly from not paying certain taxes, amount to about $7 per ton. Based on his analysis, the county couldn't produce asphalt and pave for less than $79 per ton.

Sebring attorney Jim Lobozzo, representing the state asphalt contractors association, said the main question is government's proper role.

"Is it the business of government to be in the asphalt business?" he asked rhetorically, adding that a county plant would take away jobs "directly and indirectly."

Skidmore raised the same argument, saying that local governments are offering businesses "all kinds of incentives" to come here and provide jobs.

"And this county," he added, "is talking about spending tax dollars to run private enterprise out of town."

Commissioner Jackson said he saw merit in arguments against the county plant, but was swayed by two factors: the need to better maintain roads and the lack of top-notch competition between paving companies for the county's business.

"I'm pretty much a free enterprise guy and not much for expanding government," Jackson said. But while the county plant has "some risks and unknowns," he said, "on balance it's the way to go."

Commissioners expect the asphalt plant to be up and running in about a year. In the meantime, the county paving contract for fiscal 1007-08 was awarded Tuesday to Better Roads, at a price of $91 per ton for the "virgin asphalt" mix. APAC's bid, at $5 less per ton, was rejected because it was good for only six months.

Share this:

Loading Comments...

Email Print

ADVERTISEMENT