Asphalt plant earns glowing report
Gary Pinnell | Highlands TodaySEBRING Two years ago, Highlands County commissioners were dismayed with the asphalt plant they purchased in September 2007.
Published: December 11, 2012
Published: December 11, 2012
"It looks like we lost about $1.2 million. Is that right?" then Commission Chairman Don Bates asked after going over the January 2010 audit. The clerk of court's 41-page audit confirmed a negative cash balance of $1.15 million.
"If I were running a business like that, I'd close it down," said then-Commissioner Jeff Carlson, who added that the plant was being run inefficiently and incompetently.
Then-Commissioner Barbara Stewart wanted the county to walk away. That didn't happen because a majority of the board supported the plant, and on Nov. 21, the clerk issued a follow-up report: in the past two fiscal years, the plant has produced 59,000 tons of asphalt for $4.7 million in revenues and a cash balance of $538,848.
Road and Bridge Supervisor Kyle Green said governments can't call that a profit, but he glowed from what he considered a positive report.
"We are able to resurface more miles of road because we have an asphalt plant," Green said. Now, the plant sells to the Sebring, Lake Placid, Spring Lake and Sun N' Lake governments.
"Since the initial audit, the county has taken a proactive continuous improvement approach for the costing of asphalt produced," the Nov. 21 audit said. "Cost fluctuations in both asphalt cement and aggregate could have negatively impacted the county's ability to purchase asphalt materials and produced asphalt for the coming year. Management's costing improvements and the ability to necessary changes quickly saved significant funds."
When then-Solid Waste Director Ken Wheeler sold – critics say oversold – the commissioners on an asphalt plant in 2007, his idea was to fire the plant with methane gas, which emanates from rotting garbage. However, it turned out that methane is too corrosive, so a $1.6 million-dollar scrubber was needed.
Now the plant uses both methane and diesel to produce asphalt, so the average gallons of diesel per ton of asphalt has dropped from $2.46 to $2.10, and the average cost of diesel per ton has lowered from $6.66 to $5.68.
For FY 2009-10 and FY 2010-11, this translated into an estimated cost savings of $71,000, the clerk's report said. The plant also is using more recycled asphalt and saved $271,000, and recycled asphalt shingles and saved $172,000. Recycled concrete instead of limestone or granite has saved another $4,000, for a $446,000 total.
The 2010 report noted 12 negative findings and six opportunities for improvement. The 2012 follow-up audit found improvement in all 18 areas, since operations have been transferred from solid waste the road and bridge department.
The asphalt plant still isn't totally in compliance with the clerk's audit, Green said, but he believes it substantially complies.
In five years, Green said, the plant will have paid off a loan from the landfill. "November 2017, if not before."
And at that point, he thinks, the plant will not be worn out. He's been setting aside $2 per ton for major repairs, but he doesn't think they will be needed for 10 years.
Two years ago, at least three commissioners called the plant a liability.
Today? "I say it's an asset," Green said. "Of course, that's still up for discussion. It's been a huge learning experience."
"It solves some major issues," said Jack Richie, who replaced Bates on the board. "There are no new problems, and there are only a couple of minor problems."
"Should we keep it?" Richie said. "That's a question we are still analyzing. But what are our options? But I'm extremely happy with the report. It's indicative of the great management out there. This report proves it can happen the right way."
"If I had been on the board I wouldn't have voted for it," said Brooks, who replaced Stewart. "But now that we've got it, we've got to make the best of it."
firstname.lastname@example.org (863) 386-5828