Small Town News

Supervisors approve $2.1 million loan for closure of county landfill

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Winneshiek County is entering a $2.1 million loan agreement to help cover closure and post-closure costs at the Winneshiek County Landfill.

A consortium of county banks will provide the loan, with Viking State Bank & Trust serving as the "lead bank," according to Winneshiek County Auditor Ben Steines. The beginning interest rate is 3.25 percent for three years.

After June 1, 2012, terms of the loan call for the interest rate to "be adjusted to the announced base rate on corporate loans posted by at least 70 percent of the 10 largest U.S. banks known as the Wall Street Journal US Prime rate," but no more than 4.5 percent.

Based on current volumes and regulations, the landfill has an estimated useful life of about 14 years, according to Winneshiek County Landfill Manager Dave Hageman.

The jurisdictions that use the landfill are already contributing to closure costs through their tipping fees, he said. The landfill serves the counties of Winneshiek, Howard, Clayton and Fillmore, Minn, in addition to the city of Postville.

Currently approximately $4 million is available for closure costs. The anticipated cost to close the landfill is $6.3 million, based on inflation and several other factors, Hageman said.

The Iowa Department of Natural Resources (DNR) requires landfills to show they have adequate finances to pay for closure and post-closure costs, he explained.

Attorney Lee Wilmarth of Decorah, counsel for the Winneshiek County Solid Waste Agency (WC-SWA) that oversees the landfill, advised taking out the loan now to take advantage of low interest rtes.

Hageman said the Agency felt if for some reason the landfill would have to close earlier than anticipated due a change in DNR regulations the Agency should have the funds available to cover the closing costs that include hauling leachate and testing monitoring wells for 30 years.

"It (taking out the loan) gives assurance to the WCSWA the funds are there," Supervisor Les Askel-son, chair of the WCSWA, said.

"If there are different rules and regulations, the landfill many not be able to adhere to them it's a good management decision."

"The whole point is to borrow while interest rates are low," Board of Supervisors Chairman Dean Darling said.

"We've been looking at this ever since interest rates dropped down," Askelson added.

The loan, which is amortized over seven years, will be paid from the tipping fees, Hageman said.

"We want it paid well ahead of closure," he said.

The landfill has already been setting aside $300,000 per year for closure costs and now will set aside an additional $60,000 the first year of the loan to cover interest costs, Hageman said. That interest payment will decrease over the seven-year period of the loan.



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© 2009 The Decorah Journal Decorah, Iowa. All Rights Reserved. This content, including derivations, may not be stored or distributed in any manner, disseminated, published, broadcast, rewritten or reproduced without express, written consent from DAS.

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