City of Melville Minutes – SMRC RRRC WCF Odour Issue – -25 November 2009
8. GENERAL BUSINESS
8.8 Mr R Petterson, Leeming
Q8.8.1 Does the City of Melville have an exit strategy from the SMRC?
Response Chief Executive Officer
A8.8.1 I suppose the first point is that the SMRC are, under the Act, a body in their own right and a Council and the appropriate place for these questions is at the AGM of the SMRC not the City of Melville Council as we are not the governing body of the SMRC, we are a participant. There has been a State Government policy that requires the diversion of waste to landfill to cease by 2020. Some years ago, the City of Melville honoured the policy and undertook work in a field that is fairly new and some of the issues that have occurred are in relation to new technology being implemented. It is well known that there will be permissible odour units that will come from the site. It is a matter of the level of odour units and whether it is sustained and deemed appropriate. The City is not the licensing body, the Department of the Environment is the licensing body and that is within their domain to determine whether the level of odour is compliant. I might also add that you talk about an exit strategy and of course we always explore all lines. There have been quite comprehensive and detailed discussions with the Department of Health, Department of Environment and SMRC in an open forum here of which many aspects were explored to try and understand the rigour associated with the systems and processes in place. One of them is a business case that suggests that although the City of Melville residents currently pay a premium of around $100 a year ($2 a week) to recycle their waste, between 2012 and 2014, if the business case is correct it will actually be cheaper than putting waste to landfill so at the end of the day the City has in good faith, invested in technology to try and address climate
change and also has the belief that in the longer term this may be cheaper for the residents of the City of Melville albeit in the short term that there is a cost increase, but some of the detailed questions you ask would be better placed at the AGM of the SMRC.
Q8.8.2 Mr Petterson referred to a loan commitment to the SMRC. Given the fact the SMRC have been espousing these things now as a
$100million asset, what would be the impact on the City of Melville given the percentage of interest the City of Melville has in this particular establishment and how will that affect the rates?
A8.8.2 As part of the establishment agreement there are very clear provisions for if and when one of the parties choose to exit that they include the ongoing liability as you have mentioned, for the City of Canning to repay their proportion of the debt. It also provides that a business case will be prepared and funded by the exiting participant and that process is now underway. That has been over sighted by the officers, myself included and financial and technical officers of the various Councils and that a business case is being prepared by an independent firm of chartered accounts.
Response Cr Robartson
A8.8.2 Just a minor point, the requirement to withdraw from the SMRC is a full financial year as against 12 months, but you have to remain in the organisation for a full financial year. Many people here either have or have had a mortgage, we all know that sooner or later we have to pay it back. If you sell your house of course it may be taken off. On some rare occasions you might be able to extend it and continue to pay it. The withdrawal of any Council from the SMRC is very clear in the contract that they have to fulfill the commitment of the mortgage and I am sure you understand that. So Canning have to continue either to pay out the $14million, or they continue to pay it over the period of the mortgage for the remaining time. I think your question is directed then what will the impact be on the City of Melville. The City will continue with its mortgage commitments the same as the other four members and the SMRC will be looking at how they can pick up the spare capacity that will be there to get a return on the facility to meet those costs and we believe that that will be possible and we are carrying out a business case. I might add that I have the business case we looked at in 2000 which very clearly tells all the Councils what their commitment were to be.
Q8.8.3 What is the impact on the City of Melville if the City of Canning says where is our $28million for our 28% stake of the $100million asset that now we currently own?
Response Director Corporate Services
A8.8.3 That’s the purpose of the revised business plan and that will determine that question.
Q8.8.4 Mr Petterson referred to the reallocation of fees should the City of Canning not deposit waste with the SMRC. That 28%, their contribution, is not being received. Does that then get distributed proportionally speaking to each of the other Councils that remain?
Response Chief Executive Officer
A8.8.4 It would unless they found another person to come in and consume the space that they have now made available and there are others interested in the facility.
Q8.8.5 Are the City of Melville gate fees currently with the SMRC $154 per tonne? This gate fee doesn’t take into account the outstanding loan the City of Melville has as a component of the SMRC so to try and put this into some perspective, given the fact that the City of Melville is paying $154 per tonne what would that true gate fee be if you considered the loan repayment each year?
Mr Petterson was granted a 2 minute extension to his question time.
Q8.8.6 What was the original SRMC debt and how much have they repaid? Taken on Notice
Q8.8.7 Does the City of Melville believe the SMRC is emitting an odour, has the City of Melville formed a view of how many people need to be affected before it actually causes an issue? Does the City of Melville believe how relevant it is?
Response Director Corporate Services
A8.8.5 Mr Mayor I have some figures in our 2009/2010 budget as to how the domestic waste fee of $345 is structured and I think in that figure there will be some of the detail requested. The gate fee disposal cost for 32,500 tonnes is $130 per domestic refuse service. The loan repayment to the SMRC which is $1.655million budget per year represents $43 per domestic refuse service,
materials recovery facility of some 12,000 tonnes of recycling is $36 dollars, the green waste of which there are some 6,500 tonnes is $15 dollars. Other SMRC costs in relation to R & D and administration is $7 per household collection and the waste collection costs for 3,032,400 collections per annum is $115. The total domestic waste cost per domestic collection is $345.
Response Chief Executive Officer
A8.8.7 We recognise the fact that the Department of Environment (DEC) is the licensing body that determines odour issues. We are aware that there has been an issue and that there have been notices issued and that the SMRC are rectifying those issues. We are not the body that is responsible for monitoring, that is the DEC.
Q8.8.8 Was the City of Melville aware that in 1999 they made a promise to the community there would be no odours affecting them whatsoever? Taken on Notice
Q8.8.9 Was the City of Melville aware that in 2006 the City of Canning and Town of East Fremantle, to give you an indication of why we don’t trust them, requested an independent review of the SMRC? The successful tenderer was Quadro. The Directors of Quadro were Paul Oakes and Wayne van Hermick who were both ex employees of the Bedminster Company that built this thing. How can this possibly be an independent review with the ex Directors of the company that built it?
Taken on Notice
Mr Petterson was granted a 3 minutes extension to his question time.
Q8.8.10 The SMRC proposes this financial year alone to spend $6.4million on enhancements and maintenance. They are spending $1.1million dollars on moving a gate and a weighbridge that they built on a gazetted road. They are spending $750,000 on odour monitoring, an increase in electricity charges of $300,000. It equates to about $8.5million. Given the plant is only 6 years old that appears to be an excessive amount of money?
Response Chief Executive Officer
A8.8.10 We will challenge that in the appropriate places if the SMRC are made to shift the gate. Yes it will cost an additional $1million to shift it but the SMRC had permission to place it there by Canning originally from their planning approvals. Now Canning are taking a different avenue and they have their own strategy in place. The SMRC will deal with that on a case by case basis as it comes forward.
Q8.8.11 Mr Petterson referred to a consultative environment review in 1999 on the SMRC facility.
Is this the alarm system that was supposed to go in 1999? Why was it not put in then if it was a critical piece of machinery?
Taken on Notice
Q8.8.12 Mr Petterson referred to an advertising campaign.
Given the fact that all member councils are contracted to them how much money was spent on that campaign and what was the reason behind it? Response Chief Executive Officer
A8.8.12 The detail of that would be better obtained from the SMRC. We are aware of the advertising campaign.
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8.14 Mr R Petterson – Leeming
Q8.14.1 Can the Council tell us prior to the introduction of the waste composting facility at the SMRC how many odour complaints of waste type smell have been received if its not the SMRC?
Response His Worship the Mayor
A8.14.1 It would be a very difficult question to answer. Prior to the opening we had the old tip site and there was an expectation that there would be odours from the tip site and we did have a number of complaints about the smells from the tip site.
Q8.14.2 Were the City of Melville aware prior to me building in Melville at Leeming, I wrote to the City of Melville and still have a copy of the letter dated 1992 that indicated within 12 months that Leeming tip site would be closed and turned into a Golf Course?
Response His Worship the Mayor
A8.14.2 I know from my own experience at the time when I was looking to buy a block in that area I contacted the City and asked them what were the plans for the area, was there going to be a Golf Course on the site. I was told there was no Council resolution in that direction but it was a proposal.
Q8.14.3 You have challenged the smell coming from the SMRC last night. Can you tell me what time the odour logs were received and if you are saying it couldn’t be there because of the wind conditions? What were the SMRC timeframes looked at when they judged the wind? In other words did they base it on the Jandakot readings at 7.00pm and the odour logs came in about 9.30pm?
Response Chief Executive Officer
A8.14.3 Mr Petterson I understand your frustration and I understand that this is a significant issue for yourself and others in the area. What we need to do is to sit back and understand each role that we play in it. We are not the licensing body we are not the body that determines the odours. The point I am trying to make Mr Petterson is, you know you are in the wrong forum. I don’t know why you want to push it this way. I am more than happy to give you access to Council to put your case and your information forward. You know that the proper place for the questions you are raising is at the AGM or the Council meeting processes of the SMRC
which is a Council in its own right under the Act and my ability to manage them is fairly limited on the basis that we are a participant in the SMRC and there are certain processes in place of what we can do. We do undertake our due diligence, you know that we do, We have been involved with the Health Department and the Department of the Environment. The Mayor and I have been in there personally to try and resolve some of the issues to move forward, but the questions you ask are rightfully placed before that Council. If you want us to have information then I can make that opportunity available to you.
Q8.14.4 The CEO raised the issue that I am asking the City of Melville how they became aware of the information they got? Response Chief Executive Officer
A8.14.4 I am aware of it because there were a number of odour complaints that come through and I am on the email list. I am aware of the response from the SMRC CEO and I believe Cr Robartson was on site around the time but I would leave that up to Cr Robartson to respond.
Response Cr Robartson
A8.14.4 I had a meeting here last night and had a call from my wife a bit after 9.00pm that a resident from your way had rang my home saying that the odour was very bad in Leeming. As soon as I could get away, I left and I got to the site at about 9.45pm. I drove along Gracechurch up McGuinnes and around Merrifield. I could smell a low level odour. It was an odour I have not smelled before and I would be interested in your comment because I later drove near your way. It had an acrid smokey smell about it, I have not struck it before. I went around to the plant where I met Stuart McAll who also came down. We walked up Bannister Road for 100 metres and there was absolutely no odour coming from the plant. Rod, you and I have had discussions and I think we have been very frank with each other. I would be interested if you could tell me if you distinguished an odour last night and what it was like last night. The DEC have suggested it wasn’t coming from the plant. I don’t know if they came out and had a look but they were notified. I am absolutely convinced that the odour last night at that time was not coming from the plant. I don’t know about the statistics in
terms of the wind and so forth. I guess they are being analysed now and presumably the DEC will do that. I am convinced it was not our odour last night. Now I just wonder how many occasions this does happen that we get blamed for odours that are not ours?
Q8.14.5 Mr Petterson referred to odour movement. Is the City of Melville aware that in late September Cr Robartson and I stood on the side of Beasley Road after I detected the odour there?
Response His Worship the Mayor
A8.14.5 I think we are aware of that Mr Petterson and I have been there with you myself and tried to chase this odour around the suburbs and we couldn’t catch it.
Q8.14.6 Was the City of Melville aware that the Mayor was gracious enough to come out one day when I phoned him and asked him to come down Beasley Road because that was where the odour was at the time?
Response His Worship the Mayor
A8.14.6 I went straight to the source Mr Petterson and you were there at the same time when I got there and there was no smell.
Q8.14.7 Was the City of Melvlle aware that back in July 2009 I had a meeting with the CEO, Mr Tieleman, Mr Christie and Cr Subramaniam where the CEO also expressed concerns regarding the financial aspects of the SMRC and was looking at a business case being prepared? Has that business case been prepared regarding the costings and could I get the results please?
Response Chief Executive Officer
A8.14.7 The business case has been requested and it is in play.
His Worship the Mayor thanked everyone for their attendance and invited Electors to enjoy refreshments with Councillors and Staff. His Worship the Mayor wished everyone a Merry Christmas and a Happy and Safe New Year.
