L.A. Armed for Award of Rich Pact on Trash Plant

The decision Monday was low-key and non-binding and sounded like another bit of Los Angeles City Hall routine.

Senior city department officials were recommending that Ogden-Martin Corp. of New Jersey be hired to build a city trash-burning plant.

In fact, however, the recommendation was the final step in a grueling process intended to insulate the richest city contract in years from the political byplay that colors many City Council decisions.

Financial Data

The three-month analysis by outside consultants and a committee of analysts in the Department of Public Works and the City Administrative Office sorts through a barrage of conflicting financial data and corporate posturing before recommending Ogden-Martin, which is building trash-burning plants in half a dozen cities.

As a result, when the members of the City Council sit down later this spring to award the contract on the $235-million plant, they will come armed with a volume of independent data to compare to the entreaties of lobbyists, who are already swarming in and out of council offices.

The staff report, which is advisory to the City Council, concludes that Ogden Martin’s proposal would cost the city $74 million less than the plan submitted by Signal Environmental Systems, the other bidder. Ogden Martin also offered better financial guarantees in case the plant should fail during the 20-year contract, the report concludes.

Sanitation officials say the plant will burn 1,600 tons of household trash a day to reduce the demand on city landfill dumps and generate electricity. The plant, called the Los Angeles City Energy Recovery (Lancer) project, is to be located in a residential and industrial area on Alameda Avenue in South-Central Los Angeles.

The staff recommendation in favor of Ogden Martin was released after an unusual last-ditch tactic backfired on Signal Environmental Systems of Hampton, N.H., the nation’s largest operator of such refuse-to-energy plants.

Suspecting correctly that an unfavorable recommendation was about to be announced three weeks ago, Signal president Alfred B. DelBello launched a preemptive attack on city officials. He accused them of giving an unfair competitive edge to Ogden-Martin by leaking the documents that Signal filed with the city, saying in an interview that “(Mayor) Tom Bradley would be very upset if he knew what was going on in his city.”

In that same Feb. 25 interview with The Times, DelBello denied that his firm had obtained any documents Ogden-Martin had filed with the city.

Became Suspicious

City officials agreed, reluctantly, to delay the schedule and reopen negotiations with both firms. However, they became suspicious and, after the city probed further, Signal admitted last week that it had obtained a copy of rival Ogden-Martin’s private filings as early as last November. Los Angeles officials then canceled plans to let Signal resubmit its bid.

City officials said as far as they could determine, although the companies had each other’s bid information, neither tried to change its original proposal until the DelBello maneuver in late February. The officials said the companies probably obtained the rival bid proposals from dozens of copies circulated by the city to consultants in the refuse-to-energy field. Such leaks are common and are not considered disruptive of the competitive bidding process, the city officials said.

Denial Made

DelBello, the former lieutenant governor of New York, said he was not being misleading in February, when he denied having any of the competition’s documents.

“At that time, I’m sure I didn’t know we had their business filings,” he said Monday.

He continued to contend, however, that Ogden-Martin held an unfair advantage and promised to press Signal’s case when the staff recommendation released Monday enters the political arena at the City Council.

First stop in the council is the Public Works Committee headed by Councilman Gilbert Lindsay. A hearing date has not been set, but lobbying is expected to intensify immediately as Signal attempts to line up the support it would need to overcome the negative recommendation issued Monday.

Recent Weeks

Pressure on the council has heightened in recent weeks, and the lobbying even extended to Washington, where 10 council members attended a National League of Cities conference a week ago.

Councilman Zev Yaroslavsky said he and Councilman Michael Woo, a member of the Public Works Committee, drove with Los Angeles lobbyist Joseph Cerrell, who represents Signal, to visit a Signal facility plant in nearby Baltimore. The wife of Councilman Howard Finn also accompanied them.

Yaroslavsky said the plant was not as large as he expected.

“But I think you’ve got to insulate these things from residential communities,” he said.