Beleaguered by construction delays and a slowdown in the hazardous-waste industry, Union Pacific is deciding whether to sell a subsidiary that operates a controversial waste-disposal facility in Tooele County.
U.S. Pollution Control Inc. has been losing money at its 640-acre Grassy Mountain landfill and incinerator, about 50 miles west of Salt Lake City.Last fall, USPCI complained of losses for the first half of 1993 at the facility. Things have only gotten worse since, said USPCI spokes-man Charlie Roberts.
In Union Pacific's latest report, CEO Drew Lewis said, "The corporation has engaged a management consulting firm to assist in the evaluation of the (USPCI), its strategic options and its prospects."
In other words, USPCI's eight years of being a Union Pacific company may be coming to an end.
The company's troubles aren't isolated. Aptus Inc. and Envirocare of Utah Inc., the other two hazardous-waste disposal companies in Tooele County, also have experienced a downturn in business.
"Last year was lousy. We really took a beating. This year, hopefully, we'll make it up," said Envirocare president Khosrow Semnani, whose company recently won a $23 million Department of Energy contract to remove 20,000 tons of radioactive soils from West Chicago neighborhoods.
Though Envirocare's troubles have been buffered by that contract, USPCI has not been as lucky. Its losses come at a bad time because the company is trying to get a recently constructed hazardous-waste incinerator on line.
The incinerator, which company officials had hoped would be in full commercial operation by now, is reportedly costing the company hundreds of thousands of dollars a month in maintenance expenses.
USPCI wanted to conduct test burns last December but was delayed by technical problems, legal challenges by the Sierra Club and the federal permitting process.
Even if the incinerator were already on line, though, it is doubtful the company could immediately attract enough business to keep it profitable. Aptus, which operates an incinerator half the size of USPCI's, is struggling to find enough business to stay afloat.
"The whole market is down," Semnani said, noting that U.S. Environmental Protection Agency cleanup projects are at a near standstill around the country pending proposed congressional reform of the EPA's "Superfund" law. The law - known officially as the Comprehensive Environmental Response, Compensation and Liability Act - calls for the cleanup of polluted industrial and military sites throughout the country.
"What happened is the Super-fund bill has really put things in a holding pattern," Semnani said.