A glimpse into the history of the Bay County Incinerator

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BAY COUNTY, Fla. (WMBB) — When the Bay County Incinerator finally came to life in 1986 it was called, “the wave of the future.”

In March of 1986, shortly after being built, the incinerator was sold to Ford Motor Credit Corp. for $50.2 million with a plan to lease it back to the County. 

In addition to the incinerator being built, Steelfiield Landfill was also constructed as an ash disposal facility for the Waste-to-energy (WTE) source. 

According to media reports, the county borrowed $60 million to fund the project in 1984 — today, 36 years later, they are still $7.5 million in debt with plans to pay it off in 2023. 

In 1998, John Hutt Jr., who was a commissioner from 1980-1988 said, “Bay County never realized at the time what a good deal was. The incinerator would have cost three times that much if we built it today.” Hutt also called it a “slam dunk.” 

Problems with the Bay County Incinerator began early on — one of them being how costly it was to operate and maintain. This lead Bay County to sign a contract with the Florida Power Company. The year it opened, they agreed to sell the power that the plant would produce.  

Bay County would receive payments for not only the power generated but for the “Capacity payment.” Capacity payment meant that Bay County would get extra money to offset improvements that Florida Power would have had to make if they were generating that power themselves.

ONE MAJOR PROBLEM

But when the incinerator finally opened it faced one major problem — there wasn’t enough local trash to maintain its contract with Florida Power and Light. This was an issue for the county as their contract was treated as a loan. 

The county was faced with no choice but to generate that power for Florida Power and Light. They resolved the situation by paying $1 million a year to bring in wood chips from local lumber companies and land developers to generate enough energy to keep the contract in place. It wasn’t until May of 1990 that the wood chips were finally phased out. 

Even after the county stopped paying for wood chips, Bay County still did not have enough funding to cover the daily operation of the plant. Therefore, a 1/2 cent sales tax was approved by voters in 1991. 

The tax was approved, but not to be used for operational costs — it could only be utilized for county investments. This lead the county to raise tipping fees to $25. 

In 1998, Westinghouse was purchased by CBS. The ownership of the waste-to-energy plant was also transferred from Ford Moter to Bank America. This caused a problem for Bay County because, according to their records, CBS wanted nothing to do with waste management and Bank America had no desire to take over the facility. 

Additionally, that same year, strict environmental controls were being placed on all waste-to-energy facilities. Because the Bay County Incinerator was over the allowed amount of 500 tons per day, (by 10 tons) they decided to de-rate the facility instead of paying the added expense. 

This led to Bay County buying the facility back for $57.4 million. 

According to media reports, the ever-changing prospect of raising tipping fees versus levying new taxes was a concern for residents. 

“The reason we have even studied (taking our garbage elsewhere) was not the current $31-per-ton tipping fee, but the county’s projection that they have delivered to us that has an annual increase (in the tipping fee) for the next six-year,” said Ken Hammons, Panama City’s city manager to media in 2004.

City officials said the tipping fee was raised to $35-per-ton in 2005. 

A SERIES OF BAD DECISIONS

Commissioner George Gainer told the media in 2004, “The incinerator has just been a series of bad decisions.” 

In 2007, a new agreement was signed with Engen LLC. who still operate the facility today. Additionally, an agreement was also signed with Gulf Power. 

The Gulf Power agreement from 2008-2012 was for $72.5 megawatt-hour and then from 2012-2014 for $75 megawatt-hour. 

However, a problem occurred in 2008 — a fire. According to media reports, a fire erupted in the tipping room floor on the morning of Friday, June 12, and wasn’t put out until 5 a.m. on Saturday, June 13. 

City officials said the fire caused $42.6 million in damage. 

In 2012, another fire occurred at the plant that caused it to close down for a while and caused over $52 million in damage. 

Joe Tannehill Jr., owner and managing director of ENGEN in 2012 told media, “To have two big (fires), I certainly don’t say, ‘Oh. we’ve had bad luck,’ ’’ he said. “We have to look at our procedures and how we react when (fires) do happen. .. We don’t think we are deficient in our procedures, but no stone will be left unturned.”

In 2018, tipping fees went up to $53.47-per-ton. 

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