A federal lawsuit filed April 4 by Progressive Waste Solutions of LA Inc., formerly IESI LA Corp., is the second in less than a month to claim damages resulting from the Lafayette City-Parish Council’s unanimous decision to revoke a permit to construct a waste transfer facility in unincorporated north Lafayette Parish. (IESI officially changed its name to Progressive Waste on Jan. 12 of this year.)
Waste Facilities of Lafayette, the first to file suit March 25, and Progressive Waste Solutions told Lafayette Consolidated Government officials in a recent executive session that claims for both companies’ damages total about $17 million, according to City-Parish Councilman Brandon Shelvin. Shelvin apparently divulged the amount that had been discussed privately to The Advocate for a March 26 story.
The Independent was able to confirm independently that demand letters from the two entities did estimate damages at $17 million. However, neither lawsuit specifies the dollar figure each is seeking to recover.
The suits were filed in federal court because federal courts sometimes hear takings disputes arising from the actions of state and local governments, and at least one lawyer contacted for this story believes the cases will stay in that jurisdiction. That’s significant because, unlike what happens in state courts (which can’t force governments to cough up judgments), it won’t be up to LCG on whether it will pay any potential judgment or how it will pay. The feds can even seize local government property to satisfy monetary judgments — “a hell of a stick for the plaintiff to wield,” says the attorney, who asked not to be identified.
But before the first nickel is paid out, it’s sure to be a long, drawn-out process as settlement talks will likely commence before Waste Facilities and Progressive Waste Solutions attempt to prove their cases in court.
The Advocated reported that in July 2011 Waste Facilities paid almost $400,000 for the property, a 16.38-acre site at 340 Sunbeam Lane that was to be used as a transfer station and waste hauling facility. A month before that purchase, in June of 2011, Waste Facilities and Progressive Waste signed a lease agreement giving Progressive an option to purchase the facility.
Waste Facilities then hired a contractor to prepare the site and construct the facility at a cost of $2.57 million, according to the first suit. Two change orders after construction commenced — one a $774,000 commitment from IESI La Corporation — added another $787,000 to the project.
Waste Facilities was granted its construction permit Sept. 19, but when neighbors who were unaware that the facility had been permitted began complaining, Shelvin introduced an ordinance to block it, in essence revoking Waste Facilities’ permit. Before the council’s vote, however, City-Parish Attorney Mike Hebert issued an urgent warning to council members about the potential repercussions of the ordinance. Hebert said none of the permits or approvals had been issued by mistake or error and that all complied with state and local laws, ordinances and regulations. “If Waste Facilities has acquired a vested property right to its building permit, a withdrawal of that permit would likely be held a ‘taking’ of property obligating LCG to pay compensation to Waste Facilities,” Hebert wrote the council.
At the time, Hebert predicted potential damages could extend into the millions of dollars and might also include relocation costs and economic damages such as loss of profits.
Despite the warning, the council voted unanimously for Shelvin’s ordinance just days before the October election. It became law after City-Parish President Joey Durel refused to sign it.
Waste Facilities is seeking to recover the cost of the property and construction, real estate and leasing commissions, claims by contractors and subs, claims of IESI La Corporation, lost rental proceeds, lost profits, lost opportunities, attorneys fees, court costs, and all expensed associated with investigating its claim. Progressive Waste is similarly asking to recover increased disposal costs, increased transportation costs, loss of income, loss of use, expert witness fees, attorneys’ fees and court costs.
Read more on the controversy and conspiracy theories in this November 2011 story, "Sunbeam Saga."