Senator Bob Smith (R-NH)
Hearing on Interstate Waste and Flow Control
March 18, 1997

Once again, we find ourselves here talking about interstate waste and flow control. Frankly, I am disappointed that we are here today.

Two years ago, Senator Chafee and I worked very hard to put together an interstate waste and flow control bill that attempted to balance the many parties interested in these issues. Despite my strong reservations about the use of flow control, the legislation that Senator Chafee and I introduced, S. 534, attempted to provide a narrow grandfather of flow control authority to municipalities that had relied on this power to fund waste-to-energy and landfill disposal facilities. During the full Committee markup, we broadened this grandfather authority to accommodate individual member concerns, and similarly did 50 on the Senate floor. Our bill contained interstate waste provisions that not only capped waste exports, but would have ratcheted these exports down over a series of years. We did not accept all the changes sought by members, but I believe that Senator Chafee and I bent over backward to be accommodating. Although the final bill passed the Senate by a vote of 94-6, the House of Representatives took a more free market approach to these issues, and S. 534 languished in the other body for the remainder of the Congress.

To be honest, I believe that the legislation that passed the Senate had significant flaws, particularly in regards to flow control, and perhaps the House was right after all. However, at the time, I felt it was important to quickly address these issues, and it had been my hope that a Conference with our House counterparts would have resulted in a streamlined solution to these problems. Nevertheless, this did not happen. Today, one of my primary concerns is that the rationale for passing this type of legislation has not gotten any better, and in the case of flow control, it has gotten worse. I really question whether it makes any sense to spend any time on these issues here in the Senate, until we have better assurances that the House will be willing to move on these matters.

I would like to make a few specific comments about the two issues we are here today to discuss. The first is the issue of flow control. This is an issue where some groups took a "sky-is-falling" approach. During the last Congress, we had witnesses who testified that we had to act "immediately" to protect municipalities from having to default on bonds they had issued to fund their waste-to-energy facilities, landfill construction and recycling efforts. Now we are here two years later, and, surprise, surprise, the sky has not fallen. While only about 18 downgrades have taken place nationwide -- almost all in 1995-- widespread municipal defaults did not occur. As we can see from the written testimony of Standard and Poors, these bonds have remained stable because municipalities have reacted in a fiscally prudent manner: they have instituted competitive tipping fees, cut their overhead costs, and sought alternative streams of revenue. That is the way the free market should work, and that is the way it has worked. Yet, despite these facts, we will again have witnesses today who will claim that we have to act quickly to protect these bonds.

Frankly, the supporters of flow control have a much tougher case to prove this year. Last Congress, I supported grandfathering a limited number of flow control facilities because I was influenced by the testimony of a number of local governments. Despite our good intentions, lobbyists who supported flow control were not satisfied with our common sense provisions, and worked hard to organize a number of harmful amendments to widen the limited grandfather that we had in S. 534. This effort not only created a number of significant flaws in our legislation, but I believe it also contributed to the ultimate demise of that bill. It is because of this experience, that I am wary of efforts to provide any grandfathering authority whatsoever.

The second issue I want to talk about is the interstate transportation of solid waste. Not only do I believe this issue can be discussed separately from flow control, but I think this issue is not so clear cut. For more than ten years this committee has heard dozens of witnesses who have testified that this was a significant national problem, that landfills were filling up faster than we could replace them, and that if we did not act immediately, we would have a national garbage crisis on our hands.

In response to these pleas, this committee considered and reported a number of bills, including S. 534, that would attempt to tackle this issue. Now we are back here with two year's worth of additional data. As I reviewed the information from around the country, it became obvious to me that some folks may have overstated their case a few years ago when they said we needed to act quickly. While solid waste is still being transported in interstate commerce, many states are both importing as well as exporting garbage. Landfill space is not the scarce commodity it was presented to be and tipping fees are falling.

Nonetheless, on the horizon we see the closing of the Fresh Kills landfill that could change the equation, perhaps significantly. Attempts to control the interstate transportation of solid waste also raises the dilemma over what is the most appropriate level of government to place control over these issues. Should it be at the State level, or should local communities be empowered to determine whether they want to have solid waste facilities within their borders? I look forward to hearing the testimony of our New York witnesses, and I hope they will be able to give us some insight into how they are going to deal with the more than four million tons of solid waste generated annually in the city. In addition, I hope all of the witnesses will share their views regarding who should have the ultimate control over where solid waste materials are placed.

I want to thank the witnesses for coming today and I look forward to your testimony.