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Pinellas County hit with a lawsuit over waste-to-energy plant

Published Jul. 23, 2014

CLEARWATER — The company that operates Pinellas County's waste-to-energy plant has filed a lawsuit claiming county staff cheated the firm out of the chance to bid on a new contract.

GCS Energy Recovery of Pinellas Inc. alleges that the county "exhibited substantial bias against GCS, engaged in misrepresentations relating to GCS … and failed to follow the requirements of its own procurement procedure," according to the complaint the county was served with on Tuesday.

GCS wants a judge to force the county to reverse its decision that excluded the company from bidding on the job, which can be worth as much as $35 million a year depending on how much garbage is processed. The company is seeking a judgement in excess of $200 million, claiming county staff breached its current contract by making false and disparaging assertions about the company's financial status and operating performance.

"We are seeking for our performance excellence and cost competitiveness to speak for itself in this critically important process," GCS president Marc McMenamin said in a statement. "Unfortunately, staff has managed the procurement process in a misleading manner as to prevent the full measure of GCS' strengths to be put before the commissioners."

County Attorney Jim Bennett was reviewing the complaint Tuesday and declined to comment.

The plant on 114th Avenue N in St. Petersburg burns garbage to produce steam that powers turbines. Duke Energy buys about 60 megawatts of electricity a year, paying a $3.5 million "capacity" fee each month on top of roughly $12 million annually.

GCS took over the plant in December 2012 after Veolia Environment, a French company, sold its contract. The plant, which is the first of its kind that GCS has operated, was in dire need of repair.

When the production rate dropped early last year, threatening the county's contract with Duke, the county agreed in December to cover GCS' operating costs to help boost the production numbers and reduce the plant's emissions. In return, GCS agreed that its contract, which was set to run through 2024, would end Dec. 31, 2014, and the county would put the operation contract out to bid.

That was a voluntary amendment with the understanding that GCS would also submit a bid, not a "separation agreement," as county officials have claimed, the suit states.

County staff scored GCS a distant last among four companies ranked according to financial strength and experience, among other criteria. The committee agreed that the top two scoring firms should move onto the second phase of the bid process.

The suit claims GCS should have been given points for a joint venture with a Spanish engineering firm called Abeinsa that could provide financial backing and experience. The complaint also notes that production rates have improved since late last year, prompting the county to give bonuses to GCS for hitting benchmarks.

The County Commission voted 6-1 in May to start negotiations with Covanta Projects and Wheelabrator Technologies. Both are international firms with deep experience running similar plants.

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Commissioners said they worried that negotiating with more than the top two companies would open the county to legal action. That was a baseless fear, the suit states, because the request for proposals made no reference to limiting negotiations to only two firms.

Contact Tony Marrero at or (727) 893-8779. Follow @tmarrerotimes.


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