Bill before Senate would restore much local control of waste flow.

WASHINGTON - Flow control legislation faced numerous ways to be considered and an uncertain fate on the Senate floor as of Friday, the day after the House approved a bill favored by municipal interests.

The House late on Thursday passed by voice vote a bill approved by the House Energy and Commerce Committee after defeating on a 166-to-244 vote an amendment opposed by municipalities.

The bill restores to state and local governments much of the authority to dictate where garbage is sent for disposal that was lost after a Supreme Court ruling last May struck down flow control laws.

The measure does not grant carte blanche, but instead requires municipalities to set up a competitive process for designating facilities to receive locally generated residential solid waste. That means a town facility would not necessarily win the designation.

The bill also grandfathers flow control authority that was in place as of May 15, 1994, including laws, contracts, and solid waste management plans. Billions of dollars of outstanding municipal bonds were issued by local governments to finance facilities as part of comprehensive waste plans, according to the Public Securities Assocation.

Rep. Bill Richardson, D-N.M., whose amendment was defeated, wanted to adopt a narrow grandfather provision to protect laws and contracts, but not plans, that were in place as of May 15.

The Richardson language did not go far enough to protect the outstanding bond financing that relies on flow control to guarantee revenue from the waste stream to back the bonds, according to Micah Green, executive vice president of PSA, which suppors the House bill.

In the Senate, Sen. Frank Lautenberg, D-N.J., and Sen. Dave Durenberger, R-Minn., and Senate Majority Leader George Mitchell were expected to try to act on the House bill without considering a separate Senate measure first. But opposition was expected to come from Texas Republicans Phil Gramm and Kay Bailey Hutchison and others who believe market forces, not flow control, should determine where haulers deliver trash for disposal.

Lautenberg originally intended to offer a bill he sponsored that is similar to the House measure as an amendment to a separate interstate waste bill, which gives states authority to control shipments of out-of-state waste into their borders.

In a letter to Mitchell last Thursday, PSA's Green said the legislation is essential because the Supreme Court's ruling "raised serious questions about the credit standing of billions of dollars in outstanding municipal bonds ... [and] stopped all pending flow control bond transactions."

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