Ark Valley News - Large recycling firm eyes Park City

Large recycling firm eyes Park City
By Matt Heilman
Last Updated: February 16, 2012

A large metal recycling company is interested in moving an operation to Park City, but a final decision may hinge on whether it can come up with about $500,000 to have a railroad spur built off a Burlington Northern Santa Fe rail line.

The company, Midwest Scrap Management Inc. based in St. Joseph, Mo., has a plant in Kansas City where everyday scrap metal is broken down into raw materials and shipped to steel mills.

Something similar is planned in Park City just west of I-135 and south of 49th North. Midwest Scrap account executive Nick Hayes said materials, including appliances and vehicles, would be brought to the 80-acre site via truck and the raw material would be shipped out by rail car. The Park City Planning Commission approved Midwest Scrap's plans after concluding that the site shouldn't pose any problems for nearby residents who live less than two blocks from the property. Midwest Scrap isn't seeking industrial revenue bonds from the city to fund the $30 million project, but the city's assistance is needed to help secure the proposed rail spur.

At its Feb. 14 meeting, the council approved submitting a grant application to the Kansas Department of Transportation to pay for the spur. By rule, the city has to submit for the grant instead of the business that needs the spur.

In applying for the grant, Park City has to match 30 percent of the approximate $500,000 cost for the spur, but the matching funds will be paid by Midwest Scrap.

Park City Administrator Jack Whitson said he wasn't sure whether the company would still be interested in moving to Park City if it is unable to secure the grant to pay for the rail spur.

The city's grant submittal was approved 6-1 with council member Keith Thomas opposed.

Thomas said he didn't have a problem with Midwest Scrap, but he didn't like the idea of the city assisting a large business that could create an unequal playing field for smaller metal recycling companies that are already in Park City.

Whitson said several scrap yards do business with Midwest Scrap, but Thomas still wasn't comfortable with the perceived advantage that the company would have over the smaller businesses.

A resident of Primrose Circle, which lies just north of the facility, accused the Park City council of “operating in the dark" and wondered why he hadn't had a chance to voice some of his concerns with the project.

The resident wasn't aware of what the operation would entail and he was concerned with the potential noise level associated with rail cars and heavy machinery.

Hayes said the operation would shut down by 7 p.m. each day and there would be no overnight rail traffic disturbing residents or a noise level beyond what could be heard from the interstate.

A screening buffer is also planned that would further separate Midwest Scrap's operation from Primrose Circle residents, Whitson said.

Council member Tom Jones, who lives on Primrose, said Midwest Scrap has a clean operation that wouldn't negatively impact residents.

If Midwest Scrap is able to secure the rail spur and decides to move to Park City, Whitson said the city would benefit. Hayes said the company would pay about $1 million per year in electricity. Five percent of that utility charge would go to Park City as a franchise fee, meaning the city could bring in $50,000 per year just from the metal recycler's electric bills, Whitson said.

The key component to Midwest Scrap's operation is a large electric-powered shredder. The shredder is capable of shredding three cars, with all of their parts intact, in eight seconds, Hayes said.

Hayes said the plans for Park City would bring about 50 jobs, including manual and skilled labor.