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The saga of NABORS landfill in Baxter County, Arkansas continues.
The Ozark Mountain Solid Waste District Board of Directors are holding a meeting this afternoon at 1 p.m. at Harrison City Hall.
This meeting agenda will consider a request for the board to issue a request from the Arkansas Division of Environmental Quality to sign off on a division closure certificate for NABORS landfill. If division closure is issued, the permit for the landfill will be closed. Currently, the permit status has remained open since the engineered construction closure. This allows for the possibility of transfer of the open permit to a buyer.
Permanent construction closure was completed by the ADEQ in January 2020. The landfill closure was ordered by ADEQ due to the danger to public health and the environment. ADEQ normally issues a division closure following permanent construction closure as required by ADEQ Rule 22.
The meeting is open to the public.
The upcoming OMSWD request marks the third attempt to get ADEQ to issue its division closure. Earlier in July, Mountain Home Mayor Hillrey Adams requested that Mountain Home City Council ask ADEQ to issue the certificate of closure following his first failed attempt to get the OMSWD to make the request on behalf of the public.
Adams is currently a sitting member of the OMSWD board.
Adams’ quest to ensure that NABORS landfill remains shuttered has been an uphill climb since the signing of the sale agreement to Illinois-based waste company LRS in December by former Bull Shoals Mayor David Nixon on behalf of the waste district.
The deal, which was quietly worked on as far back as June of last year, ultimately was sprung on Adams and other members of the district during the Christmas holidays last year, with a tight Jan. 1 deadline for both parties to agree to the sale.
While that deadline has come and gone, the sale continues to linger despite the efforts of Adams and other Baxter County citizens.
Adams’ first attempt to end the sale through a division closure certificate involved a letter drafted by an environmental lawyer for the Friends of the Norfork and White Rivers, who did extensive research into the closing and potential re-opening of NABORS landfill.
That research determined that ADEQ had failed to issue a certificate of closure to the landfill, even after the state government division, which took OMSWD to court to close NABORS in 2012, spent millions of dollars to shutter the landfill.
The letter was designed to have ADEQ issue the closure certificate in the hopes of ending the sale of NABORS to LRS. It met immediate pushback from OMSWD attorney John Verkamp in the district’s latest meeting on June 27.
“We entered into a contract for the sale of the landfill,” said Verkamp during the waste district’s June meeting. “There’s a provision in contract law which gives parties a duty to operate in good faith. Well, we signed the contract ourselves, and now with this letter, we’re trying to stifle that sale by going to ADEQ by giving this landfill a certificate of closure. And in the letter, we say why. It’s not in good faith. In the letter, we don’t want to do that because there’s an interest on the part of the commercial waste disposal company to reopen the landfill, and we’re going against our contract. That’s not good faith.”
During its January meeting, Adams and his fellow members of the waste district passed a resolution to end the sale of NABORS landfill, a small symbolic victory, that was overshadowed by Pulaski County Judge Tim Fox’s court order to sell the landfill as he continued to work to resolve the lawsuits surrounding the waste district’s attempt to file for bankruptcy over the landfill.
With both the signed contract by the waste district and the approval of Judge Fox, LRS had solid footing to go ahead and purchase the landfill following its due diligence period, even if OMSWD was attempting to back out of the deal.
Yet, LRS’s due diligence period came and went months ago, with no requests for extension from LRS, potentially jeopardizing its purchase of NABORS landfill. The company had 90 days to finish its due diligence period.
When pressed on what those missed deadlines could mean for the contract, Verkamp said, “That’s subject to court interpretation. Is that going to be something that terminates the contract? Is that something that can be an action for breach? Can a party still pursue specific performance to force the sale to go through?”
And court interpretation is a game that the waste district and the bondholders that backed their purchase of NABORS landfill seem to enjoy playing.
In September, Carroll County taxpayers came close to getting their money back after Carroll County Circuit Court Judge Scott Jackson ruled that Bank of the Ozarks (Bank OZK) was found to be in contempt over refusing to return $433,987.10 in taxpayer money to the judge’s court registry in August.
Yet, as has been the case in all of the various lawsuits surrounding NABORS Landfill, Bank OZK and its undisclosed bondholders ran back to Pulaski County Circuit Court Judge Tim Fox to bail them out of an unfavorable ruling, with Fox granting the bank a motion on Sept. 1 enjoining taxpayers from continuing to prosecute claims over the funds.
In June of 2022, Fox issued an order claiming that his Pulaski County Court always had superior jurisdiction over illegal exactions upon property located in Baxter, Boone, Carroll, Marion, Newton and Searcy County despite being equal to each county’s circuit court judge.
Baxter County taxpayers were set to get their shot at getting their money back during a hearing in Marion County in September, but that case has been continued due to Fox’s new ruling. Attorney Matt Bishop, who has been overseeing various lawsuits related to the unconstitutional $18 service fee that was foisted upon taxpayers to recoup money lost by the district in their 2011 bankruptcy case, expressed his frustration over the continued interference from Pulaski County.
“As a result of the Pulaski County Case injunction, Bank OZK remains free to pursue actions such as its Motion to Continue, and the Plaintiff herein cannot defend or pursue collection of final judgments obtained in this court over three years ago. At this point, Plaintiff can do little more than recite the details of the case as set forth above,” wrote Bishop in his response to Bank OZK’s motion for continuance in the Baxter County case.
To make matters even worse, court documents have revealed that Bank OZK, NABORS bondholders and various ADEQ officials, including former ADEQ Director Becky Keogh, colluded in secret to come up with a taxpayer bailout scheme.
Keogh met with Bank OZK’s hand-picked, Judge Fox-approved receiver, Geoffrey Treece in her office sometime during May of 2016. That meeting, which was attended by ADEQ’s head attorney, Michael McAlister, focused on Keogh’s attempt to recover every “thin dime” of money it had spent on NABORS landfill despite stripping the district of the landfill in a lengthy court battle.
To meet Keogh’s demands, Treece began implementing a bailout scheme that was crafted by Michael Ptak, Lance Miller and Butch Lomax. Both Ptak and Miller served as attorneys for Bank OZK, while Lomax served as managing director of Crews & Associates, an outside regional broker-dealer that specializes in public finance.
Crews & Associates was never named as a part of the various lawsuits surrounding NABORS landfill and Bank OZK but intervened behind the scenes on multiple occasions. The organization and Lomax resisted all attempts in court to determine if they were NABORS bondholders.
To this day, the bondholders surrounding OMSWD’s purchase of NABORS landfills have remained protected by Arkansas’s court system.
Lomax, Treece and at least one Bank OZK attorney met in April 2016 to discuss a taxpayer bailout scheme before Treece’s meeting with Keogh a month later.
In July 2016, Treece emailed attorneys for OMSWD, Bank OZK, ADEQ, and Lomax the details of his plan. Unsurprisingly, he adopted ADEQ’s and the bondholder’s long-sought plan for a taxpayer bailout. He promised to provide a draft shortly. By August, Crews & Associates became frustrated and began pushing for Treece for faster action.
In his May 2019 testimony, Lomax told the courts he was unsure if Crews & Associates or its parent company, First Security Bank, were bondholders. He refused to answer why he was so eager for Treece to move forward with the bailout plan.
Treece eventually responded to Lomax’s prodding, and the draft of his report was circulated and tweaked by all parties over the next two months before finally being filed in the Pulaski County case in Nov. 2016. The report almost completely adopted the plan proposed years earlier by ADEQ and the bondholders.
The report sought to impose an $18.00 charge on all improved property owners within the six counties comprising OMSWD using Ark. Code Ann. 8-6-714(d) as its statutory basis. Treece suggested that Fox’s court approve and adopt the fee in April 2017 with no objection from OMSWD.
The tax, set to run for 20 years, would have generated a total payment of $11,090,000 to Bank OZK for the benefit of its bondholders and $16 million to ADEQ, with any remaining funding going toward OMSWD.
OMSWD currently earns between $700,000 and $900,000 in fees per year, with net revenues over $200,000. This does not include money raised from the $18 tax. Treece did not attempt to utilize any of the district’s current funding to pay off its creditors. In fact, despite the district’s net positive cash flow, Treece proposed that OMSWD receive even more money from the $18 tax.
Ark. Code Ann 8-6-714(d) requires OMSWD’s board to take action to impose a service fee. The board has never disbanded and still regularly meets. OMSWD and its board members have never voted to impose the $18 tax proposed by Treece.
ADEQ Attorney Michael McAlister testified that ADEQ was not seeking relief from taxpayers but did not object to Treece’s plan to pay them. Treece testified that he was told very clearly by former ADEQ Director Keogh that ADEQ would collect all expenditures from the district.
He also testified that he was told that ADEQ was considering suing the municipalities and counties pursuant to their special litigation. ADEQ declined to intervene in the Carroll County cases.
This “change of heart,” Treece testified, was due to the Governor’s Office becoming “weak-kneed” in the face of political blowback from the $18 tax.
In late 2017, Pulaski Circuit Judge Fox signed off on the tax, and Treece began contacting the tax collectors in the district’s six counties, requiring them to put the charge on property owners’ tax invoices.
This continues to be a developing story.