|SIGN OF SUPPORT: This billboard on the eastern edge of Andrews, Texas, shows that the town isn’t shy about backing efforts like Harold Simmons’ proposed low-level radioactive waste facility.
photography by Dave Moore
|HIGH HOPES: Businessman Harold Simmons is banking on the Andrews waste-burial facility (at right).
photography courtesy of Dallas Morning News
The last thing that comes to mind cruising Main Street in little Andrews, Texas, is the word “prosperity.”
The vehicle of choice there is a pickup caked with West Texas red clay soil. The clothing line is Carhartt. The favored meal is steak fingers and fries with “salad,” a glorified garnish of shredded iceberg lettuce. In the winter, people eat with their work coats on.
Ask most anyone in Andrews or Andrews County if they’ve heard of Dallas billionaire and philanthropist Harold Simmons, and they’ll give you a blank stare or a quick “no.” But when you ask whether they know about Simmons’ firm, Waste Control Specialists—WCS for short—the answer is immediate.
They know Waste Control is the company that wants to bury and permanently store the nation’s low-level radioactive waste in their county. And, “I’m in favor of it,” says Garry Evans, 50, a radiologic technologist, as he eats a tennis-shoe-size breakfast burrito at La Mexicana restaurant across from the WCS headquarters in downtown Andrews (pop. 10,300), the county’s only town. Evans goes on to make a convincing argument on behalf of a man he’s never met. “I think it’s good for the economy. It has to go somewhere. What can you do with pastureland?”
The answer seems obvious. Most people in Andrews County—about six hours west of Dallas-Fort Worth, off I-20—either want to allow low-level radioactive waste to be buried there, or they don’t care. That may be because, for the last 14 years, Simmons and his hired guns have shook hands, twisted arms, and spent at least $150 million to make it happen.
Now, after more than half a century of hatching schemes and doing deals, businessman Simmons, 77, is on the verge of locking down one of his biggest triumphs yet: a unique business he built from the ground up that could generate $200 million a year for decades to come, despite the vicissitudes of the stock market. It wouldn’t come a moment too soon, either; in six months’ time, the bulk of Simmons’ public companies have lost roughly half their value.
If Simmons’ Andrews ploy is rejected, though, it would be a crushing defeat—an agonizingly slow-motion train wreck that would rival his failed, early-’90s bid to take over aerospace giant Lockheed. And, there still wouldn’t be any place in Texas to bury radioactive waste. Which would be just fine with the Sierra Club, not to mention a few residents of Andrews County who asked to be left out of this article.
A Whole Other World
Texas Tech University system chancellor and former Republican legislator Kent Hance recalls readily how the Waste Control Specialists deal landed on Harold Simmons’ plate. Hance, who’s now vice chairman of the WCS board, was working in the 1990s as the partner of a Houston businessman, Ken Bigham, who was seeking to build a hazardous waste dump in the Houston area. Because Hance once represented Andrews County in Congress and the state Legislature, he believed his former constituents would welcome such a project there.
Heck, Hance says, Andrews residents once fought to win the MX missile system—unsuccessfully, it turned out. They also vied, again unsuccessfully, for a state prison. Generations of West Texans have worked and died in the oil fields, and he knew they would welcome other ways to make a living—including building and operating a hazardous waste site. “It’s the perfect spot,” Hance says, “because you’ve got the community support and you’ve got the perfect geology.”
At first, the Andrews site was permitted to handle merely hazardous waste, such as PCB-contaminated soil. That site operated in the 1990s accepting such waste, but the volume of hazardous waste soon dropped off because companies found ways to reduce the amount they produced. The next step, the site’s owners reasoned, was to seek a permit for low-level radioactive waste, which is in greater supply.
|photography by Dave Moore|
Neither Hance nor Bigham had the money to mount the fight necessary to site a landfill that could handle low-level radioactive waste, however. That would require changing state law to allow a private business to build and operate a low-level radioactive waste dump; at that time, only the state was permitted to run such a facility.
So Hance approached Simmons, with whom he had worked on other deals. He knew that Simmons might be interested in the prospect. After all, it would be one of the few projects of its kind in the country, and it could be extremely lucrative.
As is his custom, Simmons had his people check out the venture thoroughly. Harold saw the promise. So, in 1995, he agreed to pay to become half-owner of Waste Control and to help obtain the low-level license.
Simmons continued to pour money into WCS over time, eventually obtaining majority ownership. It became part of his Dallas-based Valhi Inc. company, which owns another firm in turn called Kronos. Kronos produces titanium dioxide, which gives pigment to paint. In a 2006 interview with Glenn Hunter, then editor of the Dallas Business Journal, Simmons pointed to the Waste Control firm as losing millions of dollars each year. But he betrayed little frustration with the losses.
“We won’t make any money until we get that license,” he told Hunter, now executive editor of D CEO. “Then, we’ll make a couple hundred million dollars a year.”
SNAPSHOT: ANDREWS, TX
He added that he expected to get the low-level waste permit in 2007. It’s taken a little longer than that, but now, on Jan. 14—after this magazine had gone to press—Simmons and Waste Control were expected finally to have their day of reckoning. On the 14th, the Texas Commission on Environmental Quality was scheduled to decide whether anyone opposing Simmons’ project had standing to warrant a hearing. If not, the TCEQ likely would issue Simmons his long-awaited permits. If the decision went as Simmons hoped, the Andrews site was expected to start burying low-level waste by the second quarter of 2010, according to Rod Baltzer, Waste Control’s president.
Making It Happen
Most people will tell you that there’s nothing half-hearted about Harold Simmons. And, because of state law, turning Waste Control into a cash cow called for nothing less. Here’s how the Dallas businessman set about doing it:
First, Simmons hired an army of lobbyists to persuade the state Legislature to pass two laws. One of the laws permitted a private company to handle low-level radioactive waste. The other allowed just one company in the state—unnamed when the bill was written—to handle the stuff. In addition, Simmons secured the allegiance of residents living near the Waste Control site—primarily residents of Andrews County.
As an example of how Simmons is perceived to have shepherded the legislative process, consider a Nov. 19, 2008, hearing of the TCEQ in Austin, and the following exchange during that hearing between WCS attorney Michael Woodward and TCEQ Commissioner Larry Soward:
“You wrote the language” in the 2003 radioactive-waste law, Soward bluntly said to Woodward. (The lawyer is one of 11 men and women registered to lobby on behalf of WCS, which in November was seeking state action to seize mineral rights beneath the Andrews site on behalf of Waste Control.)
“No, sir, I don’t believe so,” Woodward corrected Soward. “The Texas Legislature implemented this.”
Despite the commissioner’s skeptical tone, the TCEQ board voted 2-1 in favor of asking the Texas Attorney General’s office to start eminent domain proceedings on mineral rights beneath the Waste Control site.
Technically, WCS was seeking OKs for two radioactive burial sites, both located on a wind-whipped, 25-square-mile piece of land about 30 miles west of downtown Andrews. One category of facility there would bury federal waste from sites like the Los Alamos National Laboratories in New Mexico. The other, so-called “compact” site would accept things like radioactive water filters from nuclear power plants and radioactive medical wastes generated in Texas and Vermont. (In 1998, Vermont and Maine joined Texas in a legal compact under which Texas agreed to accept radioactive waste generated in the other states. Maine subsequently dropped out of the agreement.)
Together, the permits would make the Andrews project only the third in the U.S. with the ability to bury low-level radioactive wastes in three different varieties—and the first of its kind to be licensed in nearly 30 years. WCS wouldn’t be allowed to accept things like spent reactor fuels, however; they would go to a controversial facility at Yucca Mountain in Utah.
Even so, WCS expects the volume of radioactive waste sent to Andrews County to increase with the anticipated construction of more nuclear power plants. Luminant, for example, has slated at least two new reactors for Comanche Peak, 75 miles southwest of Dallas. A total of eight new reactors are planned statewide, officials say.
When the November TCEQ hearing in Austin was finished, a cadre of Waste Control officials descended on this reporter—the only member of the media who attended—like turkey buzzards on a sun-ripened armadillo. One handed me a news release to describe what had just happened (lacking only real-time quotes). WCS’ president passed me a leather-bound, 1-gigabyte flash drive loaded with pro-Waste Control video footage.
Part of the Scene
In the town of Andrews, meanwhile, Harold Simmons’ professionals have become an integral part of the community. Waste Control’s vice president of community relations, Tom Jones III, sits on the boards of the local hospital, the Andrews Chamber of Commerce, and the local United Way. Other WCS employees are part of the community’s Meals on Wheels efforts, Faith in Action groups, and other chamber boards.
Jones lives in one of the community’s nicer houses and works in an office on Main Street, in a strip mall behind a shop called Cpl. Ray’s Coffee. (Ray, Jones explains, was a son of Andrews who was killed fighting in Iraq.)
Since opening in the 1990s, the Waste Control business has become as much a part of the Andrews business scene as the town’s Kirby Corp. vacuum cleaner plant. It certainly doesn’t hurt that the median salary at Waste Control is $50,000 annually, or that the company employs about 130 workers, including engineers, security officers, and those who handle hazardous and other types of waste. This year, Jones says, WCS may add another 60 or 70 jobs.
|Andrews city fathers envision the equivalent of a West Texas Silicon Valley—one built not around semiconductors, but the nuclear industry.
photography by Dave Moore
Having Waste Control and other alternative industries in Andrews County helps keep the economy from being overly dependent on the peaks and swoons of the oil and gas markets, city leaders say. (The day I arrived in Andrews—Nov. 20, 2008—light sweet crude oil had dropped to about $50 a barrel, off its July high of about $145.)
Simmons, who declined to speak with D CEO in advance of the Jan. 14 hearing, knows all about the fickleness of markets. In 2007, he came in at No. 43, with an estimated net worth of $7.4 billion, on Forbes magazine’s list of the 400 richest Americans. But on Dec. 8, 2008, Simmons’ Valhi stock closed at $14.25 a share, less than half its 52-week high. His Titanium Metals Corp., which produces titanium for industrial applications, closed at roughly a third of its 52-week high. A third publicly traded company, Keystone Consolidated Industries, sold for less than half of its 52-week high.
While Simmons officials shrug off concern over sagging market prices as “shortsighted,” this isn’t Simmons’ first crash. And the Waste Control permit to bury radioactive waste could very well help bolster both Simmons’—and Andrews’—fortunes.
Déjà Vu All Over Again
Between 1966 and 1969, Simmons went from owning the University Pharmacy across from Southern Methodist University to owning 100 pharmacies in Texas, according to his authorized biography, Golden Boy: The Harold Simmons Story.
By the early ’70s, however, he found himself overextended. He sold the drugstores to Eckerd Corp., covering losses from some snake-bitten insurance companies he’d purchased and making a huge profit. Executives from those same companies then sued Simmons, alleging he took part in stripping the firms of their capital. Yet Simmons never threw in the towel. He prevailed in the courts, and continued to find more diamonds than daggers hidden inside companies acquired through Contran, his umbrella corporation.
By 1996, he was worth $1.3 billion. He’d started 30 years earlier with $33,000.
These days, Simmons is often better known in North Texas for his philanthropy than for his acumen as a businessman. Like clockwork for 15 years, he and his wife Annette have substantially supported the Chrystal Charity Ball. For each of the last three years, the couple has donated $1 million to the charity.
In 2006 alone, the Harold Simmons Foundation doled out $9.3 million to hospitals, schools (including a $125,000 gift to his hometown Alba-Golden High School), and universities, according to the foundation’s tax return. That same document said the charity’s assets were shares of Valhi stock valued in 2006 at $26 million.
Simmons, a longtime friend and supporter of former President George W. Bush, also isn’t shy about spending money in the world of politics, mainly for Republican candidates and causes. Most recently, he helped fund a $2.9 million ad campaign linking former radical William Ayers to then-Democratic presidential hopeful Barack Obama.
Simmons’ biography indicates that the native of Golden, Texas, has always said his main preoccupation isn’t so much making or spending money; rather, it’s been figuring out deals, and securing a fortune or comfort for his causes and his heirs.
Hance says he’s witnessed Simmons’ ability to examine a company’s balance sheet and, within a few minutes, figure out whether the company is worth buying. In Golden Boy, Simmons credited his experience as a bank examiner with helping him quickly size up companies.
“The key in any business is staying power, and Harold’s had staying power and it’s going to pay off big for him,” Hance says, referring to the Andrews project. “This is important for the future of our country.”
Rightly or wrongly, Simmons’ drive for winning has also made him the target of critics. In the 1980s, he was labeled a “corporate raider” (to which, Simmons replied, the companies he buys often end up in better shape after Simmons gains control). Similarly, his latest endeavors involving Waste Control Specialists have been called “outmoded” and a threat to the natural environment.
“Mr. Simmons has made a lot of money, and he’s an old man now,” says former TCEQ geologist Patricia Bobeck. “His business model is based on not valuing the environment, and making a lot of money in the process. It’s an outmoded economic model.”
|THUMBS-UP: Andrews newspaper publisher Don Ingram, above, and radiologic technologist Garry Evans, below, both favor the Simmons project.
photography by Dave Moore
Bobeck says she reviewed WCS’s application for a landfill that would hold radioactive residue (called tailings) from uranium mines. She says the original application didn’t even include a “liner”—a vinyl layer to protect groundwater. (Baltzer, the WCS president, concedes that’s true, but insists that the state didn’t initially require the liner; what’s more, he says, processed tailings are less radioactive than the tailings were when they were in the ground.) The naturally occurring clay in Andrews County isn’t sufficient by itself to prevent contaminated water from polluting the groundwater, Bobeck also contends. Erosion from wind and rain at the West Texas site worried her as well.
Bobeck says she was told that WCS would get its license, and that it was her job to ask questions in order to get the company to address the state’s concerns. As a result, Bobeck says, she quit the TCEQ rather than be associated with the project.
Asked by D CEO to answer Bobeck’s charges, the state agency didn’t address them directly. Instead, it sent an e-mail stating that the state asks tough questions of applicants to develop licenses that protect the public health and the environment.
The TCEQ granted WCS a permit for a radioactive tailings landfill last May, and then issued a “draft” permit for landfilling low-level radioactive waste in August. In 2008, the Lone Star chapter of the Sierra Club asked a court to hear its objections to the project based on concerns similar to Bobeck’s. Chapter Conservation Director Cyrus Reed says that if the court agrees to hear the Sierra Club’s arguments, he’s sure it would side with the environmentalists.
For its part, the staff of Waste Control Specialists insists that the geology around Andrews is ideal for burying waste, and that numerous core samples taken on the property prove it. The water samples pulled from the WCS site date back 15,000 years, they say; in other words, what little rainfall occurs in West Texas isn’t going anywhere on the Waste Control site, the company says.
Reed of the Sierra Club admits that fighting a low-level radioactive burial site in Andrews County can be lonely work. “It’s a different political climate,” he says. “Their town has relied on oil and gas. They think it’s an acceptable risk.”
‘We Like Boring’
Back in the town of Andrews, Marc McCarthy, who works at Cpl. Ray’s Coffee, talks about his dreams for the future.
Both of McCarthy’s parents work at the Louisiana Energy Services National Enrichment Facility, just across the New Mexico state line from the Waste Control property. In recent months, the LES uranium-enrichment site has ballooned from a $1.5 billion to a $3 billion project.
McCarthy says he’s not sure if he would work at the Waste Control facility, but he would consider employment at the LES factory. “It’s a nice-paying job,” he says. “As long as everything goes smoothly, it’s worth it.”
Add to such sentiments the town’s push for an advanced nuclear reactor, and Andrews city fathers envision the equivalent of a West Texas Silicon Valley—one built not around semiconductors, but the nuclear industry.
All that energy business will help boost the tax base for schools, they believe.
“We don’t have the water, which, in this case, is good,” says Don Ingram, publisher of the Andrews County News, from behind a heavy wooden desk in his window-less office. “We don’t have hills for skiing. Our local governments get along.”
“Sounds boring,” I venture.
“When you get to be our age, we like boring,” Ingram says. “The taxpayers benefit when things are boring.”
Somehow, perhaps, Andrews’ desire for economic security will meld with Harold Simmons’ thrill of the chase. If they do, the Dallas billionaire may have a new way to mint money. And the hardscrabble county in West Texas may find its prosperity yet.