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Will sand from new mine be approved in time for spring beach replenishment?

STORY BY LISA ZAHNER (Week of December 26, 2013)

With the sand mine owned by former Marine Bank Chairman Doug Hazel not in the running for the next contract to replenish dunes from John’s Island to Treasure Shores Park, the county will need to convince regulators that a different mine can meet its demanding specifications.

County staff and consultants met with regulators on Oct. 13 about starting the permit process, and as recently as two weeks ago expressed hope that replenishment work could begin in January. Crews must be finished and off the beach by the end of April due to turtle nesting season.

This time around, the county has a new Boca Raton-based engineering firm on board to shepherd the project, and chances are good the sand will come from a new mine that’s never produced beach sand.

The federal government, in the form of the U.S. Army Corps of Engineers – not known for its swift, decisive action or its flexibility – and the U.S. Fish and Wildlife Service also have their fingers in the permitting process.

Delays in approvals, or in production from the trial and error of using new contractors and untested material, could mean sand won’t get on the beach until next November, when work could begin again in the environmentally sensitive area which at its north end includes part of the Archie Carr National Wildlife Refuge.

The job is set to cost taxpayers initially $5.4 million, 50 percent of which is “eligible” for reimbursement from the Florida Department of Environmental Protection, according to County Coastal Engineer James Gray.

Of the 560,000 cubic yards of sand placed on the beaches and dunes from 2010 to 2012 at a taxpayer cost of $15 million, one third has been washed away, leaving a gap of 186,000 cubic yards. Of that, the county proposes to only replenish the 154,000 cubic yards lost from the dunes, not the balance lost from the beach itself.

Steve Smith, managing partner of the Ranch Road Lake sand mine west of the Quail Valley Golf Course, said it’s not worth the risk to him to bid this time around. The project is much smaller, but the fixed costs of hiring a dredge crew to come in and unearth the material is just as high as for a big project.

“It costs $50,000 for mobilization and demobilization and then at least $40,000 per month for the dredge and the crew, plus fuel,” Smith said.

Due to production delays last time, the county would like to see the material out of the ground and available as bidding commences. Smith said he’s got 300,000 cubic yards in his pit – more than enough to complete the project – but with the possibility that commissioners might want to hedge their bets and split the contract between two mines, it’s a dicey business proposition.

“For us to say I’m going to put 100,000 yards of sand up out of my pit, I will have put $400,000 to $450,000 up on a gamble, and maybe only get $200,000 or $250,000 back,” he said. “I can’t put all that sand up and lose $250,000.”

Though the project is slated to cost $5.4 million, only a fraction of that goes toward purchasing sand. The rest goes to the trucking companies, to contractors placing the sand on the beach, to engineers who do the testing and permitting and to biologists who monitor turtles and water birds in the project area.

Still, beach sand has helped shore up miners with not much to do since the real estate market tanked. Since completing the county beach project in 2012, Ranch Road Lake employs six people year-round, taking sand out with heavy equipment when it’s needed for a road bed or a parking lot or other construction.

Producing, screening and processing clean, beach-compatible sand to meet the specifications of environmental regulators to be placed in a sea turtle nesting area is a whole other matter, Smith said.

“You’re in a position of shelling hundreds of thousands of dollars out and not selling any of your sand,” Smith said.

On top of that, the land that the Ranch Road Lake sand mine sits on is up for sale for $3.75 million as Hazel’s family holding company, Hazel Investments, seeks to raise cash while in Chapter 11. While Smith and other investors own 50 percent of the land, Hazel Investments owns the remaining 50 percent.

Smith said the upcoming beach replenishment job is too small for the Midwestern dredge crews who park a tanker off-shore and suck up sand from the ocean’s floor. Unless the county could find a crew that’s already working somewhere else on the Atlantic coast and piggyback on that somehow, the use of sand from the approved “borrow area” a mile off of Round Island seems unlikely.

A mine owned by Henry Fischer and Sons was approved to provide dune-quality sand for the last project, but then Fisher joined forces with Smith to dredge the beach sand from Ranch Road Lake and the two wound up in a nasty court battle.

Fisher and Smith fought over payment disputes and an alleged breach of contract that caused Smith to bring in a dredge and crew from Louisiana to finish the job. The ongoing litigation got dragged before the Board of County Commissioners in a public meeting and caused several commissioners to vow never to embark upon an upland sand project involving the same parties again.

In June 2012, Commissioner Joe Flescher said during a public meeting, “This will never happen again. There will be future needs. The beach isn’t going anywhere, or to some the beach is going away. Hearing that we’ll have to be looking elsewhere because we don’t have vendors who will cooperate.  That’s a shame because you’re local vendors.”

Now-Chairman Peter O’Bryan was also not pleased in June 2012. “If we don’t resolve this and it ever comes before us again, I’m not going to be motivated to vote if these parties are involved again,” he said.

Fischer and Sons owns its dredge equipment and has a trained crew, headed up by veteran miner Chuck Kramer, who was a driving force behind the switch to upland or trucked-in sand when miners were first allowed to bid in 2009.

That savings of $50,000 for mobilization and demobilization of the crew could make it worth Fischer’s while to bid on the smaller project, seeing that his sand was previously approved for use on the dunes by regulators. Fischer has historically good relationships with most of the commissioners who will be voting – ties that could overcome any bad taste the county may have over the lawsuit with Ranch Road Lake.

If Fischer has sand that can be processed to go on the dunes, plus the equipment and the expertise, that would seem to be the logical source for the next project.

But as taxpayers have witnessed firsthand and paid for dearly in the past, local governments don’t always do what seems logical. Plus, it would require commissioners flip-flop on statements they made about the financial dealings that sullied what was otherwise lauded as a successful project, despite massive delays and cost overruns.

Jockeying to fill the vacuum this time is an unlikely character in the ongoing sand saga, Thomas Hammond, citrus farmer and owner of Hammond Groves. Hammond owns the property on 82nd Avenue next door to the Ranch Road Lake mine and has a long-standing permit to mine sand. But Hammond is widely known as not being a big fan of his sand-mining neighbors.

Hammond, who was not part of the county’s only trucked-in beach sand experiment from 2010 to 2012, appears to not be deterred by the uncertainties expressed by Smith about getting the bid, as reflected in a report given by County Coastal Engineer Gray on Nov. 20.

Hammond’s crews have already mined a substantial amount of material for the 154,000 cubic yard project. Gray’s report said the Hammond Mine had approximately 150,000 cubic yards  stockpiled and ready for granulametric testing and review.

Fischer only had about 5,000 cubic yards stockpiled and available as of Nov. 20.

“Material appears to be consistent with the FDEP-approved sediment Quality Assurance/Quality Control Plan. Awaiting regulatory approval for use,” the Gray report said about the Hammond Mine.

But those five key words “awaiting regulatory approval for use” could be the kicker, especially if FDEP or the wildlife folks get queasy about the new mine and the new cast of characters in this sequel project.

Regardless, Hammond has been reportedly pitching his mine for the job, as has Brian Davis, the brother of Commissioner Wesley Davis, whom Gray said had 70,000 cubic yards of material already stockpiled.

Davis was ruled out last time after Commissioner Peter O’Bryan protested a less-than-spotless record that Davis has with FDEP in terms of environmental issues at his mine, which at the time was predominantly used for septic tank drainfields.

Openly lobbying for a government contract might not sound appropriate, but sand miners have done it since 2008 when Kramer, Smith and Brian Davis first started trying to break into the beach sand business.

Brian Davis, owner of Brian Davis Septic in the Sebastian area, even took out a newspaper ad and paid people by the hour to wave signs at a commission meeting when the topic of using upland sand was on the agenda. Mostly unemployed Treasure Coast residents responded to the ad, flocking into the County Administration Complex, registering their names with a Davis staffer on a clipboard and taking took up signs to join the protest. They got paid on the way out, with a bonus if they rose to the podium to speak.

The ploy worked, as commissioners opened up bidding to inland sand miners and eventually awarded a beach replenishment contract for large-scale trucked-in sand for the first time in Indian River County. The county touted the idea as a local jobs program.

County staff, miners and consultants wrangled with regulators for many months, delaying the start of the project and ramping up the cost to taxpayers. All told, the Sector 3 north barrier island beach project took 44 months from bid to completion and cost roughly the same as what the off-shore dredge crew had proposed to charge to do the project in 45 to 60 days in the winter of 2010.