San Francisco has pulled out of an agreement to send garbage via railroad to a Yuba County landfill that would have netted about $2 million annually for the county.

The plan to construct a 1.5-mile railroad spur to the Ostrom Road landfill near Wheatland, owned by Recology, is still in the environmental review phase, and while the withdrawal of San Francisco is a setback, the company plans to continue forward to complete the project and find a new partner, Dave Vaughn, vice president and group manager with Recology, said Thursday.

San Francisco likely withdrew from the agreement because the project would not have been completed in the time it needed the facility, Vaughn said.

The project has been in the works since 2007, and it would have returned an estimated $22 million to the county over 10 years and deliver an estimated 400,000 tons of garbage during that same period.

"It's disappointing on a very grand scale," said John Nicoletti, a Yuba County supervisor who supported the project. "This is a missed opportunity that also lost the potential for new jobs."

Nicoletti said he would "absolutely" support Recology's efforts to continue forward with the project.

But the project had also met substantial resistance. Three lawsuits were pending against the plan at one point.

Vaughn said the lawsuits have been "taken care of." But one, filed by Yuba Group Against Garbage is still in the appeals court, said founder Rick Paskowitz.

Paskowitz's excitement that the San Francisco deal is now dead was tempered by the fact Recology plans to continue with the railroad spur. But he said his group would likely not fight another similar contract in court.

"We'll take one win," Paskowitz said. "I suspect we have done our part by focusing that it's an improper thing to use Yuba County as a garbage dump for San Francisco."

Yuba County Supervisor Roger Abe said that it's better for the county in the long term if outside garbage doesn't come here.

"I don't think that's worth the short-term financial benefits," Abe said. "We have a bad enough image as it is, we don't need to add 'the garbage capital of the state' to that image."

Last June, San Francisco said it would pursue a backup plan in case the Recology landfill in Yuba County wasn't ready to accept the city's garbage.

The San Francisco Planning Department issued a notice it was preparing an environmental review for the shipping of garbage via long haul semi-trucks to Recology's Hay Road Landfill in Solano County starting in 2016.

San Francisco "is concerned that the green rail EIR will not be completed quickly enough for San Francisco to switch from disposal of waste at Altamont landfill to the Yuba County landfill before the Altamont landfill runs out of capacity," Paul Maltzer, a senior planner in the San Francisco Planning Department, said in an email last year.

The city currently dumps its trash at the Altamont Landfill in Alameda County. The city's agreement with Waste Management Inc. at that facility expires in 2016.

Deborah Raphael, director of the San Francisco Department of the Environment, could not be reached for comment on Thursday.

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