Bruce Thompson, Raleigh lawyer for Stanly County in its opposition to renewal of a hydroelectric license, says the county has no quibble over the public records Alcoa wants, and in fact delivered a bunch today.
In an e-mail, Thompson said, "I thought you would be interested in seeing this letter detailing the extraordinary steps the County has taken to respond to the public records request. Of note is the agreement that Alcoa's attorneys made with the County in order to narrow the scope and speed up the process. I spoke with one of Alcoa's lawyers at 4pm yesterday to inform him that the County was making a large production of documents today, some of which we hand delivered to his office. Nevertheless, Alcoa chose to file suit before even taking the time to review today's production."
Friday, March 13, 2009
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6 comments:
Bruce Thompson's claim that Stanly County has taken "extraordinary steps" to respond to Alcoa's public records request is simply not true. The facts show exactly the opposite -- that Stanly County has taken extraordinary steps not to comply with North Carolina's public records law.
Alcoa first requested public records from Stanly County on April 5, 2008 -- more than 11 months ago. During those 11 months, Stanly County has provided only a handful of documents and made it clear that it would not comply with the public records law unless it was forced to.
For Bruce Thompson to cry foul after the county has stalled for more than 11 months is disheartening and disingenuous.
It seems this road travels both ways. I remember not to long ago complaints from the county that Alcoa was not submitting adequate information regarding efforts to clean up toxic wastes and also potentially contaminated sites. Addionally, there was mention that issues important to the county regarding contamination were not allowed by Alcoa to be on the meeting agendas untill the "11th hour" of the FERC relicensing process. This lawsuit smells of an attempt at slander against the county.
I am a former resident of Stanly County. I still own property there and therefore my tax monies are at risk. I have followed the debate about the Alcoa power project relicensing process over the last two years in your newspaper. In articles published in the Charlotte Observer, I saw Mr Andrew Lucas' assertion that Mr Elbert Whitley's letter to Governor Beverly Perdue was done for financial gain. I find this comment to be ignorant and unfortunate. However, Mr Lucas' statement parrots the statements of a number of his county commisioner bosses over time.
Unfortunately the conversation about the Alcoa license has deteriorated into individuals on both sides of the issue resorting to relying on rhetoric from talking points prepared by public relations companies. I have not seen any coverage of the potential costs, risks and returns of a state/county take over of the ALCOA facility in any local or regional publication.
In response to Mr Lucas' assertion on returns that citizens might expect from the "recovery of the project", I have not seen anyone addressing how a state/county power authority would become first self-sustaining and thence a profit center to finance the other activities promised such as improved water quality, economic re-development, etc.
Recently the Charlotte Observer published an article about the project that contained some interesting information.
In that article the net return (profit) for the Alcoa facility was stated to be $8M per year and the cost of improvements was projected to be $240 M.
If one assumes that the cost of acquiring the Alcoa power generating facility is $240M and that purchase is financed through tax free bonds, (currently 3.8% for AAA insured bonds) and the net income remains at $8M per year, the project cannot become self-sustaining in the foreseeable future because the income is insufficient to service the bonds.
Therefore to make the project self supporting the net income would have to be increased by a combination of the following measures:
1) Produce more electricity.
This is problematic because the watershed that supports the power generation facility is relatively small compared to other hydroelectric projects. For example, it has been reported that the electricity produced by Alcoa was insufficient to meet the needs of the Badin smelter when it was fully operational. This fact means that the amount of electicity produced cannot support long term fixed price contracts that provide predictable future income needed to pay for the project. To solve this problem, more water would need to be forced through the turbines. However, this would negatively affect recreational opportunties due to lower water levels and would violate promises made to landowners and municipalities that surround the lakes.
2) Increase the price of the electricity generated.
The current business model relies on selling electricity on the "spot market" in no small part because the watershed cannot suuport large fixed price contracts. With increasing energy conservation measures eg. more energy efficient appliances such as air conditioners and washing machines, growing alternative energy sources for electicity generation eg. clean coal, solar power, nuclear power and wind power as well as the world wide economic slow down there will be downward price pressures on the "spot market" price of the electricity generated at Badin. Recently, it was reported the largest public utility in Texas has reduced its electricity production by more than 20% due to reduced demand.
3) Increase the efficiency of the facility.
Governmental projects are not commonly as efficient as competing private projects because their constituencies are not the customers, employees, investors or share holders and are marked by nepotism and bureaucracy. The cases of Mrs. Mike Easley and Tyler Hansbrough's mama or other recent scandals makes me believe the idea of an efficient state/county power generating operation is remote.
Eminent domain requires compensation of the owners of the properties (Alcoa shareholders) at fair market value. However, the cost of acquiring the Alcoa hydroelectric facilities at fair value appears to be economically unsustainable. The other alternative where the project could be self sustaining would be for the facility to be "recaptured" (confiscated )from Alcoa's share holders without paying them fair market value by the state and county government. This would require an unprecedented use of governmental power to forcibly take the assets of private individuals (Alcoa share holders) and award them to members of county and state governments. I agree with Mr Whitley that such efforts will effectively sabotage the efforts to attract viable businesses with jobs to Stanly County-particularly in the current economic conditions (unemployment predicted to be in double digits before the end of 2009) which may not be fully corrected for a decade or more.
I think that the elected officials that support "recovery" of the project other county citizens committed to acquiring the Alcoa hydroelectric facilities should TRUTHFULLY tell the local taxpayers:
1) How much Alcoa shareholders would be paid if the control of the facility should change.
2) How the money would be raised.
3) What the cost of that money would be.
4) How that money would re-paid and the re-payment schedule for that money.
5) The detailed business plan that supports the contention that the facility would become a "re-development" engine
6) How much money the taxpayer will have to put at risk.
7) How they plan to explain to prospective businesses that their assets also will not be available for "recovery" which is a public relations term for confiscation.
I think an impartial analysis of these issues on the pages of your newspaper that addresses these issues would a better use of ink and newsprint than what I have read so far about this issue in your paper where folks merely call one another names.
Mack Mabry
Woodinville, Washington
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