Commissioners Bloom, Hawkins, and Sikora

NOTICE — On December 16, 2020, the Monongalia County Commission sitting in Morgantown, WV, adopted “payment in-lieu of taxes” or PILOT agreements on behalf of two proposed projects, The Mountain State Clean Energy LLC is a 1200 MW plant to be fired with natural gas AND Mountain State Renewables LLC is a 70 MW solar panel array facility. Both are proposed for Ft. Martin, WV, north of Morgantown and essentially on the Mason Dixon Line.

Two coal-fired power plants already operate at Ft. Martin, the Ft. Martin plant at 1100 MW and the Longview Power facility at 700 MW. Both use stack gas scrubbers for sulfur dioxide control, but generate thousands of tons of coal ash and scrubber waste for local disposal continuously.

The Mon Valley Clean Air Coalition and the WV Sierra Club opposed the proposed gas-fired “Clean” energy plant for various reasons including the excessive greenhouse gases (GHG) that will be generated. The protest list below was presented to the Mon County Commission before the vote.

Both Mountain State PILOT Agreements were approved in a single resolution three (3) to zero (0). A PILOT Agreement for the coal-fired Longview Energy plant has been in force from the beginning of its operation in 2011 and remains active for the foreseeable future.

SEE MEETING VIDEO HERE: Monongalia County Commission Dec. 16, 2020 – YouTube — https://www.youtube.com/watch?v=tt8DLPYF7ic

>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>
PROTEST MEMORANDUM FROM M.V.C.A.C. PRESENTED ORALLY ON DECEMBER 16, 2020

RE: AGENDA OF MON. COUNTY COMM. FOR 12/16/20. Item C. To consider approval of documents related to Mountain State Clean Energy LLC & Mountain State Renewable LLC

1. These activities today are too important to our County, State and Nation to be finalized without the full and open consideration that informs the public, provides time for consideration and provides a public comment process.

2. The name Mountain State Clean Energy LLC is very inappropriate, misleading and inconsistent with the industry and with public usage. This proposed fossil fueled power plant will involve thousands of tons of emissions and effluents including acid gases, fine and ultrafine particulates, as well as greenhouse gases galore; it will not be “clean.”

3. The Conditions # 4 and 5 of the FACILITY DEVELOPMENT AGREEMENT(s) specify that the power company will hold the “Deed” and this Monongalia County Commission will hold the “Lease” during plant operations, over 30 years. If that is the case, this Commission will not actually own the facility, so said facility will not be exempt of ad valorem taxes.

4. Should the power company become bankrupt, their possession of the Deed will put our County at the mercy of the bankruptcy court. So, this problem should be corrected so that Monongalia County is the holder of the Deed.

5. Should this PILOT agreement be declared illegal or unconstitutional, which is quite possible, given that such questions are currently before the West Virginia courts, then the fact that the power company holds the Deed will be problematic. So, these problems should be corrected so that Monongalia County is the holder of the Deed.

6. Alternatively, a third party Trustee should be designated as the Deed holder so as to protect all parties to these agreements from these unanticipated circumstances.

7. Our Mon Valley Clean Air Coalition (MVCAC) provided this Commission yesterday with copies to each Commissioner of a West Virginia Law Review article entitled “PILOT AGREEMENTS IN WEST VIRGINIA: A TALE OF TURBULENT TAXATION.” This document was published on December 13, 2020, just this week, and brings forward many issues, including that PILOT agreements are not well established in the law.

8. Finally, on Monday of this week, the WVU Center for Energy & Sustainable Development issued an extensive and in-depth report titled “West Virginia’s Energy Future.” This presents a plan to ramp up renewable energy to decrease costs, reduce risks, and strengthen economic opportunities here in West Virginia. This report is the subject of in-depth articles today in both the Morgantown Dominion Post and in the Charleston Gazette Mail. The full report is now available on the World Wide Web (Internet).

Duane G. Nichols, Coordinator, Mon Valley Clean Air Coalition,
330 Dream Catcher Circle, Morgantown, WV 26508.

Excess capacity & excess greenhouse gases are issues

From an Essay by Kelly Allen, WV Center on Budget & Policy, Morgantown Dominion Post, April 26, 2020

OVER THE PAST SEVERAL MONTHS, THE MONONGALIA COUNTY COMMISSION has been negotiating a “payment in lieu of taxes” (PILOT) deal with Longview Power LLC to build a gas-fired power plant. PILOT agreements are property tax abatements where corporations agree to make annual payments to local governments instead of paying the property taxes they would normally owe and that other businesses in the jurisdiction pay. These fixed payments are generally a small fraction of what would have normally been paid in property taxes, and research shows that business tax incentives rarely pay for themselves by providing net positive tax revenues for community use.

While neither the state nor Monongalia County has disclosed the potential forgone revenue from the agreement, rough estimates calculated by looking at what Longview would be paying if it paid the same tax rates as other businesses in Mon County show that the estimated tax abatement for Longview’s proposed gas-fired power plant is $275 million over the 30-year life of the PILOT deal.

This would represent Monongalia County’s second PILOT agreement with Longview. The county is currently several years into another 30-year tax abatement for Longview’s coal-fired power plant, which is estimated to reduce their tax liability around $562 million. In total, the value of the two PILOT agreements translate into over $670 million in potential lost revenue for Monongalia County, its residents and our public school system, which receives about two-thirds of the county’s property taxes.

In light of the COVID-19 public health and economic crisis that is now facing our county, state and country, governments are facing serious revenue shortfalls. While the county commission is estimating a loss of $1.8 million in tax revenue through June 30, the impacts of the crisis on the property tax revenues, upon which our county’s public services rely, will be felt for months and years to come.

Even in better economic conditions, poorly designed business incentives threaten local revenues and public services, turning a tool aimed to promote economic growth into service cuts and tax increases on residents. In the midst of a potentially lengthy recession, business tax incentives can become economic disasters for local governments, public schools and tax-paying residents.

While other businesses and taxpayers have their property taxes re-assessed each year, Longview is being given a fixed deal for the next 30 years that fails to take into account changing economic conditions or environmental regulations. The less Longview pays, the more other businesses and residents must pay to fund schools and public services.

While proponents argue tax abatements are necessary to incentivize a business to locate in a community and any payments received via the PILOT agreement are a net gain, that fails to take into account the public costs to the community. Roads, fire and police protection, public services and water and air quality are all new costs that will be incurred and must be taken into account in any cost-benefit analysis.

This moment requires that local governments protect critical revenues and ensure that the cost of the economic crisis is not unduly borne by Monongalia County residents. In light of current economic conditions, the county commission should reconsider moving forward with this tax incentive. At the very least, it should produce a costbenefit analysis in light of changes in the economic and energy markets.

Businesses must pay their fair share, and a PILOT agreement that confers special tax treatment on a single corporation without proving net economic benefits for the community is not the right way forward.

>>> KELLY ALLEN is the director of Policy Engagement and the interim deputy director of the West Virginia Center on Budget and Policy.

#########################

See also: OPG Subsidiary Atura Power Finalizes Acquisition of Natural Gas Assets

From the CNW Group, Yahoo! Finance, April 29, 2020

TORONTO — April 29, 2020 /CNW/ – Ontario Power Generation Inc. (OPG), under a new subsidiary that will be doing business as Atura Power, has finalized the acquisition of a portfolio of combined-cycle natural gas-fired plants in Ontario. The natural gas assets had previously been owned by TC Energy.

“Natural gas is the enabler of renewable energy and provides the flexibility required to ensure a reliable electricity system,” said Ken Hartwick, OPG President and CEO. “OPG has decades of energy generating expertise in Ontario and this diversification of our portfolio is a natural fit.”

The total purchase price for the acquisition was approximately $2.8 billion , subject to customary closing adjustments. Any profits generated from these assets will stay in Ontario for the benefit of Ontarians. RBC Capital Markets acted as a financial advisor to OPG on this transaction.

Key Facts About The Acquired Combined-Cycle Natural Gas-Fired Plants:
>> 100% ownership of Napanee Generating Station (900 MW)
>> 100% ownership of Halton Hills Generating Station (683 MW)
>> Remaining 50% ownership of Toronto’s Portlands Energy Centre (50% of 550 MW)
>> In addition to these assets, OPG had previously closed a transaction in August 2019 to acquire the remaining 50% interest in the 560 MW combined-cycle natural gas-fired Brighton Beach Generating Station.

These four facilities will operate together under the Atura Power brand. Atura Power has been established to operate and manage this portfolio of natural gas assets, which are strategically important to the current and future electricity system.

OPG is the largest electricity generator in the province, providing about half the power Ontarians rely on every day. It is also one of the most diverse generators in North America with expertise in nuclear, hydro, biomass, solar and gas.

NOTE: OPG is now the owner of the 50 MW Lake Lynn Hydro Project forming Cheat Lake as well as a number of other small hydro-projects in the mid-Atlantic states. This includes a significant hydro-pumped storage project in Bath County, Virginia.

Consider the Longview II PILOT Agreement for New Power Plant

By Kelly Allen, WV Center on Budget & Policy, December 10, 2019

While local government agencies have not disclosed the forgone revenue estimates from the Longview I or II PILOT agreements, we can estimate the value of the tax expenditure by looking at what Longview would be paying if it paid the same tax rate as other businesses in Monongalia County.

PILOT Agreements in West Virginia Lack Transparency and Are Often Unnecessary —
-Neither the state nor the county report on how much property tax revenue is lost each year to PILOTs and other business tax incentives.
-There is no evaluation process for determining that PILOTs have provided a net good for residents and taxpayers.
-Research suggests that between 75-98% of the time, business tax incentives do not affect a business’ decision on where to locate.
-Even when they do tip a location decision, they rarely pay for themselves by providing net positive tax revenues.
-Poorly designed business tax incentives threaten public services, turning a tool said to promote growth into an economic disaster.

There are best practices for ensuring transparency and accountability when PILOTs are done —
✓ Disclose the forgone property tax revenue and require an evaluation of all PILOT agreements to ensure a net positive taxpayer benefit.
✓ Give school boards decision-making authority to approve all agreements as they are the most impacted by loss of property tax revenue (2/3 of property taxes go to local schools).
✓ Enlist a neutral or third-party to conduct a cost-benefit analysis to ensure that the deal is worthwhile over the short- and long-term life of the project. (Our only current analysis was paid for by Longview).
✓ Include local hiring provisions, pay and benefit standards, and clawback/recapture provisions if the developer fails to fulfill their obligations.
✓ Grant abatements only to areas in need of development and to those that maximize beneficial outcomes (infrastructure improvements, quality jobs, overall revenue gains).
✓ Limit the length of the abatement to the minimum necessary to attract the development sought.

At the very least, PILOT agreements in West Virginia, especially those where almost all of the economic impact happens during construction, like Longview Power, should require that the new tax revenue from the project exceeds the property tax abatement and that there are job creation and retention requirements.

>>>>>>>>>>>>>>>>>>>>>>>>>

See also: PILOT Agreements Cost State Millions in Tax Revenue: An In-Depth Look at Longview Power Plant, Ted Boettner, October 15,2019

Wanted — More Places to Pollute the Atmosphere

To the Editor, Morgantown Dominion Post, October 2, 2019

The plan to expand the Longview Power Plant with a gas-fired plant (Dominion Post — September 13) is disturbing. The company wants the Monongalia County Commission to approve a huge tax break, a PILOT (Payment In Lieu Of Taxes) instead of assessed property taxes.

Another fossil fuel plant means even more air and water pollution, resulting in higher health expenses. While natural gas claims to burn cleanly, fracking is not a clean process. Fracking pads leak methane, a powerful greenhouse gas, and generate millions of gallons of toxic waste water. There is no such thing as clean fossil fuels.

Longview is an electric wholesale plant, so all the energy generated there goes into the national grid and is not necessarily consumed here. Nor will it make our rates any cheaper. That Longview filed for Chapter 7 bankruptcy in 2013, two years after it went online, does not instill confidence for future performance.

According to the Rocky Mountain Institute, “continued investments in gas-fired power plants will present stranded cost risk for customers, shareholders, and society, while locking in 100 million tons of CO2 emissions each year. RMI research shows that ‘clean energy portfolios’ comprised of wind, solar, and energy storage technologies are now cost-competitive with new natural gas power plants, while providing the same grid reliability services.

Children around the world are begging us to protect their future. Why should we invest in fossil energy sources that are guaranteed to rob them of it? We should not give tax breaks and incentives to fossil fuel industries. The Mon County Commission has an opportunity to say YES to the children by saying YES to solar energy but NO to another fossil fuel plant.

Betsy Lawson, Morgantown

#########################

See also: Wanted: More Places to Burn Natural Gas – A FracTracker Guest Article, Alison Grass, Food & Water Watch, April 21, 2017

https://www.fractracker.org/2017/04/gas-fired-power-plant/