Since Crown Hydro would be past its deadline, they requested a 60 day extension from FERC. Below is the letter from Crown Hydro legal counsel, attorney Peter Grills, requesting that extension. This letter exposes a number of interesting curiosities:
1. Grills states in his April 14 letter that the staff of the Park Board has completed lease negotiations with Crown Hydro, yet at the April 7 Park Board meeting, it was clear there were a large number of open issues not yet addressed in the lease. Among those were the improper zoning of the land, vibration and noise considerations, aesthetic and property value concerns of neighborhood residents, unknown archaeological finds, risks of damage to historic properties including the Mill Ruins Park and the Stone Arch Bridge, liabilities, and the high cost of the generated electricity to the public. It's difficult to imagine that all of those points were adequately addressed in both research and legally protective language in just one week by the two parties and reviewed by both parties' lawyers.
2. Grills further states that the staff of the Park Board has recommended approval of the project. I don't imagine that Park Board staff is required to consider any third party opinion, including the tax-paying public, but it's interesting that they ignore the continued opposition to this project by the Minnesota Department of Natural Resources, the Minnesota Historical Society, the owner of the Whitney Hotel, the owner of the Crown Roller mill, and the many citizens who live in or visit the area. This is even more interesting consider the strong opposition this same Park Board staff had to this project little more than a year ago.
3. Grills's also states that Crown Hydro and the Park Board have been negotiating a lease since May, 2002 -- two years ago! This is interesting in that it demonstrates the complete failure of the Park Board to inform the public, having said essentially nothing about the project to the public until the past few months it appears. It's also interesting in that the Park Board filed a Motion to Intervene with the FERC in March of 2003, with strongly-worded opposition to this project in which the Park Board staff states "while Crown has been willing to discuss the design of the forebay/headrace area, its representatives have refused to engage in the preparation of any form of agreement," and concludes with:
"This flagrant disregard of the stipulations of the license cast into question the ability of the licensee to undertake this project in a timely, cooperative, and competent manner.
Based upon the reasons outlined above, the Park Board holds that granting the requested amendment of license has the potential to do irreparable damage to the goals of the Park Board and the City of Minneapolis in the ongoing development of recreational facilities and historic preservation activities in the project area."
To read Peter Grills's letter, it sounds as though the relationship between Crown Hydro and the Park Board has been cooperative and friendly. Yet to read the Park Board's own statements, it appears just the opposite. What's going on here?
And why has the public been kept in the dark for years?
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April 14, 2004
Via Facsimile & Overnight Mail
Magalie R. Salas, Secretary Federal Energy Regulatory Commission 888 First Street NE Washington DC, 20426
RE: Amendment Application to Change Project Design and Project Boundary Due to Proposed Relocation of Project Facilities Project No.: 11175-016
Dear Ms. Salas:
By correspondence dated January 13, 2004, the Federal Energy Regulatory Commission (Commission) requested that Crown Hydro, LLC (Crown Hydro) file an acceptable lease or other acceptable conveyance of the Minneapolis Park and Recreation Board's (Park Board) land for use by the above-referenced hydroelectric project within 90 days of the date of the correspondence. Crown Hydro is pleased to announce that lease negotiations have been completed. The Park Board staff has submitted the lease to the Park Board for its consideration and has recommended approval. The Park Board is scheduled to take final action on the on Wednesday, May 6, 2004 meeting. Consequently, Crown Hydro would respectfully request an extension of sixty (60) days to allow the Park Board to take final action on the lease.
A brief history regarding project development and lease negotiations may be helpful to the Commission and its staff in considering our request for an extension. As previously reported to the Commission, and as the Commission has previously acknowledged, the Crown Hydro project had received broad public support. The project received a big boost on November 2, 2001 when the Minnesota Renewable Development Fund awarded $5.1 million in financial assistance. This was by far the largest single grant award in this funding cycle. The grant award was subsequently approved by the Minnesota Public Utilities Commission.
Crown Hydro and the Park Board began discussions regarding the general parameters of a lease of the Park Board's land in May 2002. While discussions with the Park Board continued, Crown Hydro's focus was on the negotiation of a power purchase agreement with Xcel Energy. Negotiation of the power purchase agreement was completed on January 23, 2003 and the agreement was approved by the Minnesota Public Utilities Commission on June 10, 2003.
Following completion of the negotiation of the power purchase agreement, the Park Board and Crown Hydro began lease negotiations in earnest on April 10, 2003. A draft of a lease was provided to the Park Board in July 2003. There were many difficult issues to resolve in connection with lease negotiations. Since the project is to be located in the Mill Ruins Park, there were complex issues regarding historic preservation, maintenance of aesthetic flows over St. Anthony Falls, operation and maintenance of the hydroelectric facilities, and generally ensuring compatibility of the project with the park and recreational goals of the Park Board. Shortly before completing lease negotiations, stakeholders met with Park Board Commissioners on January 23, 2004 to address outstanding issues. Negotiations were finally completed in a marathon session on February 20, 2004.
The Park Board Staff has submitted the lease to the Park Board for its consideration with a recommendation that the Board approve the lease. The Planning Committee of the Park Board considered the lease at its meeting on Wednesday, March 17, 2004. The Park Board, sitting as a Committee of the Whole, again considered the Crown Hydro lease at its meeting on Wednesday, April 7, 2004. At that time, the Committee of the Whole directed that certain public meetings be held, and that the matter be sent to the full Park Board for final action at its meeting on Wednesday, May 5, 2004. The Park Board also directed its President and Superintendent to prepare correspondence to the Federal Energy Regulatory Commission in support of Crown Hydro's request for an extension of time to submit the lease to the Commission.
There has been a tremendous amount of effort and resources committed to completing project development and the negotiation of the Park Board lease. Crown Hydro is confident that if it is allowed to complete the project, the project will not only be compatible with the Park Board's park and recreational goals for the Mill Ruins Park, but that the project will actually enhance the experience of park visitors. For these reasons, Crown Hydro would respectfully request that the Federal Energy Regulatory Commission grant a sixty (60) day extension to allow the Park Board to take final action on the lease.
Very truly yours, O'NEILL, GRILLS &g)'NEILL, P.L.L.P. Peter H. Grills PHG: mme ec: FERC Service List John Gurban Judd Rietkerk Jon Olson/Chairman Minneapolis Park and Recreation Board
--------------------------------------------------------------------------------- Chris Johnson / Fulton
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