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Inyo, BrightSource settle on project mitigation figure

March 15, 2013

Inyo County and BrightSource Energy, Inc. signed a contract earlier this week that will have BrightSource pay the county $15 million to mitigate negative impacts to county services that are expected to arise during construction of the Hidden Hills Solar facility near the Nevada state line. Image courtesy California Energy Commission

After nearly two years of negotiations, county leaders have come to an accord with BrightSource Energy regarding financial compensation for impacts that will be created by a tax-exempt 250-megawatt solar facility BrightSource wants to build.
BrightSource proposes constructing the 5.1 square-mile solar plant in remote Southeast Inyo, just west of the Nevada border near Charleston View. Local leaders, including Inyo County Sheriff Bill Lutze, have said that impacts created by the project will increase costs to the county.
Those impacts include hiring sheriff’s deputies to patrol the remote corner of the county, and maintenance on Old Spanish Trail Highway, which county leaders said will see heavy, damaging use during construction of the project.
County officials have estimated those costs annually as more than $1 million.
On Tuesday, the Board of Supervisors signed a contract with BrightSource that will require BrightSource to provide the county with $15 million, including a $2.5 million payment when construction on the Hidden Hills Solar project begins, to pay for county costs associated with the project.
“Will this agreement fully mitigate the county’s costs? No,” County Administrative Officer Kevin Carunchio said. “Will it guarantee the county enough revenue to mitigate costs? No. But will it provide revenue to the county? Certainly.”
Because Hidden Hills is a renewable energy plant, the California Energy Commission has exempted it from standard property taxes, which would generally be used to mitigate impacts to county services.
“The county has been sitting at a very uneven table because the CEC has sole permitting authority,” Carunchio said, adding that if the amount of money the county will receive to mitigate impacts “were up to the CEC, the CEC may not have provided anywhere near $15 million.”
All five board members agreed that the $15 million contract falls short of the county’s needs, but said it is probably a far better deal than what the county would have received if the decision was left to the CEC.
“Our job is to try to position ourself in the best spot if this project gets licensed, and I believe we’ve done this,” Fifth District Supervisor Matt Kingsley, whose district includes the proposed project site, said Tuesday.
“I do not trust the state. I’d much rather have an agreement that was written by the County of Inyo,” Third District Supervisor Rick Pucci added.
Since the project was proposed two years ago, county leaders have been negotiating with the project proponent, BrightSource, to develop an agreement that would require BrightSource to help pay for impacts to local services.
County staff has estimated that county departments would need about $11 million for additional staff and services during the project’s construction phase, and $1.7 million a year in ongoing costs.
BrightSource officials said that 1,000 or more workers will be brought on over the projected 24-year life of the project. After construction the plant will need between 100 and 200 employees to operate the site, but local leaders have maintained that most of those workers will live – and spend their pay checks – in nearby Pahrump, Nev. and not in Inyo County.
Sheriff Lutze has said he would need seven new deputies and possibly even a new Sheriff’s substation, in the area to have adequate resources near the construction site to ensure the safety of the power plant, and of the local population.
However, the CEC (the agency responsible for permitting the project) hired the consulting firm the Aspen Group to do its own analysis of impacts. That analysis estimated that the county’s costs during construction would be $2.8 million, with yearly, ongoing costs of $390,000.
In December, the county proposed an agreement that would have BrightSource pay the county $7.8 million in sales and use taxes and would allow the county to request additional funds from the company to mitigate any unforeseen impacts ther $2.6 billion solar project might create during its 30-month construction period and 25-year lifespan.
Citing the Aspen Group’s analysis, BrightSource rejected that offer.
With an agreement in place with Inyo County, the next step for BrightSource is to seek permitting approval from the CEC to begin work.
Several Southeast Inyo residents have expressed concerns about impacts the project will have on the community of Shoshone.
Kingsley, who represents those residents, pointed out that the agreement with BrightSource was placed on Tuesday’s board meeting agenda as an emergency addendum, and many Shoshone residents did not have the opportunity to attend the meeting.
“I am disappointed with the timing of this,” Kingsley said. “For residents of Tecopa and Shoshone, they’re not able to be here. But I don’t think there’s much we can do about the timing at this point. This is a project where a small number of residents (in southeast Inyo) are being impacted most, but now the board will have an opportunity to mitigate those impacts.”

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