Cayuga Power Plant - Part 3

Aug232013

Cayuga Power Plant - Part 3

 

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Before the end of this year the NYS Public Service Commission (PSC) will rule on whether or not the Cayuga Power Plant remains open.  Two weeks ago we looked at the repowering proposal and what led to it.  Last week we reported on the plant's reputation as a clean coal-powered facility.  This week we look at the plant's participation in the community and the likely result if it is closed.
Giving back to the community is something that many companies do quietly.  AES Cayuga gave generously to the Tompkins County community, but much of that stopped when the company went into bankruptcy.  Now operating under new ownership, the Cayuga plant needs to build to a point where they can be profitable before it can reinstate charitable contributions.  But with a New York State Public Service Commission (PSC) ruling on whether or not the coal-fired plant will remain open coming later this year, its fate is too early to predict.  If the plant closes it will have a multi-million dollar impact on the local community.  Last year  Lansing residents saw property tax rises significantly attributable to the plummeting taxable value of the plant.  The plant's giving program has also become collateral damage in the company's battle to resurrect itself as a natural gas-fired facility.

"Up until 2010 we'd been giving $10,000 or more (per year)," says Upstate New York Power Producers CEO Jerry Goodenough.  "We sponsored some of the FIELD.  We did some work at the YMCA.  We sponsored some of the building at TC3."

That annual $10,000 giving budget was a casualty of the bankruptcy.  Goodenough says the money went to support such local causes as Relay For Life, the Franziska Racker Center, local libraries and scouts scouts.  The plant also had a program that matched each hour employees volunteered at charitable programs and events with a check to the organization.

"The Cayuga Power Plant had an employee driven group called 'Cayuga’s Helping Hands'," recalls Franziska Racker Centers Director of Community Relations Perri LoPinto.  "It was a wonderful employee-driven group that raised money and then thoughtfully supported very personal projects. I would contact the group’s coordinator when I had a specific need for a child with disabilities that couldn’t be met through traditional channels. Cayuga’s Helping Hands were always happy to help."

Goodenough says the giving budget could come back in some shape once the plant gets on its feet financially.  But for now all management can do is encourage employees to continue volunteering in the community.

"Now we encourage volunteering, and we still see employees out there doing a lot of volunteering," he says.  "I don't think the volunteering went away because we didn't match it.  These guys' hearts are in it.  Whatever organization they're close to, they still volunteer."

While that volunteering is invaluable, the loss of income to the charitable community is significant.

The closing of the plant would start a domino effect with the fall of one huge domino.  $10,000 per year is only a fraction of what the community will lose if the PSC closes the plant.  By Goodenough's estimates, the plant pays $2.5 million per year in property taxes, which accounts for 11.7% of the school district tax base, 7.4% of the Town's, and 1.3% of the Tompkins County tax base.

Additionally he estimates the facility spends $10 million in the local economy per year, purchasing goods and services including maintenance work and capital improvements.  Closing the plant would eliminate over 30 good permanent jobs and around 60 more resulting from services and goods provided to the plant locally, and result in the loss of over 550 construction jobs estimated to result from the repowering project.

And there is the loss of those charitable donations, which presents greater challenges for those organizations.

"From specialized equipment for children with mobility issues, to food cards and gifts during the holidays, the group was ready to step in," LoPinto says.  "They made a real difference for many of our families as well as other local organizations over the years.”

Another piece of collateral damage has been Lansing's place in the Tompkins County community.  Most of the support for repowering the plant comes from the Lansing Community, with town and school leaders banding together in support of repowering.  Local officials seem stunned that their comunity is under attack by neighboring governments, with school, town and fire district officials strategizing on how best to make their case to the State.

Officials and residents from neighboring communities have attacked the gas repowering plan, saying they prefer the power grid updating plan or repowering the plant with alternatives that the PSC is not considering.  Ulysses Town Supervisor Elizabeth Thomas, County Legislator Carol Chock, and Dryden council members have been among the most outspoken opponents to the repowering proposal.  New York State Assemblywoman Barbara Lifton told the PSC that in a world faced with imminent global warming she supports repowering the facility only if it done with renewable energy, flatly rejecting natural gas.

There have been notable exceptions.  New York State Senator Mike Nozzolio has been outspoken in his suport of the repowering plan, visiting Lansing multiple times to meet with Lansing leaders and plant officials, and testifying in favor of the plan at the PSC hearing last month.  County Legislator Pat Pryor has been outspoken in her support of repowering the plant with gas, as has U.S. Congressman Tom Reed.

"I one hundred percent support the repowering application as well as the one in Chautauqua County," Reed said at a town meeting at Cornell University Saturday.  "We put our position into the public record.  These are local jobs.  These are significant jobs.  These are also representative of the tax base of these communities that, if pulled out, would be at stake."

The Sierra Club, regional and local opponents are demanding the PSC include alternatives in its deliberations.  Last week a press conference was held by county and other local leaders and residents of neighboring towns demanding the PSC reissue documents unredacted, then extend the public comment period to allow more informed input.  But Reed pointed out Saturday that the only two choices actually being considered are upgrading the power lines and repowering the plant with gas.

"It is very frustrating to have this conversation and have folks talk about things that are just not in the cards right now," he said.  "I know folks have weighed in about alternatives and renewables, and those are all good things.  But the reality of what we're faced with on these projects in these situations is 'what are we going to do today?'  That's why alternatives and renewables are part (of energy policy), but fossil fuels also have to be a part of it."

Estimates show property taxes rising an average of close to $600 immediately upon the closing of the plant, forcing Lansing property owners with low or fixed incomes to sell their homes.  School Business Administrator Mary June King says that burden would rise more as the cost of fulfilling unfunded mandates and outrageously rising employee benefits costs skyrocket.  Some Lansing residents have pointed out that the additional taxes would also impact the other Tompkins County communities, resulting in less shopping an other business, which would then lead to further job loss.

The higher tax burden may well have an impact on property values, and could result in Lansing becoming a wealthy community as lower income residents are forced out.  That would have a long term impact on the character of the town, which until now has successfully merged wealthy and lower income families into a cohesive community that, in general, has managed to come together on initiatives that matter, not the least of which is enthusiastic support of its schools, town recreation programs and parks, as well as a wealth of charitable programs.

If the PSC rules against the repowering proposal the Lansing plant could stay open for up to four more years as the power grid upgrade is completed.  While the immediate impact on things like property values is uncertain, that could provide a buffer for property taxpayers.  The public comment period on the two proposals ended last Friday.  Some time before the end of the year the PSC has pledged to make its decision on whether to close the plant and approve a rate hike to pay for NYSEG to upgrade the transmission system or to repower the plant with gas.



Two weeks ago: What is the impact of closing or repowering the plant?
Last week: Is the Cayuga Power Plant clean?
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