[Editor's Note: This is part three of a multi-article series on the work session of Dec. 18, 2018.]
By Mary Alice Murphy
The Grant County Commission at its work session on Tuesday, Dec. 18, 2018, reviewed the agenda for the regular meeting on Thursday, Dec. 20. 2018.
The first item on the regular agenda was a public hearing on an ordinance to authorize and issue Grant County, New Mexico, taxable industrial revenue bonds in the maximum amount of $400 million for the proposed Great Divide Wind Farm in Grant County near the Hidalgo County border.
County Manager Charlene Webb said: "I held a conference call with the Silver Schools (which also have taxing authority over the property where the wind farm will be sited), Scout Energy and the attorneys on Dec. 7, I believe. The school board last night unanimously approved the 50-50 split, with a payment in lieu of taxes of $1,750 per megawatt with a total build out of 250 megawatts with the total being $437,500 to be split between the county and the schools at a total of $218,750 each, which will receive the compensation over the next 30 years. We negotiated the capacity of the wind generation to a floor of 160 megawatts. This prevents Scout from lowering the floor. It would then be a total of $280,000, split with the schools and the county receiving $140,000 each over the 30 years."
The county's counsel for the wind farm project is David Buchholz of the Rodey Law Firm, who was on the speaker phone. He said the cost of the facility for wind generation would be a maximum of $400 million. "I was particularly pleased that she could negotiate the floor of the capacity to give certainty moving forward."
Buchholz said his representative Luis Carrasco would attend the regular meeting.
"I wanted to be sure to answer the question that Commissioner (Harry) Browne asked at the last meeting about the charter school," Buchholz said. "The charter schools are not affected by the industrial revenue bonds."
Browne asked if any other decision points would come up that might decide whether the project goes forward.
Buchholz said there is a challenge period, but "once the ordinance passes, it is authorizing the signing of documents and proceeding with the project."
A question was asked about road issues. Buchholz said the Carrasco had reviewed the issue. The contract contains protections for the county. "I'm not aware of other things that need to come before the county."
County Attorney Abigail Burgess said road use agreements are unrelated to the ordinance.
Browne asked if there were any financial analysis done on the loss of gross receipts tax.
"I think the county will gain from the gross receipts tax paid on construction," Buchholz said. "The developer pays gross receipts tax to the state. Most will come back to the county. Compensation tax is not what the county would receive in any case."
Chairman Billy Billings said when one reads the first statement, it gives the impression that the county will be liable for the debt.
"I got a text from someone saying the project is going to soak the taxpayers for $400 million to build a wind farm," Billings said.
The bond does not indebt the county, which will not be responsible for paying off the industrial revenue bond, Buchholz explained. "The bond is the vehicle with protections for the county." He cited Sandoval and Lea counties, which have done millions in industrial revenue bonds for which the counties were not responsible for the debt. "When you present in the public hearing, tell that statement up front."
Commissioner Brett Kasten recommended that the public hearing be before public input.
Mike Greczyn, a consultant with Altis on the Great Divide Wind Farm, said the projected timeline for the project is to begin construction in late 2019. "There is risk to that schedule but it's one we've moving toward. The bond is still a moving target."
Bob Karsted of Scout Clean Energy out of Boulder, CO, is the wind farm project manager for Scout and who will be overseeing the project in Grant County, said by late 2019, the project will have two years of avian and raptor studies. "This spring we will meet with New Mexico Game and Fish and the U.S. Fish and Wildlife Service to talk about the statistics."
"We expect by August to have authority from the Fish and Wildlife Service for eagle take," Greczyn said. "The permit is required, and there may be a bird and bat conservation plan depending on the results of the studies. We have to comply one way or another."
Browne asked when the PILOT (payment in lieu of taxes) would begin. Greczyn said it would begin one year after the first effective date of the ordinance. "We will have five years to build the facility."
County Manager said Carrasco had told her the payments become effective at the closing of the lease, with one year before beginning payments. "That is a clarification the attorneys will have to tell us."
She said she is looking for more specifics on where the project is in the construction phase. "I need a clearer picture over 2019. I'm not putting you on the spot today."
Karstad said the company is still scouting for customers. "That is a huge threshold."
"Part of the reason why you and we like the site," Webb said, "is because of the nearby PNM transmission line. Have you confirmed you can use it?"
Karstad said the plan is to build a new substation at the site.
Webb asked about negotiations for using BLM and state land. Greczyn said the site chosen does not involve BLM land. "We will renegotiate state land use."
Commissioner Alicia Edwards asked if the substation would be in Hidalgo County.
Karstad said it would be built in Grant County and the transmission line would connect in Grant County.
Edwards asked what would happen if the team does not find a buyer.
"If we don't find a buyer," Greczyn said, "we will determine what we need to do."
Billings asked to move the discussion item on the choice of a recommendation for senator to replace Sen. Howie Morales, who is the lieutenant governor-elect, and is expected to resign by the end of 2018.
Edwards said the process is what the commissioners have tentatively talked about before and that is to hear from all the candidates. "What is the process, if we don't make a decision then and there? Would we recess for an hour or a day and have a later special meeting?"
Webb reiterated that the decision needs to be made quickly in open session.
Browne concurred and said he was not in favor of recessing. Billings noted that whoever gets the appointment will need to make arrangements to get to Santa Fe and find a place to stay during the legislative session.
Commissioner-elect Javier Salas was asked for input into the process. "It is a very important decision. We want to make sure we make the best decision possible. It may take some days of investigation. (Commissioner-Elect Chris) Ponce and I are new to this system. We are concerned for a prudent decision. We want to serve our constituency well. It will be a difficult task."
Edwards said the present commission should determine what questions to ask and how much time to give each candidate to speak.
Billings said his personal preference was to ask general questions, such as why they had requested the appointment and what they plan to accomplish.
Edwards said she believed five minutes per candidate was enough.
Salas said the commissioners would have reviewed the candidates and he agreed with the five minutes being enough.
Browne suggested changing the Open Meetings Act to allow public input at the special meeting, "but I don't see that public input will influence my decision."
Salas said most of the commissioners and commissioners-elect have been lobbied, but "I think it's important to have public input."
"If you have public input prior to the candidates speaking, I would limit it to two minutes," Kasten said. "The No. 1 reason why you won't see me on a ballot again is the way candidates treat each other falsely from both sides."
Billings agreed to the two minutes each public input.
"It's fantastic to have such a large pool," Salas said. "It won't be an easy decision."
The final article will cover the rest of the agenda and the decisions made at the regular session.