WATCHING THE RIVER FLOW: Our old J-school prof's blue pencil used to wear thin on students' submissions in writing "sez who?" in the margins when their articles contained fully unattributed "facts." It's become one of our pet peeves too- at least add a "reportedly" or the all-inclusive "according to critics."
So it should be too much of a surprise that steam came shooting out of our ears once again this morning when another "according to who?" bit of bull-dinky appeared in a local newspaper article about KIUC's reaction to the FERC decision to "dismiss" two of their preliminary permits and ban future ones in the islands.
In the second paragraph of an article penned by Business Editor Vanessa Van Voorhis, apropos of nothing she writes:
Free Flow Power (FFP) of Massachusetts filed preliminary permit applications with the federal agency earlier this year for projects located on Koke‘e and Kekaha Ditch Irrigation systems. The permits, once issued, were to be turned over to KIUC, under a paid contract agreement with the co-op for an undisclosed amount (emphasis added).
Of course our readers know that that timeline is straight from the Kaua`i Island Utilities Coop's party line and has never been substantiated. As a matter of fact it appears that KIUC was presented with a "deal they couldn't refuse" after FFP obtained preliminary permits from the Federal Energy Regulatory Commission (FERC).
No one really knows for sure whether in fact KIUC actually approached FFP or the other way around because the Memorandum of Agreement (MOA)- the contract between FFP and KIUC- has been declared "proprietary information" by the supposedly member owned and run co-op.
But, as we wrote last July 6 just before the "vote" to invalidate the MOA was closed:
According to documents uncovered by reporter Joan Conrow and information that has been dragged out of KIUC CEO David Bissell and their attorney David Proudfoot, the MOAs came about after FFP filed for six- and already received at least three- FERC preliminary permits that allow the holder to exclusively investigate the possibility of constructing hydroelectric systems for the named areas, potentially leading to FERC licensing of the projects.
But those permits are non-transferable so FFP set up shell corporation to file for the permits and after they were granted they "sold" the shell corporations to KIUC under those MOAs.
There's a reason why we put sold in quotes. Because, according to the information repeated over and over by Bissell and Proudfoot, should the members vote no, the MOAs say that the permits would have to be turned over to FFP- AND we would have to pay them $325,000 to take them back to boot.
We also noted that:
People might be interested to know that the person who approached KIUC for FFP to set up the "offer they couldn't refuse" is said to be investment banker Bill Collett, the same person who set up the whole purchase of Kaua`i Electric from Citizen's Electric for an exorbitant amount of money that was still way more than the book value even after it was decreased by $50 million by the PUC.
But the local newspaper hasn't exactly been in the forefront of investigating the claims of its biggest advertiser, KIUC.
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And it seems they're not about to start now.
The article also again raises the question of whether there is indeed a Hawai`i state process for permitting hydroelectric systems. As we first reported last week, in the FERC's dismissal of two of the permits they cited an established state process, one that had been used in developing 13 other hydroelectric projects in the state.
But while, according to the article, KIUC board member Ben Sullivan still questions whether there is an actual state process State Aquatic Biologist Don Heacock explained to us last week that the state process is the same one used for any other stream diversions.
He told us that, as he and Adam Asqueth- who led the effort to get KIUC to abandon federal oversight- said over and over during the membership vote in July, any hydropower effort must use the state standards for water flow and deal with them in light of the effects on the whole watershed and include effects on water use and diversion on the watershed as a whole.
According to the article Sullivan cited problems with the state process in the same breath as questioning whether there is one. But KIUC CEO David Bissell and Sullivan himself had claimed during the voting process that using FERC would never usurp any state regulations.
The article quotes Sullivan as saying:
“One of the (the problems) is the cumbersome nature of the state process —and perhaps even the non-existence of a state process — and that’s an important issue we’ve discussed... There’s high cost involved in a process that has no timeline for ending, and it’s difficult to know whether it’s in the members’ interest to even engage in such a process. The FERC avenue offers an alternate to that, potentially. It also lays out a process that we can limit, as you have suggested, and I think that it’s something that the staff is constantly working with the state to do.”
So which is it? Are they going to follow the state process or claim there isn't one and do a little as they can get away with?
The article also quotes Sullivan as saying "I do believe that we made some mistakes in the early going, but I do believe we’re doing our best in the interest of the community and continue on with an open mind and open options is the way to go,"
If that's at all true it's about time for him and the board to come clean about all the alleged FFP/FERC shenanigans, release the MOA, abandon the other permits and follow the state processes, as they promised during the vote.
Showing posts with label David Proudfoot. Show all posts
Showing posts with label David Proudfoot. Show all posts
Thursday, October 27, 2011
Friday, July 29, 2011
ELECTROCUTION ELOCUTION
ELECTROCUTION ELOCUTION: Perhaps the biggest chuckle we got during the whole KIUC FERC vote debacle was the electric co-op's promise that, like any five year old who had lied and misbehaved, they would never do it again.
So the new era of openness and transparency that was promised after the vote failed, is upon us, right?
OK you can stop laughing now. Because as many have heard, after the second petition- one to try to force a re-vote due to the massive abuse of the voting process on KIUC's part- allegedly failed to garner enough signatures, they wouldn't even allow the petitioners to go over the petition and the membership list to ascertain the co-op's claim that many of the signatures were either duplicates or those of non-members.
But for a real eyeful of what the future of "member relations" is going to look like nothing can beat the "Fear and Loathing" style first hand account of Tuesday's KIUC Board meeting by Tek Nickerson- a regular guy who was outraged by many of the things he saw and got involved with the second petition.
So we hand over the rest of today's column to Tek's "report" on what went down (all SIC).
-----
UPDATE ON PETITION TO RECALL ELECTION by Tek Nickerson
KIUC held their regularly scheduled Board meeting yesterday, Tuesday, 7.26.11. In response to the Members’ Second Petition and strong request for a verifiable count of signatures, KIUC simply issued a statement, defining a valid signature vs an invalid signature, plus a restatement of the count. They completely sidestepped the question about verification and that they might have a vested interest in protecting their own privacy how the determination was made on each signature.
I was the only one from the public signed in to talk, which was first on the agenda. Chairman Phil Tacbian said only members could talk and they could only talk in items on the agenda for three minutes.
I was called “to the stand.” I introduced myself as the point person on the second petition (to recall the election). The chairman said the petition was not on the agenda, and therefore COULD NOT BE DISCUSSED, so I could not talk. I thanked him and sat down, setting my precedence for respect.
(It was later explained to me that items are put on the agenda five days prior to the meeting. The agenda is posted on the KIUC web site. Since Tuesday was the sixth day after they received the petition, they CHOSE to avoid the issue by ignoring it on the agenda.)
I sat and listened as each person at the table gave their report. Consulting Counsel Proudfoot reported that he advised the Board how to proceed in response to the Second Petition.
Paraphrasing:
“A point of order, Mr. Chairman! Mr Proudfoot just brought the subject of the Second Petition to the table! I may now speak on the subject!”
“No, you may not.”
This is the second time the Chair CHOSE to be dismissive.
Steve Raposo, Vice Chair and chairman of the Members Relations Committee, did not mention the Second Petition in his report. This was the third time that a KIUC elected representative chose to ignore their commitment to being open and reaching out to the public.
During a break, Consulting Counsel Proudfoot approached Director Jan TenBruggencarte and me. He said he was intending to tell Jan something to tell me. Finding me pleasant and inviting his advice, he said that I could ask the Chair to wave the rule and allow me to speak. This is encouraging, especially coming from him. We showed each other we were reasonable men and could work with each other.
Raposo’s Members Relations report centered on defining exactly what their course of action would be for outreach with the public. After ten minutes of discussion, it was still a quandary for them what it would look like.
Knowing that Raposo probably categorized me as an unreasonable obstructionist, I approached him with a suggestion. He was a bit taken aback, but he listened. I reminded him that history has taught us the approach that works under similar circumstances: the Dolley Madison solution of giving weekly parties for opposing political sides in the neutral territory of her home. I.e. Take the budget for talk-down “dog and pony shows” and apply it to island-wide regional parties, where the public is attracted first by the food and then by the opportunity to ask questions of their elected directors and opposing views one-on-one. Raposo listened. Time will tell if he is receptive to Dolley Madison’s ingeniously iconic solution, used in the White House to this day.
Raposo is one of the Gang of Five, who controls the direction that the board votes. (About the First Petition, he reportedly remarked that some people are only obstructionists. This is the third opportunity they passed up.)
At each opportunity ANY one of the directors could have interjected an objection…and did not.
A CALL TO ACTION:
During a break, Jan B. told me that until the elections give them FIVE votes aligned with our thinking, the board will continue to vote as they have. I characterize this as an archaic corporate/plantation-style mentality. The progeny of field hands have come of age to think on their own without the aid of the dumbing down from a political machine.
The three up for re-election are Ben Sullivan, Stu Burley and Steve Raposo. Jan explained that if we vote out Stu and Steve with strong candidates, we’ll have purged the Gang of Five with our own Five Alive.
This is the light at the end of the tunnel.
Meanwhile, sitting in the back of the room for a while was Free Flow Power representatives, Jason Hines and his assistant, Dawn. The chairman invited them to report an update on their progress. THIS WAS NOT ON THE AGENDA.
Then we all took a break before they went onto Executive session. I took the opportunity to complain to Ben Sullivan that FFP should not have been given the floor, since they weren’t on the Agenda. Ben said he let it go, because they wouldn’t be taking a vote. That’s contrary to their own rules! Thus, there is NO WAY in which the situation can be “corrected” if the Board can continue to “pick and choose” what it can do accordingly.
Will KIUC consider the “possibility” of a forum approach in getting to the root of the matter discussed in a neutral venue with an opportunity for both sides of the issue to be in the planning process of determining what should be discussed and how both sides can be fairly presented?
If you are a member of KIUC and wish to express your position on any of these matters, you are encouraged to contact the KIUC Board of Directors at KIUCBOD@Hawaii.rr.com.
So the new era of openness and transparency that was promised after the vote failed, is upon us, right?
OK you can stop laughing now. Because as many have heard, after the second petition- one to try to force a re-vote due to the massive abuse of the voting process on KIUC's part- allegedly failed to garner enough signatures, they wouldn't even allow the petitioners to go over the petition and the membership list to ascertain the co-op's claim that many of the signatures were either duplicates or those of non-members.
But for a real eyeful of what the future of "member relations" is going to look like nothing can beat the "Fear and Loathing" style first hand account of Tuesday's KIUC Board meeting by Tek Nickerson- a regular guy who was outraged by many of the things he saw and got involved with the second petition.
So we hand over the rest of today's column to Tek's "report" on what went down (all SIC).
-----
UPDATE ON PETITION TO RECALL ELECTION by Tek Nickerson
KIUC held their regularly scheduled Board meeting yesterday, Tuesday, 7.26.11. In response to the Members’ Second Petition and strong request for a verifiable count of signatures, KIUC simply issued a statement, defining a valid signature vs an invalid signature, plus a restatement of the count. They completely sidestepped the question about verification and that they might have a vested interest in protecting their own privacy how the determination was made on each signature.
I was the only one from the public signed in to talk, which was first on the agenda. Chairman Phil Tacbian said only members could talk and they could only talk in items on the agenda for three minutes.
I was called “to the stand.” I introduced myself as the point person on the second petition (to recall the election). The chairman said the petition was not on the agenda, and therefore COULD NOT BE DISCUSSED, so I could not talk. I thanked him and sat down, setting my precedence for respect.
(It was later explained to me that items are put on the agenda five days prior to the meeting. The agenda is posted on the KIUC web site. Since Tuesday was the sixth day after they received the petition, they CHOSE to avoid the issue by ignoring it on the agenda.)
I sat and listened as each person at the table gave their report. Consulting Counsel Proudfoot reported that he advised the Board how to proceed in response to the Second Petition.
Paraphrasing:
“A point of order, Mr. Chairman! Mr Proudfoot just brought the subject of the Second Petition to the table! I may now speak on the subject!”
“No, you may not.”
This is the second time the Chair CHOSE to be dismissive.
Steve Raposo, Vice Chair and chairman of the Members Relations Committee, did not mention the Second Petition in his report. This was the third time that a KIUC elected representative chose to ignore their commitment to being open and reaching out to the public.
During a break, Consulting Counsel Proudfoot approached Director Jan TenBruggencarte and me. He said he was intending to tell Jan something to tell me. Finding me pleasant and inviting his advice, he said that I could ask the Chair to wave the rule and allow me to speak. This is encouraging, especially coming from him. We showed each other we were reasonable men and could work with each other.
Raposo’s Members Relations report centered on defining exactly what their course of action would be for outreach with the public. After ten minutes of discussion, it was still a quandary for them what it would look like.
Knowing that Raposo probably categorized me as an unreasonable obstructionist, I approached him with a suggestion. He was a bit taken aback, but he listened. I reminded him that history has taught us the approach that works under similar circumstances: the Dolley Madison solution of giving weekly parties for opposing political sides in the neutral territory of her home. I.e. Take the budget for talk-down “dog and pony shows” and apply it to island-wide regional parties, where the public is attracted first by the food and then by the opportunity to ask questions of their elected directors and opposing views one-on-one. Raposo listened. Time will tell if he is receptive to Dolley Madison’s ingeniously iconic solution, used in the White House to this day.
Raposo is one of the Gang of Five, who controls the direction that the board votes. (About the First Petition, he reportedly remarked that some people are only obstructionists. This is the third opportunity they passed up.)
At each opportunity ANY one of the directors could have interjected an objection…and did not.
A CALL TO ACTION:
During a break, Jan B. told me that until the elections give them FIVE votes aligned with our thinking, the board will continue to vote as they have. I characterize this as an archaic corporate/plantation-style mentality. The progeny of field hands have come of age to think on their own without the aid of the dumbing down from a political machine.
The three up for re-election are Ben Sullivan, Stu Burley and Steve Raposo. Jan explained that if we vote out Stu and Steve with strong candidates, we’ll have purged the Gang of Five with our own Five Alive.
This is the light at the end of the tunnel.
Meanwhile, sitting in the back of the room for a while was Free Flow Power representatives, Jason Hines and his assistant, Dawn. The chairman invited them to report an update on their progress. THIS WAS NOT ON THE AGENDA.
Then we all took a break before they went onto Executive session. I took the opportunity to complain to Ben Sullivan that FFP should not have been given the floor, since they weren’t on the Agenda. Ben said he let it go, because they wouldn’t be taking a vote. That’s contrary to their own rules! Thus, there is NO WAY in which the situation can be “corrected” if the Board can continue to “pick and choose” what it can do accordingly.
Will KIUC consider the “possibility” of a forum approach in getting to the root of the matter discussed in a neutral venue with an opportunity for both sides of the issue to be in the planning process of determining what should be discussed and how both sides can be fairly presented?
If you are a member of KIUC and wish to express your position on any of these matters, you are encouraged to contact the KIUC Board of Directors at KIUCBOD@Hawaii.rr.com.
Wednesday, July 6, 2011
STOP MAKING SENSE
STOP MAKING SENSE: With Friday's high noon deadline for the ballots to be received in Kaua`i Island Utilities Co-op (KIUC) "Hydro Vote"- as they insist on calling it, with the words Federal Energy Regulatory Commission (FERC) being entirely absent on the the ballot- looming, the lack of full disclosure, straight talk and transparency in the process are what stand out to those voters who have done their own "due diligence."
In examining the ballot one question that hasn't received much attention is, what exactly are co-op members being asked to vote upon?
In asking "As a KIUC member do you approve of the Board action set out above?" the "above" part says, in main:
This ballot allows KIUC members to approve or reject a KIUC Board action that authorized contracting services for hydroelectric development and acquiring those hydroelectric assets...
A valid petition... requests a member vote on the KIUC Board’s action taken at its Regular Board Meeting on March 29, 2011, approving a Development Services Agreement and an LLC Assignment Agreement that had been negotiated by KIUC Staff with Free Flow Power Corporation.(emphasis added)
So in essence members are being asked whether they approve of the "Development Services Agreement and an LLC Assignment Agreement."
We aren't just being asked to approve or disapprove of a board decision. It's not the decision that's central to the vote. Instead members are being asked to approve or disapprove the contracts the board approved.
The problem is that, as we all know, those agreements- referred to as a Memoranda of Agreement or MOAs- are not being made available to the voters making the decision on whether they are in the best interest of members effectively impossible.
How exactly are members to decide if they approve of the "contracts" if they have no idea what exactly they say?
Well, that "Star Chamber" aspect of this whole affair will certainly be central to any legal action by "no" vote proponents should the co-op members approve of the contracts- that and KIUC's costly, "vote yes," disinformation campaign and suppressing the claims of the petitioners
That alone should be enough for a judge to grant an injunction to enjoin a suit to invalidate the vote, giving the shareholders- the co-op members- derivative injunctive relief, according to a legal expert we spoke to who asked not to be identified.
In other words, we were told, "the guy in the robe would, most likely, tell Proudfoot 'no way'" can you ask voters to approve or disapprove of a document they're not allowed to see.
But let's examine the central claims that we do know concerning the whole deal.
According to documents uncovered by reporter Joan Conrow and information that has been dragged out of KIUC CEO David Bissell and their attorney David Proudfoot, the MOAs came about after FFP filed for six- and already received at least three- FERC preliminary permits that allow the holder to exclusively investigate the possibility of constructing hydroelectric systems for the named areas, potentially leading to FERC licensing of the projects.
But those permits are non-transferable so FFP set up shell corporation to file for the permits and after they were granted they "sold" the shell corporations to KIUC under those MOAs.
There's a reason why we put sold in quotes. Because, according to the information repeated over and over by Bissell and Proudfoot, should the members vote no, the MOAs say that the permits would have to be turned over to FFP- AND we would have to pay them $325,000 to take them back to boot.
Of course we have no way to know how much of this is the truth because no one can see the MOAs. But one thing rises to the top.
If the preliminary permits were part of the deal to "purchase" the shell corporations- which KIUC apparently now "owns"- how can the "non-transferable" permits be transferred back to FFP? And why would we have to pay them almost a third of a million dollars for taking them off our hands?
Especially if the MOA has been invalidated by the vote- something that all involved knew was a possibility when they were signed.
Another note before we take a long weekend and await the vote...
People might be interested to know that the person who approached KIUC for FFP to set up the "offer they couldn't refuse" is said to be investment banker Bill Collett, the same person who set up the whole purchase of Kaua`i Electric from Citizen's Electric for an exorbitant amount of money that was still way more than the book value even after it was decreased by $50 million by the PUC.
We've heard from many of the opponents of the FERC process that they are waiting to see the outcome before filing suit, saying that they would be satisfied if the contract is rejected.
But frankly as someone who smells corruption behind the whole deal, at this point we care less about the outcome of the vote than the contents of the two contracts that are likely so explosive that KIUC would go to these extraordinary measures suppress contents.
Regardless of what happens at 12:00 noon on Friday we hope members will still be demanding to see those MOAs at 12:01 pm. Because if we don't you can be assured that we'll be right back here again after the board and executive staff of KIUC gets the message that they can get away with withholding vital information from its members.
In examining the ballot one question that hasn't received much attention is, what exactly are co-op members being asked to vote upon?
In asking "As a KIUC member do you approve of the Board action set out above?" the "above" part says, in main:
This ballot allows KIUC members to approve or reject a KIUC Board action that authorized contracting services for hydroelectric development and acquiring those hydroelectric assets...
A valid petition... requests a member vote on the KIUC Board’s action taken at its Regular Board Meeting on March 29, 2011, approving a Development Services Agreement and an LLC Assignment Agreement that had been negotiated by KIUC Staff with Free Flow Power Corporation.(emphasis added)
So in essence members are being asked whether they approve of the "Development Services Agreement and an LLC Assignment Agreement."
We aren't just being asked to approve or disapprove of a board decision. It's not the decision that's central to the vote. Instead members are being asked to approve or disapprove the contracts the board approved.
The problem is that, as we all know, those agreements- referred to as a Memoranda of Agreement or MOAs- are not being made available to the voters making the decision on whether they are in the best interest of members effectively impossible.
How exactly are members to decide if they approve of the "contracts" if they have no idea what exactly they say?
Well, that "Star Chamber" aspect of this whole affair will certainly be central to any legal action by "no" vote proponents should the co-op members approve of the contracts- that and KIUC's costly, "vote yes," disinformation campaign and suppressing the claims of the petitioners
That alone should be enough for a judge to grant an injunction to enjoin a suit to invalidate the vote, giving the shareholders- the co-op members- derivative injunctive relief, according to a legal expert we spoke to who asked not to be identified.
In other words, we were told, "the guy in the robe would, most likely, tell Proudfoot 'no way'" can you ask voters to approve or disapprove of a document they're not allowed to see.
But let's examine the central claims that we do know concerning the whole deal.
According to documents uncovered by reporter Joan Conrow and information that has been dragged out of KIUC CEO David Bissell and their attorney David Proudfoot, the MOAs came about after FFP filed for six- and already received at least three- FERC preliminary permits that allow the holder to exclusively investigate the possibility of constructing hydroelectric systems for the named areas, potentially leading to FERC licensing of the projects.
But those permits are non-transferable so FFP set up shell corporation to file for the permits and after they were granted they "sold" the shell corporations to KIUC under those MOAs.
There's a reason why we put sold in quotes. Because, according to the information repeated over and over by Bissell and Proudfoot, should the members vote no, the MOAs say that the permits would have to be turned over to FFP- AND we would have to pay them $325,000 to take them back to boot.
Of course we have no way to know how much of this is the truth because no one can see the MOAs. But one thing rises to the top.
If the preliminary permits were part of the deal to "purchase" the shell corporations- which KIUC apparently now "owns"- how can the "non-transferable" permits be transferred back to FFP? And why would we have to pay them almost a third of a million dollars for taking them off our hands?
Especially if the MOA has been invalidated by the vote- something that all involved knew was a possibility when they were signed.
Another note before we take a long weekend and await the vote...
People might be interested to know that the person who approached KIUC for FFP to set up the "offer they couldn't refuse" is said to be investment banker Bill Collett, the same person who set up the whole purchase of Kaua`i Electric from Citizen's Electric for an exorbitant amount of money that was still way more than the book value even after it was decreased by $50 million by the PUC.
We've heard from many of the opponents of the FERC process that they are waiting to see the outcome before filing suit, saying that they would be satisfied if the contract is rejected.
But frankly as someone who smells corruption behind the whole deal, at this point we care less about the outcome of the vote than the contents of the two contracts that are likely so explosive that KIUC would go to these extraordinary measures suppress contents.
Regardless of what happens at 12:00 noon on Friday we hope members will still be demanding to see those MOAs at 12:01 pm. Because if we don't you can be assured that we'll be right back here again after the board and executive staff of KIUC gets the message that they can get away with withholding vital information from its members.
Thursday, June 30, 2011
FOLLOWING THE MONEY
FOLLOWING THE MONEY: In addition to our wholesale advocacy of a "no" vote on this FERCin' mess KIUC has gotten us into with their capitulation to Free Flow Partners' (FFP) extortion, we've been doing quite a bit of retail, taking a slew of phone calls from people for whom computers are anathema- all essentially asking "WTF?".
Many just want an answer as to whether to vote "no" or "yes." But far more have read both the newspaper articles and the ballot itself along with KIUC's unbelievably slanted voters' guide.
Under "your no vote means" the guide makes the claim that:
The contracts with FFP will be terminated, and all preliminary permits will revert back to FFP. This will make progress on hydro in the near term very difficult and more expensive, and more than $325,000 in contractual obligations will be due to FFP.
Even those that have read both our coverage and Joan Conrow's awesome Honolulu Weekly article and meticulously researched and presented Gold Diggers (parts 1 and 2) blog posts have asked an important question.
Basically they ask "well, yes- the whole deal stinks and we should never have entered into any deal with FFP. But now that we have we stand to lose $325,000 (some reports claim it's as high as $400,000) which will inevitably show up on our bill. And we will have paid that money and not be any closer to hydroelectric power project development. Shouldn't I vote 'yes?'"
The answer to the first part is that while yes, it will cost hundreds of thousands to cancel the deal with FFP, many have not heard or glossed over a quote from Conrow's Honolulu Weekly piece which says that:
Bissell said no specific price was placed on the applications, which were purchased as part of a larger consulting contract. The utility has refused to disclose the full value of the contract, which includes an incentive for delivering completed projects, but KIUC attorney David Proudfoot said FFP will be paid “several million dollars if none go past the first stage."
Given the opposition to FERC and the likelihood that, with the state's long-standing opposition and threats to sue, we will never proceed to full FERC licensing. What a yes vote means is that, although we'll have to forfeit the $325K we'd potentially be throwing away a lot more.
As Conrow concluded in her second Gold Digger post:
In its permitted applications, FFP states, “The studies will be financed by the applicant.” No mention is made of KIUC. For each project, FFP estimates the cost of doing all the first-year studies — the feasibility stuff — at $100,000. The rest of the work — consultations, developing a notice of intent and pre-application document, and beginning scoping activities — is estimated to “not exceed $500,000."
So even if FFP were to take all six projects all the way up to the license application, it would cost no more than $3.6 million. KIUC won’t tell us exactly what we’re paying, but KIUC attorney David Proudfoot told us at the June 4 community meeting that FFP will be paid “several million dollars if none go past the first stage.”
Several is defined as “more than or three but not many.” So it sounds like we’re paying close to, if not more than, the full estimated price for bringing all six projects through the first stage, even though KIUC CEO David Bissell and some Board members have acknowledged that some of the projects will never get off the ground.
On top of that, FFP will get an incentive for delivering completed projects.
The second question is a bit trickier but perhaps more revealing.
The reason why KIUC says it is going through the FERC is that there is no state process for developing hydro. But we must remember a couple of things.
What many including petition initiator Adam Asquith have said, is that what we should have done- and should do- is to go to the state and say "we want to do hydroelectric projects and want to work with the state to establish a system for development and introduce and pass enabling legislation and eventually administrative rules so that we can develop environmentally and culturally sensitive and water-wise projects into the future.
And, as a matter of fact, a good place to start is the KIUC ballyhooed flow chart that FERC has already developed for public participation and alter it for our unique water laws.
Certainly we're not the only ones in the state who want to develop hydropower. HELCO has the same renewable energy portfolio requirements as KIUC for the other islands. If and when they wake up to the insanity of their "Big Wind" project and the fact that it is doomed to failure, hydroelectric is probably the next best technology in terms of cost of both development and future rates.
But whether through pure laziness, corruption or pure stupidity the KIUC board of directors and administrative staff seems hell bent on committing us to a costly and widely-opposed way of going about it- one that, even if it were to succeed, would still leave us without a simpler, less costly statewide system for the next round of hydroelectric development.
The $325-400,000 we stand to lose in a "no" vote is peanuts compared to the cost of a "yes" vote down the road. Whether as a way to say no to FERC or to, in fact, SAVE us money, a "no" vote is the best option to get us out of this mess that the board of KIUC has gotten us into.
That and remembering this fiasco during the next KIUC board of directors election.
Many just want an answer as to whether to vote "no" or "yes." But far more have read both the newspaper articles and the ballot itself along with KIUC's unbelievably slanted voters' guide.
Under "your no vote means" the guide makes the claim that:
The contracts with FFP will be terminated, and all preliminary permits will revert back to FFP. This will make progress on hydro in the near term very difficult and more expensive, and more than $325,000 in contractual obligations will be due to FFP.
Even those that have read both our coverage and Joan Conrow's awesome Honolulu Weekly article and meticulously researched and presented Gold Diggers (parts 1 and 2) blog posts have asked an important question.
Basically they ask "well, yes- the whole deal stinks and we should never have entered into any deal with FFP. But now that we have we stand to lose $325,000 (some reports claim it's as high as $400,000) which will inevitably show up on our bill. And we will have paid that money and not be any closer to hydroelectric power project development. Shouldn't I vote 'yes?'"
The answer to the first part is that while yes, it will cost hundreds of thousands to cancel the deal with FFP, many have not heard or glossed over a quote from Conrow's Honolulu Weekly piece which says that:
Bissell said no specific price was placed on the applications, which were purchased as part of a larger consulting contract. The utility has refused to disclose the full value of the contract, which includes an incentive for delivering completed projects, but KIUC attorney David Proudfoot said FFP will be paid “several million dollars if none go past the first stage."
Given the opposition to FERC and the likelihood that, with the state's long-standing opposition and threats to sue, we will never proceed to full FERC licensing. What a yes vote means is that, although we'll have to forfeit the $325K we'd potentially be throwing away a lot more.
As Conrow concluded in her second Gold Digger post:
In its permitted applications, FFP states, “The studies will be financed by the applicant.” No mention is made of KIUC. For each project, FFP estimates the cost of doing all the first-year studies — the feasibility stuff — at $100,000. The rest of the work — consultations, developing a notice of intent and pre-application document, and beginning scoping activities — is estimated to “not exceed $500,000."
So even if FFP were to take all six projects all the way up to the license application, it would cost no more than $3.6 million. KIUC won’t tell us exactly what we’re paying, but KIUC attorney David Proudfoot told us at the June 4 community meeting that FFP will be paid “several million dollars if none go past the first stage.”
Several is defined as “more than or three but not many.” So it sounds like we’re paying close to, if not more than, the full estimated price for bringing all six projects through the first stage, even though KIUC CEO David Bissell and some Board members have acknowledged that some of the projects will never get off the ground.
On top of that, FFP will get an incentive for delivering completed projects.
The second question is a bit trickier but perhaps more revealing.
The reason why KIUC says it is going through the FERC is that there is no state process for developing hydro. But we must remember a couple of things.
What many including petition initiator Adam Asquith have said, is that what we should have done- and should do- is to go to the state and say "we want to do hydroelectric projects and want to work with the state to establish a system for development and introduce and pass enabling legislation and eventually administrative rules so that we can develop environmentally and culturally sensitive and water-wise projects into the future.
And, as a matter of fact, a good place to start is the KIUC ballyhooed flow chart that FERC has already developed for public participation and alter it for our unique water laws.
Certainly we're not the only ones in the state who want to develop hydropower. HELCO has the same renewable energy portfolio requirements as KIUC for the other islands. If and when they wake up to the insanity of their "Big Wind" project and the fact that it is doomed to failure, hydroelectric is probably the next best technology in terms of cost of both development and future rates.
But whether through pure laziness, corruption or pure stupidity the KIUC board of directors and administrative staff seems hell bent on committing us to a costly and widely-opposed way of going about it- one that, even if it were to succeed, would still leave us without a simpler, less costly statewide system for the next round of hydroelectric development.
The $325-400,000 we stand to lose in a "no" vote is peanuts compared to the cost of a "yes" vote down the road. Whether as a way to say no to FERC or to, in fact, SAVE us money, a "no" vote is the best option to get us out of this mess that the board of KIUC has gotten us into.
That and remembering this fiasco during the next KIUC board of directors election.
Thursday, June 23, 2011
ASK ALICE
ASK ALICE: It didn't take long for our phone to start ringing yesterday and, as is usual when we describe someone- in this case people with Kaua`i Island Utilities Co-op (KIUC) - grasping at straws, trying to overcome past stupid foibles by spewing additional half-truths and outright lies, as things get clearer and clearer they also get curiouser and curiouser.
KIUC's latest "claim,"- as we called it yesterday even though we know how charged that word is as opposed to simply "said" that essentially KIUC has only thus far received "preliminary permits" through the Federal Energy Regulatory Commission (FERC) process and that the state doesn't oppose that, has a few people confused.
Because for it to mean anything at all it would mean that those urging a "no" vote on the ballot question co-op members are currently being asked to decide, have won and KIUC is stopping the FERC "process" with these "preliminary permits."
The question that we came away from those calls with is "so what." Because unless KIUC has decided to reverse course and end their involvement with Free Flow Partners (FFP) and abandon the actual development of the hydroelectric projects, it's an absolutely meaningless red herring.
Because, although we can't be sure what in the heck KIUC has agreed to in their super-secret Memorandum of Agreement (MOA) with FFP because they won't let anyone see it. It's quite obvious that the "FERC process" they speak of includes the actual development of the projects and the granting of full FREC "licenses" to do so.
That bit of obfuscation and some other things were made a bit clearer with the on-line availability of Joan Conrow's Honolulu Weekly article on the subject.
But one thing, if we're reading it right, just adds another layer to the original sins of KIUC in secretly signing up with FFP.
Joan writes that:
The utility actually followed the lead of Free Flow Power (FFP), a Massachusetts-based consortium of consultants and investors that filed the permit applications that created a community uproar. The utility became embroiled when it bought Free Flow’s permits and hired the firm (emphasis added) to guide it through a hydro development process administered by the Federal Energy Regulatory Commission (FERC) in Washington, DC...
To stake its own claim, KIUC purchased the shell companies that FFP formed to file six applications on waterways (emphasis added) from Hanalei to Kekaha. FERC has already approved three, giving KIUC preliminary permits that carry the exclusive right to study hydroelectric development for three years.
Now those following the the issue down the rabbit hole will remember the original claim by KIUC CEO David Bissell and their attorney David Proudfoot was that the reason they went to FFP and engaged in the FREC process was so that they could make sure that someone else didn't apply for a permit, which grants the exclusive rights to a three-year period to consider development.
But if we're reading Conrow's contention right it sounds like that "someone else" might just have been... drum roll... FFP.
That would certainly explain why, as opponents have said, KIUC chose a company with no hydroelectric track record that sounds more like a venture capital firm- with shady connections- than an energy developer.
While as KIUC has indicated there may have been others who they were afraid of it makes you wonder who is extorting whom.
As we said in our "editorial" Monday- and as Conrow makes abundantly clear- "nothing but a pack of cards" KIUC has created a situation where anyone who didn't, as they say, think that "a sign that they're lying is that their lips are moving" before this episode, is certainly convinced of it now.
Yet unbelievably, Bissell is quoted as bizarrely having said:
“I encourage everyone to have trust in KIUC, have trust in your elected board, have trust in me and, most importantly, have trust in yourself. The only way these projects will go forward is through overwhelming community support.”
All we can say to that is "eat me."
KIUC's latest "claim,"- as we called it yesterday even though we know how charged that word is as opposed to simply "said" that essentially KIUC has only thus far received "preliminary permits" through the Federal Energy Regulatory Commission (FERC) process and that the state doesn't oppose that, has a few people confused.
Because for it to mean anything at all it would mean that those urging a "no" vote on the ballot question co-op members are currently being asked to decide, have won and KIUC is stopping the FERC "process" with these "preliminary permits."
The question that we came away from those calls with is "so what." Because unless KIUC has decided to reverse course and end their involvement with Free Flow Partners (FFP) and abandon the actual development of the hydroelectric projects, it's an absolutely meaningless red herring.
Because, although we can't be sure what in the heck KIUC has agreed to in their super-secret Memorandum of Agreement (MOA) with FFP because they won't let anyone see it. It's quite obvious that the "FERC process" they speak of includes the actual development of the projects and the granting of full FREC "licenses" to do so.
That bit of obfuscation and some other things were made a bit clearer with the on-line availability of Joan Conrow's Honolulu Weekly article on the subject.
But one thing, if we're reading it right, just adds another layer to the original sins of KIUC in secretly signing up with FFP.
Joan writes that:
The utility actually followed the lead of Free Flow Power (FFP), a Massachusetts-based consortium of consultants and investors that filed the permit applications that created a community uproar. The utility became embroiled when it bought Free Flow’s permits and hired the firm (emphasis added) to guide it through a hydro development process administered by the Federal Energy Regulatory Commission (FERC) in Washington, DC...
To stake its own claim, KIUC purchased the shell companies that FFP formed to file six applications on waterways (emphasis added) from Hanalei to Kekaha. FERC has already approved three, giving KIUC preliminary permits that carry the exclusive right to study hydroelectric development for three years.
Now those following the the issue down the rabbit hole will remember the original claim by KIUC CEO David Bissell and their attorney David Proudfoot was that the reason they went to FFP and engaged in the FREC process was so that they could make sure that someone else didn't apply for a permit, which grants the exclusive rights to a three-year period to consider development.
But if we're reading Conrow's contention right it sounds like that "someone else" might just have been... drum roll... FFP.
That would certainly explain why, as opponents have said, KIUC chose a company with no hydroelectric track record that sounds more like a venture capital firm- with shady connections- than an energy developer.
While as KIUC has indicated there may have been others who they were afraid of it makes you wonder who is extorting whom.
As we said in our "editorial" Monday- and as Conrow makes abundantly clear- "nothing but a pack of cards" KIUC has created a situation where anyone who didn't, as they say, think that "a sign that they're lying is that their lips are moving" before this episode, is certainly convinced of it now.
Yet unbelievably, Bissell is quoted as bizarrely having said:
“I encourage everyone to have trust in KIUC, have trust in your elected board, have trust in me and, most importantly, have trust in yourself. The only way these projects will go forward is through overwhelming community support.”
All we can say to that is "eat me."
Wednesday, June 22, 2011
JUST FERCIN' WITH YA
JUST FERCIN' WITH YA: Although our editorial Monday concentrated on the incredible arrogance and stupidity regarding the way Kaua`i Island Utilities Co-op (KIUC)- notably via CEO David Bissell and attorney David Proudfoot- has acted in the whole Federal Energy Regulatory Commission (FERC) hydroelectric project debacle, we did mention at least two glaring issues that have underlined efforts to reverse the board's decision to engage with Free Flow Partners (FFP) to go through the FERC process- issues that KIUC has refused to respond to, choosing instead to obfuscate the issues and overwhelm us with costly PR.
The first was the state's opposition to the project, specifically through statements by William Tam, deputy director for water at DLNR. The second was regarding the Supreme Court of the US (SCOTUS) case California vs FERC in which the court rules that FERC rules preempt state laws and regulations regarding water use.
But although KIUC has generally ignored the real issues and has attempted subterfuge and extortion in trying to win the ballot vote to reverse the decision, they are finally fighting back in the person of board members (and, full disclosure, our long time friend) Jan TenBruggencate, with whom we spoke on Monday.
Apparently TenBruggencate has also been speaking to the local newspaper and today they published an article in which TenBruggencate essentially claims that KIUC has only received "preliminary permits" and that the state only opposes actual final FERC permits.
They also said they couldn't reach Tam for the article but state that TenBruggencate met with Tam last week.
However in a piece by Joan Conrow in her Kaua`i Eclectic blog today she says that
I was able to get some clarification from Tam for my Honolulu Weekly article, which comes out today...
I asked Tam, who previously told me he’d taken no stand on the FERC permits, if that was a correct statement of his position and got this email in response:
"Hypothetical situations have been considered under certain assumptions, but no resolution has been reached."
And I can’t help but wonder, if the state supposedly doesn't oppose the use of preliminary permits to scope hydro projects, why have two state agencies — the Agribusiness Development Corp. and Department of Hawaiian Home Lands — already filed formal motions to intervene?
Clearly, they're alarmed about something.
Clearly.
But TenBruggencate's other contention- one made earlier to attorney-blogger Charley Foster- was that another SCOTUS case could mean that, as Foster headlined "FERC supremacy over Kauai water regs overstated?"
Seems a case called Jefferson County Et Al. V. Washington Department Of Ecology Et Al. (1994), which came after the 1990 California case, apparently held that some state regs could actually trump federal law as TenBruggencate claimed to us on Monday
Foster said in a comment on our Monday editorial:
It's an interesting situation before the Supreme Court. While California v. FERC said the Federal Power Act supersedes state law under all but certain enumerated circumstances, the Court later ruled in PUD No. 1 of Jefferson County v. Washington Dept. of Ecology, 511 U.S. 700, that the Clean Water supersedes the Federal Power Act and gives the power back to the states to set licensing requirements. In pointing out the seemingly schizophrenic decisions, the dissent in the later case pointed out that California would have prevailed in the earlier case had it asserted its requirements through the Clean Water Act rather than through the Federal Power Act.
In any case, I wouldn't want to be the attorney having to navigate through that legal mine field.
But in reading the two opinions, while California is a wide ranging and broad reaffirmation of a previous case called First Iowa Hydro-Electric Cooperative v. FPC, which held for federal supremacy in all water issues, Jefferson County v. Washington Dept. of Ecology, deals narrowly and specifically with the Clean Water Act and water quality, although it does say one cannot separate water flow from water quality.
It doesn't even mention First Iowa or California and only touches obliquely on California at the end by saying
In addition, the Court is unwilling to read implied limitations into § 401 based on petitioners' claim that a conflict exists between the condition's imposition and the Federal Energy Regulatory Commission's authority to license hydroelectric projects under the Federal Power Act, since FERC has not yet acted on petitioners' license application and since § 401's certification requirement also applies to other statutes and regulatory schemes.
Which means that the case didn't even touch on any FERC supremacy issues because, at the time of the decision, there was no FERC involvement yet.
Which is exactly what opponents of the FERC process are saying- that if and only if FERC isn't involved in hydroelectric development, state laws and regulations would be enforceable- otherwise, all bets are off.
While it's nice that someone with some integrity from KIUC is finally, after all this BS, at least trying to address the specifics of why members are trying to reverse the board's decision, TenBruggencate is apparently shooting blanks- blanks most likely provided by Bissell and Proudfoot.
The first was the state's opposition to the project, specifically through statements by William Tam, deputy director for water at DLNR. The second was regarding the Supreme Court of the US (SCOTUS) case California vs FERC in which the court rules that FERC rules preempt state laws and regulations regarding water use.
But although KIUC has generally ignored the real issues and has attempted subterfuge and extortion in trying to win the ballot vote to reverse the decision, they are finally fighting back in the person of board members (and, full disclosure, our long time friend) Jan TenBruggencate, with whom we spoke on Monday.
Apparently TenBruggencate has also been speaking to the local newspaper and today they published an article in which TenBruggencate essentially claims that KIUC has only received "preliminary permits" and that the state only opposes actual final FERC permits.
They also said they couldn't reach Tam for the article but state that TenBruggencate met with Tam last week.
However in a piece by Joan Conrow in her Kaua`i Eclectic blog today she says that
I was able to get some clarification from Tam for my Honolulu Weekly article, which comes out today...
I asked Tam, who previously told me he’d taken no stand on the FERC permits, if that was a correct statement of his position and got this email in response:
"Hypothetical situations have been considered under certain assumptions, but no resolution has been reached."
And I can’t help but wonder, if the state supposedly doesn't oppose the use of preliminary permits to scope hydro projects, why have two state agencies — the Agribusiness Development Corp. and Department of Hawaiian Home Lands — already filed formal motions to intervene?
Clearly, they're alarmed about something.
Clearly.
But TenBruggencate's other contention- one made earlier to attorney-blogger Charley Foster- was that another SCOTUS case could mean that, as Foster headlined "FERC supremacy over Kauai water regs overstated?"
Seems a case called Jefferson County Et Al. V. Washington Department Of Ecology Et Al. (1994), which came after the 1990 California case, apparently held that some state regs could actually trump federal law as TenBruggencate claimed to us on Monday
Foster said in a comment on our Monday editorial:
It's an interesting situation before the Supreme Court. While California v. FERC said the Federal Power Act supersedes state law under all but certain enumerated circumstances, the Court later ruled in PUD No. 1 of Jefferson County v. Washington Dept. of Ecology, 511 U.S. 700, that the Clean Water supersedes the Federal Power Act and gives the power back to the states to set licensing requirements. In pointing out the seemingly schizophrenic decisions, the dissent in the later case pointed out that California would have prevailed in the earlier case had it asserted its requirements through the Clean Water Act rather than through the Federal Power Act.
In any case, I wouldn't want to be the attorney having to navigate through that legal mine field.
But in reading the two opinions, while California is a wide ranging and broad reaffirmation of a previous case called First Iowa Hydro-Electric Cooperative v. FPC, which held for federal supremacy in all water issues, Jefferson County v. Washington Dept. of Ecology, deals narrowly and specifically with the Clean Water Act and water quality, although it does say one cannot separate water flow from water quality.
It doesn't even mention First Iowa or California and only touches obliquely on California at the end by saying
In addition, the Court is unwilling to read implied limitations into § 401 based on petitioners' claim that a conflict exists between the condition's imposition and the Federal Energy Regulatory Commission's authority to license hydroelectric projects under the Federal Power Act, since FERC has not yet acted on petitioners' license application and since § 401's certification requirement also applies to other statutes and regulatory schemes.
Which means that the case didn't even touch on any FERC supremacy issues because, at the time of the decision, there was no FERC involvement yet.
Which is exactly what opponents of the FERC process are saying- that if and only if FERC isn't involved in hydroelectric development, state laws and regulations would be enforceable- otherwise, all bets are off.
While it's nice that someone with some integrity from KIUC is finally, after all this BS, at least trying to address the specifics of why members are trying to reverse the board's decision, TenBruggencate is apparently shooting blanks- blanks most likely provided by Bissell and Proudfoot.
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