February 9, 2009
WORK SESSION
Present were: Mayor Bertrand, Councilors Cayer, McCue, Lafleur, Remillard, Evans and Poulin; absent were Councilors Goudreau and Donovan
Staff present included Pamela Laflamme, Chief Randall Trull; others present were: Lorraine Leclerc, Paul Cusson, Fran Cusson, Scott Coulombe, Jon Edwards, Roger Gagnon, Paul Ingersoll,GregNolin, Paul Grenier, Jay Poulin, Joe Vigue, Bill Gabler, Bill Andreas, approximately 50 people and media were in the audience
Review and Vote to Proceed with 155-B Order on 90-92 Main Street
Mayor Bertrand noted that the City is ready to proceed with a 155-B order on the burned property at 90-92 Main Street. Mr. MacQueen stated that this is a standard order and the motion will serve to have the large wall that is still standing demolished. If Council approves, it starts the clock on the court driven process.
Councilor Evans moved to approve commencement of an RSA 155B order substantially similar to the draft order provided tonight but as finally approved by the City Attorney with respect to the burned property at 90-92 Main Street in Berlin and to authorize the City Manager to sign such order on behalf of the Mayor and Council; Councilor Poulin seconded and the motion carried unanimously.
Laidlaw Energy
Mayor Bertrand welcomed the representatives from Laidlaw: Michael Bartoszek; Lou Bravakis, Ray Kusche and their attorney Barry Needleman. Mayor Bertrand asked for a show of hands from the audience to see how many were from Berlin and the majority was.
Mr. Bartoszek, in a prepared statement, explained that it took longer than expected for the company to be in a position to present its plans. The company will soon file with the New Hampshire Site Evaluation Committee (NHSEC) for permitting the facility.
He indicated that they are part of a new energy economy that will bring stable jobs that pay well. The project will help the state of New Hampshire meet its goal of obtaining 25% of its energy supply from renewable resources by 2025. It will also convert a brownfield site with environmental issues that is a barrier to development, into a working asset for the city that will pave the way for additional economic development and employment.
The project will directly employ 40 people in jobs with a combined annual payroll of approximately $2 million dollars. The facility will spend $20 - $25 million per year on biomass fuel purchases, keeping fuel (wood) purchases as close to the plant as possible. This will help rebuild the wood economy of the North Country.
Laidlaw has been working with Fraser Papers and they have an agreement to supply them with hot water from the facility, thereby reducing their energy costs.
The facility will only occupy a small portion of the site and efforts to redevelop the remainder of the site will attract other business to the area as well as having community benefits, such as the construction of a river walk.
The company is willing to work with the city to acquire the balance of the site from North American Dismantling and prepare it for redevelopment. They proposed the formation of a non-profit organization under tax code 501c3 to acquire the property to create a significant economic development opportunity for the city. Tax revenue associated with the biomass facility will be in excess of one million dollars.
Despite the troubled national economy, Laidlaw has been able to close on the financing necessary to fund the development of the project, a fact that supports both the merits of the project and the people developing it. Mr. Bartoszek stated that the company will set high standards for both performance and integrity. They will be good neighbors and be willing to listen to concerns and work with the community.
Barry Needleman, an environmental attorney with the firm of McLane, Graf, Raulerson & Middleton is representing Laidlaw through the permitting process. He suggested that the Council may want to review RSA 162-H and the web site of the Site Evaluation Committee. The NH Legislature created this process because energy projects of this size impact the entire state as well as the local population. NHSEC reviews projects that will produce over 30 megawatts.
Mr. Needleman informed the Council that key features in the statute have the applicant proving to the Committee that there are adequate financial, managerial and technical assets to meet the requirements of building and operating a facility. If the company cannot prove that to the Committee, then they are not entitled to get the certificate to proceed. As part of the process, public counsel is appointed and their obligation is to the public good to be sure the interest of the public is being maintained.
Interested parties are invited to be interveners in the process and through intervention municipalities have their concerns met. Stipulations to such positions as safety, aesthetics, and truck traffic, etc. from the municipality are made part of the final certificate. The timeline is contained within the statute and starts when the company submits its application to NHSEC. The Committee has 30 days to accept or deny the application. If the application is accepted, in next 30 days there is a public information meeting; the remaining process would take about 9 months.
Councilor Evans asked if stipulations can pertain to wide ranges of efforts affecting the community or if they need to pertain to the project? Mr. Needleman responded that ancillary deals could be worked out; however the preference of the Committee is to keep to the scope of the project.
Councilor Lafleur commented that the SEC consists of department heads of several State agencies; at what stage does the City have input? Mr. Needleman noted that there is the informal input that can happen at any time and the formal input that starts when Laidlaw files their application with the SEC. When the city becomes a party to the process, they would have a great amount of input.
Councilor McCue theorized that there are issues that remain in local control such as planning and zoning; however Mr. Needleman stated that in his experience, all the approvals are through the State process.
Councilor McCue expressed that there are concerns about noise, dust and debris as well as truck traffic. He also wanted to know more about the relationship Laidlaw has with PSNH. Councilor McCue reported that he is skeptical that the facility will pay full property taxes. He emphasized his fear that the project will not come together and in some years down the road Berlin will still have what is standing at the site now. He went on to say the financial resources are a concern as are the location and use of the property.
Mr. Needleman reasoned that truck traffic and noise are the things that could be worked out. The financial viability of the company will be put under scrutiny by the SEC.
In response to some of the concerns, Mr. Bartoszek responded that the relationship with PSNH is among contractual parties; Laidlaw is generator and PSNH's role is that of power purchaser. With regard to property taxes, Mr. Bartoszek stated that they are not looking to pay low taxes or not pay their fair share. He went on to say that the company was able to secure its financing even at a time of upheaval in the economy.
Another concern related by Councilor McCue was that supplying biomass would involve cutting down and chipping the Great North Woods for energy. He expressed the need for district heating and cooperative energy efficiency. Ray Kusche replied that Fraser has the opportunity to use waste heat from Laidlaw to lower their cost. Access to this resource could entice other businesses to co-locate near the energy plant. Mr. Bartoszek added that the company is committed to utilizing the wood sustainability and not pillaging the forest.
Councilor Evans established that he has ideas for stipulations and questioned whether he should bring those up. Councilor McCue indicated that a unified plan among all the city entities, including Planning Board and Zoning Board should be presented.
Councilor Cayer questioned whether the plant would burn other materials and Laidlaw representatives made it clear that their permits would define their ability to burn wood chips and the boiler is not designed to burn other materials. Councilor Cayer asked if the boiler could be converted to burn something else. Mr. Bartoszek responded that the boiler manufacturer is going to base their design on wood chips and the performance guarantee will only be for one fuel.
Councilor Cayer asked about the time frame and Mr. Needleman responded that there is an elaborate application process and it will take time to put together. Mr. Bartoszek added that they don't want to create a specific time.
Councilor Cayer asked if the Noble project and its position in the queue will have an effect on the Laidlaw project. Mr. Bartoszek noted that it has no impact on them either way.
Councilor Poulin recounted a conversation with Ray Kusche where he said that the boiler has the capability of burning oil; however there is not money to be made burning oil. Mr. Kusche confirmed that sticking an oil burner on there would not be good business; they would make no money and it makes no sense. He added that the company will have to permit for a small amount of oil or propane for a limited amount of hours per year for start ups.
Councilor Remillard confirmed that the company would be using 20 acres of 60 acres and 40 would be available to other development. Mr. Bartoszek acknowledged that they want to get the 40 acre parcel out of the hands of NADC and put it into an organization that could help guide a plan to redevelop. The land would not be under the control of Laidlaw but under control of the charitable organization developed for that purpose.
Councilor Lafleur asked why not come forward before now and Mr. Bartoszek said that the company has spent time speaking to people in the community. They wanted to wait until they were in the position of being the property owner before coming to the Council
Mayor Bertrand commented that the size of the plant has been reported as 60+ megawatts. Has the size been established and how much fuel will it take. Mr. Kusche stated that they have located a turbine that is 66 megawatts gross; roughly 58 mw would go to the grid and the remainder goes to operate the plant. Conservatively they will use 750,000 tons of wood chips per year.
Mayor Bertrand confirmed that Laidlaw will do its own wood study. He added that other projects planned for Berlin will have an effect on wood availability and that Laidlaw's wood study will have to take into account other potential projects. Mr. Bartoszek assured that the study will look at supply and demand and will be conducted by a highly qualified firm that will take into account all perimeters.
Mayor Bertrand observed that the design is to burn biomass but that does not preclude from burning other things. He asked if Laidlaw would put into an agreement that they will not burn other substances. Mr. Bartoszek indicated that the permit will be very clear.
Mayor Bertrand confirmed that there is no storage of fuel sources. He asked what measures would be taken to minimize the dust. Mr. Kusche stated that he's managed the biomass plant in Greenville, Maine for 20 years and dust is not a problem. The product that they will burn is 40-60% moisture. Truck traffic on dirt roads produces fine dust; however all roads on the property are proposed to be paved.
Mayor Bertrand questioned the financial ability of the company to pull this off. He added that according to the Registry of Deeds, the property is held by a holding company. Mr. Bartoszek responded that it is very common for the asset to be pledged as collateral.
To Mayor Bertrand's request for more information on the PSNH agreement, Mr. Bartoszek established that there is a letter agreement and the parties are in the process of drafting a contract.
Mayor Bertrand asked, should the deal with Fraser Paper not materialize would Laidlaw negotiate with the city for steam. Mr. Bartoszek explained that even with the Fraser agreement, there may be excess heat available.
In response to the Mayor's inquiry about whether there will be outside operations around the clock, Mr. Bravakis reported that one loader would be feeding the plant at night. On site chipping could occur during mud season; however if the chipping operation would go on for longer, mitigation for noise would occur. Mayor Bertrand confirmed that this portion of the plan will be finalized before applying to the SEC.
Mayor Bertrand affirmed that the 40 positions to be created will pay benefits. He also commented that it has been reported that an additional 500 jobs out of the city would be created. Mr. Kusche clarified that the plant would be purchasing wood chips by long term contract providing a steady revenue stream to the logger. He could not confirm 500 jobs.
Mayor Bertrand asked if there are hazardous materials in the southern part of the property and how would those be mitigated. Mr. Bartoszek reasoned that the company looked at the environmental issues prior to purchasing and found them to be manageable. The Mayor asked on what basis is the company basing the current environmental status of the property. Mr. Bartoszek noted that they have done an extensive environmental assessment.
To Mayor Bertrand's question about the location of the cooling towers, Mr. Bartoszek indicated that there is no fixed location at this time. When the site is determined, they will take into account the location of road to prevent moisture from being carried and causing icing on roads.
Councilor McCue confirmed that certificates can be modified or amended by reopening the process and getting a second approval. He then asked who is responsible for violations. Mr. Needleman replied that it would be dependent upon the problem, likely a State agency or the SEC itself.
Councilor Cayer asked how the agreement with PSNH would affect rate payers. Mr. Bartoszek commented that it is subject to the approval of the PUC and their finding that it is fair to rate payers.
To Councilor McCue's question about whether Laidlaw plans to help with the cost to operate transmission lines, Mr. Bartoszek stated that there is a study of transmission lines being conducted now and the results are not known yet.
Mayor Bertrand commented that the State set a goal of 25% alternative energy by 2025. He asked if the state played a role in putting this project together. Mr. Bartoszek said that there have been general discussions with folks at the state but they did not participate. Mayor Bertrand thanked the group for meeting with the Council. Mr. Bartoszek thanked the Council and public for their interest and promised to continue to have dialogue. He informed the group that they are available to answer questions and can be reached by calling Carl Belanger.
Engineering Services Review
Mr. MacQueen explained that there is a draft resolution and draft agreement for review. The resolution would transfer money from existing accounts to new capital accounts to carry out the engineering for six projects. If stimulus funding becomes available there is no guarantee that any of these projects will be funded. Time is of the essence and if possible, he asked that the Council suspend the rules to pass the resolution at the next meeting.
Councilor Remillard asked how long the work is good for and Jay Poulin of HEB Engineering stated that the design is valid; however waiting too long would invalidate the permits acquired. Mayor Bertrand asked Council members to review the information for the next meeting.
District Leachate Issue
Mayor Bertrand stated that former Councilor Grenier made statements at a recent meeting regarding a request from the AVRRDD for the City to treat the leachate from the landfill. Chris Dwinal and Paul Birkel of Wright Pierce wrote a letter in response to the comments made and an article that appeared in the Berlin Daily Sun on February 4, 2009.
Mr. MacQueen reported that the District having to have a plan by June is news to the City. Wright Pierce was hired to study the cost of treating the waste that is not huge in terms of gallons but it is stronger than the flow that is currently treated. The AVRRDD has three options: they can treat themselves with a new plant; could renovate the plant they bought from PPA or they could send the leachate to Berlin. The City can't take the leachate if they have to pass costs on to the ratepayers. The City hopes to carry out more dialogue with the AVRRDD, perhaps at their next meeting.
Chris Dwinal explained that the purpose of the study was to determine the treatability of what comes from the landfill and if it can be treated by Berlin's WWT as the facility exists. It was found that there would need to be capital upgrades and there would be cost to treat, as well as electricity, chemicals, sludge disposal, and labor. If the determination of cost is not accurate and on the low side, it would cost all of the rate payers.
Mayor Bertrand confirmed that it is not so much the quantity of leachate but the strength. Mr. Birkel affirmed that their report was to safeguard the city and identify the potential liabilities that could occur.
Councilor Evans questioned how it could be that the AVRRDD would build their own waste water treatment plant and it would be the same capital expense as sending the flow to the City. Mr. Dwinal noted that there are $2.5 million of updates needed and the AVRRDD would need to get the leachate to the city's plant and then there is annual cost. It will be expensive for them as they are in a very remote part of the community. Councilor Evans affirmed that the costs would include some reduction in I & I.
Other
Councilor McCue reminded everyone that the next Master Plan meeting is Wednesday, 2/11 at 5:30 at the college.
Non-Public Session
Councilor Lafleur moved to go into non-public session per RSA 91-A:3, II (d) Consideration of the acquisition, sale or lease of real or personal property which, if discussed in public, would likely benefit a party or parties whose interests are adverse to those of the general community; Councilor Poulin seconded and the motion carried unanimously by roll call.
Councilor McCue moved to come out of non-public session; Councilor Remillard seconded and the motion carried unanimously.
Councilor McCue moved to seal the minutes; Councilor Remillard seconded and the motion carried with Councilor Evans voting against.
Councilor Lafleur moved to adjourn; Councilor Cayer seconded and the motion carried. The meeting ended at approximately 9:00 p.m.
Respectfully Submitted,
Susan Tremblay
Administrative Assistant
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