Agency says wind company’s permit expired

RICHMOND — Is Highland New Wind Development is still allowed to build Virginia’s first wind energy utility? Virginia’s Department of Historic Resources says no, and that question is now before the State Corporation Commission.

In its complaint that HNWD isn’t meeting conditions required under its state permit, DHR says HNWD’s permit expired Dec. 20, 2009, and HNWD had not started construction.

The SCC put a two-year sunset provision in its final order when it granted HNWD’s permit on Dec. 20, 2007. The company was required to begin construction within two years — by Dec. 20, 2009 — or ask for an extension.

DHR believed HNWD was not working with the agency on mitigating visual impacts from the proposed 400-foot turbines, particularly on the Civil War battlefield nearby in Pocahontas County, W.Va., and complained to the SCC that the company was violating its permit condition.

HNWD and DHR set out their arguments on that point in legal briefs filed Monday.

Steven Owens of the Attorney General’s office, who represents the DHR, argued HNWD had a permit for grading, but had not yet received a building permit from Highland County or asked the SCC for an extension. “While grading is a form of construction that involves moving earth, it does not involve the construction of any buildings, structures or other facilities,” Owens said, citing case law. “The facility approved by the commission includes towers, turbines and other structures permanently affixed to the real estate. Consequently, HNWD is in violation of the sunset provision in the (permit) and is no longer entitled to pursue this project.”

The Recorder asked the SCC Dec. 15 and again Dec. 22 whether the commission considered the project to be “under construction.” The SCC was checking case history, but this week, the SCC said it could not provide further insight on the question.

DHR’s complaint

In DHR’s brief, Owens says the law recognizes that a party cannot keep suing another party on the same question over and over. In the years leading up to the SCC’s final order, HNWD said it already addressed the towers’ visual impacts under the local conditional use permit issued by Highland County, Owens wrote, and “that all actions that could be undertaken with respect to historic resources impacted by the project had been accomplished, and that the requirement to coordinate with DHR should be deleted from the final order.”

But, Owens says, “The commission specifically rejected that position and specifically required HNWD to coordinate with DHR. These are the same arguments that HNWD has been making throughout the course of its objections to DHR’s complaint.”

HNWD had argued it “could not and should not take any further actions with respect to Camp Allegheny because it would not be adversely impacted as far as they were concerned, and that placing any further requirements on HNWD would cause unacceptable financial impacts,” Owens said. Those arguments have already been considered and rejected by the SCC, and “HNWD is now asking for second, third, and in some cases fourth bites at the apple,” he added.

Most recently, HNWD argued DHR’s complaint should be dismissed because the agency has no authority over sites in West Virginia, which are out of its jurisdiction.

DHR says HNWD can’t raise that argument now, when the company didn’t do that before. HNWD “has never, throughout the four years that they have been pursuing this project, alleged that Camp Allegheny should not be considered because it is in West Virginia … HNWD is attempting to raise a collateral issue in connection with this proceeding because they failed to raise it during the proceedings in chief. They are not allowed to do that,” Owens said.

Even if HNWD is allowed to raise the same issues, there is another legal principle that does not allow parties in a suit to take successive positions “in reference to the same fact or state of facts, which are inconsistent with each other or mutually contradictory,” Owens argued.

This suit refers to the same set of facts, he said. “All of HNWD’s actions were consistent with Camp Allegheny being a legitimate issue to be considered by Highland County and by the (SCC). It would be inconsistent to now allow HNWD to state that Camp Allegheny should not be considered at all,” he said.

Owens said it has taken years to get HNWD to provide enough information to determine what might be impacted by the towers, but it must still work with DHR on ways to minimize those impacts.

“HNWD refused to consult with DHR for advice regarding a scope of work that would resolve the agency’s issues, refused to discuss … what its concerns were, and rather pointedly refused to pay any attention to anything that DHR put in its correspondence about what its expectations or concerns were,” Owens said.

“The parties agree that HNWD has finally done enough to satisfy the requirements of the final order that would identify the resources impacted … HNWD has now taken the position that, although it should not be required to do anything, it is certainly not required to do anything else but identify the affected assets. Again, to have any meaning at all, the final order would not require the identification of impacted historic resources without requiring the fulfillment of the final part of the process, i.e., to determine what could be done to minimize and mitigate the impacts … Again HNWD has simply stated that they have done everything that can be done without following the processes and procedures required by (DHR).”

HNWD’s claim that impacts to the Civil War site cannot be considered because Camp Allegheny is in West Virginia don’t make sense in the context of Virginia policies, Owens said.

Since the project lies in Virginia, it’s subject to SCC regulations. “For projects on the borders of other states, the mission of agencies like DHR may well extend to protecting historic assets in those other states for two valid reasons. First, DHR may be the only governmental entity in a position to protect that asset … Resources that otherwise deserve protection should not suffer simply because they are located just across a boundary line, particularly resources that have been afforded, or are eligible for, national level protection and recognition.”

Camp Allegheny is listed on the National Register of Historic Places, and is considered one of the most well preserved Civil War battlefield sites in the U.S.

Secondly, Owens argued, Virginia’s policy of protecting historic assets only works if neighboring states cooperate. “Preserving the good will of our neighbors is a legitimate and necessary strategy to protect the historic and cultural resources of the commonwealth,” he said.

In its state permit application, HNWD told the SCC its project could have multi-state impacts. “It is disingenuous for HNWD to come to the commission now and say that multi-state impacts of the project should not be a legitimate concern,” Owens said.

DHR asked that HNWD be ordered to engage in mitigation efforts “acceptable to DHR in an amount not less than one-fourth the amount committed to DGIF mitigation in the final order; or that HNWD’s permit be terminated because it expired; or that DHR “be granted such other and further relief as may be appropriate,” Owens concluded.

Developer disagrees

HNWD attorney Mark Obenshain maintains the company had already done what was required, and according to his brief, the remaining issue is “narrow, and can be settled as a matter of law.”

HNWD reimbursed DHR for a search of historic resources in 2003 and 2005, and Camp Allegheny was not among the reported sites, he said.

And, although the SCC rejected HNWD’s request to limit DHR’s role, that role had “remained unchanged from the hearing examiner’s recommendation that it simply coordinate with HNWD in order to provide guidance regarding the need for surveys and studies,” Obenshain said.

HNWD’s study confirmed “that it is not possible to relocate turbines in order to minimize the visual impact to Camp Allegheny,” but that several factors “combine to reduce impact, including the distance between the closest turbine and Camp Allegheny, the existing trees and shrubs within Camp Allegheny which provide vegetation and screening, and the property line setbacks imposed by Highland County,” he said.

After much discussion between HNWD and DHR, Obenshain said, DHR’s only mitigation demand was money — between $175,000 and $250,000.

“DHR later revised its demand, proposing payments of $125,000. HNWD rejected the DHR proposals, expressing its view that a fundamental disagreement existed between the parties as to the nature of the ‘cooperation’ required by the commission,” he wrote.

DHR identified only one historic resource impacted by the project, Obenshain said, and that impact is visual. “Therefore, any minimization of that impact lies in the hands of the board of supervisors, according to Virginia law and the commission’s final order,” he said.

“Neither DHR, nor the commission, have authority or jurisdiction to require further mitigation of the project’s effects on an out-ofstate site,” he added. “Regardless, by the express terms of the final order, DHR’s role is simply to guide HNWD through the necessary surveys and studies in order to identify potential impacts. Whether HNWD is failing to properly mitigate that impact — which it is not — does not demonstrate non-compliance … DHR admits that the necessary surveys and studies have been completed and accepted. This should defeat any claim of non-compliance.”

Even if other conditions could be imposed, “the visual impact study accepted by DHR has revealed that there are no other conditions that can be imposed to further minimize the impact upon Camp Allegheny,” he added. “Indeed, DHR seems to agree, as is evidenced by its declining to require any modification in location, design or construction of the project. HNWD has already done everything it can to minimize the impact. Continuing to litigate this issue contravenes the final order.”

Obenshain explained, “HNWD has not objected to the condition that it coordinate with DHR; in fact it has complied with this condition. HNWD does object to DHR attempting to raise issues that are prohibited from being raised by the final order and the Virginia code.”

Further, he argues, “DHR’s powers and duties are expressly conferred by statute strictly … and DHR does not have the power to request further actions by HNWD with respect to Camp Allegheny. Camp Allegheny lies entirely in Pocahontas County, W.Va.”

Obenshain said if the SCC intended to give DHR authority to require mitigation, it would have said so. “Instead, and in contrast to the other conditions imposed by the commission, the commission expressly declined to grant DHR the power to impose mitigation measures, likely because DHR has no authority to impose such measures.”

Obenshain concluded that “because HNWD has complied with the condition related to DHR, DHR should be dismissed from these proceedings, this complaint should be dismissed with prejudice, and the viewshed issue should be barred from being raised again.”

SCC agrees with

HNWD

The SCC staff also submitted a brief in which SCC attorney William Chambliss said viewshed is the only remaining issue and it cannot be considered, so “the sole question for the (SCC) is whether HNWD is in compliance with the requirements of the final order. Staff submits that HNWD is in such compliance, has fulfilled the requirements of the final order, and that this matter should be dismissed,” he wrote.

“Since Highland County considered all matters conceivably addressing the visual impact of the project on the environment, the commission is without authority to impose any additional related condition,” Chambliss concluded. “Whether or not one agrees with the wisdom of the legislation that limits the commission from imposing additional conditions on matters considered by other agencies, the plain fact is that this is unquestionably the state of the law.”

What happens next?

SCC hearing examiner Alexander Skirpan will review the arguments, and issue a ruling that serves as a recommendation to the three commissioners. There is no deadline for his ruling, but once it’s issued, HNWD and DHR will have an opportunity to file responses within 21 days.

Then, the commission will review the arguments to make the final decision. Commissioners can accept Skirpan’s ruling, modify it, or reject it.

It’s unknown whether Skirpan will rule on DHR’s claim that HNWD’s permit expired before construction started.

Skirpan had originally recommended the two-year sunset provision: “Any certificate issued by the Commission in this case should include a sunset provision that calls for the certificate to expire if construction has not commenced within two years from the date of issuance,” he wrote.

HNWD, as noted in the final order, said it “has every intention of commencing construction prior to the expiration of the tax credits at the end of 2008,” but asked to change the deadline to account for things like an appeal of the final order.

The commission said, “We reject this request. The two-year sunset provision … specifies that Highland Wind may petition the commission for an extension for good cause shown. Accordingly, if (HNWD) subsequently believes that it has good cause to request an extension, due to legal proceedings or other reasons, it may properly request the same.”

For a few weeks this summer and early fall, HNWD did some grading and clearing on a section of the project site, under a land disturbing permit. Company owner Henry T. “Mac” McBride then told county supervisors that no more work would continue during the winter, and he had not ordered turbines for the facility. He refused to say whether HNWD had a financial investor, when asked by supervisor David Blanchard.

HNWD must post a bond in order to obtain building permits for the substation and each of the 19 towers, and McBride said the company would not apply for those permits until spring, when he hopes to begin construction on the plant.