By Joe Cowan • Guest Columnist
Editor’s note: Jackson County Commissioner Joe Cowan made the following comments following a vote last week to stop legal proceedings against Duke Energy over its plan to take down the Dillsboro Dam, the centerpiece of the utility giant’s mitigation for a new license to use water from the Tuckasegee and its tributaries for the next 40 years.
Having observed this all my life, and the power company before Duke — Sylva-Dillsboro Electric Light Company, where my father worked for a few years — I’ve got some attachment to the dam and some interest in the relationships in the past and hopefully the type of relationship we may have in the future with Duke Energy.
I, too, observed the stakeholder meetings that have been referred to many, many times in the past seven years. Those stakeholder meetings, in my honest opinion, were a farce, nothing but a ruse to try and dupe good local people into believing that Duke Energy had the best interest of the people of Jackson County at heart rather than the monetary gain and interests of Duke Energy. That, to me, is a fact.
Greed. That’s the word I hear used frequently when large utility companies are referred to, greed. In my opinion, had it not been for greed, there would not have been seven years of bickering with Duke Energy.
Why did Duke want to take down the Dillsboro Dam? They haven’t said. They said many times in their proceedings that it was a linchpin of their proposal for a settlement, but why did they really want to take it down? It didn’t benefit Duke, didn’t do anything for 20 miles upriver. It’s not going to improve the environment of the river or what lives in it. Matter of fact, there is some evidence just the opposite of that.
Let’s get to why they want it down. Most of the time when an energy or utility corporation is asking to use someone’s water — and that’s what it is, asking to use the water of Jackson County for the next 40 years and make somewhere in the neighborhood of $16 million profit per year — you would think, just as a good neighbor policy, or if nothing else for the good will, the industry would have some desire to give back something to the people from whom this water use is being taken.
This is the thing that burns me up about the whole darn thing. There has been little to no evidence to this date that Duke Energy has been willing to give back even a token to this county for the use of their waterways for the next 40 years. And you multiply $16 million times 40 years, and see what you come up with. You’ll come up with a lot more than two or three hundred thousand dollars, which is the total that Duke offered, the token that Duke has offered.
Duke has had many opportunities to step up and do the right thing as a good neighbor would do. And in many cases others have done that, been good neighbors to Jackson County. Duke has not done that. They have no desire to do it. Thus seven years of bickering back and forth, back and forth.
Why do they want to take the dam down? They did not want to give the county anything, $250,000 or somewhere along there. That’s an insult for the use of the Tuckasegee River and its tributaries to the south for the next 40 years. An insult.
So they came up with this grand scheme: we will take down the dam for you. It reminds me a lot of the elderly lady crossing the street. A Boy Scout was out there helping her. They got to the other side and woman slaps the Boy Scout. A passerby saw her and said, “My God, what happened?” The lady said “I did not want to cross the dam street.”
Well, that’s what we’re dealing with here with Duke taking the dam down. We did not want the dam down, but Duke is going to do us a favor and take the dam down to show good faith to FERC. “Look what we’ve given Jackson County for the use of their water for the next 40 years.” Big deal, I hope Duke knows that.
.... It’s a bum deal. It’s a bum deal. Duke ought to be ashamed of themselves as a large corporation to attempt to pull such a stunt on the intelligent people of this county. I resent the hell out of it, and I think I’ve made that clear. That’s been my involvement in it, and as far as I’m concerned I hope it’s not over yet. We’ve still got 30 days to appeal this thing.
The seven-year battle between Jackson County commissioners and Duke Energy has come to a close.
After losing a critical court battle last week, Jackson County commissioners vote 4 to 1 to give up their legal fight against Duke Energy at a meeting Tuesday night (Jan. 19.)
“It is not prudent for Jackson County to move forward any further,” said County Commissioner Chairman Brian McMahan.
Of late, the fight has appeared nothing more than a tug-of-war over the Dillsboro dam: Duke wants to tear it down and the county wanted to save it.
But the origin of the conflict is philosophical: how much does Duke owe Jackson County in exchange for harnessing the Tuckasegee River with numerous dams? Duke proposed removing one of those dams — the small and ancient Dillsboro dam — as compensation for using the Tuck in its lucrative hydropower operations.
Therein lay the crux of the disagreement. The county didn’t want the dam torn down, so it should hardly count as compensation, said Commissioner Joe Cowan, who voted against giving up the fight.
“It’s a bum deal,” Cowan said. “Duke ought to be ashamed of itself as a large corporation to attempt to pull such a stunt on the intelligent people of this county. I resent the hell out of it.”
Cowan gave a strongly word speech directed at Duke at the meeting Tuesday.
“Why did they want to take the dam down? Because they didn’t want to give the county anything,” Cowan said.
Cowan said taking down the dam was a grand scheme on Duke’s part, a ruse intended at duping local people into believing Duke was doing them a favor by taking down the dam. But Cowan said Duke was only looking out for its own monetary interests.
“Had it not been for greed there would have been no seven years of bickering with Duke Power,” Cowan said. “Duke had many opportunities to step up and do the right thing as a good neighbor would do. Duke hasn’t done that. They have resisted it, thus seven years of bickering back and forth, back and forth.”
The other four commissioners who voted to call it quits clearly did not revel in their decision.
“Seven years has been a long time and looking back on what has transpired I still feel as strong today about my position on saving the dam as I did then,” said McMahan. “I grew up there learning to fish. It holds a sentimental place. It is going to move into our history now. It is going to become a part of our past.”
Commissioner Tom Massie, who has been urging the rest of the board to throw in the towel for over a year now, said he hopes the county and Duke can mend fences and work together in the future.
“It is unfortunate it has gotten to this point in terms of the legal costs and wrangling that has gone on,” Massie said. “I am glad it is over with.”
It’s one statement Duke agreed with.
“We at Duke are, as one of the commissioner’s remarked, glad it is over with,” said Fred Alexander, Nantahala district manager of Duke Energy.
Duke has contended the river will be better off without the dam environmentally. It will also open a new stretch of free-flowing river to paddlers and rafters, including commercial rafting operations.
Several members of the public took a turn the podium to thank the county commissioners for putting up a valiant fight.
“I came tonight to applaud you — applaud you for giving us leadership in your efforts to retain the Dillsboro Dam, as a historical site, as a viable source of sustainable energy and as land to be used by all the residents of Jackson County,” said Susan Leveille, an artist with a gallery in Dillsboro. “You have strived well to lead us toward the moral high ground of not just thinking of ourselves today but for making wise decisions with regard to the people, the land and the resources.”
Supporters said Jackson did the right thing by standing up to Duke, even if the cards were stacked against them.
“I also want to commend this board for doing everything they could to save the dam and the powerhouse,” said Tim Parris, a resident of Dillsboro. “I do realize you were up against a fight with a corporate giant in Duke Power — not only that but you had to fight the special interest groups like American Whitewater. The landscape is changing at Dillsboro, but I can tell you it is not what the people of Dillsboro want.”
But Sam Fowlkes, a paddler who is pleased the dam will finally come down, chastised commissioners for wasting so much money on an ill-conceived strategy.
“I am sure lawyers who get billable hours will always have more options for you, but it kind of looks like game over,” Fowlkes said prior to the board’s vote to end their legal fight.
Fowlkes said the big winner isn’t Duke, but rather Jackson County’s attorney throughout the protracted standoff.
“Let’s not forget Paul Nolan, the big winner. Win or lose, it is more money for him,” Fowlkes said. “The losers? The taxpayers. I am one of them.”
Commissioner William Shelton congratulated Duke on its win.
“I grew up on the Tuckasegee River and have watched it about every day in my life,” Shelton said. “This has been a gut wrenching experience for me. There has not been one easy thing about it.”
Duke Energy could start tearing down the Dillsboro Dam any day after Jackson County lost a final and critical legal battle this week.
Judge Zoro Guice denied a move by the county to temporarily halt demolition on the Dillsboro Dam. Jackson County hoped to exercise eminent domain to take the dam away from Duke and make it the focal point of a new riverfront park along the shore of the Tuckasegee. The county was seeking a restraining order against Duke to stop them from tearing down the dam while the condemnation suit played out.
The case hinged on state’s rights versus federal pre-emption — whether the opinion of a federal agency superseded state law that grants counties the power of eminent domain.
Guice ruled that the Federal Energy Regulatory Commission trumped state law and agreed Duke could proceed with tearing down the dam. After the dam is torn down, the county can use eminent domain to go after the river shore if it still wants to, the judge said.
Fred Alexander, Nantahala district manager for Duke Energy, said in a written statement demolition could begin in early February. Alexander cited the benefits of restoring a section of free-flowing river, intended to offset the environmental impacts of its myriad other hydropower dams in the region.
Jackson County Commissioner Chairman Brian McMahan said he had not had a chance to explore the implications of the ruling as of press time on Tuesday afternoon. The ruling was handed down Monday (Jan. 11).
“We will discuss it fully at our meeting and take some kind of action,” McMahan said of the commissioners meeting scheduled for at 6:30 p.m. on Tuesday, Jan. 12.
The county’s choices are presumably to throw in the towel or appeal the decision.
Commissioner Tom Massie isn’t surprised. For the past year, he has been the lone commissioner opposed to the protracted legal battle. Massie said he supported the county’s stance philosophically but felt the chance of success was too slim to justify the legal costs of continuing to fight Duke.
“I think they had to see for themselves where it was going to go,” Massie said. “Now it has played out to its conclusion.”
Massie said the Tuckasegee River could still make a wonderful backdrop for a park without the dam. Duke had all along planned to turn the river shore over to the county as part of the environmental mitigation required under the Clean Water Act in exchange for operating its other dams.
In a further blow to Jackson County, Duke can proceed with a countersuit for its legal costs, Guice ruled. Duke has filed a lawsuit against Jackson County for legal costs, as well as a lawsuit blaming Jackson County for an abuse of power. Jackson hoped the judge would throw out Duke’s countersuits, but he did not.
“I am disappointed we don’t have more leverage to negotiate with Duke. If we had gotten something more positive from the judge’s ruling, Duke may have been more willing to talk to us about an (out of court) settlement,” Massie said.
After years of battling Duke Energy in nearly every legal arena it could scout out, Jackson County was dealt a major blow last week when the U.S. Court of Appeals denied its plea for federal intervention.
Jackson County is trying to save the Dillsboro dam from being torn down by Duke, and at the same time force Duke to offer up better compensation for the environmental impacts of its network of hydropower facilities in the region. Jackson hoped the U.S. Court of Appeals would step into the fray and send Duke back to the drawing board to reconsider its plans for dam demolition, slated to move forward this winter.
“This brings Duke a giant step closer to river restoration by removing the Dillsboro Dam,” said Fred Alexander, Nantahala district manager for Duke.
After exhausting everything shy of the U.S. Supreme Court, Jackson County’s fate now hangs on a final case with a decision pending as early as next week. Jackson County hopes to exercise eminent domain to take the dam away from Duke and make it the focal point of a new river front park along the shores of the Tuckasegee River.
A lawsuit in Jackson County Superior Court will decide whether the county can go forward with the plan. Arguments were heard earlier this month, but a decision from Judge Zoro Guice is still pending.
Jackson County Manager Ken Westmoreland said the case for eminent domain is much more critical than the U.S. Court of Appeals filing was.
“That was just another one of those procedural administrative challenges. It doesn’t go to the heart of the issue now, which is condemnation,” Westmoreland said.
Duke’s biggest ally has been the Federal Energy Regulatory Commission, which has consistently agreed that tearing down the Dillsboro dam is a good idea and has been unwilling to force Duke into more mitigation.
Jackson County has challenged everything their lawyers could think of to challenge, from state and federal environmental reports to technical jurisdictional issues, pushing mountains of paperwork around over a six-year period.
Jackson County had finally appealed to the U.S. Court of Appeals in hopes it would force the energy commission to give a hard look at Jackson’s stance, but instead the three-judge panel upheld FERC’s decision.
“This decision affirms that FERC acted appropriately in approving Duke’s application to surrender the license and decommission and remove the Dillsboro Dam and Powerhouse,” Alexander said in a written statement.
The appeal did not require an extensive legal investment on the county’s part. It was mostly a matter of rounding up all the paperwork that has previously been filed in various arenas and packaging it with a new cover letter.
“Most of it was just a compilation of things that had taken place over the years, so it wasn’t all that expensive,” said Westmoreland. The county has not gotten a final legal bill for the appeal filing.
Jackson County and Duke Energy squared off this week over the Dillsboro dam, marking the first major head-to-head courtroom battle in the nearly eight-year saga.
Duke Energy wants to tear down the Dillsboro Dam, while Jackson County hopes to save the historic landmark as the focal point of a riverfront park.
Jackson County devoted part of its court time this week to pleading with the judge for a restraining order that would prevent Duke from tearing down the Dillsboro dam.
It could be months before Jackson County gets a legal ruling on its attempt to seize the dam by the power of eminent domain. By then, however, it will be too late, as Duke previously announced it would start demolition in January.
“This is a historic structure that once taken out can’t be recreated,” Attorney David Ferrell argued on behalf of the county. “It’s a structure that means a great deal to this county. The commissioners of Jackson County believe they are speaking for the citizens in trying to preserve this dam and power house. Without an injunction that’s not going to happen.”
Jackson County wants to preserve the historic dam as the focal point of a river park, replete with walking paths, fishing piers, boat docks and picnic tables.
Kiran Mehta, a Charlotte attorney for Duke, said there would be no lasting harm to Jackson’s river park if Duke tears out the dam. If Jackson County wants a dam so much, it can build a new one in its place, Mehta said.
The protracted arguments in Superior Court this week centered on whether Jackson County can use the power of eminent domain to seize control of the dam and stop Duke from demolishing it.
Duke countered that it was obligated to tear down the dam, citing an order by the Federal Energy Regulatory Commission.
“The county’s suit for condemnation is nothing more than a collateral attack upon and an end run around the FERC order,” said Mehta.
Sherin disputed Metha’s characterization of FERC’s order.
“He talks about this FERC order as if it was the tablet that Moses brought down with the Ten Commandments on it. But it’s not that,” Sherin said. “Duke asked to remove the dam. The FERC said OK.”
Sherin said FERC’s order even contains alternative provisions should circumstances change and the dam not be removed after all.
Duke argued that the interplay of federal agencies and the Federal Power Act make federal court, not state court, the proper legal venue for the case. If successful in getting the case kicked up to federal court, Duke could more easily bog down Jackson’s bid to save the dam.
Jackson County argued that state condemnation law, which gives counties the power to seize property for the creation of parks and recreation areas, stands on its own two legs.
“Duke acts as if federal pre-emption is some sort of blanket that wraps itself around this whole controversy and nullifies all of the county’s rights,” Sherin said.
Who wins and loses
Mehta said that Duke would be irreparably harmed if the dam’s removal is delayed by an injunction.
Mehta claimed Duke could be fined by the Federal Energy Regulatory Commission if it didn’t remove the dam on schedule.
The company is currently in the process of dredging decades worth of sediment from behind the dam before its demolition, a process that might have to be repeated if more sediment accumulates during the delay. Duke also had to relocate bats that nested in the old powerhouse, which is also slated for demolition. The bats could take up residence again, prompting a second round of relocation.
Mehta put a price tag on the delays of $3.4 million in costs to Duke.
Ferrell said the claims were “disingenuous.” He said it was ludicrous to suggest Duke would be fined for failing to remove the dam, if a court order was preventing them from doing so. Ferrell asserted that the federal energy commission doesn’t really care if the dam comes down or not, having granted Duke permission at the company’s own request.
Mehta countered that there are other parties who do care immensely if the dam comes down. Removing the Dillsboro dam was a carefully crafted compromise intended to please disparate special interests concerned with the impacts of Duke’s hydropower network in the region. Duke’s permits for 10 other dams are up for renewal, and to get new permits, it had to come up with environmental mitigation that satisfied everyone. Tearing down the dam pleased environmental agencies who want to see the river restored to its natural state. It also pleased paddlers who wanted a free-flowing river.
Jackson County protested, not only out of a desire to save the historic dam, but also on the premise that another form of mitigation would benefit a greater cross section of the public, such as an environmental trust fund to pay for greenway construction along the Tuckasegee.
Mehta said Jackson lost that fight, but hasn’t been able to give up. The attempt to seize the dam for a park is a last ditch effort to bring down the hard-fought compromise, which could send Duke back to the drawing board, he argued.
“There is no way to calculate the loss that would result from a collapse of the settlement agreement,” Mehta said. “It is incalculable really.”
Ferrell called the injunction a “lynchpin” in Jackson’s case. Unless the judge grants an injunction barring Duke from destroying the dam, Jackson County will be precluded from getting its day in court down the road, Ferrell said.
“That’s what we need first and foremost,” Ferrell said.
Judge Zoro Guice, who heard the arguments in Jackson County Superior Court, said he likely wouldn’t have a decision until January.
Jackson County has formally filed a lawsuit against Duke Energy to seize the Dillsboro Dam and surrounding river shore, using eminent domain to create a public park and in the process save the dam from being torn down.
The county is also seeking a preliminary injunction against Duke to keep the utility from demolishing, altering or removing any part of the dam or nearby powerhouse.
“Duke intends to immediately begin preparing the Dillsboro Dam and Powerhouse for demolition and removal,” the lawsuit states. But any forays toward removal would cause “irreparable harm as these historic structures cannot be replaced.”
Jackson County wants to transform the dam and surrounding shoreline of the Tuckasegee into a river park and promenade, replete with walking paths, benches, fishing areas and river access. The dam and powerhouse are intended as focal points in the county’s Dillsboro Heritage Park Plan, and, therefore, must be protected through a preliminary injunction against Duke, Jackson pleads.
The injunction also seeks to allow county officials to come onto Duke’s property. Duke had threatened the county with trespassing charges if it attempted to do so, keeping the county from surveying the property it plans to seize or conduct an appraisal.
The lawsuit claims the county is within its rights to seize the property under a state statue allowing for eminent domain for the purpose of creating, enlarging or improving a park or other recreational facility.
Duke has previously countered that condemnation would interfere with an order from the Federal Energy Regulatory Commission to tear down the dam. Jackson claims that the “order” to tear down the dam is being misrepresented by Duke and that FERC merely granted Duke permission to tear it down. Once Duke no longer owns the dam, the FERC ruling will become moot, Jackson argues.
Jackson points out in the suit that the hydropower operation at the Dillsboro dam has been offline for five years, and therefore isn’t a core part of Duke’s business operation. In addition, Duke no longer has a federal license to operate the dam, having relinquished it in anticipation of demolition.
The county would be required to compensate Duke for the monetary value of the dam if condemnation is successful. At the time of filing the condemnation suit, the county was supposed to deposit the money upfront in an escrow account with the courts.
However, Jackson County only deposited $1. The county argues that by seizing the dam, Duke has been saved the trouble and expense of tearing it down, an undertaking that would have cost more than $1 million. That savings should more than suffice as the monetary compensation Jackson would otherwise owe Duke, the suit argues.
Duke Energy has begun work preparing a site along the Tuckasegee River upstream of the Dillsboro Dam in order to start dredging the river there.
While virtually everyone agrees the dredging is a good thing in and of itself, the fact that it is a prerequisite to tearing down the dam next year leaves all aspects of the project mired in controversy.
A site adjacent to the river along the slow-water pond created by the dam was cleared on July 1. It will be used as a staging area for siphoning out sediment backlogged behind the dam. A series of settlement ponds will separate sediment from the river water, allowing increasingly smaller particulate and fine organic matter to settle out before water flows back into the river.
An estimated 100,000 to 120,000 cubic yards of sediment have accumulated behind the Dillsboro Dam. Duke was mandated by the state to remove at least 70,000 cubic yards before it can tear down the dam to keep the sediment from washing downstream.
The dredging “is something they should have been doing for years,” said John Boaze, a biological consultant with Fish and Wildlife Associates and an opponent of dam removal. And, “I hope that when they get it done in Dillsboro they’ll move to Bryson, Lake Emory in Franklin, Mission over in Clay County,” Boaze said, listing some of Duke’s other dams that also have backlogged sediment behind them.
Boaze is concerned that Duke only has to remove 70,000 cubic yards rather than all of it.
“From the river’s standpoint, removing the sediment would be a good thing. They should remove it all,” Boaze said. Boaze said there was no basis for the state to arrive at 70,000 cubic yards as the magic number.
Kevin Barnett, an environmental specialist for surface water in the state Division of Water Quality’s Swannanoa’s office, said he thinks 70,000 cubic yards is sufficient to protect downstream water quality when the dam is removed. Barnett’s concern, however, is making sure sediment doesn’t end up getting transported downstream during the dredging process itself.
“The number of cubic yards removed is less important as opposed to how much material is transported downstream that would negate the intended effect of the work,” Barnett said.
To ensure this, Barnett said he would be checking — and Duke would be regularly reporting — on turbidity both upstream and downstream of the dredging work in order to monitor downstream deposition of sediments.
At the dredging site, Duke corporate spokesman Andy Thompson in Charlotte said the endangered Appalachian elktoe mussel could benefit from the dam’s removal, as upstream and downstream colonies would be able to mingle and create a larger, more viable population.
“I don’t really go along with that theory. We’ve already got mussels upstream and downstream,” Boaze said. “You’re going to mostly kill the ones downstream” due to habitat disruptions from the dam’s removal, no matter how carefully done.
Boaze said a better idea is to leave the dam but to create bypass waterways alongside it.
“I have a design: a fish passage put in place allowing them to go upstream and downstream, and kayakers to go downstream,” Boaze said.
Duke initially said they would do the dredging as part of the dam-removal plan if they could find a market for the sediment to offset the cost. But heightened attention to the project led the state to end up requiring the dredging.
The removal of the dam is in question, however, as Jackson County has moved to condemn the site. Jackson would like to seize the dam and adjacent shore to create a river park, which would serve as a scenic and recreational attraction. Jackson would also like to operate the dam as a form of green power.
Asked why Duke is proceeding with the dredging when it might be blocked from removing the dam, Thompson said Duke is confident the attempted condemnation will fail.
“It does not appear to Duke that Jackson County would be allowed by the applicable laws to condemn the Dillsboro Hydroelectric Project,” Thompson said. “Under the Federal Power Act, a hydroelectric plant can only be condemned by a county or municipality for the generation of hydroelectricity.”
Thompson added that state law does not provide for the use of condemnation to acquire a hydroelectric facility for power generation purposes. He said Duke “will certainly vigorously oppose any attempt by the county to condemn the Dillsboro Dam.”
County Manager Ken Westmoreland wasn’t concerned about Duke going to the trouble and expense of doing the beneficial dredging even while they might end up being prevented from removing the dam.
“The dredging is overdue. They should have been doing it under their previous license,” he said. “Our position is they’re simply doing it in compliance with their existing license — that they’re obligated to do periodic cleaning and dredging at all of their facilities.
Despite the dredging, Westmoreland says nothing is a fait accompli.
The removal of the dam is still very much in question,” Westmoreland said.
The proposed dam removal arose as a compensatory move by Duke in exchange for renewing federal permits for power-generating dams on other rivers throughout the region.
Removing the Dillsboro Dam to restore the section of the Tuckasegee to free-flowing status was offered by Duke as a benefit in exchange for the impacts of the other dams. However, the county and some area residents prefer to retain the historic dam. Other critics say dam removal does not serve as adequate mitigation, particularly for Duke’s dams on other rivers.
As Jackson County leaders continue their fight against Duke Energy, an unassuming local lawyer that few have heard of has appeared as the county’s heavy-hitter against the politically powerful and uber-wealthy Fortune 500 utility.
Attorney Gary Miller, 52, a former business lawyer from New Orleans, has been hired to represent the county in its push to seize control of the Dillsboro dam owned by Duke. Jackson leaders plan to use eminent domain to take over the dam and adjacent shoreline and turn it into a river park. The move would thwart Duke’s plan to demolish the dam, achieving the county’s long-standing goal to save the dam.
Miller spent most of his career to date representing the corporate world. His expertise lies not in the courtroom, but in pulling off complex deals and financings rife with legal maneuvering, at times plowing new ground where precedent was lacking. Miller has negotiated deals between mega-corporations like Shell and Union Carbide. He also has represented casinos, developers, financial syndicates and other large organizations, both private and publicly traded.
“Historically I have been a transaction lawyer. I am typically a paper pusher,” Miller said, downplaying his lawyering past.
A paper pusher, perhaps, but mass quantities of extremely complicated, critically worded paper. Hundreds of pages with millions on the line should the other side manage to get a fast one by in the language. Paper with months of legal maneuvering and tedious research lurking behind the ink.
“Yeah, I’m good at that,” Miller said.
Paper pushing, in the world of lawyers, is how things get done. Jackson County Manager Ken Westmoreland said Miller’s background is a good match for “peculiarities” of the eminent domain case against Duke.
“His experience is in corporate law, working both for and against big corporations. Secondly, he specializes in real estate law, and the condemnation is basically a real estate issue,” Westmoreland said.
The most typical work for Miller involved commercial financings: a gigantic loan collateralized by corporate assets scattered across the county.
“They will hire attorneys in each state to give their opinion of the enforceability of the documents or modify them to make them enforceable,” Miller said.
When some of those assets resided in Louisiana — such as a deal involving an oil might putting up its refineries as part of the collateral — Miller was their guy
“It wasn’t the kind of stuff your average lawyer had knowledge about,” Miller said.
One of Miller’s most interesting jobs involved dueling casinos vying for a single gaming license in New Orleans. The state of Louisiana awarded the gaming license to one casino, while the City of New Orleans granted a lease to a different casino operator. Both groups felt they were entitled to the license — seemingly a no-win situation.
“The governor forced the two groups into a shotgun wedding and they formed a partnership to operate and build it,” Miller said. The joint entity that emerged went bankrupt before they finished construction, complicating an already sticky situation. Miller spent the next two years helping to sort out the mess. Skill in sorting out messes will be critical to resolving the bitter fight and test of wills between Duke and Jackson County.
The path that led Miller to Western North Carolina isn’t exactly a pleasant one. Miller is one of the thousands of Hurriane Katrina refuges who left their home city of New Orleans for good in the aftermath of the devastation and struck out for a new life. Miller hung a new shingle in Bryson City, and calls Sylva home.
Ironically, a life-long love of paddling drew him to Western North Carolina during that trying time. The paddling community is an ally in Duke’s plan to demolish the Dillsboro dam, as it would open up a new stretch of free-flowing river. Miller can frequently be found paddling the Tuckasegee in his free time, and until recently, was a member of American Whitewater, a paddling advocacy group that is a stalwart defender of dam demolition. Yet when it comes to tearing down the dam, Miller sides with the county in its fight to save it. Miller could not talk about specifics in the case or the county’s strategy.
As Hurricane Katrina bore down on Miller’s former city of New Orleans, he sent his wife and two children away. But saddled with an elderly mother on oxygen who refused to leave, Miller, too, was forced to stay behind. Sadly, his mother did not survive the paralyzing power failures that accompanied the storm.
The next day, as Miller tried to make plans to get her body out of the city, his family reached him on his cell phone and warned him of the broken levees and rising water that would soon envelop the already ravaged city. Miller escaped in time, although three weeks would pass before he could finally get his mother’s body out.
While holed up at the home of extended family the next day, Miller got a call from his law firm giving him two choices: transfer to their Houston office or their Baton Rouge office.
“I wasn’t prepared to make a decision to move,” said Miller. “I told them ‘I’ll go off on my own.’”
Miller scrounged to find a rental house for his family in Lake Charles, La., but just as they got settled in, albeit with just a few suitcases between them, a mandatory evacuation was announced for Hurricane Rita.
Miller had given one of the family vehicles to his mother’s caretaker, who had no car of her own and was stranded at a major refugee camp in Dallas. So when the evacuation order came for Rita, he piled his wife, children, mother-in-law, two golden retrievers and a pet guinea pig into their only remaining vehicle and joined the mire of traffic crawling north.
Shortly after Katrina hit, Miller had received an email from John Burton, the then general partner of Nantahala Village Resort, asking if the family was OK. Miller’s family was a regular at the Village, and he had befriended Burton after years of vacationing there. Burton had offered to put them up — an offer Miller initially declined with the intention of continuing his life in New Orleans. But as Miller reflected on his life — no home, no possessions, no job and one family car — Miller contacted Burden to tell him they were on their way.
Burton put them up for free at the Village for six weeks while they figured out what to do.
“Having lived through Katrina and two weeks later being evacuated for Rita, to be honest I was a little gun shy,” Miller said of moving back to New Orleans. “I have lived through many hurricanes, but that was something that was overwhelming.”
Miller had vacationed in WNC as a kid, often to paddle on the Nantahala. He continued the tradition with his own family, and in 1999 he and his wife bought a lot with the intention retiring here one day. They decided to make the move sooner rather than later.
“After Katrina, things and money basically had no meaning to me. My priorities were completely restructured in terms of what was important in life,” Miller said. “When you are working for a Fortune 500 company, you are just helping an officer climb the corporate ladder and make money. I had worked on a lot of ‘sexy ‘things as lawyers call it, but here I can help people. It is more rewarding professionally and emotionally.”
Miller brought a few of his big corporate clients with him, however.
“Clients said, ‘We don’t care where you are as long as you have a phone, a fax and a computer,’” Miller said.
Miller said he hasn’t experienced culture shock. He was tired of the big law firm and city life, despite the big paycheck that go with them. Miller said he paid his dues, from the 3 a.m. phone calls from big money clients who feel like talking and must be humored to missing his kid’s bedtime night after night.
While many may believe Jackson County has little chance of winning against the likes of Duke, there’s little doubt that any settlement that goes the county’s way will have to involve a very complicated game of give and take. Whatever the outcome, Miller will be back in his old element in his new WNC home.
Jackson County appears to be on firm footing in its quest to seize the Dillsboro dam from Duke Energy as far as state law goes, but it is unclear whether the county could hit a roadblock from the Federal Energy Regulatory Commission.
Jackson County commissioners have voted to pursue condemnation of the Dillsboro dam and adjacent shoreline under the pretext of creating a river park. On the surface, recreation is grounds for condemnation under state law. Eminent domain law in North Carolina is complex to say the least, however, with seemingly endless exceptions and disclaimers written into the statute.
One pitfall Jackson County can cross off the list, though, is the North Carolina Utility Commission.
“I am not aware of any restrictions under North Carolina public utility law,” said Antoinette Wike, chief counsel for the N.C. Utility Commission.
That’s not to say counties can go around condemning any utility operation they please, such as coal plants or nuclear plants, and converting them into parks. Power plants of larger stature operate under a “certificate of public convenience and necessity” from the state. Considered integral to serving the public demand for electricity, those power plants would be protected from any foray into condemnation, Wike said.
But the Dillsboro dam is so old — nearly 100 years — and produces so little power, it never operated under a certificate of public necessity. Further, the power turbines at the dam have been off-line for five years.
“In this instance the Dillsboro dam and powerhouse have not been used for several years so the Utility Commission, as far as I know, doesn’t really have any jurisdiction over this,” Wike said.
Duke’s lack of upkeep on the Dillsboro dam could ultimately work against the utility in the condemnation fight. Maintenance on the dam was already in decline when major flooding on the Tuckasegee River in 2004 sidelined the hydro plant. Duke had already set its sights on demolishing the dam by then and chose not to invest in repairs to get it working again.
Prior to the flood, the two turbines in the powerhouse were capable of churning out just 225 kilowatts of power — although outside hydropower specialists say that the turbines could be retrofitted and additional ones added to make more power.
Had Dillsboro dam been operational, Duke may have been shielded by the state’s eminent domain laws. Statue allows for the condemnation of property owned by a public utility only if “the property is not in actual public use or not necessary to the operation of the business.”
Duke could try to claim that tearing down the dam is necessary to its operation. Tearing down the Dillsboro dam was considered environmental mitigation to continue operating its 10 other dams in the region — or so everyone thought. Special interests, from environmental agencies to paddling groups, supported dam removal following a three-year series of negotiations aimed at developing a mitigation package for the region that would allow Duke to renew its licenses for the other dams.
In a confusing ruling last summer, however, the Federal Energy Regulatory Commission disputed the notion that Dillsboro dam removal has anything to do with mitigation for the other hydro operations.
“The Commission is not bound to accept that view, and indeed, as the record demonstrates, we do not,” FERC ruled.
That could frustrate any claims by Duke that the dam’s removal is “necessary to the operation” of its business.
Duke may not be without recourse, however. The utility could turn to its powerful and long-standing ally in the fight against Jackson County: none other than the Federal Energy Regulatory Commission. FERC has consistently sided with Duke, from minor tiffs over language to major appeals.
FERC may — or may not — have something to say about Jackson County’s bold move to condemn the dam and halt its demolition.
“It would be premature to speculate on this matter at this point,” said Celeste Miller, spokesperson with FERC.
Miller said it is too early to know what if any sections of the Federal Power Act could come into play in this complicated situation.
The terms of Duke Energy’s counter-offer to Jackson County and the town of Franklin in exchange for dropping their opposition to Dillsboro dam removal have been made public.
Duke Energy made a confidential offer to their opponents two weeks ago in hopes of staving off a move by Jackson to use eminent domain to seize the dam. Jackson County commissioners voted 4 to 1 last week to turn down the offer. The Franklin town board followed suit this week with a unanimous vote to reject Duke’s offer.
Franklin Alderman Bob Scott made the terms of the offer public. Once the town board voted on the offer, it became a public record, he said. Scott also believes the residents of Franklin have a right to know what the town board voted to accept or reject on their behalf.
“The public body exists for one reason only and that’s to conduct the public’s business,” Scott said. Furthermore, Duke is a public utility operating as a monopoly in the region and should answer to the public as well.
Here is what Duke has offered Jackson County in exchange for dropping their opposition to dam removal:
• Pay $150,000 to help create a river park along the Tuckasegee River in Dillsboro.
• Provide 200 hours by a Duke staffer to write grants to assist with the river park.
• Pay $75,000 to help Jackson County with the upkeep and management of a boat launch Duke already has plans to build along the Tuck, but will be turning over to the county for maintenance.
• Agree not to seek damages or attorney fees against Jackson County for holding up permits Duke needed to dredge sediment behind the dam. Duke had to go to court to get the permits.
• Speeding up payment of $350,000 for recreational amenities on the Tuckasegee and Lake Glenville that had been already promised. Duke had previously pledged to pay the mitigation sum within 15 years, but would speed it up to five. Duke similarly offered to speed up the already-promised sum of $40,000 for sediment control initiatives.
Here is what Duke had offered Franklin:
• Pay $10,000 for additional amenities at a recreation area on Lake Emory. Duke plans already call for a boat put-in and picnic tables.
In exchange, Duke wanted Jackson and the town of Franklin to drop all legal and public opposition, including challenging Duke in the news media. The offer also was contingent on the majority of terms remaining confidential.
Franklin leaders claim Duke has shortchanged their residents in the way of mitigation for the utility’s dam and powerhouse the Little Tennessee River at Lake Emory. Removing the Dillsboro dam was supposed to count as mitigation credits for Duke’s hydro operation at Lake Emory, but Franklin leaders fail to see the benefit of dam removal in Dillsboro to their residents in Franklin and want to see more direct benefits, primarily around Lake Emory.