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Despite the looming threat by Jackson County to win control of the Dillsboro Dam using eminent domain, Duke Energy announced that it will begin preparing for its demolition this week by dredging the backlog of sediment from behind the dam.

It marks yet another interesting twist in the increasingly tit-for-tat saga between Jackson and Duke.

Jackson County commissioners voted 4 to 1 last week to launch eminent domain proceedings against Duke to take ownership the Dillsboro dam and adjacent shoreline for the creation of a riverside park. State law allows for the use of eminent domain for parks and recreation.

The move was a last-ditch effort by Jackson County to stop Duke from tearing down the dam. But Duke seems unfazed. The company sent out a press release this week stating that it would begin prepping for sediment removal in anticipation of dam demolition in early 2010.

State and federal environmental agencies have insisted Duke dredge behind the dam to keep the backlogged sediment from flushing downstream and harming the aquatic ecosystem when the dam is removed. Duke is being required to dredge 70,000 cubic yards of the estimated 100,000 cubic yards behind the dam.

It will take six months to remove the sediment, according to Duke. Dam demolition, if not halted by Jackson’s move to seize the dam, would begin in early 2010.

Prep work to dredge the sediment could begin late this week or early next week. Duke will take precautions to minimize the impacts of the earth-moving operation in the river, according to Fred Alexander, Nantahala District Manager of Duke Energy Carolinas.

“We recognize this will be an environmentally sensitive operation, and we are taking great care to follow all appropriate environmental and regulatory requirements,” Alexander said in a statement.

Duke plans to process the sediment and hopes to find a market for its reuse in the construction industry or other uses.

Earlier this year, Jackson refused to grant Duke the permits it needed to dredge the sediment. Duke turned to the courts to demand the permits and won. Jackson was not only forced to relinquish the permits, but faces the prospect of reimbursing Duke’s legal costs to secure the permits.

For eight-tenths of a mile behind the dam, the Tuckasegee River is a wide, slow-moving backwater. Following dam removal, the area will be restored to natural river conditions, Duke said in a press release.

“There will be a significant environmental benefit once we have removed the dam and powerhouse,” said Alexander.

The free-flowing river will create new paddling and fishing opportunities and allow for natural migration of aquatic species.

John Boaze of Fish and Wildlife Associates has argued that a fish passage around the dam could accommodate migration for some species without removing the dam.

Jackson County played the ultimate trump card in the drawn-out fight against Duke Energy over the Dillsboro dam this week.

County commissioners voted 4 to 1 Monday (June 8) to use the power of eminent domain to seize the dam and surrounding land along the Tuckasegee River from Duke Energy. The move will effectively stop Duke Energy from tearing down the dam as planned. It could also send Duke back to the drawing board on a mitigation package for the region.

Counties can use eminent domain to seize private property if there is a public purpose in mind. In this case, Jackson County wants the dam and surrounding land for a park.

Recreation is accepted as grounds for eminent domain in North Carolina state law. That doesn’t mean Duke won’t challenge the move, however.

“Duke is in for the duration to remove Dillsboro Dam,” Fred Alexander, Duke’s community relations manager in the region, said in a prepared statement.

There might be little Duke can do, however, other than argue over the amount Jackson is willing to pay for the dam and surrounding property. If Jackson County says the dam and surrounding property is needed for a public park and recreation, the courts won’t get into a judgment call on whether the idea for the park is a good one or bad one, according to Charles Szypszak, an expert in public law with the Institute of Government at UNC-Chapel Hill.

“Generally speaking, as long as there is an apparent legitimacy to it, what the courts have said is they don’t look at the details of a taking,” Szypszak said.

Duke could argue that the concept of the park is a ruse, and that Jackson County has an ulterior motive for condemning the dam, however. County commissioners have alternately touted numerous reasons for wanting to keep the dam: as a piece of history, a tourist attraction, its aesthetic value, to provide green power for Dillsboro — even as a way to force Duke to pay up in an ongoing disagreement over what constitutes appropriate mitigation for its hydropower network.

But it is highly unlikely that Duke could prove Jackson’s recreation claims are illegitimate, Szypszak said.

“The court wouldn’t say ‘Well, you say you want it for this but we think you really want it for that,” Szypszak said.

The lack of merit may not stop Duke from trying, however, and potentially burying Jackson County under a mound of litigation. As Fortunate 500 company, Duke could simply outspend Jackson County until commissioners finally grow weary and give up.

Duke has no financial stake in the dam — it hasn’t been maintained and it currently isn’t producing power. When Duke had to cough up mitigation to offset the environmental impacts of its 10 other dams straddling rivers in the region, tearing down the Dillsboro dam and thereby restoring a stretch of free-flowing river was likely seen as an easy out, appeasing the paddling community and environmental agencies.

It has since become apparent just how much the dam means to Jackson County, however. Commissioner William Shelton questioned why Duke doesn’t walk away from its plans to tear it down now that the going has gotten so tough. But it may come down to a test of wills, said Jack Brown, chairman of the Green Island Power Authority in New York. Brown is one of the few that has used eminent domain to wrest ownership of a dam away from another entity and go on to operate it himself.

“Not knowing the mind set of Duke Energy, I don’t know how much they will resist,” Brown said. “They have been unchallenged and pretty much run the show. If they think this is going to be a chink in their armor, that Jackson County is going to come in and take this away from them, they may not want to set the precedent.”

How the vote went down

Duke had caught wind in recent weeks that a move was afoot to start condemnation proceedings. Commissioners were poised to take a vote on the matter last Monday, but Duke staved it off at the last minute with the promise of a counter offer.

Jackson commissioners suspected Duke would make a last-minute bargaining pitch. Just a week earlier, Duke and Jackson County had been brought together for court-ordered mediation in Washington, D.C.

“There was some interesting give and take among the participants and hopefully something positive will come from that,” Chairman Brian McMahan said last week.

Duke’s olive branch apparently fell short of commissioners’ expectations, however. When commissioners reconvened this Monday to consider Duke’s attempt at a settlement, they voted 4 to 1 to reject it.

“It wasn’t for a lack of effort that mediation didn’t work out,” Alexander said. “And I’m certainly sorry it didn’t.”

The terms of Duke’s counter-offer were not made public citing the confidential nature of court-ordered mediation.

After voting to reject Duke’s offer, commissioners had one more order of business before moving on to their big vote of the night. The first step was to formally embrace their desire for a recreational park around the Dillsboro dam. The county recently hired a planning firm, Equinox Environmental, to create a master plan for a park along the shore of the Tuckasegee River in Dillsboro. The dam is a focal point of the design. In hindsight, it’s obvious the county’s intention in drawing up the master plan at a cost of nearly $20,000 was to set the stage for condemnation of the dam and river shore.

A motion to “adopt the major concepts of the Dillsboro Heritage Park” passed with a unanimous vote.

Commissioner Tom Massie, who disagrees with the continued fight against Duke, put aside his dissent to back the conceptual idea for a riverfront park in Dillsboro.

Commissioners then forged ahead with the long-anticipated motion that many in the audience were hoping for.

“I will move that Jackson County institute an eminent domain proceeding to acquire title to the following property for the public purpose of establishing a water front park and recreation facility along the Tuckasegee River and preserving the Dillsboro reservoir,” Chairman Brian McMahan said. McMahan proceeded to list several pieces of property Duke owns along the river shore around the Dillsboro dam, along with the dam itself.

Massie pointed out that the land along the riverbank owned by Duke is already slated to be turned over to the county following dam removal, as Duke would no longer have a use for it once the dam was gone.

The vote to condemn the dam was well orchestrated. Commissioner Joe Cowan made the motion to reject Duke’s counter-offer. Commissioner Mark Jones made the motion to adopt the concepts of the Dillsboro river park. And Commissioner Chairman Brian McMahan made the motion to seize the dam with eminent domain.

The commissioners cited what they call overwhelming support from the people of Jackson County to take this step. Jones cited an online poll by the Crossroad Chronicle newspaper in Cashiers with 78 percent of respondents supporting the county’s fight.

“I’ve heard those same statistics throughout the county as I have worked very hard to ask people their opinion,” Jones said.

Jackson County has proved a tough customer in the fight against Duke Energy. For Commissioner Cowan, standing up to corporate power runs in his blood. His father helped organize the workers at Mead Corporation to form a union decades ago and bring about a fair wage, he said.

Cowan compared his father’s fight to the one against Duke today.

The commissioners have met an untold number of hours in private sessions over the past three years to discuss the drawn-out legal wranglings against Duke. A new face has claimed a seat at the table recently, however. Gary Miller, a Bryson City attorney, has been present at the past three closed sessions. This week, commissioners announced Miller will be their legal counsel on the condemnation proceedings. Paul Nolan, the D.C.-based attorney who specializes in hydropower issues, will continue in a peripheral role as well.

Duke still has two pending legal challenges against Duke. One is an appeal of a state water quality permit that paves the way for dam demolition. Another is an appeal in the U.S. Court of Appeals. Both of those cases will likely be put on hold as eminent domain plays out.

Whatever it takes?

Jackson County has spent around $250,000 in its opposition to Duke over the past five years. The majority has been on legal fees, but some has been for environmental consultation.

In his lone dissent to condemnation, Massie argued that it is time to stop the bleeding.

Massie advocated continuing down the road of mediation, citing a glimmer of hope in the offer Duke already made.

“While it is not what I would have hoped for, Duke has finally made some movement in our direction,” Massie said. “A bird in the hand is better than a bird in the bush.

We are a whole lot better off taking it now and cutting our losses.”

Massie told Duke it wasn’t too late to make the county a better counter-offer, that there was hope yet the commissioners would back down.

“I sincerely hope the action we have taken here today will encourage Duke to come back to us and negotiate some more so we can avoid going through with this proceeding,” Massie imparted to Duke following the vote Monday.

Commissioner William Shelton said he doesn’t understand why Duke won’t agree to a compromise. If Duke would turn over the dam to the county, it could walk away from the fight.

Shelton said the expense of a potentially protracted legal battle was the only thing that gave him pause in his decision.

“The only reservation is the David and Goliath factor. Can we beat Duke and can we afford to beat Duke? But I choose not to have a defeatist attitude,” Shelton said.

McMahan said the cost of giving up the fight is greater than the cost of continuing. He cited the loss of tourism in Dillsboro, the loss of an historic icon, the loss of a popular fishing hole, the loss of an aquatic ecosystem, the loss of green power. The cost of the fight to save the dam pales in comparison, he said.

“It is a small cost to pay to preserve something that is so precious to us,” said McMahan, who grew up fishing around the dam.

Duke’s new permits could last for 30 years or more before the region has another crack at exacting mitigation from the company. McMahan said the county’s chance is now or never.

John Boaze, owner of Fish and Wildlife Associates, shared the latest generation figures off Duke’s 10 hydropower dams in the region. Boaze estimated Duke brought in $33.7 million in revenue off its hydro operations in WNC, for a profit of $6.8 million.

Last week, commissioners learned that Duke Energy was donating $1 million to study the effect of rising sea levels on the Alligator River National Wildlife Refuge. The donation sent a message to Jackson leaders that Duke, a Fortune 500 company, has money at its disposal to offer Jackson County a better deal than it has.

River park a public good?

Dillsboro merchants and residents have become regulars at Jackson County commissioners meetings over the protracted fight against Duke, appearing to both prod and applaud the commissioners in their effort, often appearing with the most recent stack of signed petitions voicing support for the fight.

Shelton said he had to look at the long haul for Dillsboro. The mountain hamlet of galleries, craft shops and gift stores lost a major source of foot traffic when the Great Smoky Mountains Railroad stopped running trains to the town.

“I see a town that is struggling mightily right now,” Shelton said. “If you look at the long-term investment on this concept, it could be an economic development tool for Dillsboro looking into the future.”

Susan Leveille, an artist and owner of Oaks Gallery in Dillsboro, said the town has taken a hit from the loss of the train coupled with the economy. The river park in Dillsboro and preservation of the dam will provide a much-needed focal point and amenity for the town, she said.

“I think it will serve all of us in the county very well,” Leveille said.

Teresa Dowd, the owner of West Carolina Internet Café in Dillsboro, said a public park anchored by the dam is needed desperately.

“When you go to other towns with waterfront that is being utilized, the park generates so much interest among tourists and the locals. It is economically beneficial,” Dowd said.

Commissioner Joe Cowan said the river park around the dam will set Dillsboro up to prosper.

“If you back off and look at it over the long run, the benefits to Jackson County and Dillsboro specifically call for this action,” Cowan said.

McMahan questioned what the river would look like if the dam was gone. If the dam is torn out, the water level in the slow moving backwater stretching for eight-tenths of a mile behind the dam will drop.

“If they jerk that dam out and leave a big mud flat and Dillsboro looks like a bomb hit it, what’s the cost to our tourism economy?” McMahan said.

Chairman Brian McMahan

“I believe that river belongs to the people of the United States of America. That’s our river. Yes we have benefited from the production of power, but it still belongs to the people. I don’t argue the fact that Duke should be allowed to make a profit, that’s part of capitalism. At the same time, if they are going to use our river to generate power, shouldn’t they compensate the people here a little bit more? If you look at what they have offered, it is pennies compared to what they are making off our river. The people have pretty much been ignored.”

 

Commissioner Joe Cowan

“We are all elected by the people of Jackson County. The vast majority of my constituents have said to me ‘Help save the Dillsboro dam.’ I think it is time to stand up to Duke I don’t care if it does cost a million dollars, I think we will beat Duke and will prevail in this lawsuit because we have facts on our side. Never have I seen a large energy corporation come in and take so much from a people of a county and want to take more and more over the next 40 years and give back so little.”

 

Commissioner William Shelton

“This has been a very very tough decision for me. I have gone back and forth. Unfortunately it comes down to whether you vote your heart and morals or do you vote with your head? After lots and lots of tossing and turning I’ve done the very best I could to put my finger on the pulse of my district and I am finding overwhelming support to save the Dillsboro dam. After a long difficult decision, I am going to have to vote with my heart on this.”

 

Commissioner Mark Jones

“I think we should continue the fight. The money we have spent already is the vast majority of the money we are going to have to spend. The economic problems the town of Dillsboro has gone through in recent years, this would be a tremendous benefit.”

 

The lone dissenter: Commissioner Tom Massie

Jackson County commissioners are fool-hardy if they think they can win a fight of this magnitude against Duke Energy, Commissioner Tom Massie expressed to fellow board members for the umpteenth time this week.

Massie nearly begged his fellow commissioners not to go through with the vote for condemnation.

“Condemnation is very, very risky. We are breaking new ground. There is no if’s and’s or but’s. This has never been done in the state of North Carolina, this kind of condemnation,” Massie said. “I am not a gambler. I wouldn’t spend a penny in a poker game. I refuse to gamble the taxpayers’ money of Jackson County with this kind of risky venture. I wouldn’t do it with my money, and I wouldn’t do it with theirs.”

During the county commissioners lengthy closed-door discussion leading up to the vote this week and last week, audience members relegated to the hallway outside the meeting room would occasionally walk over to the door and peer through a small window to see what was going on inside. And more often than not, Massie was the one doing the talking, growing animated at times as his fellow commissioners patiently listened but were ultimately unmoved.

Massie agrees with the rest of the board on one count: Jackson got a raw deal from Duke, he says.

“I didn’t think it was fair then I don’t think it is fair now,” Massie said. “My heart says we should continue this argument and fight but my head says this is not good business. This is a time we need to put emotion aside and we need to make prudent cold calculating business decisions about what is best for the Jackson County taxpayers and residents of this county.”

Massie said the writing is on the wall, and has been for a long time now.

“All the federal and state agencies involved in this thing have sided against Jackson County and are for dam removal. We have lost every single appeal we have had in this fight for the past five years,” Massie said.

Massie said he hopes he is proven wrong and the county prevails this time.

Why does Duke want to tear down the dam?

Dam removal is tied to the larger issue of mitigation for Duke’s hydropower operations in the region. Duke operates 10 other dams on five rivers in the region. The permits for those dams are up, and to get new ones, Duke must offer environmental and recreational mitigation, compensating the public for the use of the rivers to produce profitable hydropower.

Tearing down the Dillsboro Dam is the cornerstone of Duke’s mitigation plan. Paddlers and environmental agencies are excited to see the dam go as it will restore a stretch of free flowing river. Others think Duke is unloading an aging dam it didn’t want anyway under the guise of mitigation.

 

Is there hope for a compromise yet?

Yes. Duke could at any time make Jackson County a counter-offer to back off condemnation proceedings, or vice-versa.

 

What exactly does Jackson plan to take from Duke?

Jackson County voted to initiate condemnation proceedings against the Dillsboro dam, the powerhouse adjacent to the dam and shoreline property Duke owns around the dam on both sides of the river.

 

Can Jackson County legally take the dam from Duke?

Jackson County wants the dam and surrounding property to make a park. Counties are granted the power of eminent domain to seize property for several public uses. One of those is recreation, which the county cited as its reason for the condemnation. Recreation was used to as grounds for eminent domain in the creation of the Great Smoky Mountains National Park.

 

What would Jackson do with the dam?

Jackson County leaders previously said they wanted to operate the dam themselves as a source of green power rather than see it torn down by Duke. Making electricity isn’t just cause for a county to flex eminent domain power, however. But once Jackson has control of the dam under the guise of recreation, it could theoretically try to put the dam in operation for hydropower.

 

What happens now?

Jackson County’s next step is to have a survey and appraisal of the property it plans to condemn. Following the vote Monday night, the county must wait at least 30 days before it can formally file condemnation proceedings through the courts. As for Duke, representatives at the commissioners meeting said their next step is to wait and see if Jackson follows through with formal proceedings.

 

How much will Jackson have to pay for the property?

Jackson will hire an appraiser to determine fair market value for the property. The dollar value will be filed as part of the formal condemnation proceedings in court. When Duke formally initiates the proceedings, it has to put up the money right then. Whatever dollar value Jackson County puts on the dam and surrounding property must be deposited in full in an escrow account held by the court.

If Duke disagrees with Jackson’s offer, it can sue for more money. The ultimate decision would rest with the courts, possibly a jury trial.

 

Can Duke challenge the value Jackson puts on the property?

Yes. The most common protest in a condemnation proceeding is over the monetary value being offered for the property. Duke can go to court claiming the market value of its property is more than what Jackson says it is. Duke’s legal argument would center around what’s a fair price rather than the ideological premise of condemnation.

 

Can Duke challenge Jackson’s use of eminent domain?

Yes. Duke could challenge whether Jackson County has just cause for the condemnation and argue that the dam is not an integral to the recreation plans, although this type of legal challenge to eminent domain is rarely attempted.

The state spells out grounds for eminent domain, one of which is recreation. Whether the particular recreation project is a good idea is not legal grounds for contesting it.

“To say, ‘Well we don’t think it is a very good project’ isn’t going to do very much,” said Charles Szypszak, an expert in public law with the Institute of Government at UNC-Chapel Hill.

 

Can Duke hurry up and tear down the dam?

Duke still owns the dam for the moment. However, hurrying up and tearing down the dam while Jackson gets its ducks in a row for condemnation is logistically impossible.

Before Duke tears down the dam, it is mandated to dredge 70,000 cubic yards of back-logged sediment from behind the dam to prevent it from washing downstream when the dam comes out. The dredging would take approximately five months, according to Fred Alexander, Duke spokesperson.

The target date for dam removal to begin was January 2010. That would get Duke outside the window for spawning season of the endangered Appalachian elktoe mussel, which lives downstream of the dam.

 

If tearing down the Dillsboro dam was Duke’s version of environmental mitigation, what will serve as mitigation if the dam stays?

This is unclear and a matter of great debate. Duke says if the dam stays, it will be required to forgo some of its power generation at the much larger dam upstream at Lake Glenville.

To make hydropower at Lake Glenville, Duke diverts water out of the Tuckasegee River and sends it for miles over land through giant pipes to a power plant before finally being returned to the river. The more water Duke diverts from the river, the more power it can make. The same goes for hydro operations at its other bigger dams, like Nantahala Lake and Bear Lake.

In the meantime, however, several miles of the river downstream of those dams are left with little water, harming the aquatic ecosystem.

Removing the Dillsboro dam was supposed to mitigate for robbing other stretches of the river of water. If the dam doesn’t come out, environmental agencies could insist on Duke restoring more water to those stretches currently being by-passed.

The less water Duke is allowed to divert, the less power it can make at its large Lake Glenville power plant. Because of this, Fred Alexander, a spokesperson for Duke, argues that keeping the Dillsboro dam would actually mean a net loss in hydropower. The amount of power produced off the small Dillsboro dam could not make up for the power production lost at Lake Glenville, Alexander said.

Alexander said it is an either-or proposition. If the Dillsboro dam doesn’t come out, Duke will have to restore more water to the dewatered sections, and thereby lose some of its hydropower capacity.

The mitigation package on file with the Federal Energy Regulatory Commission says only that failured to tear down the dam “may nessicitate” a re-examination of how much water is being diverted from the river below Duke’s larger dams.

John Boaze, an environmental consultant with Fish and Wildlife Associates, said it is not necessarily and either-or proposition, but that other mitigation may be an option contingent on approval by state and federal environmental agencies.

“What becomes of that your guess is as good as mine,” said Boaze.

Jackson County has long held that tearing down the dam was a poor excuse for mitigation that benefited a small segment of the population, namely paddlers. Jackson would rather see greenways along the river, or an environmental trust fund based on a percentage of Duke’s profits off the dams.

Jackson County’s decision to take the Dillsboro dam through eminent domain is a bold next step in the relicensing saga that has been playing out for years.

Commissioners voted 4-1 Monday night to use one of the strongest powers they possess to get what they believe to be a fair deal from Duke Energy. Taking the dam through eminent domain promises a messy legal fight. But it’s the end game that matters here, and a majority of their constituents are — in a word — insulted by the mitigation package Duke has offered.

As we’ve noted before, making the removal of a community icon the centerpiece of the giant utility’s environmental mitigation effort just didn’t make many people happy. Yes, the free-flowing river will be a boon to paddlers and restore a lengthy stretch of the waterway to its “pre-Duke” status, but other considerations came into play.

This dam, small in size and in plain view of thousands of citizens every day, has gained a value aside from its hydropower production. It has become a part of Dillsboro, one of those man-made objects that give residents a sense of place. As soon as Duke began pushing the idea of removing the dam, many started speaking up to voice their surprise and displeasure.

Here’s the rub for Duke: if the giant utility had come to the table with a better mitigation package, removing the dam likely could have happened. A look around the region proves that in other cases where utilities sought federal licenses to operate hydropower plants, more tangible mitigation packages were offered.

Two relicensing arrangements nearby — Alcoa to the west and Progress Energy’s Pigeon River deal to the east of Jackson — offered big-time, lasting packages. The Progress Energy solution — creating the Pigeon River Fund — has, almost 20 years later, helped every school child in Haywood County gain intimate knowledge of the watershed, in addition to providing money for dozens of environmental and riparian efforts to help landowners and nonprofit organizatios.

Representatives from this newspaper attended many of the stakeholder meetings that led to Duke’s decision to take down the Dillsboro dam. During the relicensing process for all of its hydropower plants in Western North Carolina, Duke invited citizens, representatives of various state environmental and licensing agencies, and others to a multi-year series of meetings. Many of those supported the dam removal, and so Duke thought it was going down the right path.

A glimmer of hope for compromise arose during mediation that took place over the last couple of months. But those privy to those negotiations obviously did not think Duke offered enough.

We somehow wish the energy company could become a partner in this effort to make Jackson County a green energy leader, not an opponent. Unfortunately, it appears it will be left to the courts to determine a fair outcome.

Five years into a bitter fight over the fate of the Dillsboro Dam, Duke Energy showed its first sign of budging this week.

Following a mediation session in Washington, D.C. Duke pledged to make Jackson County a “counter offer” in the tug-of-war over the dam. Duke wants to tear down the dam, and Jackson County wants to save it. The case is currently before the U.S. Court of Appeals.

News of the counter offer came at the end of a lengthy closed meeting on Monday (June 1) between commissioners, two attorneys and a third one on conference call.

Word that the Dillsboro dam would be a topic of discussion at the commissioners meeting had apparently circulated among dam supporters, who turned out around 15 people included Dillsboro town leaders, merchants and residents donning green “save the dam” tags. Several spoke up for saving the dam during the public comment period at the start of the commissioners meeting.

When commissioners retreated into closed session, spectators packed into the small foyer outside the room and loitered about for an hour and a half in anticipation of an announcement by the county.

When the crowd filtered back in, Commissioner Chairman Brian McMahan reported the board would hold off on any action regarding the dam until it had a chance to see Duke’s alleged offer. Jackson County commissioners gave Duke until the end of the day Friday (June 5) to submit their offer. Commissioners will reconvene at 4 p.m. Monday, June 8, to talk about it.

When commissioners stood to adjourn the meeting, McMahan walked over to where Duke’s attorney was sitting in the audience and pointedly said, “If you are serious about this, we need to see that counter offer by 5 p.m. Friday.”

 

Trump card or bluff?

The mediation between Jackson County and Duke last week was not the first in their five year history. Previous attempts at mediation had not been successful, however.

Duke may have finally been spurred toward cooperation by a looming threat by Jackson County to use its ultimate trump card: condemning the dam under the right of imminent domain. Jackson first broached the idea publicly almost a year and a half ago. It has resurfaced in recent months.

The vote that Jackson County commissioners postponed Monday night was presumably the one to set the wheels of condemnation in motion.

Fred Alexander, a Duke spokesperson, protested the notion that imminent domain was an option.

“There is no legal basis for the condemnation of Dillsboro dam,” Alexander told commissioners. “The county is under a Catch 22. Under the Federal Power Act, the county can only condemn the Dillsboro dam if it plans to maintain it as a hydropower plant. However, North Carolina law only allows the county to condemn for nine specific purposes, none of which include operating a dam.”

Other opinions hold that Jackson County use the right of imminent domain to seize ownership of the dam, and there would be nothing Duke could do about it.

“There are plenty of purposes the county is authorized to use imminent domain for,” said Charles Szypszak with the Institute of Government at UNC-Chapel Hill. “If the purpose is within one of those there is almost no chance of contesting it. There is very little constraint. A challenge is very rarely successful.”

Parks and recreation is one accepted justification behind imminent domain. Coincidentally — or maybe not — the county recently hired a firm to develop a conceptual design for a river park that uses the Dillsboro Dam as a focal point.

Jackson County would have to pay Duke fair market value for the dam. Duke could challenge the offer price in court.

Dillsboro dam supporters were hopeful than Duke may be coming around.

“It sounds to me like the pendulum is swinging,” said Dave Waldrop, who spent his boyhood fishing around the dam. Waldrop said whatever this counter offer is, however, better involve keeping the dam.

 

A long road

Jackson County has spent more than five years fighting Duke Energy’s plans to tear down the Dillsboro dam. Tearing down the Dillsboro dam is the cornerstone of Duke’s environmental mitigation plan for its network of hydropower operations in the region.

Jackson County commissioners would rather see another form of mitigation that would benefit a larger sector of the population, and have proposed cash payments instead that Jackson County could put toward a greenway along the river or environmental initiatives, along with turning ownership of the dam over to the county.

Jackson County commissioners got their first look last week at a master plan for a Dillsboro river park — a plan that prominently features the controversial dam — on the same night they spent nearly three hours in closed session discussing their legal fight with Duke Power over the fate of the dam.

Jackson County and Duke Energy have been locked in a lengthy battle over the dam. Duke wants to demolish it and county leaders want to save it.

The county contracted with Equinox Environmental of Asheville to develop a conceptual design for a park along the river in Dillsboro. The inclusion of the dam and powerhouse as a focal point for the river park surprised some, however, including Commissioner Tom Massie. Massie, who has unsuccessfully prodded the others commissioner to give up in their fight against Duke, seemed perplexed over why the dam appears as a focal point when its demolition is all but imminent

“I’d like to say that Equinox Environmental does wonderful work, and that this is a good plan,” said Massie after a presentation by landscape architect Dena Shelley of Equinox. “But I guess, Mr. Chairman, I’m missing something here. Does this mean that Duke has given in to Jackson County and said the dam could stay?”

Commissioner Chairman Brian McMahan said the park could be built with or without the dam, and Equinox’s Shelley concurred with McMahan.

“We had in mind that the plan could work with or without the dam,” Shelley said.

The park, if built, would radically change the riverfront on both sides of the Tuckasegee in and around Dillsboro. The conceptual design includes river put-ins for boaters, river viewing and fishing areas, parks on both sides of the river connected by a river walk, plus an extended greenway. It was designed to entice anglers, boaters and pedestrians, and would be tied into downtown Dillsboro with footpaths and signage.

“The idea was to create a destination for recreation and tourism in Dillsboro,” said Shelley.

Commissioner Joe Cowan said he hadn’t had time to study the plans, but on first glance he was impressed.

The plan even incorporated turning the old powerhouse it into a craft center or some other retail business and had dam viewing areas.

Following the presentation, commissioners went into closed session to discuss their legal battle with Duke over the Dillsboro dam. Tearing down the dam would serve as the centerpiece of Duke’s environmental mitigation, required to offset the impacts of its other hydropower operations in the region.

Jackson County, however, wants to keep the dam and force Duke to perform other mitigation instead, such as an environmental trust fund. While Jackson has lost several appeals against Duke, the county’s attorney on the issue claimed Jackson held the ultimate trump card: condemning the dam with the power of imminent domain and taking it over to operate as a source of green power. That idea appeared to die last summer, however.

The closed session last week (May 18) lasted until after 11 p.m. but no action was taken afterward. Among those attending the closed session was Gary Miller, a lawyer who aided Dillsboro Inn owner TJ Walker in his opposition to Duke.

An attorney for Duke Energy gave Jackson County commissioners a “friendly reminder” this week to stop dragging their feet on turning over permits that will pave the way for the demolition of the Dillsboro Dam.

Before Duke can tear down the dam, it must dredge sediment backlogged behind it. Jackson County, which has been at loggerheads with Duke for several years over dam removal, has resisted issuing the permits.

Duke Energy went to court over the issue and won a ruling by Judge Laura Bridges that forces the county to provide the permits, despite appeals over dam removal that are still in play at the federal and state level. Jackson County feared that releasing the permits would hurt its chances in the pending appeals.

Despite the court order, Jackson County has continued to put up resistance. The county agreed to issue a permit, but only with a disclaimer that the county wouldn’t be liable if anything went wrong during dam removal, be it environmental or human safety. Other conditions involved safety parameters.

Duke refused to accept the permit with the disclaimers and conditions and has accused the county of violating the court order. Duke Attorney Molly McIntosh gave the county a last chance to comply this week before going back to the courts.

“I have tried, I think today is the third time I tried, to get the permits without conditions,” McIntosh told the commissioners at their meeting Monday night (May 4). “Mrs. Cable told me she was told to hold the permits until after tonight’s meeting. The order doesn’t say anything about conditions on the permits. If we don’t get the permits we are going to have to move for contempt in violation of the order.”

Commissioners discussed the permit issue in closed session Monday night. The following morning, the county issued the permits without any conditions, but emphasized it was for sediment dredging only.

The commissioners have been split in recent months over their continued opposition to Duke. Commissioner Tom Massie and William Shelton advocate throwing in the towel on the fight, but remain in the minority.

Despite losing yet another court battle over the Dillsboro dam, the majority of Jackson County commissioners have vowed to continue their fight to save the structure.

Superior Court Judge Laura Bridges on March 23 ordered that Jackson County issue permits to Duke to dredge sediment backlogged behind the dam. Dredging the sediment is required before Duke tears down the dam, but the county had been withholding the permits Duke needed until other litigation surrounding the dam was resolved.

But Bridges ruled that the county had no right to withhold the permits, namely a floodplain development permit and land development compliance permit.

Duke argued that the county was just delaying the permits in an effort to save the dam. The county argued that it was withholding the permits until other legal matters surrounding the dam were resolved.

At Monday’s county commissioners’ meeting, Commissioner Tom Massie urged his fellow commissioners to pull out of the fight, saying it can’t be won.

“Have you had enough yet?” Massie asked the other commissioners.

Massie said the county’s fight against Duke is like pushing a chain.

Massie said he and Commissioner William Shelton have made it clear they are ready to throw in the towel and other commissioners should think hard about doing the same.

“We have to face reality,” said Massie.

He urged his fellow commissioners to speak with their constituents about how they feel on the issue. Massie said most of his constituents have said they favor ending the fight against Duke in order to stop spending money on legal fees.

Commission Chairman Brian McMahan said he has spoken with constituents who want the county to continue the fight against Duke.

“In all due respect I talk to taxpayers as well, and they have a different opinion,” McMahan said.

County Manager Ken Westmoreland said County Planning Director Linda Cable was expected to issue the permits to Duke on April 7.

Duke spokesman Fred Alexander said he did not know when Duke would begin dredging the 70,000 cubic yards of sediment. The sediment must be dredged before the dam is torn down to prevent the silt from washing downstream and causing environmental problems.

 

Another legal matter remains unresolved

The county still has a federal appeal over the dam removal, which is headed for mediation.

Duke won approval from the Federal Energy Regulatory Commission to remove the dam as a form of mitigation for its other hydropower operations saddling rivers throughout the region, but the county appealed that ruling to the Court of Appeals in Washington. Jackson County believes Duke owes more in mitigation than removing the dam, such as a cut of Duke’s profits off the dams going into an environmental trust fund.

Alexander said it is normal for matters to go to mediation. If it isn’t resolved in the mediation, the court will make a decision, Alexander said. Alexander did not know when the mediation would be. Alexander also did not know if Duke could proceed with tearing down the dam before the appeal is resolved.

Duke Energy and Jackson County appeared in court Monday (March 16) to argue over permits related to the removal of the Dillsboro dam.

An attorney for Duke Energy said the court should order the county to issue the permits to Duke.

Superior Court Judge Laura J. Bridgers said she will make her decision after she has had time to review all the documents.

The permits are necessary to dredge sediment behind the dam. Before Duke can tear down the dam, it has to dredge the sediment.

Duke asserted that the county, which wants to save the dam, is simply denying the permits to delay the demolition.

Duke Energy sued Jackson County a few months ago, charging that the county refused to issue a Floodplain Development Permit and a Land Development Compliance Permit to dredge 70,000 cubic yards of sediment from behind the Dillsboro dam.

Duke says it has met every requirement for the permits, but the county still won’t issue them.

“You either meet the requirements or you don’t,” Duke attorney Kiran Mehta of Charlotte said. “You’re not in a position to refuse permits when you meet all the qualifications.”

Moreover, Duke said it has received the go-ahead from the Federal Energy Regulatory Commission to dredge the river and demolish the dam, and therefore doesn’t even need county permits.

Duke asked the court to declare that the Federal Power Act supersedes or “pre-empts” the county permits.

The county said it is not going to issue the permits until all its legal appeals regarding the Dillsboro dam are resolved. Depending on the outcome of the appeals, there could be a modification to how the dam is removed or it may not be removed at all, argued Jackson County’s attorney in the matter, Paul Nolan from the Washington, D.C., area.

Nolan said the permits can’t be granted before the litigation is resolved because the matters are “intrinsically intertwined.”

The county is appealing the FERC order that the dam be demolished to the U.S. Court of Appeals in Washington and is also appealing the state’s issuance of a water quality permit.

Duke wants to tear down the Dillsboro dam as a form of mitigation to keep operating its myriad other hydroelectric dams in the region. The Dillsboro dam is antiquated and no longer produces enough power, Duke says. Tearing it down will improve the environment by opening up the river, which will also benefit whitewater enthusiasts, Duke says.

Nolan told the court that the county wants the dam to stay because it is scenic, historic and a tourist attraction for Dillsboro. It could also be a source of green power if retrofitted.

FERC ruled that the sediment must be removed before the dam is demolished. Otherwise, the sediment could rush downstream and cause environmental problems.

Duke’s attorney, Mehta, noted that the FERC order states that the dam must be removed by July 19, 2010. By failing to issue the permits, Jackson County could prevent Duke from meeting the deadline, Mehta said.

For Duke to meet the deadline, dredging needs to begin by July 1 of this year, Mehta added.

Duke applied for the Land Development Compliance Permit in August 2008 and the Floodplain Development Permit in November 2008 and still hasn’t received either one. Such permits usually only take about a week to issue, Mehta said.

The county was giving Duke the “run around” over the permits, Mehta said.

For instance, after reviewing Duke’s Land Development Compliance permit application, the county planning office determined that a floodplain permit would also be needed but didn’t tell Duke, Mehta said.

Duke had to specifically inquire as to whether it would need another permit. It wasn’t until about three months later that the county informed Duke that it would also need the floodplain permit, which Duke then applied for, Mehta said.

But Planning Director Linda Cable notified Duke that the county would not issue the permits until the appeal regarding the water quality permit was resolved.

FERC does not require Duke to get local permits, but suggests that it should try to abide by local rules to be “good citizens.” But if the local laws cause interference the utility doesn’t have to follow them, FERC says.

Duke claims it tried to be a good citizen and get the local permits, but the county refused to issue them. Mehta said Jackson County refused to communicate with Duke and built walls around the permit process rather than facilitate it.

Mehta told the judge that the county has argued that the Superior Court does not have jurisdiction in the matter because of the other litigation taking place over the dam. But Mehta balked at that, saying, “You have subject matter jurisdiction on anything that walks through the door.”

It doesn’t make sense for the county to not issue the permits, because the county also wants the sediment dredged, Mehta said.

But Nolan, representing the county, said if Duke gets the permits for dredging it is a “slippery slope” toward dam demolition. For instance, if the dredging takes place, a court may be more inclined to go ahead and allow for the dam to be removed.

The holdup with the permits has caused six to nine months of delay, said Mehta, and to ensure there is no more delay, he wants the court to order that the county can’t require any future permits for the dredging.

By denying the permits, the county is attempting to “derail” the FERC order that the river be dredged and the dam removed, Duke asserts.

It’s “obvious that Duke is right and the county is wrong,” Mehta said, adding that it is in the judge’s power to tell the county “enough is enough.”

There was only one member of the public in the courtroom, Sam Fowlkes, who favors dam removal and said the county is spending too much in legal fees on the matter.

Fowlkes said he can’t understand the county’s wanting to save the dam.

‘“It’s an ugly hunk of concrete,” said Fowlkes, who said he is on the board of directors for the American Canoe Association.

Removing the dam would help his sport by opening up the river, he added.

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