Article published Feb 1, 2008

County approves zoning change for coal-fired power plant

By KARL PUCKETT

Tribune Staff Writer

Cascade County commissioners on Thursday voted 2-1 to approve a heavy industrial zoning designation necessary for construction of a coal-fired power plant proposed east of Great Falls.

The move brought quick criticism from opponents of the plant.

"I feel like we've been betrayed," said Bob Lassila, who owns land abutting the site. "It's almost like they're asking for litigation."

But the plant's developer and the owner of the land where it would be constructed called the rezoning the right decision.

"Of course we're pleased," Mary Urquhart, one of the owners of the proposed site, said after the vote. "But we're not elated the neighbors feel like they do."

The Urquhart family plans to sell the land to Southern Montana Electric Generation & Transmission, which wants to construct the Highwood Generating Station, a 250-megawatt power plant.

The farmland requires an industrial zoning for the plant to proceed.

Commissioners Joe Briggs and Lance Olson supported the rezoning, but stopped short endorsing Highwood Generating Station.

"There are elements of this proposal about which I am very positive and others which concern me mightily," Briggs said.

His concerns relate to the state's review of small particulate emissions and the potential use of eminent domain to secure utility right-of-ways associated with the plant.

State law allows rural utilities to use eminent domain. However, Briggs said this case is unusual because the owners who might be asked to sacrifice land are not in SME's electricity service area.

Commissioner Peggy Beltrone voted no to the rezoning, calling it a case of spot zoning.

The power plant would supply 60,000 customers served by SME, which is made up of five rural utilities and the utility arm of the city of Great Falls.

One more commission vote is needed to finalize the rezoning. That vote will follow a 30-day protest period.

"We respect the difficult time the commission had in dealing with this rather contentious issue," SME General Manager Tim Gregori said.

After the meeting, landowners issued a statement saying the rezoning of the agricultural land to heavy industrial "will forever change the footprint of our community."

Environmental and financing challenges remain for the power plant, which SME officials originally said they hoped to begin constructing in March 2007.

The plant has received an air-quality permit from the state Department of Environmental Quality, but that's being challenged before the Montana Board of Environmental Review.

The environmental impact statement prepared by DEQ and the federal Rural Utilities Service, is the subject of a lawsuit in federal court.

Gregori said SME is taking a closer look at private financing for the $720 million facility and making "considerable progress."

SME also is applying for a federal loan from RUS to cover 85 percent of the cost of the plant.

Gregori said there are challenges to receiving public financing because Congress has yet to fund the power supply division of RUS, which is part of the U.S. Department of Agriculture.

"Typically, it's done by this time," he said.

In late 2006, commissioners also voted 2-1 to approve the rezoning, with Briggs and Olson approving it and Beltrone voting no.

That decision was later rescinded following a legal challenge to the county's zoning rules. A second application to rezone the power plant site was submitted after the rules were changed.

On Thursday, Briggs and Olson read from prepared statements.

Briggs said he was sorry to disappoint the plant's opponents, whose arguments had "won my heart."

But, he noted that the application complies with the county's growth policy and meets the legal requirements for a valid zoning request and, as such, should be granted.

A zoning action by a county commission is not the appropriate vehicle to "set environmental policy or overrule the precedents of eminent domain," he added.

Olson said he accepted a favorable report by the planning staff and a recommendation for approval by the Cascade County Planning Board.

Every chair in the commission chambers was occupied as the clocked ticked toward 9:30 a.m. Thursday.

Opponents had hoped that information about the project presented during the past year would lead to a different outcome from the commission's first affirmative vote, Lassila said.

"We had a 50-50 chance," he said.