Record of Decision and Air Quality Permit Issued for Highwood

On May 11th, 2007, the federal Rural Utility Service (part of the U.S. Department of Agriculture) and the Montana Department of Environmental Quality issued a decision purportedly approving the Highwood project. Usually a Record of Decision (ROD) is a final decision about whether the government entity reviewing a proposed project will approve it or not. Instead, this ROD contains so many conditions that it is nearly meaningless.

The co-ops involved in this project have asked the Rural Utility Service (RUS) to finance 75% of the cost of the plant. The City of Great Falls is supposed to finance the other 25%.

What made the ROD so bizarre?

• RUS said that it would finance 85% of the project and that the City of Great Falls would only need to finance 15%. Up until this point the City has been paying 25% of the bills related to the plant because the City was supposed to own a 25% share. In one fell swoop, the RUS cut the City’s share down, apparently unbeknownst to the City. (Some people are asking whether the City will receive a refund on its previous payments.)
• RUS said that the record of decision was not actually a decision on the loan application at all, and that no funding decisions have been made yet. Although RUS was supposed to consider economic impacts, the ROD specifically said that the actual loan decision would be made later by another entity in RUS.
• The RUS has ignored the historic nature of the site from the beginning. The ROD recognizes this important issue but reaches two opposing conclusions. The ROD is conditioned upon resolution of the historic preservation issues related to the National Historic Landmark. This will be difficult because the U.S. Department of Interior sent RUS a letter two weeks prior to the release of the ROD, saying that the site for the plant was unacceptable and that locating the plant on the Lewis and Clark Portage site would have “significant adverse impacts” that could not be mitigated. Despite the letter, and the language in the ROD that there would need to be resolution of this issue prior to funding, the ROD also said: “there has been a reasonable and good faith efforts as well as an adequate and thorough analysis of site alternatives and that the site selection process is complete.” RUS makes it clear that the only concession it is willing to consider is mitigation. Yet the Department of Interior said that the impacts of locating the plant on a historic landmark cannot be mitigated.
• Finally, and most importantly, the ROD is conditioned on SME complying with all local, state and federal regulations. That means that if the local zoning regulations prohibit locating a plant on the property, RUS will not finance the plant. Since the rezoning decision was rescinded by the county commissioners, the future of this plant is in serious jeopardy.

MEIC and Citizens for Clean Energy notified DEQ on May 29th, 2007, that they will appeal the air pollution permit. They will be represented by Earthjustice in Bozeman. Another decision will be made shortly on whether to appeal the RUS decision.