Senator will have input on licensing

[EDITOR’S NOTE: The July 10 print edition of this story had incorrect information. This is the corrected and extended version.]

POLSON — A state senator, concerned that electric rates could soar and $1.2 million could be siphoned away from schools and Lake County, has been granted the right to have input on the federal licensing of Kerr Dam’s sale to the CSKT.

A Federal Energy Regulatory Commission secretary accepted a request from Lake County Commissioners and State Sen. Verdell Jackson to act as intervenors in federal proceedings related to the sale of Kerr Dam to the Confederated Salish and Kootenai Tribes.

Jackson said anywhere between $800,000 and $1.2 million in taxes that normally fund Lake County schools and Flathead and Lake counties would be collected by the tribe but there is no guarantee that money would be refunded.

Tribal officials said they will pass on those taxes but Jackson wants a guarantee.

“Lots of things are said verbally but if it’s not in writing it has no validity,” Jackson said. “If these things, like property taxes, are not in the licensing, they will not be done.”

He said the present administration might honor the agreement but one in the future might not.

“The people who are affected must play a vital role related to transfer of this license,” he said. “Unless Lake County is vigilant, they will come down with the short side of the stick. Otherwise, the dam is only accountable to the federal government and the feds haven’t shown much interest in Montana.”

Jackson, R-Kalispell, filed a motion to intervene in June intended to stall or halt the federal license allowing the tribes to operate the dam.

On Tuesday, July 8, the commission issued a notice granting intervention by Jackson and Lake County, which filed a separate motion.

Jackson believes the commission and utility supplier NorthWestern Energy do not have the “proper authority to convey the Kerr Project to a tribal government,” because it would violate existing contracts and reduce tax funding to schools and Lake County.

“History bears out the fact that Kerr Dam serves everyone in many ways. It is an important observation that producing power was secondary to irrigation,” Jackson wrote in a response to PPL Montana’s argument against allowing him to intervene. “The 1930 Flathead Power Development report for the Kerr Project identified four interests that have guided the management and operation of the Kerr Project since its inception, including the tribes, the general public, the irrigation project composed of Indians and settlers, and the power company.”

The CSKT would be the first Native American entity to own and operate a dam, which the Tribal Council will rename, said a tribal spokesman.

“Our economy in Western Montana is built on tourism and agriculture,” Jackson said in his application. “It is necessary to intervene at this juncture in the proceedings to make sure that each licensee or any transferee is able to meet the obligations of the previous licensee, including maintaining a balance between power revenue and the other purposes for which the project was built such as irrigation, flood control, fishing, boating, tax payments, electricity rates, and public responsiveness.”

Some non-tribal ratepayers fear the tribes might raise rates but a spokesman said ratepayers won’t notice a difference.

The plan in place calls for the tribes to assume control in September 2015.

Jackson, an irrigator, is also against implementation of the proposed tribal Water Compact and opposes giving up water rights to the tribes or anyone else.

Jackson wants the commission not to issue a license to the tribes until after the sale is complete, and then to issue the license, “as to minimize the disruption to and destruction of the local and regional economies.”

After extensive hearings and a negotiation decided through arbitration in March, the tribally owned Energy Keepers will pay $18.2 million to purchase Kerr Dam.

The tribes offered $14.7 million while dam-owner PPL Montana was asking $50 million. Jackson claims the dam is worth more than $200 million to $300 million based on output compared to the other 10 dams in the sale.

If he is successful, Jackson said more economic benefits will stay in the valley instead of going to Pennsylvania, where PPL Montana is headquartered. The tribes already operate Mission Valley Power.

Attempts to contact Lake County Commissioners were unsuccessful.