Commissioners looking for ways to replace lost revenues

POLSON – Lake County Commissioners are already planning on replacing about $1 million in potential lost taxes once the sale of the Kerr Dam to the CSKT is completed in 2015, said Lake County Commissioner Gale Decker.

“We’ve been in talks with the Tribal Council,” Decker said at a recent Ronan Chamber of Commerce lunch. “They have pressures from their constituents as to the (payment in lieu of taxes).”

Decker said there is federal Impact Aid that could serve to replenish those lost funds.

The Polson School District could lose an estimated $400,000 annually and Flathead County would also take a hit if the funding is not replaced.

Decker said he has taken the issue to Senator Jon Tester, who is a strong supporter of the tribes.

“I think he finally gets it,” Decker said. “I think the feds might wind up making some kind of PILT.”

Decker supports state Senator Verdell Jackson’s (R-Kalispell) action to serve as an intervenor in the federal proceedings related to the sale of Kerr Dam to NorthWestern Energy then to the Confederated Salish and Kootenai Tribes. In July, the Federal Energy Regulatory Commission approved Jackson and Lake County as intervenors, giving them access to all the information related to the sale and transfer licenses and having a voice in the negotiations.

Jackson wrote that the Western Montana’s economy is based on tourism and agriculture and the tribes should have the ability to maintain, “purposes for which the project was built such as irrigation, flood control, fishing, boating, tax payments, electricity rates, and public responsiveness.”

The Confederated Salish and Kootenai Tribes would be the first Native American entity to own and operate a dam, which the Tribal Council will rename.

Some non-tribal ratepayers fear the tribes might raise rates but tribal officials said the FERC would still regulate the cost just as it always has.

“People won’t see a difference,” he said.

The plan in place calls for the tribes to assume control in September 2015 with an $18.3 million payment to NorthWestern, tribal officials say.

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.

Tribal Council members said the only difference ratepayers will see is that more money will stay in the Mission Valley instead of going to Pennsylvania, where current owner PPL Montana is headquartered.

The tribes already operate Mission Valley Power.

If the tribes are successful in acquiring the dam, officials say it would be a huge win for them and the state.

 “I imagine it will be a two-year construction process for the stand-alone building by itself,” Barron said. “It will be nothing fancy; professional but reasonably fast.”

The mandatory public bidding process is open to development companies across the country but Barron hopes that regardless of who wins the bid, the building process will open a few economic doors.

“If they hire local people there will be more jobs,” he said. “We might sell a couple more cars, some furniture, electronics.”

For now, commissioners are focused on the first steps, which include getting a public-input committee in place.

“It will be about six to eight people. We’ll want someone from the Sheriff’s office, someone from the judge’s offices, someone from the courthouse and some public members,” he said.

Barron will be heading the input committee, and said commissioners are in the process of creating that committee’s mission now.

Republican Steve Daines, Monatana’s lone representative, said sale of the Kerr Dam could have a negative affect on the valley’s economy.

“It could have a significant impact on budgets and tax revenues on our communities here,” he said. “If it does reduce (tax revenues), we will have to look at new sources of revenues for the county and cities.”

After a three-decade negotiation settled by arbitrators, it was announced on March 5 that the CSKT will purchase the Kerr Dam for $18.3 million.

Dam owner PPL Montana asked for $49 million.

Tribal members, who believe nature should not be harnessed in such a way, opposed construction of the dam before it was built in 1938 on the Flathead River about 7 miles south of Polson.