Deciding wind dispute is no breeze 

Several questions still need to be answered before Monroe County Supreme Court Justice John J. Ark reaches a final decision in a case brought by a wind energy company against the town of Italy in Yates County.

Ecogen LLC and Ecogen Transmission Corp. of Erie County want to build a wind farm project that would consist of 17 wind turbines in Italy and 16 in the neighboring town of Prattsburgh in Steuben County.

The Italy Town Board, on Oct. 5, 2009, denied Ecogen’s application for incentive zoning approval and a special use permit needed for the Italy portion of the project, prompting the company to seeking a judicial review of the town’s decision through an Article 78 proceeding. The application also included an electrical substation, associated infrastructure and setback variances for two of the proposed towers, one of which was later withdrawn.

Ecogen, which is represented by Nixon Peabody LLP attorneys Robert W. Burgdorf and Laurie S. Bloom, are challenging the way the town applied its 2009 local law to Ecogen’s proposed project. Burgdorf was out of town and could not be reached for comment. Bloom declined to comment.

The town, which is represented by attorney Gary A. Abraham of Cattaraugus County, adopted a “Wind Facilities Amendment” to its zoning law in March 2009 to allow for consideration of industrial wind energy turbine facilities. The move came after Ecogen sued the town for a moratorium it had against such projects that it kept extending for a couple of years.

The town, in its October 2009 denial of Ecogen’s project, listed reasons which Justice Ark addressed individually. The town’s concerns include noise, reduction of nearby property values, insufficient amenities, tax abatements, aesthetics, significant clearing of town slopes, stormwater runoff and the potential impact on wetlands, woodlands and scenic views.

Justice Ark ruled the town was arbitrary in applying noise standards that were more rigorous than current town standards. In his decision, released this week, he said the town cannot circumvent the law by implementing standards impossible to meet or rejecting any offer of amenities.

Ecogen, according to the town’s rejection resolution, offered to pay the town one-time amenities valued at $1.5 million and continuing annual payments starting at $431,000.

The town’s incentive zoning law says amenities must “substantially and significantly” outweigh any detrimental impacts of the proposed project. The town board ruled that would not happen because an agreement with the local industrial development agency would exempt Ecogen from property tax payments for 20 years. The town estimates that would be about $806,000 annually.

“On the basis of these numbers, the amenities and benefits proposed do not significantly outweigh the adverse impacts of the project, especially when compared to the revenues that would be generated if the project were fully taxable,” it is noted in the town’s six-page rejection.

Ecogen, Justice Ark noted, claims its proposed amenities were found satisfactory to the town and exceeded any offered elsewhere, including a project within 25 miles in the Steuben County town of Howard. He further noted the Italy Town Board has not specified what would be acceptable.

Abraham said it is not the town’s job to draft a benefits package and that the town has not heard from Ecogen since it rejected its first offer.

“Ecogen has to knock on the door,” he said. “They have not made any effort to make a counter offer since this thing began. They went right to court.”

Justice Ark said the town must set forth the amenities that would substantially outweigh any detrimental impacts.

Citing Matter of Market Sq. Props v. Town of Guilderland Zoning Board of Appeals 66 N.Y. 2d 893, Justice Ark further noted a town board’s determination would ordinarily prevail, but that Italy’s denial of Ecogen’s application must be reviewed in the context of what happened before and after its moratoria.

Also needed to be considered are its negotiations with another wind company and a request for Ecogen to withdraw, inordinate delays on variance applications after the original moratorium was lifted, the local political environment at the time and the rejection of the amenities package without specificity.

Justice Ark further rebuked the town’s claim that the turbines will impact the unique scenic and quiet of the town, saying concerns that multiple 400-foot wind turbines would emit noise and affect views were included in the consideration and passage of the local law.

“Accordingly, to deny Ecogen’s permit application because of the inherent characteristics of wind turbines, as long as the turbines comply with the enabling statute, is arbitrary and capricious,” Justice Ark wrote.

Before he renders a final decision, he wants specific information from the town regarding the status of the 2009 local law and electrical substation, how an issue with steep slopes was not satisfactorily resolved with the town and what property line setbacks would be required for two turbines, what amenities will significantly outweigh any detrimental impacts and what complaint resolution process would be acceptable.

“The order is confusing,” said Abraham. “It appears to conclude that once the local law of 2009 governing wind farms and providing for incentive zoning was adopted, then Ecogen had a right to approval and there’s nothing the town can do by way of disapproval.”

He said it appears Justice Ark doesn’t believe the town had any discretion to deny the permit and that the town board used the deficiencies it cited as a pretext to deny the permit.

“That’s dramatically contrary to the town’s experience,” Abraham said, noting it learned a lot more about wind projects during a review process and that it doesn’t seem right that the town is not able to reform its decision about wind turbine projects based on the knowledge gained.

“The 2009 law did not say the first applicant to come forward gets a permit automatically,” he said. “[The town] went through the review process and they found that the burdens outweighed the amenities that were being offered. It’s pretty simple. For the judge to rule that the town was arbitrary in doing so is surprising.”

Abraham said the town asked for specific amenities that would offset the impact to the small group of people “who are shouldering most or all of the burden.” He said the amenities were offered to the town as a whole, but nothing was mentioned about the people living in the area who would be most impacted and the town made it clear it was looking for specific benefits for those people.

Abraham said Justice Ark has scheduled a hearing for Sept. 22, presumably to schedule a time for the town to provide the requested information which it is in the process of gathering.

Justice Ark said that once everything is submitted, he will schedule a hearing to determine if there were Open Meetings Law violations at the Sept. 22 and Oct. 5, 2009, town board meetings and whether Ecogen was misled that the town was satisfied with its amenities offer and the steep slopes resolution.

He said that a reasoned argument could be made that the town’s denial was made during an executive session at either meeting with limited public discussion and “counsel attending the meeting with a resolution of denial in hand,” which may be a violation of the law.

“Although the Open Meetings Law allows communication with legal counsel to be exempted from public scrutiny, the deliberative process is not,” Justice Ark wrote, citing the law. “The presence of legal counsel to give protected legal advice does not give the board carte blanche to carry out non-exempt public business in a closed session. Because of the possible severe ramifications, a hearing must be held to determine whether an OML violation occurred.”

He will also consider any other unresolved issues at that hearing.

The Prattsburgh side of the project is involved in separate litigation, also pending before Justice Ark.