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A waiver of a nearly $700,000 application fee for permits for Deepwater Wind’s proposed $205 million wind farm and cable project off Block Island was denied Wednesday by a subcommittee of the state Coastal Resources Management Council (CRMC). The decision came at a meeting in Wakefield after the private developer did not prove that paying the fees would be a hardship for the company.
In voting 4-to-1 against waiving the fee, members of the Ocean Special Area Management Plan Subcommittee said that the application fee was miniscule when compared to what taxpayers and the company has already invested in the 30-megawatt, five-turbine wind farm. If the subcommittee had approved waiving the fee, the recommendation would have been sent for a vote by the entire the CRMC. Chair Anne Maxwell Livingston was the lone vote in favor of waiving the fee.
“[The fees] don’t come anywhere near what the state’s taxpayers pay for the cost of managing the program,” said CRMC member Tony Affigne about CRMC’s $5 million annual budget.
“You’ve spent millions, how is our fee excessive?” asked CRMC Vice Chair Paul E. Lemont.
Affigne added that he would like to see Rhode Island become the first state in the nation to have a wind farm but didn’t believe that the fee would “make or break” the project.
Deepwater Wind’s CEO Jeffrey Grybowski testified that he hoped the board would allow Deepwater Wind some leeway since the company has already given the state’s renewable energy fund $3.2 million and spent another $6.7 million in environmental studies and surveys.
“I look at all we’ve committed to and spent to date,” Grybowski said. “Discretion is allowed because in totality with other costs it makes the fee excessive.”
Grybowski also proposed that Deepwater Wind pay a reduced fee – between $150,000 to $200,000 – and that the remaining fee be designated for use to pay for future project studies. The subcommittee did not discuss that proposal and noted that CRMC does not have control over the fee that is placed in the state’s general fund.
“It’s premature to waive a fee,” said Block Island Town Councilman Sean McGarry, who noted that Deepwater Wind and its investors could potentially make millions in profits. “I can’t see how $700,000 presents a hardship.” McGarry and several other Block Island residents traveled to Wakefield, where the meeting was held.
Councilman Chris Warfel agreed. “I ask that the fee not be waived,” he said.
Motion to intervene
Maggie and Michael Delia, who live parttime on the island, had filed a Motion to Intervene to Deepwater Wind’s request to have the fee the waived.
Prior to the fee waiver discussion, the subcommittee ruled on whether the Delias’ objection to the fee should be considered. Their attorney, Terence J. Tierney, objected that his motion was even being discussed, since the board’s agenda only addressed the request for the fee waiver.
“Let’s get it right,” Tierney said. “Everyone is in a rush to get to the merits of the application … but public notice requires that you tell the public there is a motion to intervene.”
In the motion, the Delias state the applications by Deepwater Wind will cause economic and other harms if the project is permitted. The motion states the proposed project is complex, extremely controversial and approval of the applications would constitute an unprecedented diversion of public resources to a private developer in violation of the Public Trust Doctrine. The Delias contest the validity of the Deepwater applications under applicable laws.
Although the board ruled that the Delias had no standing to intervene in the fee issue because it did not concern them directly as Block Island property owners, the board did note that such a decision would not prohibit the Delias objections to the project as a whole.
That objection is focused on a Joint Development Agreement (JDA) that designates Deepwater Wind as the preferred developer for offshore wind in Rhode Island. That preferred developer status was granted after a negotiation with state Economic Development Corp. and Governor Carcieri. In the JDA, Deepwater Wind agreed to reimburse the state for financing the Special Area Management Plan process to be used in determining an alternate energy zone in state waters. The motion notes that although CRMC might fulfill the development portion of the policy, their ability to preserve and protect has been compromised by Rhode Island’s JDA, imposing CRMC approval of Deepwater’s projects.
“I’ve seen plenty of people try to go around regulations,” Maggie Delia said. “I don’t agree with that. I did what I could to preserve a really special place … Wall Street doesn’t need the money. The state needs money.”
On Wednesday, Robin Main, a lawyer for Deepwater Wind, argued that a 2012 Supreme Court ruling was precedent to show that the Delias had no standing to intervene against the fee waiver.
“The mere interest in a problem is not sufficient enough,” Main told the CRMC subcommittee.
After the subcommittee agreed with Main, it heard testimony and decided not to waive the fee, the board set a date for a hearing on the Delias’ motion to intervene on the overall application and any others that might be filed before the March 22 deadline. That hearing will be held on Friday, April 5, at 9 a.m. The location for the meeting has not been decided.
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