A U.S. District Judge has now agreed that the Port of Astoria is in breach on it's sublease with Oregon LNG.
This follows on a Federal Magistrate's opinion in the same matter.
Almost six years ago the Port of Astoria entered into an agreement with Calpine where the Port acts as an enabling agency between the Division of State Lands and the energy company to secure property on the Skipanon peninsula. At the heart of that agreement is an arrangement where the Port holds a master lease for the property with the state. The terms of that lease were to be mirrored in a sublease agreement with Calpine. The affect gives the energy company control of the property for an initial term of five years to be followed by two renewals of thirty years each.
Last year as the first five year term was coming to a close Oregon LNG gave legal notice that it would enter into the first of two successive thirty year terms. The the Port did something odd.
The commissioners voted to re-negotiate that first five year term with the state for an extension. They did not accept the first thirty year option. The company that took over Calpine's assets filed suit after finding that while they had a legally binding sublease for thirty years with an option for another thirty year term the Port does not have a lease with the State for those terms.
When asked by reporters why the Port has taken this unusual turn Executive Director Jack Crider said that he does not believe Oregon LNG will be able to gain all the permits to build the storage and regassification facility. He said the commission is concerned that by entering into the thirty year term the Port will be left holding the bag if OLNG fails. Meantime, there was an effort underway to prove that the Port and not the State owns the property as a grandfathered right of ownership. The city of Astoria has similar rights to submerged and submersible lands so the Port's arguments may have merit.
There is something else about this situation that is curious. The lawyer representing the Port in this matter is Thane Tienson. He is a member of the board for River Keepers a very strong opponent of LNG projects in Oregon. It turns out that Mr. Tienson was also the attorney representing two other organizations battling the Palomar natural gas pipeline project.
About 20 months ago it was Mr. Tienson who lost a suit filed on behalf of OCAP (Oregon Citizens Against The Pipeline) and NWPRC (Northwest Property Rights Coalition) and some individuals who were seeking relief from the companies involved in the pipeline project. It was claimed that employees of the companies had trespassed on posted property to do survey work for the new line. After reading the claims it was clear that in some cases there may have been no trespass and those where there may have been it could not be proven. The most interesting opinion was that OCAP and NWPRC were found to have no standing because the judge ruled that organizations such as these can not defend the constitutional rights of people who may be members. They may only defend against the organizations own rights.
The questions here are why would the Port Of Astoria choose to be represented by a lawyer with such obvious ties to anti-industry groups? Why would an organization with a stated goal of providing economic development take an anti-development approach in the first place?
The Port commission's approach is wrong-headed. I've been pointing this out for months and now two judges agree on every single point.
Judge Mossman also answers another question posed by some of you faithful readers. He says there are any number of creative ways the Port can meet it's obligation to the OLNG sublease the least of which is to renotiate with the state.
Let's do that.
Ok, the judges have ruled but, I ask again, what's going to get "PofA" to move on anything relevant to OLNG until the 59th minute of the 24th hour on that 2 year DSL extension that the "PofA" has working for them?
ReplyDeleteRenegotiate?
Current Tax Rate plus appropriate market lease rate plus a 1% residual, at TUA(Terminal Use Agreement between OLNG and their clients as it goes into pipeline) rate going into a general benefit County Fund, on every cubic foot of re-gasified LNG that goes out of the place?
Think that would make it less painful for "US" for the inconvenience and us hanging our life quality and collective asses on the line for a few end jobs?
Can we not do any better to put many more of us to work?
What could a 4 billion dollar investment by, say, 4 compatible, cohesive industries strategically placed in Clatsop County do for putting more than 30 to 50 people to work in permanent, family wage jobs?
The Construction Trades Jobs are still going to be there up front to satisfy that short-term feeding frenzy to leave us with many hundreds if not thousands prospering in the end.
Why don't we have a "Private", "Non-Profit" "Breakfast Club" for this prospect around these parts?
Keep in mind that the purpose of the litigation is to force the Port to cure the breach. Until final judgement there is nothing forcing the Port to take that action. OLNG has been successful in having Port objections denied regarding the immediate harm this breach has caused. That's serious money.
ReplyDeleteIf the Port continues on it's present course one can predict the outcome would come in paying significant damages in addition to being directed to cure the breach.
As to the tax dollars involved just keep in mind that the entire city of Warrenton is an urban renewal district. Property taxes paid within that district stay in the district and are not distributed to all the other taxing districts. That would include the Port.
Interesting huh?
Correction to my previous statement regarding the boundries of the Warrenton urban renewal district. The boundries comprise a little over 8% of the total acreage in the city limits. State Law allows for up to 25%. That leaves plenty of room to expand. Further research shows that Warrenton expanded it's city limits to include the submerged land around the proposed OLNG site in 2005. The City could easily expand the district to include that property. It appears at this point the boundry extends just beyond the Marina area..It's a little hard to tell exactly where that boundry ends.
ReplyDelete