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Heartland faces local opposition

Fri, Apr 4th, 2003
Posted in Features

While Heartland Energy & Recycling recently received a favorable response from the Minnesota Pollution Control Agency (MPCA) - the regulatory agency accepted its Environmental Assessment Worksheet and did not require a costly and time consuming Environmental Impact Statement - the energy plant may be asked tougher questions the next time around when it goes to get a a conditional use permit from the city of Preston. The city council recently rescinded a conditional use permit given to Heartland in May when the citys legal council advised that local permits should not be issued until the regulatory permiting process was completed by the MPCA. Bob Maust, the president of Heartland, is expected to reapply for city permits at the next Preston Planning & Zoning meeting scheduled for April 14.But it is possible that Maust may be asked tougher questions this time around by both the planning group and the city council. Preston Mayor David Pechulis, who has visited tire-burning facilities in Illinois and Connecticut, said that he will absolutely not support the Heartland project without knowing who the investors are behind the project and being satisfied with the projects viability. Pechulis points out the less than successful history of two previous Maust projects in the city as reasons for needing this information. He also noted that the tire burning facility that Maust was involved in Fort Heights, Illinois has had a history of financial difficulties. We can make this a part of our Finding of Facts, Pechulis said. We need to know who the investors are and what is Heartlands business plan.Pechulis is also interested in seeing any contracts Heartland may have with suppliers and electrical companies who might purchase the plants energy.One legal authority, familiar with the city of Prestons zoning ordinance, said that if the city has concerns about Heartlands financial capacity to carry out the project, it can require a performance bond to ensure that the city wont be stuck with any cleanup or other costs in the event the venture fails.When asked whether he is ready to respond to the Mayors request to identify who Heartlands investors are, Maust said, Not at this time. Maust noted that it was a $50 million project and that the investors are there to support it.Legal ChallengeRegardless of what oppositon Maust meets through the city of Preston permitting process, Heartland faces opposition from Southeastern Minnesotans for Environmental Protection (SEMEP), a local grassroots environmental organization opposed to the energy plant. SEMEP has filed a declaratory judgement complaint against the MPCA, over their ruling not to require an EIS for Heartland on the basis that the EAW did not adequately consider the cumulative impacts of air emissions from Heartland in combination with other sources, including Pro-Corn Ethanol Plant. SEMEP has hired the law firm of Peters & Peters from Alexandria to represent the group in this action. Peters & Peters have been successful in the past with suits against the MPCA, including court action taken in Fillmore County District Court recently regarding the proposed Reiland Dairy. The court case will be heard in the Third Judicial District.Tax ExemptionsIf Heartland is able to begin construction this year, the energy plant will benefit from a bill passed in the last legislative session that will provide a property tax exemption on attached machinery and other personal property in the facility. Heartland will still pay local property taxes on the real estate, which the Fillmore County Assessor estimates would be in the $100,000 per year range. In addition to the property tax exemption, Heartland would also be exempt from paying sales tax on processing equipment as well as construction materials and equipment. This could save Heartland hundreds of thousands of dollars on a plant that Maust has previously estimated would cost in the $40 to $50 million range.Former State Senator Kenric Scheevel, who sponsored the bill in the senate a year ago, said that the legislation is similar to that passed for other power generation facilities, including one built in the Sargeant area recently. In that case (Sargeant), the power company would have had to pay a million dollars more per year in property taxes, Scheevel told the Journal. The company would not have built in Minnesota without the personal property tax exemption.At the time that the legislation for Heartland was introduced, the state, as well as the whole country, was looking at power generation - California had been experiencing brownouts and there were debates going on about de-regulation of utilities.Heartland was treated like any other power company, Scheevel said. In fact, the wording in the legislation is boiler plate from previous bills.According to the bill, Heartland would have to begin construction on the project before January 1, 2004 in order to benefit from the state tax exemptions.Another bill (H.F. 208, S.F. 135)), introduced in the current legislative session by Rep. Bill Kuisle of Stewartville and by Sen. Sheila Kiscaden of Rochester, would define energy produced from solid waste or refuse derived fuel as renewable energy, and thus eligible for green pricing programs. If passed, the bill would allow utilities that purchase energy from Heartland eligible for green credits.Public Information Meeting Re-scheduledThe public information meeting scheduled by the MPCA for Tuesday, April 8, has been re-scheduled for Tuesday, May 13, at 7:00 p.m. at the Preston United Methodist Church. The comment period for the air emission permit has been extended to May 23, 2003.

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