Judge Rules In Favor Of SME

In today's Tribune, there is this article about the judge's ruling concerning spot zoning:

Montana District Judge Wayne Phillips of Lewistown ruled Friday afternoon that the County Commission's rezoning of the plant site did not constitute spot zoning in an agricultural area.

Tim Gregori, Billings-based general manager for the Southern Montana Electric Generation & Transmission Cooperative, which is developing the project, was buoyed by the decision.

"I think that it just underscores that the county was very thorough in their process," Gregori said. "We will continue to proceed."

"Basically, he ruled against us on all counts," said Anne Hedges, program director for the Helena-based Montana Environmental Information Center, one of the plaintiffs in the suit. "It's quite likely we will appeal."

She said the group has lost before at the district court level only to prevail before the Montana Supreme Court. Some landowners near the project site also are in plaintiffs in the suit.

While Hedges was disappointed with the outcome, she praised Phillips for making a prompt decision.

"He acted expeditiously, as we asked him to do," Hedges said. "We just think he got it wrong."

Gregori praised the judge's conclusions.

Opponents of the coal-fired power plant, an $850 million, 250-megawatt facility, said in the filing that a power plant was not compatible with the area's rich agricultural nature. Phillips said the plaintiffs' best argument on spot zoning was that the rezoning would benefit one landowner at the expense of others. However, he said the project did not meet the other two criteria for spot zoning — that there was a change of land use and that the 668-acre site to be rezoned was a small part of the whole area.

Phillips said Cascade County's zoning already allowed electrical generation facilities in A-2 agriculture areas, as long as the project obtained a special-use permit.

Hedges said she believes that conclusion was reached through odd logic.

Gregori agreed with the judge's interpretation.

"We had reached the same conclusion," Gregori said.

Phillips said heavy industrial zoning was required so the project site would qualify for special tax-increment financing, where all property taxes generated by new development in the area would go into a fund to pay for new roads, water and sewer lines, as well as other improvements.

Early construction work began at the power plant site eight miles east of Great Falls along Salem Road in mid-October. Gregori said he was at the site Wednesday when concrete was poured. The state Department of Environmental Quality recently took SME to task for starting construction too soon, but added that work would be allowed beginning Wednesday. The project has until Sunday to meet construction requirements of a state air-quality permit, including poring a portion of the plant's foundation.

Phillips referred to the deadline in his ruling, noting "a serious and consequential deadline looms."

Power plant developers have taken a roller-coaster ride in obtaining permits and fighting various appeals and challenges at the court and administrative levels. Aside from those skirmishes, the project also continues to seek permanent financing.

Opponents claim the plant would pollute the air too much and contribute to climate change. Supporters say the plant would broaden the county's tax base and be one of the country's cleanest coal-fired acilities.

In his ruling, Phillips said county commissioners did not ignore public comments, but acted "clearly and convincingly."

In a series of decisions, he ruled against the landowners' and MEIC's motion for summary judgment that would have decided the case in their favor. Phillips also refused to authorize several writs, or formal documents, on the plaintiffs' behalf.

MT Supreme Court Spot Zoning Hearing

The Montana Supreme Court heard arguments yesterday over the issue of spot zoning for the coal plant.

According to this article, SME/Cascade County are now arguing that the issue is legally dead and the case moot, because the county issued new zoning regulations in August.


November 19, 2009
High court hears Highwood zoning suit
By KARL PUCKETT
Tribune Staff Writer

HELENA — Attorneys for Cascade County and a group of landowners locked horns once more Wednesday over a 2-1 vote last year by the County Commission, which allowed construction of a power plant east of Great Falls. This time the clash came before the Montana Supreme Court.

In a surprise twist, Gary Zadick, an attorney for developer Southern Montana Electric Generation and Transmission Cooperative, and attorney Alan McCormick, hired to represent Cascade County, told justices the disputed rezoning case is legally dead because the commission passed new countywide zoning regulations in August.

As a result, McCormick said, a Supreme Court decision would be "academic" because the lawsuit is challenging old regulations, under which the land rezoning for Highwood Generating Station was processed.

"This case is now moot," McCormick said.

The new argument, which was never raised during state District Court hearings last year because the new regulations had yet to pass, prompted immediate questions from justices.

Justice James Nelson asked that if the updated regulations render the current challenge moot, couldn't local governments always keep ahead of people who challenge rezoning requests by simply changing the zoning rules?

Justice Brian Morris questioned McCormick on why the court wasn't informed sooner about the new zoning regulations argument if it renders the case moot. McCormick said he had just learned last week that the new regulations had taken effect.

McCormick cited a Flathead County zoning case as precedent in making the argument.

The argument was flatly rejected by Roger Sullivan, the attorney for the plaintiffs — 60 landowners and the Montana Environmental Information Center.

"This controversy is still very much alive," Sullivan said.

Additionally, SME has replaced its original plans for a coal-fired power plant with a smaller, cleaner-burning natural gas facility, but Sullivan said that doesn't change the arguments. The county still erred in allowing an industrial facility — gas or coal — amidst farmland, with the decision amounting to spot zoning and special legislation for SME, he said.

MEIC and the landowners living in the vicinity of the proposed plant are asking the Supreme Court to reverse District Judge Wayne Phillips' decision upholding the county's action. Such a decision would declare the rezoning unlawful.

Landowners say their quality of life and agricultural operations are at stake in the case.

After the hearing, Kent Holtz, a plaintiff and farmer who listened from the second row, said he didn't understand all of the technical arguments, but wants farmland protected from the power plant.

"There are so many other places in the state it could be put that would not destroy productive land," Holtz said.

SME officials say a reliable source of electricity for its customers is at stake in the case.

SME, which has sunk $40 million into the power plant, purchased the property on which the plant would sit for $3 million, said Zadick. SME intervened in the case on the side of the county.

Located in a rural setting, with just seven homes within 3 miles, the site is ideal for a power plant, Zadick said, with the electricity benefiting the general public.

"Where do generating plants get built?" he asked.

SME, which provides power to five rural electric cooperatives and the city of Great Falls' utility arm, is proposing to construct a 120-megawatt, $210 million facility powered by natural gas to replace electricity it's losing as a result of canceled power contracts.

If the court overturns the county's decision to rezone, the Highwood project could be returned to county commissioners or the District Court, said Brian Hopkins, an attorney with Cascade County.

At the conclusion of Wednesday's hearing, the seven justices quickly exited without comment. A decision could take months, Hopkins said, noting the court could still ask for additional written briefs.

The courtroom was packed Wednesday with residents from Great Falls and SME representatives, who sat on opposite sides of the courtroom.

The case stems back to March 2008, when Cascade County commissioners Joe Briggs and Peggy Beltrone and then-commissioner Lance Olson voted 2-1 to rezone 668 acres of land east of Great Falls from farmland to heavy industrial. Beltrone was the sole no vote.

MEIC and the landowners later sued, with Phillips siding with the county in a decision handed down in November 2008, prompting the appeal to the Supreme Court.

In the liveliest moment of a hearing fraught with zoning jargon, Sullivan, the attorney for the landowners and MEIC, left the designated podium and moved closer to the justices, pacing before them and theatrically holding up thick binders of technical zoning information and sometimes pointing to his clients in the audience.

"This is a classic case of the county making up its regulations on the fly," he said, his voice rising.

Sullivan took aim at the way in which 11 conditions proposed by SME were added to the rezoning approval. The conditions themselves are not the issue, he said, but he is concerned that they were submitted to the county two days before a public hearing in the rezoning request, not affording the public a chance to comment.

SME's Zadick countered that the 11 conditions actually benefit the general public, dding they were based on public feedback. For example, one of the conditions is that roads be maintained.

Sullivan also charged that SME submitted hundreds of pages of technical information in the 11th hour. In addition, Sullivan said, no guarantees exist in the zoning regulations, ensuring enforcement of the attached conditions.

That amounts to illegal "special legislation" for SME, Sullivan said.

Wondering aloud whether such conditions aren't just "part and parcel" of any rezoning proceeding, District Judge Jeffrey Sherlock, sitting in for the retiring Justice John Warner, who recused himself from the case, questioned the special legislation assertion.

Sullivan also said Judge Phillips erroneously concluded that a coal-fired power plant already is permitted in an agriculturally zoned area if a special use permit is granted.

Sullivan said a special use permit, while allowing wind farms and electrical generation facilities, would prohibit a coal-fired power plant.

Zadick disagreed, saying special use permits allow a broad range of uses from garbage dumps to hospitals to generation facilities.

But if that were the case, a justice asked Zadick, why didn't SME just ask for a special use permit in the first place instead of seeking rezoning. Zadick said that rezoning was preferred because of the type of financing the developer sought at the time.

Facing the seven justices and a digital time clock that allowed each side 30 minutes to make its case, the attorneys raised many of the same arguments Wednesday that they did at the District Court level.

"We'll just have to wait and see how the court decides," SME General Manager Tim Gregori said after the hearing. "At this time, the property we purchased is zoned appropriately for what we have planned."

Spot Zoning Case Going To State Supreme Court

According to an article in today's Tribune, the landowners spot zoning case against Cascade County and SME is scheduled for a state Supreme Court hearing on November 18.

A year ago, District Judge Wayne Phillips ruled in favor of the county and SME when he ruled that rezoning the land for the HGS was not considered spot zoning. Opponents indicated they would appeal to the state Supreme Court.

It IS Considered Spot Zoning

The Montana Supreme court ruled in favor (page 31) for the plaintiffs and appellants.

According to this ruling, Cascade County illegally spot-zoned the property for the coal plant when they changed the zoning from agricultural to heavy industrial.

Not surprisingly, Tim Gregori says that SME will ask the court to reconsider their decision, because it was based on "outdated and erroneous facts".

Landowners Continue Their Fight

Just because the coal plant is off the front burner, doesn't mean the landowners are giving up on their lawsuit against the county for what they say is spot zoning. According to this article, they have appealed the judge's decision last year to keep the zoning as is and have taken their case to the Montana Supreme Court.

See here for more links to all of the details.

MT Eighth District Court Ruling

Hat tip: CCE

Here is the formal ruling from Judge Wayne Phillips concerning the spot-zoning issue of HGS.

"Cooked The Books"

No. This post has nothing to do with the City of Great Falls and their numbers game pertaining to ECP.

Ann Hedges of MEIC wrote an article in the current issue of Down To Earth, the publication of MEIC, highlighting some of the problems with HGS.

One of the issues she discusses is the rezoning of the property. We've just learned that Judge Phillips issued in favor of SME concerning the spot-zoning appeal. We should know shortly if MEIC is going to appeal his decision.

Another issue she discusses is the Construction Permit issued by Cascade County. I think you will find her explanation of what went on with that quite interesting.

She also tackles the Air Pollution Permit where she indicates that SME "cooked the books" on its hazardous air pollutant analysis.

Thanks very much Anne for granting permission to post your article.

Quick And Dirty Update

According to a CCE supporter present at last night's meeting, here is a quick and dirty (no pun intended) update:

- SME and the four remaining co-ops bought the Urquhart property, but according to SME, without city monies. (Yellowstone Valley wasn't a buyer either). Our informer wonders if that is why the city manager and Commissioner Jolley have been "locked out" of that information.

- Names were discussed for the City Commission to consider for the ECP board replacements.

- CCE will apparently not get their information request on the Highwood cost spreadsheet. They call it 'coal', but SME calls it wind/gas estimates.

- Tribune reporter, Karl Puckett, didn't stay for the entire meeting so CCE will fill in the gaps. (They have taped it).

According to an article in today's Tribune, SME is planning to break ground this fall. They purchased the property in late August and according to Tim Gregori, "you can't build on property you don't own. We own the site, and we intend to build on that site."

The article also points out that SME has filed a motion to dismiss the lawsuit that was filed against the county for what landowners and MEIC claims is illegal "spot zoning" of land that is primarily agricultural to heavy industrial. The motion is scheduled to be heard Oct. 2.

What I enjoyed reading was Tim Gregori's acknowledgement that Highwood faces "significant challenges". Unless my memory has failed me or I missed some articles, I don't ever remember Gregori admitting this project has been anything but a done deal.