ROCKLAND, Maine — The City Council voted Friday morning to grant an option to a Boston-based energy company that wants to build a $200 million natural gas power plant on land where City Hall is now located.
The decision came two days after the council failed to grant the option to Rockland Energy Center. Councilors voted 2-1 Wednesday night in favor of the option, but three affirmative votes were needed for approval.
But two of the five councilors were absent for that vote and the council decided to meet again Friday morning to reconsider. Friday’s meeting lasted for nearly three hours as 70 people packed City Hall. More than a dozen residents expressed concern about the proposed project and questioned the decision to hold a second vote. Other citizens, however, urged the Council to approve the option to allow for further study and negotiations.
The Friday vote was 4-0 with Councilor Larry Pritchett out of town on business.
The option is nonbinding, and no sale could occur before Aug. 31 under the agreement for which the company is paying the city $1,000 per month. A final sale would need to be approved by voters at a referendum.
A spokesman for Rockland Energy, which is owned by the principals of Energy Management Inc. of Boston, spoke publicly for the first time. Evan Coleman said the natural gas plant would provide significant tax revenues to the city, construction jobs, 12 to 18 permanent jobs that will pay more than $60,000 annually, and low-cost steam that could lower operating costs for other local industries. The cogeneration facility would generate both electricity and steam.
“We think this is a great project for Rockland, a great project for the midcoast,” Coleman said.
The meeting, which began at 9 a.m., was attended by the superintendent, business manager and chairman of the Regional School Unit 13 Board. The district is facing a financial crunch due to reduced state aid.
Superintendent John McDonald, who did not speak during the meeting, told the BDN afterward that he and the business manager were in attendance because of the importance the issue could have for the community. RSU 13’s proposed budget for 2015-2016 calls for Rockland paying an additional $1.5 million in property taxes for the schools.
“We’re all partners in this,” McDonald said.
Rockland resident Chris Whytock said Rockland does not have a government spending problem but a lack of revenue problem.
Other citizens who spoke against the project voiced concern about the environmental impact of obtaining natural gas through a controversial fracking method.
Resident Paul Chartrand criticized the council for giving an exclusive option to the company, saying the city should seek competitive offers for the land.
Others also criticized the council for holding a second vote after it failed on Wednesday.
City Manager James Chaousis urged the council to grant the option to allow more information to be gathered prior to any sale. He said some of the people opposing this project also opposed a downtown hotel that is under construction and have opposed other downtown developments.
Coleman said the proposed Rockland plant would be a 68-megawatt facility, about one third to one fourth the size of a plant in Rumford that Energy Management built about 20 years ago.
He said Rockland was selected for a variety of factors, including available property, the proximity of high-voltage power lines and a number of industries that could benefit from the steam that would be created in the process.
The plant would be fueled by natural gas which would require the extension of a natural gas line that currently goes through Windsor at its closest point. The cost of extending the gas line would be $13 million to $20 million but that would be done by a different company.
Rockland Energy was submitting a proposal Friday to the Maine Public Utilities Commission to provide electricity long-term to the power grid, he said. Coleman said the company needed the option on the Rockland land in order to submit its proposal.
He said if Rockland failed to grant the option, the company would look elsewhere and would submit a new proposal to the PUC next year.
“Capital goes where capital is wanted,” he said.
Coleman said he expects the PUC will make a decision on the contract in six to eight months. The life of the plant would be up to 50 years, he said. He said the company has a history of making additional investments in communities where it locates.
City officials stressed that the option does not complete a sale but allows the city to negotiate with the company.
The option approved by the council gives the final say to any sale of the 18 total acres to the voters at a referendum. No date for a referendum has been set.
City officials have said they have not given serious consideration yet to where municipal offices would relocate but that would be studied during the negotiation period with the energy firm. The company said it would work with the city on relocation costs.
FMC Corp., which is Rockland’s largest property taxpayer and one of its largest employers, had representatives at both Wednesday’s and Friday’s meetings. Site manager Joseph Hamlin said Thursday FMC has had some some initial conversations with the energy company about what benefits FMC could see from the natural gas plant, such as steam for heating the plant and possibly natural gas to fuel the FMC facility but has not taken a position on the natural gas plant proposal.
The energy company contacted the city initially on April 3, according to a review of city emails. The company considered several sites including in the Rockland Industrial Park, city land next to the landfill, and then the City Hall and public services properties. The council discussed the potential sale in a closed-door meeting on April 13 and then on April 15 voted to solicit bids. Real estate agents were contacted and a public notice was published in the BDN.
The bids were open April 27. Chaousis said that the amount of time it took and the type of notice given were consistent with city practices.
Energy Management has built similar power plants in Rumford; Tiverton, Rhode Island; Dighton, Massachusetts; and Dartmouth, Massachusetts.