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Front Page » February 18, 2014 » Emery County News » Potluck group hears update on refinery in Green River
Published 154 days ago

Potluck group hears update on refinery in Green River


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In Green River every two weeks the Potluck group meets. The group consists of interested business leaders and community members. Anyone is welcome to attend. The group hears updates on what is going on in Green River and strategic planning sessions are held. The meetings are held at the Epicenter.

In January, Carol Cohen from the Rural Community Assistance Corporation attended this meeting. Carol has been helping Epicenter with its strategic planning endeavors and helped Green River City with its housing plan.

Mike McCandless gave an economic update for Green River. He met with refinery representatives and they said they secured all the necessary property and have completed negotiations with UDOT for the Highway 6 interchange.

They have also completed their agreement with the railroad and are finalizing designs. The site should be looked at as a rail transportation hub with a refinery on it; out of 600 acres for the project, only 20 are for the refinery. The majority of the project is a rail facility. A rail facility and railyard bring opportunities for other resources to come into the area and also the ability to ship out.

The first phase of the refinery will be operational in 19 months from the time it breaks ground. When they start the rail spurs, there will be cranes and heavy equipment working and 300 construction employees.

Construction is planned for this summer and they'll hire nine months before the plant opens. The company plans on bringing in 10 percent of employees from the outside who have specific skills and will hire the rest of the employees locally. McCandless has tried his best to connect them to local companies to do anything from engineering to gravel.

The City of Green River is working with the refinery on an annexation agreement outlying what the refinery will do and what the city will be able to deliver to them. The industrial area the refinery will be in will be one for tax increment financing (TIF). TIF allows municipalities to take a percentage of property tax revenue and use it to create infrastructure that benefits the municipality in the long run including water lines, etc.

Currently, about 66 cents of every property tax dollar goes to the school district. The city and county pay for economic development, but the biggest beneficiary is the schools.

A municipality knows what the base income is for a given group of properties and knows that if it makes certain improvements to the area, that taxes will go up. A municipality will use a piece of that incremental increase to make needed municipal improvements. This is the way Carbon County and other places do many of their projects. An example would be property taxes are $10,000, but will be raised to $20,000. They'll use $6,000 to make the improvements, which will go to things like housing. This is a way to get all people that are tax recipients to participate in economic development.

The TIF is performance based. An agreement can be made, but until the jobs are there and things are built, there isn't a penny in the bank. The TIF based Economic Development Areas, or EDAs, go from seven-20 years (but average around 10 years). TIF based strategies happen everywhere, though California has outlawed them. Cities often used EDAs to bond for water and sewer. The lack of California EDAs will lead to more bankruptcies and businesses leaving California.

MCandless has been in contact with nuclear power plant officials several times each week. The recent bad news for coal has been good news for the potential power plant. Now there's more interest in the plant than there's ever been.

The area including the refinery will be much more than a transportation hub. Currently there are 3,600 acres, including the 600 acres utilized in the refinery project, making it the second biggest industrial property in the State of Utah.

Green River is the perfect distribution location for businesses and is a very unique location. Right now, petroleum is very attractive for this area and companies are not producing as much as they can with their oil and they need more ways to get the product to market.

McCandless has been working on bringing natural gas to Green River for about six years now.

The excessive cost is because of Questar's overhead structure. McCandless believes Wasatch Front customers are not paying their fair share for new lines.

Questar has finally considered this matter. Emery County is in testimony right now at the Public Service Commission. McCandless said the only people opposing affordable natural gas rates for new rural communities are Ivory Homes and a town along the Wasatch Front who claim that the economically disadvantaged people will be at more of a disadvantage for paying a little more ($250-400). But, the people who would be affected are those who are buying new homes, and he pointed out that economically disadvantaged people are probably not buying new homes.

McCandless is also working on an alternative solution for natural gas utilizing a pipeline near town. Another company besides Questar could be the provider and Questar could provide the service.

Propane is three times the cost of natural gas. This is a big deal, especially for businesses like restaurants and hotels. A restaurant like the Tamarisk could hire 1.5 more people. Green River businesses and residents would save thousands a year if they had access to natural gas.

If Green River residents could be connected to natural gas, that would be one of the first areas to relieve residents economic pressure. McCandless said that often many residents are paying more for propane than shelter and that paradigm needs to be shifted. But, the problem is that the market is not competitive, Questar has a virtual monopoly and is more worried about its whole market instead of helping an individual community.

The last proposal that McCandless made to Questar requested that every customer pay an extra 17 cents on every bill every month. The extra revenue earned would ensure that every community (even rural communities) in Utah would have natural gas in the next 10 years. This proposal was killed by a community in the Wasatch Front that came out in mass.

There will be a time when McCandless will want some Green River people to do some testifying to the legislature and the public service commission, they need to know that citizens are in support of extended natural gas to rural communities. Currently, companies are trying to get rid of natural gas; they sometime burn gas wells into the air because they can't get rid of it. But, someone can't build a gas line right now because it's just too expensive and Green River doesn't look like the most profitable endeavor to offset those costs.

The Obama Administration has kept its promise in making coal much harder to use. Emery and Carbon has lost close to 700 jobs since 2007 and the Carbon power plant will close in 2015 (losing 85 jobs). Rocky Mountain Power maintains that it will no longer utilize coal after 2040.

If the government taxes carbon the way that they might, plants will soon go under. The goal within the EPA is to make coal very expensive to use.

Cathy Gardner said when she first came to Green River in 1978, it was unbelievably busy, now its like a ghost town. The descent of coal also has implications for coal support industries, and because coal companies are not investing in mines and support companies are starving now. Also, coal companies are trying to cut every corner they can.

Those attending included: Keith Brady-Robber's Roost, Carol Cohen-Rural Community Assistance Corporation, Cathy Gardner-Ray's Tavern, Mike McCandless-Emery County Economic Development, Armando Rios-Epicenter, Julie Zwahlen-Comfort Inn, Julie Steuer-First Choice Auto/JWP Museum.

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February 18, 2014
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