Tuolumne County supervisors are concerned about being unable to complete three major projects funded by a $70 million grant through the federal National Disaster Resilience Competition
before the deadline of Sept. 30, 2022.
The board received an update on the status of one of the projects at a public meeting on Tuesday, but most of the comments from supervisors focused
on the need to meet the deadline or lose the funding without much to show for it.
“We gotta get this stuff done, otherwise we just spent two years of wasted effort,” said District 5 Supervisor Karl Rodefer, who serves as board chairman. “It’s good job security for the folks who did it, but it doesn’t get anything done for this county or the state or the nation.”
In January 2016, the U.S. Department of Housing and Urban Development announced the winners of the first National Disaster Resilience Competition that was created the year before by former President Barack Obama to provide up to $1 billion for communities that had recently experienced a federally declared disaster.
The state of California submitted an application on behalf of the county and was awarded a $70 million grant for three projects intended to help the community and surrounding forests recover from the 2013 Rim Fire, as well as become more resilient to future disasters.
The three projects that received funding were $28 million for a forest and watershed health program, $22 million for a biomass utilization facility, and $20 million for one or more “community resilience centers” that could provide shelter for people during disasters.
A team of state officials and consultants working on the projects presented an update to the board at Tuesday’s meeting on the $22 million biomass utilization facility after recently completing a study to determine whether it would be economically viable.
The facility was envisioned to include a biomass energy plant that could generate and sell power, but the study determined that it would also need to have additional co-located businesses to be profitable.
The study looked at a facility with a small-scale sawmill, pole and post manufacturing plant, and firewood bundling operation, which would help bear the costs of gathering and transporting material for the energy plant.
The total estimated cost to get the facility up and running is about $45 million, which will require partnerships with developers and entrepreneurs.
Roy Anderson, a consultant from the Beck Group that was contracted by the state to work on the study, said the facility as a whole would need about 50,000 tons of biomass material annually to generate a combined profit of about 8 percent.
The annual cash flow generated by the facility would be about $3.6 million.
However, the study determined there only about 43,000 tons of material per year within a 40-mile radius of Sonora that would be accessible and not being used by other logging companies and biomass energy producers in the area.
Anderson explained that there are a number of ways they determined that the difference could be made up, such as recently passed legislation that could free up an additional 105,000 tons of material.
There are also still many dead trees on the landscape from multi-year mortality epidemic that could increase the amount of material available.
“We feel there’s enough unknowns in supply to keep the four businesses in there (as part of the facility),” he said during an interview after the presentation.
The study looked at two possible locations for the facility, a 5-acre industrial site on Camage Avenue in East Sonora and the county’s wood sorting yard off Highway 120 and Enterprise Drive near Chinese Camp.
According to the study, the Camage Avenue site would likely be too small, because the facility would require about 7.5 to 10 acres. While the wood sorting yard would enough room, it would also cost an extra $5 per ton of biomass to transport because it’s farther away from sources of material.
An electrical substation and water would also need to be located nearby, as well as adequate access for roughly 6,000 truckloads going in and out per year.
The study also found that the facility would create an estimated 46 jobs, as well as 100 to 150 indirect jobs.
District 1 Supervisor Sherri Brennan questioned the officials on whether the timeline to get the plant up and running by the end of September 2022 was realistic, especially considering that the project still needs to go through the state and federal environmental impact review.
Bill Carlson, from Carlson Small Power Consultants, said he believed the timeline was realistic but “there’s just no way to know” for sure due to Pacific Gas and Electric Co. recently filing for bankruptcy.
Brennan also said she was concerned about how timelines for the projects have already been pushed back and called on the state to streamline the administrative process that’s required before the actual work can begin.
“That administrative paperwork has been one of the real complications and so I think it’s going to really take a commitment from everyone if we’re going to realistically achieve this,” she said.
District 3 Supervisor Anaiah Kirk said he believed building the facility isn’t the “wisest use of taxpayers’ dollars” because there are already two mills operated by Sierra Pacific Industries in the county, as well as a privately owned biomass plant near Chinese Camp.
Kirk suggested using the $22 million for projects that would remove biomass from the forest.
“I could make a fire resilient community with $22 million, no problem,” he said, adding that he was worried about the uncertainty over missing the deadline making it more difficult to attract outside investment.
Larry Cope, executive director of the Tuolumne County Economic Development Authority, asked state officials and consultants giving the presentation if they would have program for using local contractors and vendors in the process of building out the facility.
Cope also asked if they’ve reached out to existing producers like SPI and Pacific Ultrapower to see if there was a way to use money from the program to upgrade their facilities or bring materials to their facilities.
Elliott Vander Kolk, coordinator of the program with the Sierra Nevada Conservancy, said he doesn’t believe that HUD would allow them to have a preference for local vendors using federal money.
Vander Kolk also said that SPI and Pacific Ultrapower are both aware of what they’re doing, but he doesn’t believe that either would be eligible to receive funds because HUD requires them to be certified as a “small business” through the federal Small Business Administration.
The Redding-based SPI is considered the largest private landowner in California and one of largest in the entire United States, with annual revenues estimated by Forbes Magazine at more than $1 billion.
IHI Power Services Corp., which operates the Pacific Ultrapower Chinese Station plant, bills itself as “one of the leading third party contract operators serving power plant facilities across the country” and is a subsidiary of the Japan-based IHI Corporation, which has a presence in more than 20 countries and plans for further global expansion.
John Buckley, executive director for the Central Sierra Environmental Resource Center in Twain Harte, said the study on the economic viability of the biomass facility was “probably the most detailed and expert report on forest products that has ever been developed for anything in this region.”
Buckley also said he shared Brennan’s concern about meeting the deadline and offered to help work with the county and other groups to expedite the environmental review for the facility at either of the two proposed sites.
“There’s tremendous support for doing whatever’s possible to get biomass from the forest,” he said.
The center recently filed a lawsuit against the county and board over its approval of a comprehensive update of the county General Plan. Also on Tuesday, the board voted in closed session to hire a law firm to defend itself against the suit.
Contact Alex MacLean at email@example.com or (209) 588-4530.