November 4, 2003
George E. Pataki, Governor
Executive Chamber
State Capitol
Albany, NY 12224
Dear Governor Pataki:
On behalf of the Batchellerville Bridge Action Committee, a volunteer
activist group on Great Sacandaga Lake, I am enclosing three newspaper
clippings describing a recent public hearing conducted in Northville by
the Hudson River-Black River Regulating District. The District's
ill-considered proposal to raise access permit fees to the lake by five
to 10 times drew an irate crowd of more than 900, who competed for seats
in a school auditorium with capacity for only 565. One can only
speculate as to what the turnout would have been if the Regulating
District had played fair and scheduled the session for a Saturday
morning in the summer instead of a weekend evening seven weeks after
Labor Day. As the newspaper headlines indicate (sample: "Sacandaga Lake
Crowd Blasts Board"), the District was subjected to a withering barrage
of complaints. They were not confined to the permit fee fiasco.
Attendees provided numerous examples of how the District wastes money,
ranging from its lavish headquarters in Mayfield to its duplication of
facilities, including offices in Mayfield, Albany, and Watertown. Other
complaints covered the extensive shoreline erosion caused this spring by
overfilling the lake, the District's penchant for secrecy, its
arrogance, and its inept communications.
The bad news is that you appoint the members of the District's board,
which makes you the "owner" of this mess. The good news is that your
office can solve this problem quickly. After all, the Regulating
District is one of the state's smallest agencies, with an annual budget
of less than $7 million. It barely shows up on the radar when compared
with the New York Racing Association or the Canal Corporation, two other
public benefit corporations in the news these days. At the moment, the
Regulating District has withdrawn its 2004-2006 budget and is working
furiously on a new one that it hopes will take it out of the glare of
public scrutiny, after which it can resume its usual practices. That's
not good enough! Now is the time to take steps to assure that this
problem does not resurface three years hence. Here are some suggestions:
You need to restore public confidence in this floundering agency. As
one of our members says, one would have better luck following the
progress of a dried pea in a Times Square shell game than in tracking
the Regulating District's gyrations with its budget numbers. We urge you
to request that the State Comptroller throw open the District's closets
and cupboards, and expose their contents to public scrutiny. Assure us
that the budget numbers are legitimate, that the District is squeezing
every dollar, that competitive bidding practices are being followed.
Once a legitimate budget is in hand, cut it by 15 percent. Let
District management decide how to implement the cuts. If they are not up
to the task, replace them. There is no reason why the District should
not be treated the same way as a $7 million business that operates in a
bruising real-world environment. Note: The District operates in a
fantasy world. In the face of this budget crisis, it recently added
three new employees and granted everyone a raise. Only after public
pressure was applied did its non-union employees "voluntarily" give back
their raises.
You need to help the District deal with its deadbeat downstream
beneficiaries. Great Sacandaga Lake was created in 1930 to serve two
purposes: 1) flood control and river regulation along the Upper Hudson,
and 2) hydro power generation. According to the District's handbook, the
37 property owners and five municipalities downstream from the dam
"obligated themselves to share in perpetuity all of the operating and
maintenance costs of the Regulating District not recovered by other
District revenues." They are refusing to do so. The largest of the
downstream municipalities is Albany, which, in 2002, paid a paltry
$64,000 assessment for protection against millions of dollars of annual
flood damage. But the biggest culprits are the energy firms that
generate hydro power at the Conklingville Dam and at various downstream
locations that benefit from the existence of the lake. They claim they
are being overcharged. As a result, they are paying their annual
assessments "with prejudice," which means that they are litigating to
obtain a partial refund. Over the next three years, the District
anticipates spending an extraordinary amount of money, more than $1
million, on litigation involving Erie Boulevard Hydropower, which
operates the hydro plant at the dam, and downstream energy firms. You
should ask the Attorney General's office to look into the substance of
the litigation. Is there evidence of mismanagement by the District or
harassment by the energy firms? If the District is cleared, then the
Public Service Commission should have the power to rein in the public
utilities.
Make certain that the Regulating District is not awarding special
treatment to Erie Boulevard Hydropower. In its 2000-2003 budget, the
District charged Erie $950,000/year for use of the reservoir's water to
spin its turbines. In its initial 2004-2006 budget, now withdrawn, the
District proposed to charge Erie $850,000/year — a 10 percent reduction.
Erie is a division of Reliant Resources, Inc., a Texas-based energy firm
with $12 billion in revenues in 2002. If the revised budget continues to
award Erie a reduction, we demand one, too. Incidentally, according to a
study conducted by a District consultant, it would cost Erie more than
$8 million/year to replace this source of electricity. Since this is the
same company that pays its annual District assessment "with prejudice,"
we strongly recommend that the District find another licensee for the
hydro plant at the dam.
Order the Regulating District to stop wasting money on studies that
attempt to classify lake-area property owners as "beneficiaries" of
Great Sacandaga Lake who, like downstream hydro firms and
municipalities, should pay an annual assessment. It is reprehensible
that the board members you appoint are caving in under pressure from
corporate bullies and attempting to target the "little guy" to bail them
out of a financial jam. This is taxation without representation and will
not stand up in court. What will the District pull next? Set up toll
booths on roads leading to the lake? Assess local towns and villages
because their tradespeople and stores service lake-area property owners?
Collect fees from boats on the Hudson? Is the District looking for an
infinite number of lawsuits? This is an attorney's dream come true.
Your lawyers should review the Settlement Agreement that led in 2002
to the Federal relicensing of the hydro plant at the dam. The Regulating
District was a major player in the negotiations. Not surprisingly, its
contributions were flawed. For example, it consistently misinformed the
public about maximum water levels under the new license. This spring,
the first full year of the license's implementation, the District
overfilled the reservoir, resulting in extensive shoreline erosion and
preventing many property owners from putting out their boats and docks.
Mention of this at the recent public hearing triggered a loud storm of
outrage. The District is now spending tens of thousands of dollars to
repair the damage. The bottom line is that the license may need to be
amended.
Finally, you should work with the legislature to take the Regulating
District out of the access permit business by selling the buffer zone
around the lake to current access permit holders. By removing this
distraction, the District could focus its full attention on its main
mission: flood control, river regulation, and hydro power generation.
This action also would have a long-sought benefit: It would remove the
cloud of uncertainty that hangs over the head of area property owners.
Currently, access permits have a life of only one year, and the
Regulating District will not guarantee that the same permit area will be
assigned to the holder year after year. Nor are permits transferable
from one property owner to another, a situation that depresses real
estate prices.
I hope these comments have been helpful. Please let us know if we can be
of any further assistance.
Sincerely,
Peter VanAvery
Batchellerville Bridge Action Committee
