KBC Home

COB Homepage

Save Our Rural Oregon's response to hearing officer's Recommended Order
(Recommended Order is HERE - pdf file)

BEFORE THE ENERGY FACILITY SITING COUNCIL

OF THE

STATE OF OREGON

)

IN THE MATTER OF THE APPLICATION ) SAVE OUR RURAL

FOR A SITE CERTIFICATE FOR THE ) OREGON’S EXCEPTIONS TO

COB ENERGY FACILITY ) THE RECOMMENDED

) ORDER

)

As authorized by OAR 137-003-0650(1), Save Our Rural Oregon and the parties it represents Carl and Susie Gibson, William and Melyn "Lyn" M. Brock, Lewis W. Sowles, Maryann Reed, Mary Kent, Cheri Madsen, Mario and Diana Giordano, Douglas Madsen, Marsha Robinson, Roger Hamilton and Berkeley Cone (collectively referred to as "SORO") present the following exceptions to the Recommended Order served by the Hearings Officer in this matter upon the parties and the Energy Facility Siting Council ("EFSC" or the "Council"). SORO also joins in the exceptions filed by Water for Life, another party to these proceedings. The Exceptions are as follows:

1. Discussion of Rulemaking Requirements under Land Use Standards of OAR 345-022-0030 (pp. 8-11)

The Recommended Order adopts the Oregon Department of Energy ("ODOE") closing brief characterization of SORO’s rulemaking issue, as well as its substance. The grounds raised in connection with this issue were stated consistently and fully throughout these proceedings those portions of our briefs setting out those grounds are incorporated in these exceptions by this reference. The Recommended Order responds to this issue by denying any rulemaking obligation on the part of the Council, characterizing SORO’s request as one of prehearing interpretation of already-existing standards, and concludes that whatever statutes and rules exist are adequate. The Recommended Order has set up a classic straw person, viz. the argument ascribed to SORO that every site certificate hearing requires new rulemaking. Not surprisingly, the Recommended Order knocks it down on grounds of inefficiency, unconstitutionality, and being contrary to statute.

However, SORO’s rulemaking argument is not the one characterized by the Recommended Order, either independently or through the extensive quotations of the arguments of other lawyers.

Rulemaking is important to set forth the standards for a "reasons exception" under ORS 469.504(2) and OAR 345-022-0030(4). SORO set out the issues for this type of exception at pp. 11-12 of its opening brief:

The applicant, the Department, and the Recommended Order appear to have it both ways. Each denies that the statutes, goals and rules of the Land Conservation and Development Commission ("LCDC") are applicable to these proceedings, pointing to ORS 469.504(2). On the other hand, they rely on those same statutes, rules and goals, asserting that they, and their case law, are what was intended in the first place. These parties are better at suggesting what the standards are not than what they are. The only way to resolve this dilemma is to undertake rulemaking, as SORO has suggested, through a rulemaking petition before these proceedings have been completed. The Council certainly possesses that power. ORS 469.470(2) and ORS 469.501(1). Perhaps more importantly both the Oregon Administrative Procedures Act ("APA") and the Council’s own statutory structure require EFSC to adopt standards through rulemaking. Application of Portland General Electric Co. (Marbet v. Portland General Electric), 227 Or. 447, 561 P2d 154 (1977) is almost directly on point. The reason for such standards is to provide, in advance, for the rules of administrative engagement in a sufficiently meaningful way. While a generalist legislature cannot know in advance all the circumstances that may occur in all permit proceedings, the requirement for rulemaking is a safeguard provided under the Oregon APA to assure the fairness and due process of administrative proceedings. The proceedings before the Council are not frequently recurring. They involve a departure from the state’s process for determining land use permits and involve the potential expenditure of much money by an applicant. The Council owes the parties, and itself, the disclosure as to what "reasons" are sufficient to site a facility when the goals are not met, the nature of "mitigation" to meet "adverse consequences" and the like. This process may only be undertaken by rulemaking, rather than case-by-case adjudication. The Recommended Order errs in failing to require an obligation for rulemaking. These proceedings must be held in abeyance pending such rulemaking and the opportunity to apply the product of those proceedings to this contested case.

2. Construction and Application of ORS 459.504(2) (pp. 11-18)

ORS 469.503(4) states that a facility siting application may not be approved until the Council finds that: "The facility complies with the statewide planning goals adopted by the Land Conservation and Development Commission." To determine whether the statewide planning goals are met, ORS 469.504 sets out an elaborate procedure allocating responsibility for determining the applicable review criteria and then applying those criteria. The applicant elected to have the Council review the land use elements of the application under ORS 469.504(1)(b) instead of asking the County to provide this function as is permitted under ORS 469.504(1)(a). Rather than wade through all of the Council’s options in delegating responsibility to the local government to make these decisions, it is clear in this case that the Board of County Commissioners of Klamath County acting as a "special advisory group" under ORS 469.504(5) made no recommendation to the Council as to which standards apply or whether those standards were satisfied.

ORS 469.504(1)(b) sets out the requirements for finding goal compliance when the County does not provide guidance about what standards apply.

The compliance standards of ORS 469.504(1)(b)(A) through (C) more

specifically provide:

Relying on analysis from the ODOE, the Recommended Order explains that the Proposed Order "evaluates the application under ORS 469.504(1)(b)(A) and (B)." SORO has continually argued and further argues now that finding goal compliance based on a mishmash of local standards as set forth in ORS 469.504(1)(b)(A) along with selections from certain goals and one or two exceptions as set forth in ORS 469.504(1)(b)(B) is inconsistent with a standard that unambiguously requires full compliance with ORS 469.504(1)(b)(A) or (B).

The Recommended Order suggests on page 17 lines 22 and 23 that SORO has "no specific legal authority to support this reading of the EFSC statutory authority." SORO respectfully responds that the plain use of the term "or" rather than "and" in ORS 469.504(5) and the options of 469.504(1)(b) shows that either all of the local substantive criteria or all of the statewide planning goals must be met.

The first level of analysis when interpreting a statute is the text of the statutory provision itself and is the best evidence of the legislature's intent. PGE v. Bureau of Labor and Industries, 318 Or 606, 610, 850 P2d 1143 (1993). The term "or" is defined by Merriam-Webster dictionary as "a function word used to indicate an alternative choice." http://www.merriam-webster.com/cgi-bin/dictionary?book=Dictionary&va=or. Thus compliance with a standard that is separated by an "or" requires compliance with either subsection (A) or (B). By contrast, the term "and" means a "connection of items in within the same class." http://www.merriam-webster.com/cgi-bin/dictionary?book=Dictionary&va=and. The terms "or" and "and" do not have the same meaning, thus it is improper for the applicant, ODOE and the Recommended Order to find compliance based on application of ORS 469.504(1)(b)(A) and (B).

It is the applicant, ODOE and the Recommended Order who "appears to leap" to a determination that is illogical and inconsistent with the requirements of ORS 469.504(5)and (1)(b)(A) through (C). ORS 469.504(5) states that compliance can be established under the "applicable substantive criteria" prong or under the goals and exception prongs of ORS 469.504(1)(b)(B) and (C). This standard says nothing about mixing standards between local regulations and the goals.

Similarly, the substantive compliance requirements of ORS 469.504(1)(b) do not provide any further support for the conclusions in the Recommended Order on this issue. Reliance on use of the term "otherwise" set out in subsection (B) of that section is misplaced. To paraphrase the statutory requirements, subsection (B) states that if the "local substantive criteria" cannot be met, the Council must find that that the "facility otherwise complies" with the goals. As used here, "otherwise" means in the alternative. It does not mean as to the specific goal that is implemented by the "local substantive criteria" that cannot be met. The Recommended Order imposes an expanded meaning to the term "otherwise" that is not consistent with the plain meaning of this requirement. Not even rulemaking, however, can convert an "or" to an "and" as was done by the Recommended Order, and the applicant and ODOE in previous submittals.

Further, if the applicant is indeed applying ORS 469.504(1)(b)(B), the Council had an express obligation to "make its own determination" of which standards apply. Even in the face of numerous requests by SORO for the list of applicable standards, neither the Council nor the ODOE have made any formal determination of which standards apply. Rather the ODOE and the Recommended Order picks and chooses which standards apply based solely on where the facility might show compliance. This approach is contrary to the express language of the rule which requires the Council or ODOE to "make its own determination."

The applicant suggests, and the Recommended Order agrees, that requiring compliance with the local substantive criteria and all of the goals is too stringent an obligation for the applicant. Recommended Order page 18, lines 23-29. SORO did not make the rules or have a hand in drafting the applicable statutes as did EFSC staff (and quite possibly the law firm representing the applicant.) Rather SORO takes the statute as it finds it, as must the Council and other parties. To read the requirement in this way to impose an "and" where none is written is outside the power of the Council. All parties to this proceeding knew that the applicant could not meet all of the "local substantive criteria" when the process commenced. Thus, the applicant, ODOE and the Recommended Order should have excluded consideration of the local code provisions because many of them, most notably the policies dealing with Goals 3 and 4, and shown compliance based solely on all of the Statewide Planning Goals. ORS 469.504(1)(b)(B) or (C) cannot be satisfied unless all of the Goals are considered.

Deciding which standards apply is a complicated problem of evaluating the different layers of regulation from the state, agencies and the local government, and determining which ones apply. The legislature recognized the complexities in drafting ORS 469.504 by first recommending that the local government, the group with the most expertise in understanding and applying land use regulations, provide or assist in providing this review. ORS 469.504(1)(a) and (6). The Council, on the other hand and with all due respect, does not have the experience or sophisticated understanding of continuity between the local standards and the goals to determine whether a local standard as applied to a use never considered by that local government is sufficient to satisfy the overarching goal. Even local governments, who make land use decisions all of the time, are not authorized to mix and match which goals or local criteria will apply when taking a plan amendment. ORS 197.175(2)(a), 197.180 and Goal 2. Thus, the context of land use planning indicates that the Council is not authorized to mix and match criteria when the plain language of the standard does not provide this authorization and the Council has an obligation under ORS 469.503(4) to find that all of the land use planning goals are met.

3. LDC 54.030 (pp. 19-20)

Following the adoption of the hybrid process in the interpretation of ORS 469.504(2), so as to allow both the local plan and code and some state law, including an exception, to be considered, the Recommended Order then proceeds to determine that the Klamath County Land Development Code ("LDC") §54.030, which provides that when a commercial utility facility takes up more than 20 acres of non-high value farmland, it must obtain an "exception pursuant to OAR 660-04," does not, in fact, apply. The applicant cannot have it both ways. Either the local code applies, or it does not. If it applies, it must be adhered to. If it does not, then the "track" taken must show compliance with all applicable goals (including exceptions). The Council does not have the authority to pick the rules that apply, as in a cafeteria, on an ad hoc basis.

4. Goal 3 Exceptions (pp. 20-30)

In dealing with the Goal 3 exception requirements, the Recommended Order makes a number of assumptions that SORO believes are inconsistent with the evidence contained in the record and makes findings that are both inadequate and based on an incorrect application of the requirement.

As an initial matter, the Recommended Order concludes that, whenever an exception is required, ORS 469.504(2) applies to that exception. Recommended Order page 22, lines 3-8. However, if review of this application is based on the "local substantive criteria" according to ORS 469.504(1)(b)(A), as the applicant and Recommended Order assert, then the applicant has an obligation to take an exception pursuant to OAR 660 Div. 04 et seq. as required by Klamath County LDC §54.030(M) when a commercial utility facility takes up more than 20 acres of non-high value farmland. Policy 4 of Goal 2 of the Klamath County Comprehensive Plan is also an "applicable local substantive criteria." It provides:

There is no authority in the Council’s siting statutes or rules that allows the Council to avoid applying these "applicable local substantive criteria" and instead to apply the exception criteria of ORS 469.504(2), merely because they both reference the term "exception." Compliance with ORS 469.504(1)(b)(A) requires taking an exception pursuant to OAR 660 Div. 04 as Policy 4, Goal 2 is "local substantive criteria" or choosing to apply either ORS 469.504(1)(B) or (C). Whether these are the same exceptions in substance is the stuff of rulemaking, rather than selective prestidigitation for the convenience of achieving an immediate objective.

The exception language of ORS 469.504(2) provides, in relevant part:

Rulemaking

As explained in greater detail in Issue 1 above, the Council cannot consider whether the exception standards are met until it conducts further rulemaking. First, the Council must provide greater clarity about how it interprets "notwithstanding the requirements of ORS 197.732." The Recommended Order’s approach on Page 24, lines 19-30 of the Recommended Order, rejecting the substantive requirements of the LCDC goal exception requirements of ORS 197.732 and then, at the same time, looking to the LCDC goal exceptions to provide guidance about when the standard is satisfied, is an approach that defies logic. If this is the direction the Council wishes to take, it should be done in an open rulemaking process, not in the limited participation contested case process.

Reasons Standard

The Recommended Order’s principal flaw in the analysis of SORO’s arguments is that it suggests that "SORO’s entire analysis of the ‘Reasons’ factor is premised on how the proposed facility would fail to satisfy an alternative sites analysis." Page 25, lines 3-6. This statement completely misses the mark. SORO recognizes that the more limited exception requirements of ORS 469.504(2) does not require an alternative site analysis. Rather, SORO uses an alternative analysis to debunk the applicant’s assertion that operational requirements of this facility are "unique" and that it is "locationally dependent on the resources of this site." Recommended Order page 25, lines 26-27 and footnote 10. "Uniqueness" is a relative term and can only be established by comparing the resources available in other locations to determine if this standard is met.

Evidence and written testimony contained in SORO’s brief establishes that the alleged "unique" features of this site are, in fact, not unique but rather are available at many other sites both within and outside urban areas. First, the applicant’s water demand is not based on a quantity, rather than on a special natural quality within the water. The applicant has not submitted any evidence to show that water in the necessary quantities is not available at any other site. Thus, there is no statutory showing that the water resource requirements is unique. Similarly, natural gas lines and electric transmission lines can be found throughout the state and the applicant has not cited to any evidence that shows that the pipeline and transmission line hookups must occur at this precise location. The applicant has not met its burden of presenting evidence that show that "reasons justify why the state policy embodied in the applicable goal should not apply," much less dealing with the complete absence as to what these "reasons" must entail.

ESEE Analysis

In taking an exception under ORS 469.504(2), the Recommended Order acknowledges that an ESEE analysis is required. However, that ESEE analysis contains significant flaws. Again, as an initial matter, SORO believes that the ESEE analysis requirement is too ambiguous to provide adequate guidance about how it should be applied and rulemaking is required to clarify its requirements. The Recommended Order disagrees, finding that application of this standard is a factual matter wherein the Council need not set a number of significant ESEE consequences that must be evaluated. Recommended Order page 26, lines 41-44 and 27, lines 1-4. SORO’s request is not so stringent in its demands.

The Recommended Order points to the definition of "significant" at OAR 345-022-0010(48) which is:

This provides an example of definitions already contained in EFSC rules, so that rulemaking is not required. However,this definition does nothing to eliminate any ambiguity about what impacts rise to the level of having "important consequence." One could certainly interpret this rule to say that when the impact is "likely" to affect a population then it is "significant." Marbet supra. A similarly reasonable interpretation might be that the "natural resource" must be "important" and "intensely" impacted before an ESEE evaluation is required. This standard provides no direction or yardstick for the parties to determine when an impact is significant. SORO freely admits that this guidance will not come in the form of a numeric or otherwise quantifiable standard. Rather, a rule might provide for consideration of a wide range of all impacts and based on the nature of the conflict, a conclusion can be drawn about whether the impact is "significant." See for example, OAR 660-023-0040 (LCDC rules explaining how an ESEE analysis should be preformed.)

Further, there is no obvious connection in this exception provision between articulation of the significant ESEE consequences and a determination that "adverse impacts" are "mitigated." Rulemaking must be initiated to further clarify this requirement as well.

In addition to the rulemaking obligations, the Recommended Order failed to weigh adequately the evidence when it decided to adopt the applicant’s ESEE analysis contained in the Application for Site Certificate (ASC), Exhibit K, Amendment 1. Recommended Order page 28, lines 1-2. As part of its initial brief, SORO included a more complete ESEE analysis. Exhibit 7. Without any further analysis, even in light of SORO’s final closing argument challenging these points on pages 16 through 18 of its brief, the Recommended Order summarily rejects without further discussion this additional evidence finding that ASC responded to those additional impacts. SORO objects to these overly conclusory findings.

First, none of the expert testimony provided by the applicant is from anyone who actually lives or farms in the Langell Valley. Soil scientists such as Jason Smesrud, wetland ecologists, such as Steve Mader, and land appraisers, such as Barton DeLacy, are not qualified to testify about the social and emotional impact of construction of this facility. The residents of the Langell Valley are uniquely qualified to talk about how this facility will impact their lives. And yet, without so much as a mention from the Recommended Order, this testimony was swept aside in favor of the testimony of retained outside engineers and appraisers. Social impacts are not so easily quantified.

Not only was the testimony of the residents more compelling than that of the applicant, the ESEE analysis contained in the application was composed by Steven Mader, a Senior Habitat Management and Planning Technologist with CH2M Hill, Inc. According to his affidavit, his educational and professional experience is with natural resources, most particularly forestry, and not with land use planning. It does not appear from his resume that Mr. Mader has any experience in considering how construction of this massive facility will harm the surrounding human populations, much less any experience in drafting an ESEE analysis or weighing ESEE impacts.

The ESEE analysis contained in Exhibit 7 of SORO’s initial brief was drafted by an experienced land use planner. The drafter, Leslie Ann Hauer, was the only professional land use planner to participate in these proceedings. She has experience in drafting and analyzing ESEE evaluations for rural land use proposals. At no time did the applicant challenge the expertise of Ms. Hauer. The Recommended Order failed to even mention, much less discuss, her astute analysis.

As a final point, the Recommended Order places the cart before the horse when it relies on the applicant’s ESEE analysis because it does not use the ESEE analysis criteria to determine the existence of any significant impact. Rather, without any analysis, the applicant assumes that it knows which of the ESEE consequences rise to a level of being significant and then shows how those impacts are mitigated. If evaluating significant ESEE consequences is to have any meaning it must require a weighing of the positive and negative ESEE consequences of allowing and disallowing a use. It must be detailed in its inquiry and based on evidence of those who have expertise to evaluate these impacts. The Recommended Order failed to require such detailed analysis which is necessary before this exception criterion is satisfied.

Compatibility Standard

The final element of an ORS 469.504(2) exception is a finding that the "Proposed Facility is compatible with other adjacent uses or will be made compatible through measure designed to reduce adverse impacts." The Recommended Order suggests that all of SORO’s compatibility arguments are misplaced because they are based on the use itself rather than "whether the size of the facility, not the facility itself is incompatible." Recommended Order page 28, lines 34-38 and page 29, lines 1-4. SORO does not dispute that energy generation facilities are conditionally allowed on EFU land. ORS 215.283(2)(g). Assuming arguendo that this facility took up less than 20 acres of high value farmland and was scaled to serve a rural population consistent with the purpose of the EFU standards, SORO probably would not have the same grounds to object to the lack of compatibility between the facility and the adjacent uses. However, this facility extends over more than 63 acres, taking high value farmland, valuable forestland, and habitat migration areas out of productive farm and forest uses. The allegations of incompatibility are contained in SORO’s Initial Brief on pages 16-17 as well as its Closing Brief on pages 19-20.

As explained in Issue 2 above, rulemaking is required to further flesh out the meaning and compliance requirements in order to determine whether a facility is "compatible."

As explained in all of its previous briefs, if the Council is going to look to the LCDC compatibility standard of OAR 660-04-0020(2)(d), it must do so with sufficient specificity such that it identifies the specific locations that the Council considered "adjacent areas," summarizes the uses occurring on those specific areas and then, explains why the proposed use in the exception is or will be rendered compatible. Jensen v. Clatsop County, 14 Or LUBA 775, 784-786 (1986); Loos v. Columbia County, 16 Or LUBA 528, 539-541 (1998).

For example, the adjacent and surrounding lands analysis submitted by the applicant is not tax lot specific such that SORO can identify the boundaries of the applicant’s compatibility study area. The Agricultural and Forest Practices Mitigation Plan (Attachment K-5) speaks generally about what mitigation efforts the applicant will employ but does not specify where or to what intensity these measures will be applied. Without this additional information, the Recommended Order and the Council are ill-equipped to determine whether this standard is satisfied.

Finally, SORO strenuously objects to the Recommended Order’s characterization that: "The remote nature of the location reduces, rather than increases, the impact of the size of the proposed facility on the surrounding areas." Recommended Order page 30, lines 19-20. It is policy of the State to preserve agricultural practices furthered through a rural way of life, and specifically limiting population density in rural areas. ORS 215.275. Under the Recommended Order’s analysis, any industrial use of any size, and the larger the better, could be located anywhere in a rural area so long as there were not very many people around to object. Simply because urban-sized populations do not turn out in opposition to this facility does not mean this facility is "compatible." The people who live on agricultural lands near this facility have a right to the preservation of their rural lifestyle; state policy is in place to preserve this way of life and the resources on which it depends. The validity of an objection should not be diminished just because it comes from those who live in "remote" locations.

5. Goal 5 Exceptions (pp. 30-31)

SORO takes exception to the Recommended Order’s reliance on the ODOE analysis of Goal 5 exceptions. First, in response to SORO’s contention that an exception to Goal 5 is also required before this facility can be approved, displacing a significant amount of land that currently serves as a winter range habitat for mule deer that is protected under the County’s Goal 5 inventory, the ODOE takes the position that the local "substantive criteria" allow energy facilities to displace Goal 5 protected land so long as it satisfies the local conditional use criteria. The problem with this is two-fold.

First, because the requirements for an OAR 660 Division 04 exception in LDC §54.040(M) depends on the size of energy generation facility siting in EFU and forest lands, the size of such a facility also must be relevant in determining whether "extensive impact to services and utilities" can be located on Goal 5 protected lands. It would be illogical and absurd to allow an energy facility to potentially usurp a significant Goal 5 inventoried resource without so much as a Goal 5 post acknowledged plan amendment to consider the consequences of permitting this use. Here, again, the applicant, ODOE, and the Recommended Order dart between the local criteria and the goals, to suit the needs of the moment, manipulating flexible terms in either set of standards to suit the foreordained objective of approval of this project.

Moreover, both the Recommended Order and the ODOE failed to consider that adjusting the boundaries of the Significant Resource Overlay (SRO) area, and thereby amending a Goal 5 resource included within a comprehensive plan inventory, requires an amendment to the inventory through the post acknowledgment plan amendment procedure set out in OAR 660 Division 016.

The Recommended Order also rejected SORO’s argument that a Goal 5 exception is required to deal with groundwater resources. Neither the Recommended Order, nor the ODOE point to any part of the Klamath County Comprehensive Plan or Land Development Code that provides Goal 5 protection for groundwater resources. Goal 5 is unambiguous in its requirement that groundwater resources must be inventoried and protected. Since the local plan and regulations are not acknowledged as to groundwater, the Recommended Order could not rely on the limitation of OAR 660-023-0250(1) for a PAPA amendment. ORS 469.504(1)(b)(A) requires "that the facility complies with any Land Conservation and Development Commission administrative rule and goals and any land use statutes directly applicable to the facility under ORS 197.646(3)." The Goal 5 protection of groundwater is a new rule, imposed after the County’s plan and regulations were acknowledged. Thus, Goal 5 and OAR 660 Division 016 must be satisfied before this application can be approved.

6. Compatibility with Farm Uses under ORS 215.296 and LDC 54.040(1) (pp. 32-37)

(2) An applicant for a use allowed under ORS 215.213 (2) or 215.283 (2) may demonstrate that the standards for approval set forth in subsection (1) of this section will be satisfied through the imposition of conditions. Any conditions so imposed shall be clear and objective.

The Recommended Order recommends adoption of the Proposed Order, finding that it

SORO set forth its views as to what these provisions required in its submissions in these proceedings. The Recommended Order adopted the ODOE position that "The Department does not have evidence that the energy facility would significantly increase the cost of specific agricultural practices on nearby lands." However, the Department’s lack of evidence is not the issue; rather, it is the applicant that must show that the applicable statutory and ordinance criteria are met. Most of the Recommended Order’s energy is devoted to modification of the wording of a relatively unimportant condition and SORO’s request for rulemaking, rather than compliance with these standards. The Recommended Order does not mention the requirement that any conditions are clear and objective under ORS 215.296(2), nor does the Recommended Order spend much time on the requirements of case law that an area be selected, that the farm and forestry uses in that area be inventoried, and that the provisions of ORS 215.296(1) be applied.

These are affirmative obligations of the applicant and the Recommended Order’s avoidance of that issue and preference to discuss the irrelevance of impacts on rural lifestyles does not equate to a showing of compliance with the standard. The Recommended Order does not discuss the affidavit and evidence of Ms. Hauer; rather, the Recommended Order finds that there was other evidence and that this evidence is believable, preferring to emphasize rural lifestyles than the applicable standard. Where there is occasion to discuss evidence, the Recommended Order relies on the testimony of Jason Smesrud, who is a soils engineer and technician. His affidavit shows he is not a farmer and not a planner. That affidavit also shows that his work was to deal with soil restoration following construction and reuse of process water from the operations of the facility. He refers to a mitigation plan which lists crops and crop production activities (but not ranching) in the "vicinity" of the facility and related facilities, as well as "a general description of accepted farming practices in Klamath County." Finally, he refers to potential impacts to agricultural areas on the site and "in the areas surrounding the construction areas" and measures to mitigate and minimize potential impacts.

Mr. Smesrud’s information is not responsive to the applicable criteria, which requires a specific area to be established, the accepted agricultural and forestry practices in that area to be inventoried, and application of the standards occur. Sanders v. Yamhill County, 34 Or LUBA 69 (1998). While there is discussion of impacts to agriculture on the subject site (which is excluded from consideration under ORS 215.296(1) under Stockwell v. Benton County, 38 Or LUBA 621, 626-627 (2000)), and wastewater processing, the discussion of ORS 215.296 at pp. 20-22 of Mr. Smesrud’s affidavit is conclusory, fails to set forth both the area considered, the farm and forest practices occurring on that land, and limits its mitigation to buying land from willing landowners, restoring and using COB’s land for agricultural purposes and avoiding disturbance "wherever possible." And then there’s the lawyer’s question at the end of the Affidavit as to whether there is any significant change in farming or forestry practices or increases in the cost of the same, along with the stock "No problem" response. If the applicant’s sole expert never sets the grounds for the expert opinion in terms of the statute, never deals with opposition testimony, and emphasizes that it could have been worse (had not the project changed from a water- to an air-cooled version), then the witness is led by his lawyers to make a legal conclusion that is not supportable by the record in this case. The Recommended Order erred in finding otherwise.

Additionally, the wording of the Klamath County LDC is broader than ORS 215.296(1) because it requires a review of "nearby agricultural or forest lands," rather than "surrounding lands devoted to farm or forest use." If the Recommended Order is applying the "local substantive criteria" as explained on page 15, line 3-4 of the Recommended Order, then the applicant has an additional obligation to identify and review the "nearby" agricultural and forest lands, in addition to the "surrounding" ones.

Finally, the analysis under ORS 215.296 also applies to the accessory facilities such as water, sewer and transmission lines, that were excepted by the applicant and Recommended Order because they were improperly characterized as uses permitted under ORS 215.283(1). A further discussion of the relationship between accessory and primary uses follows in Issue 9 below.

7. Location, size, design and operating characteristics of the proposed use Will Not Have a Significant Adverse Impact on the Livability, Value or Appropriate Development of abutting Properties or the Surrounding Area -- LDC 44.030(1) (pp. 37-40)

Neither ODOE, nor the Recommended Order has required the applicant to submit a revised site plan to show the current proposal before the Council. The applicant made a substantial alteration of use of the site by changing from the initial water-cooled iteration, but did not submit a new site plan. A mere listing of uses and acreages does nothing to demonstrate the nature, extent and location of the components of the generating facility now before the Council. Moreover, it is unclear whether the storm water pond is still part of the proposal How can the Council evaluate these matters without a site plan? The Recommended Order erred in forwarding the Recommended Order to the Council in the absence of such a revised site plan.

Further, the applicant and Recommended Order conflated the notions of livability with property values. The only evidence on this subject was the testimony of a Portland appraiser who blithely concluded no impact on property values within two miles of the site, primarily because the facility would not be visible from any residence within that distance. That testimony, even if accepted, does not respond to the other issues under this criterion and the Recommended Order erred in so concluding.

8. Klamath County LDC § 44.030(C) (pp. 37-40)

This Code section provides that:

The Recommended Order states that the standard of this code section is satisfied through compliance with ORS 215.296 and LDC § 54.030(C), discussed immediately above, and recommends that the testimony of Mr. Smesrud and Mr. P. Barton DeLacy be used as additional evidentiary support for this same conclusion.

However, optioning surrounding properties from willing sellers is by no means a response to this criterion. More importantly, the Recommended Order has overlooked the differences between the subject code section and ORS 215.296 and LDC § 54.030(C). LDC § 54.030(C) is not limited to agricultural and forestry uses, but to all uses. Moreover, the analysis that must be made is similar to that found in ORS 215.296, i.e., an area must be selected (which was done in the DeLacy report, but not in the Smesrud soils and wastewater processing study), the uses identified and an analysis must be made under the code section. As noted above, the Smesrud report was limited to certain agricultural issues and nothing more. The DeLacy report is limited to effects on property values and not to "livability, value, or appropriate development of abutting properties or the surrounding area." The abutting properties are those proposed to be in the ownership of parties other than the applicant. While the appraiser had different conclusions from those who live and work in the area, the value of the appraiser’s testimony can only be as far as his field of expertise, i.e., appraisal work. Livability and appropriate development of abutting properties and the surrounding area were addressed by those who live and work in the area and by a professional planner. In short, there is a lack of evidence from the applicant to meet this standard, and there are no findings that support compliance. The Recommended Order erred in concluding otherwise.

9. ORS 215.275 and 215.283 (pp. 42-43)

The applicant, the Department, and the Recommended Order have been inconsistent in their application of ORS 215.275 and 215.283. As discussed in SORO’s briefs at various points in the process, each of those parties argued that ORS 215.283(1) applied (which would bring ORS 215.275 into play), while at other times, they appeared to argue that ORS 215.283(2), which implicates ORS 215.296(1) and (2) would apply to that same facility. If SORO understands the Recommended Order correctly, it is ORS 215.283(2) that applies to the power generation facility (so that ORS 215.296 also applies). Recommended Order at pp. 40 and 43. However, the Recommended Order also appears to state that ORS 215.283(1) applies to certain aspects of the facility, i.e., the water supply system (well and pipeline), natural gas pipeline, and electrical transmission line. Recommended Order at p. 50, lines 16-18. SORO has two responses to this interpretation:

1. If ORS 215.283(1)(d) is applicable, the analysis required under ORS 215.275 is required; and

2. The water line, transmission line, water pump, evaporation ponds and other peripherals are clearly accessory to the power generation facility. If so, the analysis required under ORS 215.296(1) must be undertaken for the entire facility, but was not. Moreover, the exception area must be expanded.

SORO contends that this is one facility and that there must be one analysis of the entire facility, including its accessory uses, which include the wells, water line, natural gas line and electrical transmission line. Consequently, ORS 215.283(2) applies and the Recommended Order erred in bifurcating the analysis.

Even if ORS 215.283(1)(d) and ORS 215.275 applied, the Recommended Order erred in concluding they were met. ORS 215.275(1) provides:

This statute is based on the entire facility, and not accessory portions and militates against the application of ORS 215.283(1), because "the facility" in this case is the entire generating facility, which need not be located in an exclusive farm zone, and in any case no showing that these accessory uses are "necessary for public service" when these elements are necessary and available only for the generating facility. The Recommended Order’s analysis assumes the generating facility as a given, and limits the ORS 215.275 analysis to providing the utility facilities to the posited generating facility. Second, the Recommended Order rejected the use of public right of way which, under Friends of Parrett Mountain v. Northwest Natural, 336 Or 93, 79 P3d 869 (2003), would have allowed and would have avoided crossing EFU lands. The reasons given were that such an alignment would conflict with (unspecified) "LCDC rules," "Klamath [sic] LDC provisions," and "conflict with cultural resource sites, and would increase adverse effects on bald eagles." Until the applicable law is evaluated correctly, the summary rejection of this alternative is improper and the Recommended Order erred in accepting it.

As to the natural gas pipeline, this facility may be located in a right of way under the Friends of Parrett Mountain decision if ORS 215.283(1)(d) applies. However, some of the pipeline is not proposed to be located in the right of way. In addition to the previously discussed contention that ORS 215.283(2), 215.296(1) and the exceptions process apply, SORO also contends the generation facility need not be located in an EFU zone and the Recommended Order improperly limited the analysis to a posited generation facility.

The same general analysis also applies to the wells, which are not a freestanding utility as contemplated by ORS 215.283(1)(d), but part of the generation facility and therefore, must be judged under ORS 215.296(1) and the exceptions process. Additionally, the use of the water pipe along existing right-of-way was summarily rejected because it is not "reasonably direct" and would require the use of EFU land. The EFU land used would be within a right-of-way and is lawful under Parrett Mountain. The additional cost of using a more expensive lawful method is not a reason for rejecting it, certainly not on the basis of "locational dependence." The generation facility does not depend on the well, although that water may be cheaper. The Recommended Order erred in finding otherwise.

9. Goal 4 Exceptions (pp. 47-50)

According to the Recommended Order, a Goal 4 exception is required under LDC §55.040(P) because certain segments of the access roads for the transmission line will be sited outside the 100 foot easement limit permitted for additional right-of-way. The Recommended Order granted this exception based on reasons submitted by the applicant that, in sum, concluded that the lines are locationally dependent because of the location of the main facility. Recommended Order p. 48, lines 18-41. This analysis is incorrect for a number of reasons.

First, the Recommended Order misunderstands the requirements of Goal 4. An exception is required in this case, not because of the road right-of-way location requirements. It was required because LDC §55.040(I) prohibits an energy generation facility from removing more than 10 acres from a commercial forest operation without first taking an exception pursuant to OAR 660, division 4. Combined, the natural gas pipeline and the transmission line will take 76.45 acres of land out of commercial forest production. The "applicable substantive criteria" requires a specific type of exception and this criterion cannot be satisfied until that specific exception is taken.

Again, this raises the issue of whether or not the applicant chooses to be in under ORS 469.504(1)(b)(A) or out under ORS 469.504(1)(b)(C). Any less than full and complete compliance with the criteria of a reasons exceptions under OAR 660-004-0020(2)(c) is incomplete and fails to ensure that the ultimate conclusion – compliance with the statewide land use goals – is satisfied.

Second, there is no authority in either LDC §55.040(P) or OAR 660-006-0025(4)(q) for locating electric transmission lines beyond the 100 foot right-of-way limitation. It is true that ORS 772.210 does permit condemnation of other lands, in additional to the 100 feet, that are necessary to accommodate the proposed service. However, there is nothing in the language of OAR 660-006-0025(4)(q) to suggest that the necessary additional width can be taken from designated Goal 4 protected forestlands. To the contrary, OAR 660-006-0025(4)(q) provides for "New electric transmission lines with right of way widths of up to 100 feet as specified in ORS 772.210." If DLCD had intended to include additional necessary width as a use allowed on forest land, this rule would permit: "New electric transmission lines with right of way widths up to 100 feet plus other lands necessary and convenient for the purpose of construction of service facilities as specified in ORS 772.210." However, the Goal 4 rule is not so expansive. It limits the condemnation power granted under ORS 772.210 to the 100 foot right of way. Nothing under either OAR 660 Division 04 et seq. or ORS 469.504(2) authorizes this expansion of the right-of-way on to forest land through the exception process.

Third, even if a Goal 4 exception provides the proper review criteria for this use, the Council must complete rulemaking to establish the policy parameters for showing compliance with the "reasons" requirements.

Finally, the Recommended Order failed to show adequate "reasons which justify" this exception. ORS 469.504(2)(C)(a). To that end, SORO argued on pp. 14-15 in its Opening Brief:

The Recommended Order rejected that argument finding that "a Goal 4 exception is required for the Transmission Line, and not the construction and operation of the proposed facility." Similar to the analysis explained in Issue 8 above, the transmission lines are accessory to the proposed use and cannot be viewed in a vacuum as having independent value without operation of the core use. Of course, once the facility is placed on a particular site, the location of its accessory uses, such as transmission lines, become the direct link between the facility and its nearest connection. Although this might make perfect sense in the contest of the Recommended Order, it takes all of meaning out of the Goal 4 reasons exception requirement. The only way to give meaning to these exception requirements is to view them not as a function of distinct working parts, but rather as a working whole. Thus, the only way to ensure that the land use goals are satisfied is by requiring a Goal 4 exception for the entire facility as it is operation of the entire facility as an energy generation use that will result in the loss of commercially valuable forest lands.

10. Other Land Use Standard-Related Issues (pp. 50-52)

Failure to Take a Goal 3 Exception for Proposed Water Supply

The Recommended Order rejected SORO’s argument that a proper Goal 3 exception must include the additional 20.7 acres permanently impacted by the proposed water supply system. See Proposed Order 306. The Recommended Order relied on ODOE analysis finding that ORS 215.283(1)(d) and ORS 215.275 allow a water supply system use. As an initial matter, SORO contends that this accessory function cannot be considered as a stand-alone use, as explained in greater detail in Issue 8 above. Rather, it must be considered a component of the overall facility function.

If the Recommended Order and the applicant are genuine in their efforts to apply the "applicable substantive criteria" as required by ORS 469.504(1)(b)(A), they would note that LDC §54.030(M) implements ORS 215.283(1)(d) and contains the added requirement that an OAR 660 Division 04 exception is required any time a use takes more than 20 acres of non-high value farmland out of commercial agricultural production. SORO believes that since this use is accessory to the energy generation facility, its impacts could be dealt with through the Goal 3 exception that was taken for the facility. However, this additional exception land was not included in the Goal 3 exception reasons analysis. The Recommended Order erred by failing to require a complete Goal 3 exception for the water system.

In its brief, as well as in Ms. Hauer’s Alternative Sites Response, SORO explained that it is impossible to tell the size and extent of this facility from the application or the Proposed Order. The land use application requirements for most local governments require that the applicant submit a site plan illustrating the location and footprint of all of the structures associated with an application, the tax lot lines, roadways as well as all additional utility facilities such as storm water collection areas or evaporation ponds. The application does not include this type of detailed site plan map. SORO continually requested a complete and updated site plan map to reflect proposed amendments, and the applicant has failed to provide one.

In its initial brief, SORO raised discrepancies that it found in the amount of land needed to accommodate this facility. Rather than specifically respond to these allegations, the applicant stated that the dimensional impacts from this facility were correctly determined. The Department and the Council cannot satisfy the obligation to find compliance with the Statewide Land Use Goals until they know exactly how large and far this facility will extend.

11. Other Applicable Regulatory Requirements – Water Issues (pp. 55-61)

SORO joins in the exceptions to the Recommended Order of the Recommended Order filed by Water for Life.

12. Structural Standards under OAR 345-022-0020 (pp. 4-7)

The evidence relied on by the Recommended Order to address the structural standards of OAR 345-022-0020 is illogical, incomplete, and is not the type of evidence that a reasonable person would rely on to conclude that this standard is met. The Recommended Order has chosen to ignore certain portions of Ms. Whitsett’s testimony while, at the same time, relying on incomplete portions of e-mails from the applicant, ODOE and DOGAMI to substantiate the belief that all of the necessary geotechnical work has been, or will be, completed. These e-mails are indicative of the necessity of continuing geotechnical studies of the area.

As an initial matter, SORO challenges the Recommended Order’s assertion that: "the [e-mail] excerpts certainly indicate that the ODOE evaluated and studied this issue in depth, and questioned the applicant’s evaluation in order to better understand and evaluate the ASC [application for a site certificate]." Recommended Order page 5, lines 11-13. However, ODOE’s inquiry in to this issue was not based on the application material or inquiries by the staff before the Proposed Order was completed. Rather, all of the staff e-mails were generated after Ms. Whitsett submitted oral and written testimony at the hearing on January 24, 2004. In that testimony, Ms. Whitsett questioned the statement in the Proposed Order that all necessary geotechnical field work and studies were complete. Had it not been for her attention to the geotechnical information deemed acceptable by the ODOE in the proposed order, it appears that none of the additional geotechnical tests or studies would have been ordered to be undertaken.

Up to that point, the application which blithely relied on old previously published literature and air photos of the site, which in combination with extremely limited superficial building cores that were sufficient to satisfy this standard. Ms. Whitsett, utilizing her extensive geologic education and field knowledge, repeatedly brought the insufficiency of the applicant’s geotechnical report to the attention of Adam Bless with ODOE and then consequently to Yumei Wang of DOGAMI.

Adam Bless of ODOE states in an e-mail dated 2/17/04:

OAR 345 -022-0020(a) and (c) set the standard for finding structural stability and these provisions require:

The Proposed Order fails to acknowledge use of past tense in these requirements meaning this work must have been adequately completed through proper and complete geotechnical studies including extensive field mapping and Paleolithic seismic trenching before the site certificate can be issued. Imposing conditions that require these studies in the future are insufficient to meet a standard that requires that these acts are already completed.

Further, this interpretation of the use of past tense in these requirements is substantiated by the e-mail from Adam Bless, quoted above, stating that EFSC would be in violation of state law by awarding a site certificate to COB before completing the geotechnical characterization of the seismic hazard of the site. The Recommended Order fails to acknowledge Mr. Bless’s statement or respond to his concerns.

Only after Ms. Whitsett asked ODOE to reconsider the paucity of geotechnical studies did requirements that numerous other major tests, including Paleolithic seismic trenching and peak ground acceleration predictions were required in order to understand the nature of the Bryant Mountain Fault and the geologic area over which the site is proposed to be built. It appears that none of this necessary testing and studying would have been either required or completed had she not shown why People’s Energy’s geotechnical field report and study was so lacking. For the ODOE to then disclaim her extensive geotechnical skills and abilities in the contested Case ruling is unfortunate and short sighted. It is apparent that Ms. Whitsett’s recognition of COB’s lack of pertinent technical information in the geotechnical report was a milestone in making sure basic tenants of the public’s safety were not compromised.

As part of the contested case proceeding, Ms. Whitsett again came forward telling the Hearings Officer that the recommended geotechnical studies still appear insufficient to meet public safety standards. What SORO and other citizens in the area fear is that the work will never be properly undertaken and accurately reported. This belief is entirely reasonable in view of ODOE’s unwillingness to take a closer look at these issues in the beginning.

Further, the evidence sited by the Recommended Order is incomplete and provides a false sense of compliance with the standard. If the Recommended Order is going to rely on an e-mail to show that a standard is met, it must address the whole e-mail in context. For example, the only portion of the February 3, 2004 e-mail from the applicant’s engineer, Douglas Schwarm to an ODOE employee, Adam Bless, is "The scenarios are intentionally "conservative," which means they are based on assumptions that likely overstate actual risks." Recommended Order page 6, Lines 305. However, paragraph 2(a) of this e-mail states:

Taken as a whole, this e-mail paragraph amplifies the extent of the deficiencies much more clearly than the Recommended Order’s excerpt. Taken in its entirety, this paragraph states that CH2M Hill put a value of maximum shaking at 6.0 magnitude, and not coincidently, that value just happens to coincide with the maximum building code values. The inference is that CH2M Hill may have deliberately underestimated the magnitude and/or epicenter, which would result in ground shaking seismic activity that exceeds the building code standards.

Similarly, a final e-mail from ODOE’s Adam Bless to Janet Prewitt of ODOJ, Yumei Wang of DOGAMI, Catherine Van Horn and David Stewart-Smith on ODOE on 2/12/04 is in direct contradiction to the Recommended Order’s reliance on Mr. Dailer’s testimony submitted by the applicant. This testimony is set forth in the Recommended Order on page 6, lines43-46 and page 7, lines 1-5 and provides:

More reliable contrary evidence is in the record comes from the February 12, 2004 e-mail where it says:

If the Recommended Order and ODOE rely on unsubstantiated statements by the applicant rather than their own staff, they must provide a reasonable basis for this belief. Throughout the course of these proceedings ODOE staff has confirmed Ms. Whitsett’s analysis of the seismic issues relating to this application. The applicant, on the other hand, has been constantly scrambling to make additional assertions to support its lack of analysis. In light of this history, a reasonable person would rely on the testimony of Ms. Whitsett and her qualified understanding of the geotechnical aspects of the application when she concludes that the Council has insufficient evidence to determine if these standards have been met.

Conclusion

For all of the reasons set forth above, and consistent with the evidence in the record, SORO respectfully requests that the Energy Facility Siting Council issue an Order very different from that issued by the Recommended Order or ODOE. Either it should remand this case to the Department to initiate rulemaking or apply all of the state land use goals based on substantial evidence in the record or it should deny this application based on the findings contained in these exceptions.

Respectfully submitted this 29^th day of September, 2004.

Of Attorneys for Save Our Rural Oregon