Last week, I heard rumors around the proverbial country water cooler (which is a couple of folks leaning against a pickup truck in a Peck’s Market parking lot) that Mirant, the power company that owns the Swinging Bridge reservoir and dams, is about to sell its energy holdings in NY state, including Swinging Bridge. That was confirmed in this morning’s Times Herald Record (read article).
Alliance Energy Renewables has bid $3 million in bankruptcy court for Mirant’s NY holdings, including Swinging Bridge, Rio and Mongaup reservoirs, as well as two gas turbines. There is no other bidder, so the bid will likely be approced on March 8th. Alliance will then need to seek regulatory approvals before the sale can close.
Mirant has indicated that it plans to complete the dam repairs under its watch, but its not clear whether that will include refilling, or whether Alliance will assume responsibility for the refilling decisions.
The sale of the reservoirs by Mirant is not wholly unexpected, but it throws a wrench into the future status of our largest lake. Alliance is a gas company, and may only have interest in operating Mirant’s NY gas turbines, not the hydro dams. If they don’t want to operate the hydro dams, what will they do with them? Surely, they won’t want to maintain them, insure them and pay taxes on them if they’re not producing revenue. Would the State of NY buy the reservoirs as a natural resource? It
could take a couple of years of political wrangling for that to happen.
And if Alliance does not plan to produce power at the dam, is there any incentive for them to bring the water level back to its previous level, or will it be brought back just to a level to maintain the fish and eagle populations? It looks like a cloud of uncertainty will continue to hang over Swinging Bridge.
The other issue is that the Swinging Bridge dam and reservoir system generates a lot of property and school tax revenue for the county and surrounding townships. The dams are currently assessed at $26 million. If Alliance gets them for $3 million, the assessments will drop substantially, along with the property taxes that Alliance will pay.
Swinging Bridge real estate boosters have seen me as something of a Scooge for the last year. Through the fall, the news about Swinging Bridge was looking pretty bright. Mirant announced the dam repair was close to finished and refilling was imminent. But I’ve said to clients all along that until SB is actually refilled, there are no assurances, and there continues to be some risk as to if, when and to what level the lake will come back. Do I personally believe that Swinging Bridge is coming back? Yes, its too valuable a natural and recreational resource. But I don’t have a crystal ball, and what I can’t predict is when its coming back, under who’s ownership and to what level.
And if these reservoirs are selling for the fire sale price of $3 million, why haven’t our politicians stepped up to the plate to arrange for the state or county to buy them, or even a big stakeholder like Chapin to buy ’em.
I’m not familiar enough with the situation to have the answers, and would sure appreciate anyone with more information to add some comments here.