140West: RAM Development’s Money Tree, Chapel Hill Taxpayers Moneypit

Tuesday, August 3rd, 2010

Local commentator and involved citizen Fred Black invited me to do a WCHL1360 Who’s Talking segment last week.

It airs this evening (Tues. Aug. 3rd, 2010) at 6PM.

While the subject was supposed to be the Lot #5/140 West project, which is slated to finally get started later this month, Fred used this opportunity to talk about development Downtown, public engagement, and Council.

As I said then and before, I believe Lot #5 presented an excellent opportunity for redevelopment.

I and others argued for a fiscally prudent, environmentally sustainable, community-oriented development that had workforce housing, affordable commercial opportunities, an integrative tenant – like a grocery store – and real public space.

Instead of getting a signature development that met those goals from the RAM Development/Chapel Hill collaboration we got a $10M+ taxpayer funded luxury condo development with little public utility. Architecturally, the project’s look fits the Atlanta beltway more than Chapel Hill – it says little, if anything, significant about our community.

Not only was the business model flawed but so was the underlying commitment to adhere to measurable energy and environmental targets (the Council, unlike what they’ve pushed UNC to do, did not adopt and has no plan to evaluate energy usage, for instance, using ASHRAE or other quantifiable standards).

Of course, I thought that the scale of this development (which you can get a sense of from the site models I created 4 years ago) didn’t fit the human-scale dimensions of our current Downtown. That human-scale is part of Chapel Hill’s ‘brand’ – evidenced by the Town’s own logo – and shouldn’t have been casually tossed without at least a proper attempt to educate our residents and some informed buy-in from the community.

What now?

The Council had many chances to walk away from the project over the last few years as RAM Development missed contractual obligation after obligation. The majority didn’t.

The Council had 2 years to work with local businesses to minimize the impact of the next 2 years of construction. That collaboration just started and already there is some significant friction between the Town and the Franklin St. commercial district.

The public financial burden begins immediately as the environmental remediation begins though the Town’s finances are stretched to the maximum by the majority of this Council’s decision to issue $20+ M in bonds for the Library expansion among others capital improvements. There’s no plan in place to publish those costs as they mount.

Is it too late to do anything? No.

This is OUR project. WE are investing $30-40M in cash and property and have every right to expect that nearby businesses can still function, that questions of public access be finally laid to rest, that every dollar invested by our residents is accounted for and that we have a solid commitment to measuring the success or failure – in terms of tax and parking revenues, energy efficiency, growth of commercial activity – of the project

I did a quick review of my posts on the Lot $5/140 West project and have collected those from 2006 to 2010 below for further background:

Passing Gas

Tuesday, October 7th, 2008

One problem I’ve had in trying to change the way our Town does business is that the issues I’m trying to address – higher energy costs, revenues drying up, development policy that drives diversity from our community, financial instability – haven’t reached a level of concern for the greater community.

I’m a proactive guy, work in an industry that rewards innovation and leading not trailing the pack, so it just makes sense to me to work an issue before it rises to a level requiring crisis management. Trying to raise folks concerns about %10-20 tax increases two or more years before they are implemented is a tough task – doubly so when tricks are used by our elected officials to postpone the inevitable. Trying to prepare folks for the impact of $4/gallon gasoline on the Town’s budget when gas in $2/gallon is a tough sell – doubly so when Council members publicly discount prudent measures in spite of obvious trends.

In any case, I’m just dumb enough to keep trying to work issues prior to a crisis point – it just makes good financial and social sense.

A case in point. I asked former Town Manager Cal Horton 4 years ago for public records documenting fuel use by Chapel Hill’s staff. About the same time, I asked for information on electricity use at each of the Town’s facilities. My idea was to identify specific problem areas, measure policy changes to see how effective our Town’s “green” goals were being met, to look at rewarding staff for impressive reductions in their energy use and basically get prepared for the anticipated increase in energy costs.

This was four years ago when gas was under $2 a gallon.

Four years later, after numerous requests, a new Town Manager, I still haven’t received any of those records. I’m going to make another run at doing that analysis – now in retrospect – to see not only see how we can pare down the cost of operating our Town but to understand if the policies so far adopted have had any direct effect.

Here’s what I asked for Sept. 26, 2005:

3a(10). Will Raymond, regarding Agenda Item #5b, Fuel Supply, Cost and Budget Issues for the Town’s General Municipal Fleet and Transit Bus Fleet.

Mr. Raymond petitioned the Council regarding Agenda Item #5b, Fuel Supply, Cost and Budget Issues for the Town’s General Municipal Fleet and Transit Bus Fleet. He noted he had sent the Council an email regarding the purchase of bio-diesel fuel, and was pleased that shortly after that the Town had purchased 1,000 gallons. Mr. Raymond said that was a “fantastic” first step and hoped the Town would follow up on that, noting that at the present time bio-diesel fuel was 20 to 30 cents a gallon cheaper than diesel or kerosene.

Mr. Raymond said there appeared to be some confusion in the agenda item, noting there had been some discussion that they could burn bio-diesel fuel in their buses, and now they were saying that maybe they could not. So, he said, he had called Detroit Engine that made the engines for the buses, and they were recommending to their customers that a 20 percent blend was “perfectly suitable” for those engines. Mr. Raymond said that Detroit Engine had indicated they would be happy to work with the Town and could possibly get that blend higher. He encouraged the Town to contact them and take that action.

Mr. Raymond also suggested that since they were running at a deficit within the fuel budget that they today start with targeted reductions in the amount of fuel they were using. He said they still have vehicles that idle wastefully, and that yesterday he had observed a Town vehicle left idling for two hours. Mr. Raymond said with the price of gasoline that was unacceptable behavior. He asked that the Council take immediate action to conserve fuel.


Raleigh LEDs the Way

Wednesday, March 21st, 2007

Comparison in life, I guess, is inevitable.

Hey, even if there’s a tiny bit of vanity bragging about Chapel Hill – “look how smart I am to live in the Southern slice of Heaven” – I probably indulge in it as much as anyone else. Folks brag about how progressive, sensitive to civil liberties, environmentally conscious our Town is in spite of examples to the contrary.

For instance, not too long ago Council member Kleinschmidt suggested Wilson and Rocky Mount were not quite up to Chapel Hill standards yet those communities underwrite more than a hundred hands-on arts programs and have built facilities to support the arts in general. On the other hand, progressive Chapel Hill’s one hands-on arts program teeters on the brink of extinction.

Civil liberties? Chapel Hill leads the way much of the time with the occasional incredible lapse.

Environmentally conscious? Many times with, again, some unfortunate glaring exceptions.

Besides noting Council’s leadership faux pas, Jim Ward recently pointed that even the simplest of energy saving efforts – using efficient light fixtures at Town Hall – never get very far.

Raleigh, though, is making a bold commitment to reduce energy and save some bucks in the process

Last week, the City of Raleigh announced a plan to possibly use light emitting diodes (LED’s) to light city streets throughout Raleigh.

Although more expensive initially, compared with regular lights, LED’s last much longer and use much less electricity. According to city, some LED’s may last as much as 20 times longer than regular incandescent lights.

At a city hall news conference on Friday, Mayor Meeker and the CEO of Triangle-based LED maker Cree, Inc. announced a partnership to perform a cost-benefit analysis to possibly replace as many city lights as possible with LED’s.

The city says that the mayor hopes that the “LED City” initiative will serve as a model for other cities that are considering implementing energy-efficient measures.

“The City of Raleigh is willing to set the pace and invite other municipalities to join in developing energy-efficient civic centers,” Cree CEO Swoboda said. “This leading edge effort is undoubtedly an important driver in LED adoption within the United States.”

Raleigh Chronicle, February 19, 2007

I own shares in Cree. That said, they have a great product that, at least I think, will shake up the world one day.

Raleigh Mayor Meeker said that it is “sound fiscal and environmental stewardship” to investigate the application of LED’s “as broadly as possible.”

The analysis on how LED’s can be used will be performed over the next 18 months, says the city.

In his comments, Mayor Meeker said that there may be “substantial potential savings from converting the City’s more than 33,000 streetlights to LEDs.”

According to the city, Raleigh spends more than $4.2 million annually for electricity to power the streetlights and estimates that 30 percent of its energy costs are for lighting.

According to the city, Raleigh electric provider Progress Energy says the floor equipped with LED lights will use over 40 percent less energy than the standard lighting system and will actually provide better lighting.

Raleigh Chronicle, February 19, 2007

Fixing Chapel Hill’s policy of using inefficient, poorly sited, streetlight fixtures kick started my life as a local concerned citizen. Six years ago, and occasionally since, I’ve asked Council to revise our current lighting policies, direct Duke Power to install more efficient fixtures and adopt the standards developed by light pollution experts for the International Dark-Sky Association.

Better, longer lasting lighting that operates much more efficiently at a cheaper cost when amortized over its extended lifetime.

Seems like an easy decision to me. We should take Raleigh’s invitation to participate.

Trash Talk: Waste Not Methane, Want Not Energy

Tuesday, March 13th, 2007

One of the “planks” I ran on for Town Council involved inculcating a conservationist ethic within our local government. Besides practicing energy efficiency (Leather Seated SUVs), I suggested we could start using both energy recovery and decentralized energy production technologies to help make our Town’s operations more sustainable and economical.

One such technology is methane recovery.

To quote EPA (links via LocalEcology’s Terri Buckner):

EPA created the Landfill Methane Outreach Program (LMOP) in 1994 to significantly reduce methane emissions from municipal solid waste (MSW) landfills by encouraging the use of landfill gas (LFG) for energy, which has the added benefit of offsetting the use of fossil fuels such as coal and natural gas. Since the program’s inception, LMOP’s efforts have reduced landfill methane emissions by nearly 21 million metric tons of carbon equivalent (MMTCE). The greenhouse gas reduction benefits are equivalent to having planted 21.2 million acres of forest or removed the annual emissions from 14.9 million vehicles.

EPA is interested in developing LFG energy for many reasons:

  • Projects help destroy methane, a potent heat-trapping gas, and offset the use of non-renewable resources such as coal, natural gas, and oil.
  • There are many cost-effective options for reducing methane emissions while generating energy. (To learn more about the economic feasibility of a LFG energy project, see LFGcost-Web under Documents, Tools, and Resources.)
  • Projects help reduce local air pollution.
  • Projects create jobs, revenues, and cost savings.

Of the 2,300 or so currently operating or recently closed MSW landfills in the United States, about 380 have LFG utilization projects. We estimate that approximately 600 more MSW landfills could turn their gas into energy, producing enough electricity to power over 900,000 homes.

Landfill gas emitted from decomposing garbage is a reliable and renewable fuel option that remains largely untapped at many landfills across the United States, despite its many benefits. Generating energy from LFG creates a number of environmental benefits:

Municipal solid waste landfills are the largest human-generated source of methane emissions in the United States, releasing an estimated 38 MMTCE to the atmosphere in 2004 alone. Given that all landfills generate methane, it makes sense to use the gas for the beneficial purpose of energy generation rather than emitting it to the atmosphere. Methane is a very potent greenhouse gas that is a key contributor to global climate change (over 21 times stronger than CO2). Methane also has a short (10-year) atmospheric life. Because methane is both potent and short-lived, reducing methane emissions from MSW landfills is one of the best ways to achieve a near-term beneficial impact in mitigating global climate change.

It is estimated that a LFG project will capture roughly 60-90% of the methane emitted from the landfill, depending on system design and effectiveness. The captured methane is destroyed (converted to water and the much less potent CO2) when the gas is burned to produce electricity.

Another idea was to use Orange County’s bio-mass waste stream to produce bio-fuels. One of the great thing about attributes of these technologies is that you can start small with pilot projects and build on your success. No million dollar upfront investment required.

Unfortunately, Orange County believes it to be too expensive:

Rod Visser said that this topic has been of interest to the Board for some time in terms of looking into the feasibility of extracting energy from a landfill from methane gas and how might this be used, etc. The staff asked the consulting engineer to provide a brief analysis.
Gayle Wilson said that they looked at three energy recovery options:

• Producing energy either through micro-turbines or internal combustion engines
• Extraction of dirty gas and delivery to a nearby industrial use
• Capturing the gas and processing it to upgrade it and selling it, or putting it into a gas company line

He said that the only two options that the consultant thought were feasible were the high grade BTU pipeline gas or the creation of electricity through micro-turbines or internal combustion engines. He said that the landfill gas recovery process requires a balance of maximizing the amount of electricity produced with the generation ability. The old landfill on the north side is probably not worth pursuing for this. The only one with potential is the new landfill on the south side. The consultants did not seem to believe that there is an economically viable gas energy project. When the staff asked about the new schools planned in the future as well as a new animal shelter, the consultants said that they could do a more focused analysis of providing energy to one or more of those facilities.

The analysis that was done looked at three options and none broke even. Some of the costs were steep and the County would have to invest in a collection system. He said that if the County Commissioners want them to pursue this further, they would need additional information on the facilities and the energy demands.

Commissioner Halkiotis said that it would be nice to explore a micro-turbine providing electricity for the Solid Waste administration building. He would also like to explore this possibility for the schools and the animal shelter.

Chair Jacobs said that there is a critical mass of needs in this area and for them to talk to Steve Scroggs of CHCCS because they are going to operate on a quick timeframe for a new school. He would like to do some additional analyses.

Commissioner Halkiotis said that it might be good to plan on a transfer hookup for a possible micro-turbine machine in design of buildings.

BOCC Minutes, 03/15/2006 [PDF]

But UNC thinks pursuing the idea worthwhile as Commissioner Alice Gordon reported to the BOCC April 4th, 2006:

Commissioner Gordon said that she went to the first Air Quality Advisory Committee meeting and they reviewed how they wanted to reduce greenhouse gases. After the meeting, a representative from UNC spoke to her about the University being interested in purchasing methane gas from the landfill on Eubanks Road. She asked that the County investigate this possibility.

The County’s staff reported back to the BOCC Oct. 24th, 2006 [PDF] explaining the methane recovery options for the Eubanks landfill.

[ Please excuse the formatting, the original is a PDF. I’m looking for the original Powerpoint. ]

a) Landfill Gas Opportunities

Gayle Wilson introduced Bob Sallack of Olver, Inc. Bob Sallack is performing the feasibility analysis for landfill gas and he made a PowerPoint presentation.

Previous Conclusions:
– Based upon current electric rates, the sale of electricity alone will not support development of a Eubanks Road LFG recovery project
– Cogeneration is required to make an LFG recovery project more attractive
o Cogeneration generation of electric power and recovery of waste heat from electric power generation equipment
o Coincident user need for electric power and thermal energy
o Thermal energy (heating)

Microturbine Technology
– Small combustion turbine 25 kW to 400 kW capacity units
– Compact size
– Modular can be brought online quickly
– Less maintenance fewer moving parts
– Multi-fuel flexibility can burn LFG, natural gas, etc.

Cogeneration Opportunities
– Eubanks Road Project
o Solid Waste Operations Center
o Animal Shelter
o Possible Transfer Station
o Auxiliary Site Use
o Elementary School
– Carolina North Project
o Multi Building campus Development (8,251,000 GSF)

Eubanks Road User Energy Demands and Energy Balance graphs

Eubanks Road System Components
– LFG Extraction Wells and Collection System (South Eubanks MSWLF)
– Blower and Flare Station (South Eubanks MSWLF)
– Moisture Removal and Compressor Station (S

Eubanks Road Economic Evaluation

Energy Sales and Avoided Costs $168,100
Energy Production Costs $276,700
Renewable Energy Cost ($108,600)

Eubanks Road Status
– Preliminary Economic Assessment
o Estimated Costs exceed Revenues and Avoided Costs ($108,600)
o Economics Negatively Impacted by Low Thermal Energy Demands of Primary Users

Eubanks Road Key Action Items
– Refine Energy Demands
o Animal Shelter
o School

– Assess Economic Impact of Public/Private Partnership Options
o Maximize Green Power and Energy Credit Benefits

Energy Demand Comparison graph

Carolina North System Components
– LFG Extraction Wells and Collection System (North and South Eubanks MSWLFs)
– Blower and Flare Station (North and South Eubanks MSWLFs)
– Moisture Removal an

Carolina North Energy Summary

Carolina North Economic Evaluation

Energy Sales and Avoided Costs $507,400
Energy Production Costs $506,700
Renewable Energy Cost $0

Carolina North Status
– Preliminary Economic Assessment
o Economically Viable Breakeven given Current Assumptions
o Must Maximize Cogeneration Energy Production and Usage
o Delays in Carolina North Development Timeline

Economic Feasibility Time Dependent Decline in LFG Generation Rates

– Environmental Benefits
o Green Power/Energy Conservation
o LFG Emission Control at Landfills

– Economic Proforma Submitted to University for Review

Carolina North Key Action Items
– Finalize Economic Proforma
– Establish Energy Contract Framework
– Conduct LFG Testing Program
– Finalize Implementation Plan

Renewable Energy Incentives
– Public Sector
o Energy Improvement Loan Program (EILP) – $500,000; 1% Interest; 10-Year Maximum Term
o NC GreenPower Production Incentive RFP Procurement Process; $0.015- 0.019/kWh

Renewable Energy Incentives

– Private Sector
o Renewable Energy Equipment Manufacturer Incentive; 25% of Construction (equal installments over 5 years)
o Renewable Energy Tax Credit; 35% of Construction (equal installments over 5 years); $2,500,000 per installation
o Energy Improvement Loan Program
o NC GreenPower Production Incentive

Chair Jacobs asked if the Chapel Hill operations center was considered and Gayle Wilson said that the infrastructure is already present there, but it could be considered. Bob Sallack said that the only thing that could happen there is the sale of electricity.

Commissioner Carey asked about the timeline for the economic proforma. Bob Sallack said that the University has a proforma, but there is no timeline for feedback yet.

Gayle Wilson said that the County is somewhat at the mercy of the University.
Chair Jacobs said that groups are being put together to study infrastructure the first and second weeks of November. He said that he does not think that building will begin until 2009.

Commissioner Carey asked about the estimated cost of equipment to make this work.
Bob Sallack said that the capital cost for the Eubanks Road project is $2.5 million and for the
Carolina North project is $5 million.

Chair Jacobs asked about the $500,000 and if this was total or annual and it was answered annual for 30 years.

Chair Jacobs said that this is to be taken as information. Gayle Wilson said that the staff would come back with the final report as soon as they get information from the University.

The projections in this preliminary report seem underweighted on the benefit-side and over-weighted on the cost-side. And there’s a few curious omissions, like the Section 45 and Section 29 ($0.009 per kWH) tax federal tax credits and the sale of CO2 as incentives to form a private/public partnership.

Still, a good start to build upon. As the methane fritters away, I hope we don’t have too long of a wait on UNC.



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