Salt Lake Tribune: ‘Utah’s Coal-Export Deal Still Faces High Hurdles’

first_imgSalt Lake Tribune: ‘Utah’s Coal-Export Deal Still Faces High Hurdles’ FacebookTwitterLinkedInEmailPrint分享The Utah Legislature last week approved a $53 million investment in an Oakland, Calif., export terminal, but the state’s coal-shipping aspirations may still be just a dream.So far, Utah is the only entity that may pledge money toward building a $275 million bulk-freight terminal at the deep-water port under construction at the site of the former Oakland Army Base.But Utah wouldn’t pay up until $200 million in private financing is secured — and the identity of those investors and the status of their contributions is unknown.Another hurdle: Utah’s money wouldn’t be released until the four rural Utah counties borrowing it for the investment have a plan to pay it back if the terminal can’t move coal profitably. No plan has been offered.The coal-producing Utah counties of Carbon, Sevier, Sanpete and Emery initially secured a loan from Utah’s Permanent Community Impact Fund to invest $50 million in the proposed terminal, in exchange for 49 percent of its 9.5-million-metric-ton loading capacity.However, the Utah Attorney General’s Office apparently declined to sign off on the loan, necessitating last week’s passage of SB246 as a legal workaround.Normally, money from the fund — derived from federal mineral royalties — is spent on civic projects in the counties where mining and drilling occur. But in recent years, county commissioners who run the Community Impact Board (CIB) have become interested in funding grander projects that would deliver commodities to market.SB246, which Gov. Gary Herbert is expected to sign, circumvented limits on how counties may spend revenues from the fund. It cycles community impact revenue — critics call it “laundering” — through the state Transportation Fund and back to the CIB in a new pool of money known as the “Throughput Infrastructure Fund,” which also can be tapped to build transmission lines, pipelines and rail.When the CIB first approved the loan in April 2015, it included an additional $3 million to cover administrative costs — such as paying consultants like Jeff Holt, a former Utah Transportation Commission chairman who brokered the deal between the counties and the CIB.The CIB’s approval was premised on Holt’s claim that the $200 million in private financing needed to build the Oakland Bulk and Oversized Terminal would be secured by June 2015.“This benchmark has been missed. That means the only player in this transaction with an open checkbook and a deep pocket is the state of Utah,” said critic Tom Sanzillo, director of finance for the Institute of Energy Economics and Financial Analysis.Full article: Utah’s coal-export deal still faces high hurdleslast_img

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