SLO County supervisors, San Luis Coastal school district approve PG&E settlement
Both the San Luis Coastal Unified School District and the San Luis Obispo County Board of Supervisors have approved PG&E’s proposed $85 million settlement to help the county cope with the economic loss when Diablo Canyon nuclear power plant closes in 2025.
That leaves a coalition of six cities — Arroyo Grande, Atascadero, Morro Bay, Paso Robles, Pismo Beach and San Luis Obispo — that still needs to approve their portion of the proposal before it can go before the California Public Utilities Commission. City councils are expected to review the settlement later this month.
The San Luis Coastal Unified School District Board of Trustees unanimously approved the proposal during a closed-session meeting Tuesday.
“(PG&E’s) conversations with the schools were earnest, collaborative, and this is a good result,” board President Marilyn Rodger said after the announcement. “The agreement is a fair way to mitigate some of the economic impacts. The agreement provides some certainty about our funding for the next nine years, and the establishment of the foundation also gives us a jumpstart in finding ways to generate revenue after Diablo’s closure.”
The county Board of Supervisors also received an update on the proposal at its meeting Tuesday, after previously approving it in closed session in November.
“This was a joint collaborative effort between the cities, the county and PG&E, and I appreciate that,” 4th district Supervisor Lynn Compton said after the update. “It is still a sad day when our No. 1 employer, our No. 1 tax contributor is going to close in the future, and we see it happening. And it does concern me what happens to the economy of this county.”
The proposal allocates $75 million to local agencies to make up for the loss of property taxes as the plant shuts down, plus $10 million to an economic development fund that would help encourage job creation in the county.
It also promises funding for emergency management services throughout the decommissioning process, something that is expected to take 15 to 25 years. Depending on its length, this could net the county another $37.5 million to $62.5 million.
That brings the entire settlement package to between $122.5 million and $147.5 million.
The settlement package comes after the county, school district and a coalition of cities protested the original $49.5 million PG&E promised in support when it announced the closure in June, saying it did not adequately consider the potential $1 billion annual impact on San Luis Obispo County’s economy.
The largest portion of the new agreement will go toward making up for lost property taxes. Of that, San Luis Coastal would get about $36.8 million over the next nine years until the plant closes in 2025. It plans to put $2 million a year for the first five years into an endowment fund to help offset revenue losses after the plant closes.
The county would receive about $28 million over that same nine-year span.
The new $10 million in economic development funds could be used to encourage local companies to expand or recruit businesses to San Luis Obispo County, helping to at least partially fill the anticipated hole in the economy once the power plant closes. Officials are especially concerned because of the plant’s head-of-household jobs; in 2014, the Diablo Canyon paid about 1,500 employees an average annual salary of $157,000.
The economic development funds will be distributed among the county and the coalition of cities; another $400,000 will be dedicated to a study into economic response strategies. Of the county’s amount, $192,000 will be allocated to the city of Grover Beach (the only city in the county that chose not to participate in the coalition of cities).
The proposal doesn’t address whether the plant could be utilized for water desalination after its closure; PG&E continues to say that is infeasible, though the county has said it will continue to push for that option in future discussions.
Once approved by local groups, the proposal will still be subject to approval by the California Public Utilities Commission as a modification to PG&E’s application to close the nuclear power plant. The CPUC is expected to consider the utility’s entire application in mid-2017.
Kaytlyn Leslie: 805-781-7928, @kaytyleslie
What you need to know about the settlement
- $75 million would go to offset property tax losses by the school district, county and 69 other special districts.
- $10 million would go for economic development efforts in the county and cities. It will be divided into three parts: a $400,000 study to evaluate strategies; $5.76 million to the coalition of cities; and $3.84 million to the county, which will share part of that with Grover Beach.
- Between $37.5 million and $62.5 million would go toward local emergency planning efforts until all spent fuel is in dry cask storage and the two nuclear reactors are fully decommissioned.
- PG&E will make no decisions on reuse or sale of the land surrounding the plant, including Wild Cherry Canyon, until it has completed a decommissioning plan with input from the community.
- Negotiations can reopen after the release of an economic impact report required by a state bill authored by Sen. Bill Monning, D-Monterey, and outgoing Assemblyman Katcho Achadjian.
- Ratepayers will foot the cost of the entire deal.
This story was originally published December 6, 2016 at 7:36 PM with the headline "SLO County supervisors, San Luis Coastal school district approve PG&E settlement."