County Commissioner Kevin Stufflebean has stated the reorganization of the Coos County Road Department was done to increase department efficiency and the accompanying 22 layoffs were in anticipation of projected budget shortfalls for the upcoming fiscal year. The reorganization was also stated to allow for $1M a year for asphalt and to build a reserve for Federal Highway Administration (FHA) and FEMA matching fund grants. Tuesday, during a special meeting with Oregon Resources Corporation (ORC) and the Board of Commissioners set to work out a deal on mineral leases, a new reason was given.
Commissioner Stufflebean, speaking to representatives from ORC, South Coast Development Council and the Ko Kwel said,
“…there’s been quite a hype about some of the restructuring we’ve done in the road department. One of the reasons it was essential we do some of those is everybody who has read the URS report that was provided by Oregon Resources Corporation, Coos County needed to make a $450,000 investment of their share just to deal with maintenance of the road department itself on W Beaver Hill. With the changes we made that was factored into that. We will now have the money to actually make that investment. “
The URS Pavement Analysis Report, funded by ORC, concludes the 4.7 miles of W Beaver Hill Road required for mining operations will require a 1-inch asphalt overlay within one year to meet ODOT standards at a cost of $450K. The conclusion is based upon existing, non-mining traffic only and is projected to extend the life of the road 10 years. The report further states “…a 4-inch overlay is required to support the future mining traffic over the 10-year operation.â€
According to the report existing traffic will exceed the remaining life of the pavement within a year but “…is not anticipated to fail the pavement section†if no overlay is done. The report defines ‘failure’ as a “complete rebuild, including removal of the old asphalt†and would cost an estimated $2.75M. A question to Stufflebean regarding how many other county roads might be in the same condition was not answered by press time.
ORC originally proposed to lease 2,000 acres for chromite mining. Tuesday the company proposed an additional 6,000 acres for exploratory testing and projected that the future revenue to the County via mineral leases might reach $1.7M annually. The money would be paid into the forest fund and would be available to the County general fund.
According to Stufflebean the improvement costs “would come from a variation of either capital improvements and/or asphalt also there is a chance we could use STP funds†from the Road Department operating budget. He says it is unlikely any money from the County general fund will be transferred back to the Road Department.
It is unclear if the upgrades on W Beaver Hill Road will have an impact upon the build up of matching grant funds for FHA and FEMA. It is also not known if the prior Board of Commissioners that included Nikki Whitty and John Griffith already approved the upgrades to W Beaver Hill Road.
ORC promises up to 75 new family wage jobs when operating at full capacity. The company has been unavailable to answer when these jobs might begin.
Acknowledging the Road Department no longer had qualified staff to lay $1M of asphalt, Stufflebean told the meeting,
“ …We are moving forward with the new roadmaster, John Rowe, down here [pointing to Rowe], we are going to be bringing in a consultant to train and cross train staff on paving. That was one of the things that we definitely knew that we had to do but we also know that we needed the money to make that initial investment of the county’s fair share of W Beaver Hill too.â€
The mineral lease negotiations propose ORC pay the County $333K to offset road upgrades for each of the next three years and $125K a year thereafter. The payments will go into a special dedicated fund to only maintain the 4.7 miles of W Beaver Hill Road.
Speaking of the reorganization Stufflebean said,
“…we dealt with those. Those restructuring portions have been done. We anticipate that as early as June we can start making the $450,000 investment we need to make into W Beaver Hill. Because one of the reasons we did that we strongly believe in Oregon Resource Corporation and too we wanted to make sure that we were able to meet the commitments that Coos County needed to make on this project as well. And uh, so we know now that we can make those commitments and keep the development moving forward also.â€
Stufflebean projected ORC would begin making payments June 2009. Dan Smith of ORC stated permitting and other issues would delay the company contributing to road maintenance until at least June 2010. Stufflebean replied,
“If you’re not going to do that this year, we still need to make our investment and be ready for it because if we don’t the reality is if we don’t spend it this year on that road its going to get spent somewhere else.â€
The Teamsters Union filed an Unfair Labor Practice (ULP) complaint with the Employment Relations Board on behalf of road workers. If the ULP amounting to more than $650K in damages prevails, the ‘somewhere else’ may be to the 22 road workers sacrificed to fund improvements on W Beaver Hill Road.
When asked his opinion of the County laying off 22 people to fund improvements for ORC, Chief Operating Officer Dan Smith answered, “It’s a business,†and then added he did not know enough about the layoffs to have an opinion.
At a meeting of the Chamber of Commerce Transportation Committee, Thursday, Stufflebean fell back to his original explanation for the reorganization. Budget constraints, he said, do not justify maintaining a seasonal paving crew year round or keeping a ‘tire man’ solely to change tires.
According to former road workers the paving crew were already ‘cross trained’ and performed many other functions including grading and excavating when not laying asphalt. The tire man, Adam Wideman, didn’t just change tires but also maintained brakes and suspension on all county vehicles, not just road department vehicles and had a backlog when laid off. Former paving crew worker Danny Pearce said, “Everyone working there did multiple jobs.â€
The public meeting was December 16, 2008. However, it was not clear to anyone attending that meeting, nor is it clear listening to the tape of the meeting that any layoffs are imminent in the Road Dept. At no time is ORC mentioned with respect to the Road Dept in a public meeting before February 3, well after the fact.
Yes, to this point its been before the planning depart. I don’t know what the commissioners had to approve, other than what the planning depart. sent to them. What is before us now, is, I’m am not sure? ORC wants something from the Commissioners. Jacki sent them something in Nov. 08. They have yet to respond, but may have sense 2/03/09. Jacki is putting that together so she can brief the commissioners about it on 2/18/09. Then a work session on 2/24/09? Question, is, 2/18 and 2/24/09 public or executive sessions. When were the public meeting held that caused the reorganization of the road depart. so their shift in financial resources could be arranged to support a company doing mining in Coos County?
According to an email from Kevin Stufflebean there were public hearings with extensive debate on the ORC matter.
From Stufflebean: “The board has not voted on this issue. I would encourage you to talk to Patty or Jacki as this is part of a land use issue, and their was several public hearings and public input on this issue. The issue might come back to the board if the project is contracted out, and that has not been determined, as a project of this magnitude would typically be contracted out, but it will also depend upon the funding stream if we get any money from other sources. But this is a land use issue, and not just a road project.”
My understanding, which is about none, on this subject, the county is selling the rights to drill, lease, with option, to do what? There must be some compensation for messing up the back yard to see if there is enough mineral content to market, a beer or something. “county has given mineral leases 5, 6 or even 7 times in the last 25 years” Just gave them away. Whom, has ask or made a condition, for the county to put asphalt down for their trucks? What is wrong with a lottery, economic development grant, good cause, Whitti is good at getting them. We got gas. It does no sence to cut off a leg, to have funds to buy a new shoe for the one foot. I think consensus is about as worst as it might be. That is like being in the same page. What I ment, at least read the same page, before they go to a meeting about the page.
Having the commissioners on the same page may not really be in the best interests of the county, depending upon which page they are reading from. However, obtaining a consensus of opinion based upon factual data and reasoned analysis would be a complete breath of fresh air.
The URS report indicates the pavement will not fail if traffic exceeds the 5900 ESALS projected for the life of the 4.7 miles. It merely says the road life will be extended an additional 10 years by putting down a 1″ overlay. Yet the county is being asked to invest almost one half of its ‘asphalt’ budget on one short stretch of road out of 600 miles of county byways.
As I understand, the county has given mineral leases 5, 6 or even 7 times in the last 25 years, once before from ORC, and never, not once, received a dime in royalties. So it is a huge gamble to risk the safety of the public by sacrificing most of the road crew to fund ORC over the needs of other county roads and jeopardize the county forests without any commitment as to when ORC will pay for road maintenance, create jobs or begin paying on mineral leases contingent upon conditions in the world market.
Stufflebean projected ORC would begin making payments June 2009. Dan Smith of ORC stated permitting and other issues would delay the company contributing to road maintenance until at least June 2010. Stufflebean replied,†Oh, something like were going to spend it anyway, on something? The meeting between Oregon Resources Corp. and South Coast Development Concil and the Coos County Commissioners was held on 2/3/2009, 10 am.
It’s all about timing:
It will take 2 years to explore, 8 years to work out the plan, and then somewhere in there is the land use permit process
ORC is not ready to pay the County their portion of the beaver hill road project. It will be Feb. or 2nd quarter 2010, or more before they start construction of the plant. and an 8 to 10 month construction period puts them into 2011-12.
Timing is bad now for ORC to contribute to the roads, in fact not this year. They are considering that won’t happen until 6 months after production begins, and or 6 months after all the permitting. They cannot control the permitting. Bob Main thought that would be after 2011, Nikki Whitty did not think Kevin Stuffebean was expecting the payment to start this June 09.
You can see how all three commissioners are on a different page, and they are going to SPEED, through the process of signing away mining leasing rights, with options, to ORC by 2/24/2009 with little to none public meetings. The scheduled meeting for 2/24/2009 at 10 am is for a finalization of the agreement, possibly with signing. The County will be pressured by South Coast Development Council and OCR to complete the contracts as soon as possible, so the jobs can flow in, and the ore can flow out. Nikki is expecting a briefing on 2/18/09 from council as to the terms of the contracts. Wouldn’t one think that council would be receiving the briefing from the commissioners?
So, as described by ORC, the first pilings for the plant will go in in February 2010, or maybe as late as May or June, 2010. Construction time is 8 to 10 months. Then, after 6 months of production or all the permitting completed, they will consider funding, if and as agreed upon the amount Kevin wants for the roads. Kevin wants to put money in reserve or into the road now, and wants ORC to start paying their share now. They are, I guess, are not required to, and are not going to spend money for our roads they are not using.
What is that time line. Construction starts, May/June 2010. 10 months plant construction completion. March 2011. A variable Production starts, six months, October 2011 the county could see some money for the roads. Another variable, not all permits competed, six months pass, waiting holding pattern. How much money will the county be receiving for the exploration, mining, leases, with options, in that meeting on 2/24/2009?
Nikki does not think they should pay, they don’t have their permits or building up. Kevin thinks the County should make its $450,000 investment now on the road in —-hill. or it will get spent somewhere else. Nikki, “put in dedicated fund.â€
OK, what ever? I would say getting on the same page will be a good start.
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