Bay Journal, Plan outlines strategy to pay for Conowingo cleanup
The Conowingo financing strategy calls for creating an independent financing authority that would receive funds and invest them in ways that would both accelerate the cleanup and reduce the cost.
The lynchpin of the strategy, completed in December, would be a pledge from Bay watershed states to fund the cleanup effort, which is expected to cost in excess of $53 million a year. But that’s something states in the Bay watershed have not committed to doing.
“One key issue is that a public commitment to investment is paramount, [their emphasis]” the financing strategy said. “The entire Conowingo … financing process is predicated on the responsibility of the public sector in general and the Bay states in particular to fund restoration activities.”
The strategy, prepared by the University of Maryland Center for Global Sustainability, says the proposed financing authority could leverage private funding, issue bonds to accelerate the cleanup and invest in innovative pollution control techniques.
But no one will buy bonds or make other cleanup-related investments unless the states will pay them back, said Daniel Nees, a senior fellow at the center and the lead author of the financing strategy.
“The obvious issue here is the states guaranteeing that they’re going to engage,” Nees said. “Everything else is kind of background after that.”
It’s unclear whether states are willing to pay to resolve the problem created by the 94-foot-high dam.
I really ain't seeing it. Everybody wants someone else to pay the bill. Or at least take out huge loans (as bonds) in hope of forcing someone else to pay it off after they're out of office.
The financing strategy suggests the proposed authority would be a catalyst to incentivize new technologies and market-based pollution control mechanisms that could accomplish the cleanup at less cost. For instance, it could promote pay-for-performance projects that would encourage the private sector to implement pollution control efforts, such as stream restoration, and then repay them for actual nutrient reductions — something that could produce more results at less cost than traditional grants or farm cost-share projects. The authority could also borrow money to speed implementation.
But the strategy emphasizes that investors need a financial commitment from the states to ensure they will be paid back.
The plan anticipates all states in the watershed would pay into the authority, though it would primarily fund projects in Pennsylvania, where they are the most cost-effective. States committed to jointly fund development of the plans but made no commitment to fund them.
When work on the plans began, the states expected that a settlement between Maryland and Exelon — the utility that owns the dam — would generate tens of millions of dollars a year for the work. The utility needs approval from the state before it can get a new federal license to continue operating the hydroelectric dam.
But last year, the state and Exelon struck a deal that committed just $19 million over the 50-year lifespan of the license for that purpose.
I've never understood the value of having the owners of the dam, which has protected the Bay for almost a century, be charged for the privilege.