Thursday, June 13, 2013

Illinois Agriculture Impact Mitagation Agreements, Damages to the Land, and RICL

Well, I’ve read the Rock Island Clean Line Agriculture impact Mitigation Agreement.  It’s a rather simple agreement.  Personally, I found this one about Future Gen Alliance to be a better agreement.  Even better reading material is the Agriculture Impact Statement required in Wisconsin.  It’s like an Environmental Impact Statement for farmers and great reading on a cold winter night.

Personally, I think utilities should be required to pay the Illinois Department of Agriculture to make a site specific Agriculture Impact Statement for each parcel of property.  List the soil types, productivity levels, erosion possibilities, income producing capabilities, and potential damages for each parcel.  Show the aerial maps and exactly the soils affected.  The utility company should be required to pay the Department of Agriculture to create these studies so it is not an additional burden on the state.    

Regardless, there are a couple loopholes this AIMA that should be discussed.  First, the AIMA must be listed in the Right of Way Agreement.  This is a non-binding agreement.  The binding agreement is the Right of Way Easement that is filed in the courts with your lawyer.  If it’s not listed in the Easement, the company will not follow it. 

The next big loophole is the words “unless the landowner specifies other arrangement that are acceptable to Clean Line”.  Now maybe “Clean” Line hasn’t figured this out yet (they have proven not to be that bright in the ways of right of way negotiations) but often times in the final negotiations of a Right of Way Easement, the utility company will make a cash payments to cover the damages to the property.  After that, it’s up to the landowner to make the repairs to the land.  In this situation, the landowner acts as a general contractor.  The landowner pays the local fertilizer company and pays for a custom operator for a subsoiler to chisel plow the ground.

From past personal experience, accepting the utility company’s money and acting as a general contractor is a mistake.  It’s not worth the headache to accept the responsibility.  When negotiating a right of way agreement, I’ve learned it’s better to dictate to the utility company exactly who will do the repairs and how they will be conducted.   

When an Illinois power company came through our pasture with a powerline a couple years ago, we stipulated the landscape company who will install the temporary electric fence and make the repairs to the fences when the project is complete.  In this instance, up to a certain amount would be allocated to the landscape contractor, perhaps $7,500.  This worked out very well.  We chose the landscape company to do the repairs and the repairs were done to our satisfaction.

Years earlier when the first pipelines came through, Dad had the pipeline company install the temporary fence and make repairs.  However they hired, did not know how to make a good fence.  The cheapest material possible was used.  Thin fence wire was used and it was constantly breaking while the project was on going.  The cheapest steel posts were also used.  Letting the utility company chose the contractors for agriculture matters was nothing but a headache.

I cannot over emphasize the importance of choosing your own contractors to make the repairs and forcing the utility company to pay them directly through the ROW easement agreement.  Do not get into the position where you are the general contractor for field repairs. 

This also protects the interest of the farmer when absentee landowners are involved.  Many absentee landowners are not in the best position to supervise the repairs to the land and act as a general contractor in such matters.  It’s better to consult the tenant and choose the fertilizer applicator and custom operator to make the repairs. 

If RICL comes through my aunt’s field, I would advise to list the local cooperative who will make the fertilizer improvements, the custom tillage operator to do the subsoil chisel plowing, and also list the local drainage tile installer.  Keep in mind the Agriculture Impact Mitigation Agreement specifies removing compaction to 18 inches.  Running a subsoiler that deep over many fields will likely tear out drainage tile that would otherwise not be damaged. 

There are several clay and plastic tiles 16 to 20 inches deep that won’t be disturbed by the monopoles or compaction from the cement trucks, but the tillage necessary to remove the compaction will likely damage several tiles.  This damage won’t be found immediately.

Page 7 of the FutureGen AIMA does a much better job describing who and what will be done to repair damaged tile with Point #3.  Point #4 on page 8 is also a good idea to list in a ROW agreement.     

“The company shall be responsible for installing such additional drainage measures, including additional tile lines, as necessary to properly drain wet areas on the permanent and temporary easements caused by construction equipment and/or the existence of the powerline.”

Seriously, damage to tile is not going to be known immediately.  Damage will more likely be cause by the ripping with a subsoiler than the installation of the monopole towers.  In a ROW easement agreement, make sure to protect yourself for damages found after the contractor is back home in Nebraska.

Chisel plowing with a subsoiler is another issue that should be specified in a ROW easement agreement.  It requires serious horsepower to run a subsoiler 18 inches deep.  As farmers, you know who to contract this out to much better than a utility company, and besides, it’s your land.  Chose the custom operator.  Chisel plowing with a subsoiler that deep is going to require multiple passes over two or three years.  List the custom operator who will do the subsoiling and force the utility company to pay them directly. 

 The utility company is not going to disagree to this.  They are not going to like it, but as my past experience with the fences in the pasture, they will go along with it.  They will agree to get the deal done.  While it’s in the utility company’s interest to get a powerline built and move on to operation, no utility company is willing to go to court over eminent domain for such trivial matters.

Speaking of Right of Ways, it’s my understanding the purchase of a ROW must include, not just damages to the 200 foot wide ROW, but payment for damages to the loss of value for the entire property.  If a Right of Way goes through a 200 acre property, the utility company needs to pay damages on the loss of property value for the entire 200 acres and not just damages to property value to the 4.5 acres of right of way.    Clean Line’s offer of $8,500 dollars per acre of ROW is a joke. 

I wonder if Clean Line knows they have to pay for damages to the entire property’s value and doesn’t want to admit it, or are they just that stupid.  The line between deceitful and foolishly naïve is often blurred.  They act like this is their first attempt to a Right of Way purchase in Illinois.  Actually it is Clean Line Energy’s first ROW purchase, and they are in way over their heads.

The opinions above are that of one individual. Ultimately it is best to hire a lawyer negotiate a Right of Way Easement. Do not attempt to negotiate yourself with a utility company. List above are suggestions on how to handle matters of damages to the land. Matters of Right of Way negotiations are done with real public utilities recognized by the state. To date, "Clean" Line Energy is not a real public utility recognized by the state of Illinois. Therefore, the commentary above should not be considered an approval of the company or an expectation the state will consider the company a public utility. The commentary above is only states as the timeliness of the subject matter considering AIMA's.  It is the opinion and hope of the author that Rock Island Clean Line or any other subsidiary of Clean Line Energy Partners NOT be considered a public utility in Illinois. 


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