20070812 Ver 2_Independent Weekly_20091118

I
THE TRIANGLE'S WEEKLY
WWWANDYWEE
ii.i8.og
Q U E E R I E S
What's a bi guy to do?
5'd sT VEN P FROW
Q: My favorite restaurants haven't
z' changed suite I became bisexual and
stopped seeing men exclusively, but eating
at those places is a lot less fun. Gay guys
around my neighborhood look at me funny
when I'm out with a woman. Please don't
tell me moving away from my beloved San
Francisco is the only
{ &WPM way to be comfortable in
public agaun.
A: No, but you may
need to stop going to
j, all-gay restaurants (and
by that I mean eateries
frequented primarily by
iLL same-sex couples). As
much as homophobia is
a problem in this coun-
try, along the same lines (OK, not as much)
there are strains of heterophobia in the LGBT
community. Never heard of homophobia's
first cousin, heterophobia? It's a term used
to describe irrational fear of, aversion to or
discrimination against heterosexuals. If you
and your girlfriend are the only opposite-sex
pair in a restaurant or dub, not only will you
appear as outsiders, but in some way you
may be perceived as social trespassers or just
made to feel unwelcome.
Years ago,1 went into a gay club in New
York with it straight woman friend. When I
ordered, the bartender, instead of serving us,
actually asked us to leave. Even when I told
him that 1 was gay, he reiterated his request.
Times have changed somewhat, and our
communities tend to mix more comfortably
now. But my point is that heterophobia is
gayandlesbianmanners. cone Admmlb? as misplaced as homophobia, if less was in creating change. Since you're
Steven Petrow writes regularlyfor
The Huffington Post and is the author
ofThe Essential Book of Gay Manners
& Etiquette. Visit him online at www,

prevalent and without such serious the go-to guy for manners, I'm
consequences. wondering if you have any thoughts
about one's social obligations
W O V/ W It A T'S A S T R .A I G H T regarding political protest and dissent.
GUY TO DO? Because I'm ready.
Q: As the only straight person invited A: First, let me say that you're not alone
to my friend's weekend house, will I be
gay in feeling outrage at what happened at the

uncomfortable or out of place? [ think polls; for the second November in a row

said there would be about four other guys (Californians revoked the rights of LGBT
there. people to marry)ust a year ago). Many activ-
A: if your gay friend did any thinking ists in our community are styrrued by these
(which we all do), he would have factored results, in part because of the overwhelm-
this into his invitation before doing so. Since ing influence and dollars from the Catholic
the first rule of being a good host is to make Church and, in this latest voting, from the
your guests feel comfortable, my guess is that National Organization for Marriage.
he dibiks you will be. And that he imagines A former ACT UP leader recently told
"
his other friends will be, too. (Or do you me,
Civil disobedience is the missing piece
imagine they'll all be lusting after you?) of activism in our portfolio these days." And
Consider this: While sexual identity he should know, as one who protested vehe-
is important for many LGBT people, it's mently against drug companies when they
rarely our only defining characteristic. were price-gouging patients with HIV/ AIDS
We have gender, age, profession, religion, here and overseas during the '30s and '90s.
education and so on, as part of that great But the truth is that the very nature of
cocktail called "me" Certainly, you'll share civil disobedience is its high code of con-
something with these fellows, even if sexual duct, as per the 1849 essay by Henry David
orientation is not one of them. What you Thoreau that is now commonly called "Civil
"
need to bring is a good attitude, and your Disobedience
but was originally titled
"
"
host needs to provide a welcome environ- Resistance to Government.
Indeed, break-
ment for all. big the law for a noble cause, while illegal,
is not inunor.tl, unethical or bad manners.
IS C. I V t 1. 0150 B E D i E N C E BAD What is problematic is violence of any kind
M A N tJ F R a 1 (such as the murder of that abortion doctor
uh Kansas earlier this year by an an ti-abor-
Q: After the recent election in Maine, tion activist), as well as attempts to curb free
where 53 percent of voters revoked die speech (like the Catholic Church does, along
right of gays and lesbians to marry, I've got with the Rush Limbaughs of the world).
to say I'm tired of these postelection blues. What is important about civil disobe-
I'm tired of our right to marry being an dience is that it's an opportunity to pres-
electoral issue. I'm tired of the tyranny of ent arguments and persuade people who
the majority. I'm just plain over it. I'm old disagree with you that you're right, in this
enough to remember the civil disobedience case, on the right of LGBT people to marry.
that ACT UP staged during the height of the Sometimes it takes actions like this to "help"
HIV/ AIDS epiderruc and how effective that others hear and understand. MR
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)NTENI NEWSLVIEWS i RSTORY CULTURE CLASSIFIEDS WEDNESDAY. NOVEMBER 1B, 2009 15
i
Give back the
Yadkin, dam it
from above High Rock Mountain to just below
the Narrows, the Yadkin falls almost 400 feet in
elevation, further concentrating its power.
"The Yadkin is enormous;' says Dean
Naujoks, the Yadkin Riverkeeper. "It is unbe-
lievable what a resource it is, and nobody's
ever paid much attention to it. I call it the
forgotten river."
The reason it's forgotten is that the Yadkin's
power-the power of its falling water-was tied
up almost a century ago by Alcoa, then called
the Aluminum Company of America. Alcoa
built three dams in the early 20th century, and a
fourth in 1962, and used them to generate elec-
tricity for a massive aluminum smelting plant
in the little Stvily County town of Badin.
The Yadkin's power, Alcoa's critics say, could
have been used to supply electricity to 170,000
homes or to small manufacturers that might've
come to the area if Alcoa's smelter hadn't.
Instead, all the power went to a single plant that
once employed about a thousand workers but
recently had a workforce of lust 400 to 500.
And today, even that one plant sits empty:
Alcoa dosed it in 2007 ("curtailed it;' the com-
pany says), sending its jobs to newer facilities
abroad. Indeed, the name Alcoa is no longer an
acronym for an American company. It i< instead
The Yadkin, the state's second largest river (only the Cape
Fear is bigger), is a gentle giant as it traverses the northwest
foothills from Wilkesboro to Elkin to Pilot Mountain State
Salisbury, gathering size and force from its various tributaries
until, passing the Uwharrie mountain range, ill's squeezed
L from 1,000 feet wide to less than 100 feet in the gorge
known as "the Narrows." Over a 38-mile stretch
a global brand for a firm that makes alunnum
in Iceland, Brazil or wherever it's most efficient
to do so. But not in North Carolina.
Nonetheless, Alcoa retains control of the
Yadkin and is seeking a 50-year renewal of its
operating license, which expired last year. With
its smelter shut down, it sells the electricity to
wholesalers or "the grid" Most of the power ends
up in other states, the company reports. The
revenues, minus payroll for a skeletal workforce
of about three dozen to North Carolina, belong
to an Alcoa power subsidiary based in Tennessee.
The profits are distributed worldwide.
Stanly County's leaders think there's some-
thing wrong with that picture. They want the
Yadkin, a pubhc resource, to work for the region,
riot Alcoa. Over the last year, they've persuaded
top state officials, including Gov. Bev Perdue,
that Alcoa should go.
A key :illy in their battle is Keith Crisco, who
owned a manufacturing business in Asheboro
and was a leader in the anti-Alcoa movement
before Perdue appointed him secretary of com-
merce this year. Now Crisco heads up the state's
campaign to block Alcoas relicensing, saying
16 1INDEPENDEUT I DiC TRIANGLE'S WEEKLY I WEDNESDAY, NOVEMBER 18, 2009
Top: Yadkin Riverkeeper Dean Naujoks, on a boat at Badin Lake, is among Alcoa's biggest critics.
Bottom: Alcoa mothballed the giant smelting plant in Badin two years ago, but it continues to
run four hydroelectric dams on the Yadkin under a federal license that may not be renewed.
by L, AN [r 3-
the company has stiffed the local economy and
dragged its feet on er ironmental issues.
"Not only does APGI [the Alcoa subsidiary]
not offer the benefits that v ere a quid pro quo
for the state's support of its initial license;' Crisco
says in the Perdue administration's 21st Century
Plan for the Yadkin, "but it produces harm in
that it does virtually nothing to address the water
quality needs or the economic or recreational
needs of the region."
"It's almost as if it's Venezuela," Alcoa spokes-
man Kevin Lowery retorts. The company main-
tains that the license is Alcoa's property, and the
state's effort to take it is akin to President Hugo
Chavez nationalizing his country's oil industry.
Yadkin Riverkeeper Naujoks is on Stanly
County's side. He accuses Alcoa of exploiting the
Yadkin for profit while leaving the region with
"a toxic legacy" of cancer-causing PCBs-poly-
chlorinated biphenyls-and other contaminants
from the smelter. The extent of the damage is
not yet understood, he maintains, because nei-
ther Alcoa nor state environmental regulators
have thoroughly investigated it.
Naujoks likens the situation in Badin to the
investigation of PCB pollution in Wake County's
Crabtree Creek, with which he was involved when
he was the Upper Neuse Riverkeeper. Those con-
taminants originated miles away, at the old Ward
Transformer plant. "Once they started digging,
they just kept finding more and more problems
farther and farther out;' Naujoks says.
On a damp October day, Naujoks has come to
Badin for a ride on Jimmy Dick's pontoon boat
and to help him make the case against relicens-
mg Alcoa. Dick, a university professor who grew
up near Badin and returned after his retirement,
is a more vociferous critic of Alcoa than even
Naujoks. He vies for the title of biggest Alcoa critic
with his brother, Roger Dick, president of a com-
munity bank company and the force behind the
anti-Alcoa campaign, who thinks the Yadkin is
worth billions to the local economy as a source of
cheap hydroelectric power, and even more to the
state as a future source of drinking water.
Steering his boat on Badin Lake in front of
the hulloing smelter, Jimmy Dick recounts how
in 1958, when Alcoa last came up for license
renewal, the company argued that it needed the
maximum allowable term of 50 years to ensure it
could recoup its planned investments in a fourth
dam and in doubling the smelter's capacity. In
a legal brief, the company noted that the license
was subtect to "recapture" when it expired, at
which point "the management of Carolina
Aluminum could not rely on any assured source
of power" for the plant.
The point, Jimmy Dick says angrily, is that
Alcoa knew half a century ago that its license`
which he terms a contract, not "property"-was
for a limited time. Alcoa also knew that it could
make big bucks in Badui before the contract was
up. But now, as local leaders try to reclaim the
license, he says, Alcoa acts like it owns the river
and should be allowed to stay there forever.
A f4 it the pollution issues, Dick worked at the
plant when he was young, as did his father and
grandfather. Everyone saw the dumping, only no
one knew of the environmental consequences
Regardless of the pollution, he says, if the plant
were still operating, "no one would be challenging
CONTENTS NEWSB V;' COVERSTORY
the license'" But when Alcoa gave up on the plant,
Dick says, it gave up its rights on the river.
"It was a contract," Dick shouts over the wind
and his pontoon's engine "They got their W
years with our public resource, and the benefit
to the public was the jobs. But now the jobs are
gone, and the contract's finished, and we want
our resource back. So, Alcoa, get the hell out."
f it sounds like Alcoa's doue for, however, it
isn't. Because under the Federal Power Act,
the decision about who controls the Yadkin
isn't up to the state but the five-member Federal
Energy Regulatory Commission (FERC) in
Washington. And ultimately, it's up to Congress.
According to a FERC spokesman, not once
since the act becarne law in 1920 has the com-
mission done what the state is asking it to do:
reject a license holder's renewal application while
also recommending-as the law requires-that
Congress pass a bill to allow FERC to award the
license to someone else-in this case, a state
water authority that doesn't exist yet.
Recapture, as this process is called, is a cumber-
some process. Deliberately so, historians say, since
many in the 1920 Congress wanted to bestow
control of the nations rivers to private companies,
with no strings attached. Still, recapture is in the
law to assure that the license holder, among all
contenders, is best able to achieve a rivers various
"beneficial public uses."
Crisco argues that recapture is justified in
Alcoa's case. In a Sept. 8 filing to FERC, he says
the state doesn't relish fighting with a major
corporation and remains "business-friendly." But
Alcoa's "failure to contribute in any manner to
the economic health and well-being of North
Carolina" leaves the state no choice but to step
in and try to redirect the profits from the Yadkin
to the region's economic development and water
quality needs.
In a heated response filed with FERC Oct.
9, Alcoa's Washington lawyer called the Perdue
administration's challenge "an amalgamation of
factual misstatements and legal arguments that
are inventive in the extreme.'
70

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High Rack
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HIGH ROCK DAVIDSON
ROWAN DAM COUNTY
COUNTY

YADKIN RIVE R
49
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Tuckertown
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TUCKERTOWN MONTGOMERY
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COUNTY
DAM
CABARRUS O
COUNTY
52 Uwharrie
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Uwhame
740

STANLY River

COUNTY ALCOA PLANT BADIN DAM
Badin =
Falls Reserv
i
o
r
52 FALLS DAM i
Morrow Mountain
Slate Park
The lawyer, David Poe, asked FERC to dismiss
it and immediately renew Alcoa's license without
offering Gov. Perdue a chance to appear before
the commission, as Perdue requested.
Perdue's aides say they don't expect any
action from FERC until next year, after a dispute
over whether Alcoa qualifies for a clean water
certificate from the state is settled. (See "The long
and circuitous path to license renewal" on page
18.) Until FERC rules, Alcoa can operate with a
temporary license.
While those battles continue, Alcoa is in
Raleigh battling a bill in the General Assembly
(Senate Bill 967) that would create a Yadkin
River Trust Authority to assume Alcoa's license.
The bill sailed through the Senate this year with
bipartisan support, but failed in the House just
before the session ended, when Alcoa's team of
lobbyists went on the attack, convincing con-
servative legislators and some progressives that
Alcoas property rights were under assault.
The bill remains alive for the 2010 short ses-
sion, however, and Crisco is confident it will pass.
The five lobbyists Alcoa sent to the House
only hinted at the huge amount of money at
stake for the company and, on the other side,
for the Yadkin region. Together, Alcoa's dams,
powerhouses and generators can produce 215
megawatts of electricity, the equivalent of a
small coal-burning plant or about one-fourth
the power of the 900-megawatt Shearon Harris
nuclear reactor in Wake County. The Yadkin
Project, as it's known, annually produces about
one-seventh of the power of Shearon Harris,
according to public records.
In short, Alcoa's dams are worth hundreds of
millions, if not billions, of dollars (estimates of the
cost for another nuclear reactor at Shearon Harris
start at $8 billion), far more than they cost to
build and maintain over the years. That's
because a hydropower plant, unlike a
coal or nuclear facility, is cheap to install,
easy to operate, and the" fuel"-the water
from the Yadkin-is essentially free.
Once the dams are constructed, the
water behind them is dropped down passage-
ways onto turbines that power the generators--
with the amount of generated power dependent
on how far the water falls.
Under the Federal Power Act, if Alcoa lost its
license, it would be entitled to compensation for
its property but not the "fair market value" if it
were to sell, for example, to a public utility like
Duke Energy. Instead, the law requires compen-
sation to be calculated using a formula based on
a company's net investment: the cost to build,
mmus depreciation. Until recently, when Alcoa
slatted spending money on turbine upgrades, its
net investment in the Yadkin Protect was just $24
million, according to FERC records.
In a small administrative building next to the
idled smelting plant, Gene Ellis, who is leading
Alcoa's relicensing efforts, says that anything less
than hall market value as compensation would
ainount to an unconstitutional "taking" of Alcoa's
property, notwithstanding the formula in the
license agreement.
Ellis says that with the turbine upgrades,
Alcoa's net investment is now $91 million. But
he maintains that in a recapture, the company
would also be entitled to "severance payments'"?
WEDNESDAY, NOVEMBER 18, 2009 117
Jimmy Dick, a retired University of South
Carolina professor, is back in his native Stanly
County, fighting Alcoas bid to remain on the
Yadkin. PHOTO BY D a ANDERSON
based on the amount of its
lost future earnings, which
could amount to hundreds
of millions of dollars more.
Severance, he concedes,
isn't defined in the law; nor
is it part of the compensa-
tion formula. The state
doesn't buy El is' severance
definition, and it estimates
in its filings to FERC that
the license can be recap-
tured for $150 million
tops, including the cost of
deferred maintenance that
Alcoa didn't count.
The state estimates
that the Yadkin River Trust
would earn at least $20 mil-
lion a year on the power
plants-at current revenue
levels of about $40 million
annually-and more when acquisition costs are
repaid.
And if electricity rates increase, so would the
profits.
To Ellis, the debate over compensation is
moot since he believes that APGI (the Alcoa sub-
sidiary) is entitled to a new license, regardless of
the states objections.
Mcoa's license to generate power on the Yadkin
was never predicated on keeping the smelting
plant running, he says. Rather, it was given and
should be renewed based on Alcoa's ability to
keep the power plants operating, while also being
"a good steward" of the river. That it's done, he
maintains, by creating some 23,000 acres of recre-
ational lakes and reservoirs (mainly the sprawling
High Rock Lake and Badin lake, the small but
very deep (almost 200 feet) impoundment behind
the Narrows Dam) and by donating land to vari-
ous parka, including Morrow Mountain State
Park and the Uwharrie National Forest
Alcoa owns an additional 15,000 acres of tun-
berland, Ellis says. As part of its relicensing applica-
tion, it negotiated with local stakeholders for thew
support, pledging to donate 1,442 acres to various
jurisdictions if the application is approved.
The fact that 23 public and civic organizations
signed on as supporters, Ellis says, "shows that the
public interest is being served"
Ills concedes that the smelting plant, like
most industrial plants of its vintage, polluted
for most of its history. "Before modern- day
environmental regulations, everybody used the
`Back 40' to get rid of their waste byproducts;' he
says, and, like the rest, Alcoa dumped. Waste oils,
PCBs and PAHs (polycyclic aromatic hydrocar-
bons): They all were poured on the ground, into
a lagoon next to the plant or into the town dump,
he admits.
Ellis shows a visitor around the plant site,
pointing out the many places where Alcoa
removed soil, sealed its pollution with clay, and
drilled test wells that demonstrate, he says, that
no contaminants are leaching into the aquifer or
the lake.
Stanly County contested that position when
the company applied to the state for a 401 water
quality certificate for the Yadkin Project. The
18 INDEPCIYDE?T nnr rR1ANGLE'S WEEKLY
Alcoa fought against the p
posting of Fish for A of Alcwas test wells and capping, it hasn't
Consumption Advisory sign
of Badin Lake, where elevated
have been found and are b
believed to be to do so "and shut us up." Ellis says it's not neces-
related to the aluminum s
operated for 90 years. PHOTO
application (and, ordinarily, i
required step in the FERC licensing
The coLinty commission
pol-
lutants in Bailin Lake by Dr. J
John Rogers, a Badin Lake. The state, however, cites the 401 dis-
Clemson University professor
gist who co-directs Clemson's environmental
institute. Rogers found evidence
ship" between the kinds of PCBs he found in
the lake's sedinnents and material used in the
smelter-near the plant itself, he reported, the
relevant concentrations were 10 to 100 times
greater than in other places.
Alcoa disputed Rogers' findings, saying the
PCBs in the lake were commonplace in Lri
try and could've originated elsewhere. In any
event, the state Division of Water Quality, part
of the Department of Environment and Natural
Resources, limited its 401 review to impacts from
Alcoa's generating facilities, steering clear of the
smelter's problems.
Ellis says that was the correct call because the
certificate is for the power plants, not the smelter.
Moreover, if pollution is traced to the smelter,
Alcoa will be required to clean it up, regardless
of what happens to the power license.
After that, however, the situation got murky.
DWQ approved the 401 permit, but with a
requirement that before it was issued, Alcoa must
post a $240 million bond to ensure that it will
make necessary improvements to the turbines
in the power plants. The old ones are reducing
dissolved oxygen levels in the river, impairing
water quality for the fish. Alcoa didn't dispute the
need, but neither did it post the bond. Instead,
it appealed the requirement as exceeding the
division's authority. Stanly County and Naujoks,
the rrverkeeper, also appealed, and, in September,
an administrative law judge sided with them and
blocked DWQ from issuing Alcoa the pennit
pending a hearing, probably in February.
Interestingly, the gover-
nor's office sided with the
Meanwhile, the state
III.," L,0.
levels s of PCB
said. . Pregnant womenand
r:'r s ?3 eat all y.
Alcoa tried unsuccessfully
A-- .r."'"' • to block the posting.
Naujoks argues that
s along the shores opened the plant site to an independent assess-
ment of the contamination. He's challenged Alcoa
sary. plant Alcoa sary. The Division of Water Quality has certified
or o ANDEk50q that Badin Lake is safe for swirmning, he noted.
And the Division of Waste Management, another
unit in DENR, found that wherever the PCBs
came from, they pose no threat to human health.
is approval) is a Whether any of this will matter to FERC isn't
process. dear. Ellis says it won't, because there's no link
d a study of between the power plants and the pollution in
pute and the fish advisory in a section of its filing
to FERC titled "Environmental Degradation of
of a "relation- Yadkin Water Quality Remains a Public Concern,"

county and Naujoks against
its own state agent
cy.

' Y Division of Public Health, a
h9rlr ca..Jm,gmn Advbnry unit of the Department of
Healthand Hurrian Services
,
posted a fish consumption
advisory for Bailn Lake
because of the elevated
„? sand mercury

:'r Most people should limit
themselves to one meal per
week of largemouth bass
and catfish caught there, it

dnildren under IS shouldn't
t
"Regrettably," Secretary Crisco says, "the
more recent history of this licensee fails to dem-
onstrate that the State can rely on the licensee's
concern for the State's well-being."
oger Dick, Jimmy's brother, is an unusual sort
of banker, the kind who talks passionately
about economics on a human scale; about
ethical, socially responsible businesses; about how
Ronald Reagan led us astray with his thoughtless
support of free trade; and about how cool it is that
Pittsboro has a currency based on barter. A liberal
Democrat? No. Roger Dick, like his brother and
most of Stanly County's leading citizens, is a free-
enterprise Republican--one with a strong distaste
for monopolies.
Dick is president of Uwharrie Capital
Corporation, a holding company for a trio
of community banks un Stanly, Anson and
Cabarrus counties whose mission, he says, is to
"restart the local economy" after a long period of
stagnation. Its annual report comes with a "Shop
Local" refrigerator magnet. The home office
is a converted department store in downtown
Albemarle, the Stanly County seat.
The Uwharrie stretch of the Yadkin, Dick
says, was always remote and poor, a place with
rocky soils and a river whose banks were too
steep to locate a textile mill. But the Yadkin holds
a tremendous amownt of water and power, both
of which can mean jobs for the region-but not
if Alcoa's m charge.
Alcoa started to shut down the smelter in
2002, the same year it began its relicensing process
tinder the Federal Power Act. Dick says he sat
down at the table with Alcoa, expecting it would
ant a deal to retain its license in return for sharing
its power revenues with the community, both for
The long ON circuitous path to license renewal
ICOd 5 subsidiary, APGI, began seeking anew
license for the Yadkin Protect in 2002. six years
before the old one, issued in 1958, was sched-
uled to expire. Under the Federal Power Act.
APGI must demonstrate [hat its operations on the
Yadkin "will be best adapled to a comprehensive
plan for improving or developing a waterway"
in terms of its navigation, hydropower, fish and
wildlife, flood control, water supply, recreation
and other "beneficial public uses."
Other applicants can vie for the license when
it's up for renewal, as the stale is doing-over
Alcoa's objection (hat its application came in
after the 2006 deadline
The decision is up to the Federal Energy
Regulatory Commission (FERC), a five-member
body that must include at least Iwo members of
each political party The board is currently com-
posed OF Iwo Democrats and Iwo Republicans:
there is one vacancy
FERC can renew APGI's license on its own
authority The FERC staff recommended renewal
in September 2007,
If FERC decides against renewal, however,
u cannot ship the license from APGI and assign
11 10 someone else without an act of Congress to
"recapture" it Under recapture, Congress would
reimburse APGI for the depreciated value of its
inves[menl in the dams and power plants, an
amount disputed between North Carolina and
APGI but which is likely to be far below what
they could be sold for Whatever Congress paid
APGI would be billed to the new licensee
Alcoa says that if North Carolina wants its
facilities, it should use its powers of condemna-
lion to acquire them, which would require Ihal
the state pay "fair market value" for them.
Meanwhile, Alcoa (APGI) is seeking a 50-year
license will) the support of 23 organizations, pub-
lic and private, including the [own of Badin, the
city of Albemarle and Montgomery and Rowan
counties. Other counties on the Yadkin are either
neutral or, in Stanly County's case, opposed.
In its application. APGI promises to donate
1,942 acres of land to Morrow Mountain Stale Park
and other public agencies and to make available
for sale L000 of the 15,000 acres,t owns along the
Yadkin. Pending FERC approval, il's promised to
supply Albemarle with up to 30 million gallons of
water a day from its reservoirs, essentially for free.
II also pledges to keep summer lake levels
high at High Rock Lake, even if doing so costs it
water for power generation. Otherwise, the com-
pany is allowed to charge for withdrawals from
its reservoirs if they would cut into the water it
has available for its power plants.
WEDNESDAY. NOVEMBER 18, 2009
Alcoa on the Yadkin
ueled by Andrew Mellon's fortune, Alcoa came
to dominate l he aluminum industry in the
late 19th and early 20th centuries, following the
invention in 1885 of the electrolytic process that
made aluminum smelling highly profitable. Alcoa
bought bauxite mines across the South, control-
ling the basic material from which aluminum
was extracted. It also bought river rights where
it could, using hydropower to produce electric-
y-the other key ingredient in the smelling
process-more cheaply than anyone else.
When World War I broke out in Europe,
Alcoa purchased an unfinished smelling
plant in Slanly County from a French rival,
['Aluminum Francaise. By 1917, the Badin
smelter was up and running, powered by
three hydroelectric dams that Alcoa installed
on the Yadkin River. When Congress enacted
the Federal Water Power Act of 1920, Alcoa
received a license for its hydro plants. In 1958,
the license was renewed for 50 years.
See limelineai www.indyuie&.com.
economic development and pollution cleanup.
But Alcoa offered only cheap timberland, he says,
some of it already clear-cut That's when he start-
ed to read up on the law and its history,
Originally called the Federal Water Power
Act, the 1920 statute capped a long, bitter fight
in Congress over who should be in charge of the
nation's waterways, the people (government) or
private companies.
Breakthroughs in dam bulling and in long-
distance electricity transmission (via alternating
current) had made hydropower hugely profit-
able. Businesses like Alcoa naturally wanted to
control it-without government interference, if
possible.
But the conservation movement was also gain-
ing steam, and Presidents Theodore Roosevelt
and Woodrow Wilson fought to keep the nation's
rivers as public trusts and out of the hands of pri-
vate monopolies. "Keep an eye on the Aluminum
Company that is trying to get control of your
water powers," Roosevelt warned in 1915, when he
was out of office. "Don't let go of them."
Five years later, Wilson signed a compromise
"r that gave the federal government jurisdiction
over the rivers (taking it away from the states),
but allowed leases to public or private enterprises
for limited periods-with "recapture" permitted
when the license expired.
All this is covered in a 1959 book, The
Conservation Fight, written by Judson King, a
turn-of-the-century progressive who worked
with Roosevelt and Gifford Pinchot, the famed
forester, among others.
Wilson, according to King, worried that the
recapture clause in the law was so diluted and
complicated that it would prove unworkable.
Indeed, Roger Dick says, recapture has never
been used, but that's somewhat misleading. The
fact is, a number of states where the rivers had big
hydropower potential-New York and Washington
among them--created their own public power
authorities after 1920 and applied to Washington
for the licenses, which they still hold. They then
INDY
subcontracted with private firms like Alcoa, but
under terms favorable to the states.
Before his election as president, New York
Gov. Franklin D. Roosevelt created the New York
State Power Authority in 1931. It still controls
the power plant at Niagara Falls. And in South
Carolina, Strom Thurmond learned from FDR
and created the Santee Cooper Authority, still a
low-cost hydropower generator for that state.
But in North Carolina, Alcoa was already
operating on the Yadkin by 1920, and the state
never protected itself It supported Alcoa's ini-
tial bid for licensing and, when the first license
expired in 1958, backed Alcoa's application for a
50-year license based on its promised expansion
of the Badin smelter.
Now is the time for North Carolina to rectify
its mistake, Dick argues. The reason recapture is in
the law, according to his reading of history, is for
cases such as this, in which the licensee's interests
and the public interest are diametrically opposed.
If the state misses this chance, it won't get
another one for 50 years. Meanwhile, Alcoa will
have perfected a perfidious kind of globalism: It
still generates power from the Yadkin, and the
power is still linked to industrial jobs---only the
jobs are in Iceland.
That's the kind of free trade we don't need,
Roger Dick says. He thinks the conditions are
right-weak dollar, available labor-for local
manufacturing to make a comeback in this
country. His banks would love to get behind it.
The Yadkin region would have on advantage, he
thinks, if a state or regional authority could help
make cheap electricity available to such start-
ups. But it can't happen as long as Alcoa holds its
monopoly:
"If you don't control monopolies," Dick says,
"you've just put some Poo in the cogs of a free-
market system. Free markets cannot function
with monopolies hanging around"
And when the monopolies are multinational,
he says, local enterprises don't stand a chance
against them.
Roger Dick doesn't swear at Alcoa like Jimmy
does. He prefers historical hyperbole. Letting
Alcoa control the Yadkin, Roger Dick says, is
similar to what the American colonists rebelled
against with the British trading monopolies.
"It's no different than if they hit our beaches
toting rifles and with knapsacks on their backs,"
he declares. "They're taking our dignity. They're
taking our ability to restart an economy."
But Roger Dick is as irate as his brother when
he hears Alcoa's argument that recapturing the
license would be a "taking" of its private prop-
erty and therefore unconstitutional.
"Alcoa will say they're not contractually obli-
gated to provide jobs, but it was certainly morally
implied," Roger Dick says. Now, the Perdue admin-
istration is ready to pay them exactly what their
license-their contract-promised when they
signed it, but that's not good enough for them?
"I'm a free-market capitalist," Roger Dick
went on, "I believe good capitalism is virtuous. I
believe when you put people back to work, that's
how you build community. We've got to get back
in our society to making things, not just being
the raw material for global capital. Our economy
should be serving our society. But we've got a
society serving our economy." Mx
A DAZZLING PROPOSAL
FOR LOVE AND LEGACY
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WEDNESDAY, NOVEMBER 18, 2009 19
PUBLICATION DATE
Dec 4
L.JL.N DE 11.18.09:
WWW.INDYWEEK.C,4M

INM
Q U E E R I E S
What's a bi guy to do?
Y STEVEN PETROW
Q. My favorite restaurants haven't
changed since I became bisexual and
stopped seeing men exclusively, but eating
at those places is a lot less fun. Gay guys
around my neighborhood look at me funny
when I'm out with a woman. Please don't
tell me moving away from my beloved San
Francisco is the only
way to be comfortable in
public again.
A. No, but you may
need to stop going to
all-gay restaurants (and
by that I mean eateries
{ frequented primarily by
same-sex couples). As
much as homophobia is
a problem in this coun-
try, along the same lines (OK, not as much)
there are strains of heterophobia in the LGBT
community. Never heard of homophobia's
first cousin, heterophobia? Its a term used
to describe irrational fear of, aversion to or
discrimination against heterosexuals. If you
and your girlfriend are the only opposite-sex
pair in a restaurant or dub, not only will you
appear as outsiders, but in some way you
may be perceived as social trespassers or just
made to feel unwelcome.
Years ago, I went into a gay dub in New
York with a straight woman friend. When I
ordered, the bartender, instead of serving us,
actually asked us to leave. Even when I told
him that I was gay, he reiterated his request.
Time: have changed somewhat, and our
communities tend to mix more comfortably
now. But my point is that heterophobia is
Steven Petrow writes regularly for
The Huffington Post and is the author
of The Essential Book of Gay Manners
& Etiquette. Visit him online at www.
gayandlesbianmanners. com
as misplaced as homophobia, if less
prevalent and without such serious
consequences.
NOW, WHAT'S A STRAIGHT
GUY TO DOT
was in creating change. Since you're
the go-to guy for manners, I'm
wondering if you have any thoughts
about one's social obligations
regarding political protest and dissent.
Because I'm ready.
Q: As the only straight person invited A First let that erica not to my gay friend's weekend house, will I be
uncomfortable or out of place? I think he
said there would be about four other guys
there.
A: If your gay friend did any thinking
(which we all do), he would have factored
this into his invitation before doing so. Since
the fast rule of being a good host is to make
your guests feel comfortable, my guess is that
he thinks you will be. And that heimagines
his other friends will be, too. (Or do you
imagine they'll all be lusting after you?)
Consider this: While sexual identity
is important for many LGBT people, its
rarely our only defining characteristic.
We have gender, age, profession, religion,
education and so on, as part of that great
cocktail called "me" Certainly, you ll share
something with these fellows, even if sexual
orientation is not one of them. What you
need to bring is a good attitude, and your
host needs to provide a welcome environ-
ment for all.
IS CIVIL DISOBEDIENCE BAD
MANNERS?
Q: After the recent election in Maine,
where 53 percent of voters revoked the
right of gays and lesbians to marry, I've got
to say I'm tired of these postelection blues.
I'm tired of our right to marry being an
electoral issue. I'm tired of the tyranny of
the majority. I'm just plain over it. I'm old
enough to remember the civil disobedience
that ACT UP staged during the height of the
HIV/ AIDS epidemic and how effective that
The Queeries column is sponsored by
-------------------------------------
----------
-T* HOURS I
it lam - VW t
Flt & 8k %1A1% - Zan
rim NOON - tow t
nt
I
I
I
CONTENTS NEWSLVIEWS Ci)'VEN
me say Yo one
in feeling outrage at what happened at the
polls for the second November in a row
(Californians revoked the rights of LGBT
people to marry just a year ago). Marry activ-
ists in our community are stymied by these
results, in part because of the overwhelm-
ing influence and dollars from the Catholic
Church and, in this latest voting, from the
National Organization for Marriage.
A former ACT UP leader recently told
me, "Civil disobedience is the missing piece
of activism in our portfolio these days." And
he should know, as one who protested vehe-
mently against drug companies when they
were price-gouging patients with HIV/ AIDS
here and overseas during the '80s and'90s.
But the truth is that the very nature of
civil disobedience is its high code of con-
duct, as per the 1849 essay by Henry David
Thoreau that is now commonly called "Civil
Disobedience but was originally titled
"Resistance to Government:' Indeed, break-
ing the law for a noble cause, while illegal,
is not immoral, unethical or bad manners.
What is problematic is violence of any kind
(such as the murder of that abortion doctor
in Kansas earlier this year by an anti-abor-
tion activist), as well as attempts to curb free
speech (like the Catholic Church does, along
with the Rush Limbaughs of the world).
What is important about civil disobe-
dience is that it's an opportunity to pres-
ent arguments and persuade people who
disagree with you that you're right, in this
case, on the right of LGBT people to marry.
Sometimes it takes actions like this to "help"
others hear and understand. rx1
,n
FRED
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INDEPENDE.T
)
art
k
t? ?? s
WEDNESDAY, NOVEMBE.
18, 2009 15
i
"IUIIS BID L -DERS0N
Gm
R.ve back the
Yadkin
l,ooo feet wide to less than 100 feet in the Jorge
known as "the Narrows," Over a 38-mile stretch
from above High Rock Mountain th just Wow
the Narrows, the Yadkin falls almost 400 feet in
elevation, further concentrating Ns obwer.
"The Yadkin is enormous;' says Dean
Naujoks, the Yadkin Riverkeeper. "It is unbe-
lievable what a resource it is, and nobody's
ever paid much attention to it. I call it the
forgotten river."
The reason it's forgotten is that the Yadkin's
power-the power of its falling water-was tied
up almost a century ago by Alcoa, then called
the Aluminum Company of America. Alcoa
built three dams in the early 20th century, and a
fourth in 1962, and used them to generate elec-
tricity for a massive aluminum smelting plant
in the little Stanly County town of Badin.
The Yadkin's power, Alcoa's critics say, could
have been used to supply electricity to 170,000
homes or to small manufacturers that might've
come to the area if Alcoa's smelter hadn't.
Instead, all the power went to a single plant that
once employed about a thousand workers but
recently had a workforce of just 400 to 500.
And today, even that one plant sits empty:
Alcoa closed it in 2007 ("curtailed it;' the com-
pany says), sending its jobs to newer facilities
abroad. Indeed, the name Alcoa is no longer an
acronym for an American company. It is instead
a global brand for a firm that makes aluminum
in Iceland, Brazil or wherever it's most efficient
to do so. But not in North Carolina.
Nonetheless, Alcoa retains control of the
Yadkin and is seeking a 50-year renewal of its
operating license, which expired last year. With
its smelter shut down, it sells the electricity to
wholesalers or"the grid! Most of the power ends
up in other states, the company reports. The
revenues, minus payroll for a skeletal workforce
of about three dozen in North Carolina, belong
to an Alcoa power subsidiary based in Tennessee.
The profits are distributed worldwide.
Stanly County's leaders think there's some-
thing wrong with that picture. They want the
Yadkin, a public resource, to work for the region,
not Alcoa. Over the last year, they've persuaded
top state officials, including Gov. Bev Perdue,
that Alcoa should go.
A key ally in their battle is Keith Crisco, who
owned a manufacturing business in Asheboro
and was a leader in the anti-Alcoa movement
before Perdue appointed him secretary of com-
merce this year. Now Crisco heads up the state's
campaign to block Alcoa's relicensing, saying
16 1 INDEPENDEUT I THE TRIANGLE'S WEEKLY I WEDNESDAY, NOVEMBER 18,2009
Top: Yadkin Riverkeeper Dean Naujoks, on a boat at Badin Lake, is among Alcoa's biggest critics.
Bottom: Alcoa mothballed the giant smelling plant in Badin two years ago, but it continues to
run four hydroelectric dams on the Yadkin under a federal license that may not be renewed.
the company has stiffed the local economy and
dragged its feet on er ironmental issues.
"Not only does AYGI [the Alcoa subsidiary]
not offer the benefits that v ere a quid pro quo
for the state's support of its mitial license;' Crisco
says in the Perdue administration's 21st Century
Plan for the Yadkin, "but it produces harm in
that it does virtually nothing to address the water
quality needs or the economic or recreational
needs of the region,"
"It's almost as if it's Venezuela;' Alcoa spokes-
man Kevin Lowery retorts. The company main-
tains that the license is Alcoa's property, and the
state's effort to take it is akin to President Hugo
Chavez nationalizing his country's oil industry.
Yadkin Riverkeeper Naujoks is on Stanly
County's side. He accuses Alcoa of exploiting the
Yadkin for profit while leaving the region with
"a toxic legacy" of cancer-causing PCBs-poly-
chlorinated biphenyls-and other contaminants
from the smelter. The extent of the damage is
not yet understood, he maintains, because nei-
ther Alcoa nor state environmental regulators
have thoroughly investigated it.
Naujoks likens the situation in Badin to the
investigation of PCB pollution in Wake County's
Crabtree Creek, with which he was involved when
he was the Upper Neuse Riverkeeper. Those con-
taminants originated miles away, at the old Ward
Transformer plant. "Once they started digging,
they just kept finding more and more problems
farther and farther out;' Naujoks says.
On a damp October day, Naujoks has come to
Badin for a ride on Jimmy Dick's pontoon boat
and to help him make the case against relicens-
ing Alcoa. Dick, a university professor who grew
up near Badin and returned after his retirement,
is a more vociferous critic of Alcoa than even
Naujoks. He vies for the title of biggest Alcoa critic
with his brother, Roger Dick, president of a com-
munity bank company and the force behind the
anti-Alcoa campaign, who thinks the Yadkin is
worth billions to the local economy as a source of
cheap hydroelectric power, and even more to the
state as a future source of drinking water.
Steering his boat on Badin Lake in front of
the hulloing smelter, Jimmy Dick recounts how
in 1958, when Alcoa last came up for license
renewal, the company argued that it needed the
maximum allowable term of 50 years to ensure it
could recoup its planned investments in a fourth
dam and in doubling the smelter's capacity in
a legal brief, the company noted that the license
was subject to "recapture" when it expired, at
which point "the management of Carolina
Aluminum could not rely on any assured source
of power" for the plant.
The point, jimmy Dick says angrily, is that
Alcoa knew half a century ago that its license-
which he terms a contract, not "property"-was
for a limited time. Alcoa also knew that it could
make big bucks in Bailin before the contract was
up. But now, as local leaders try to reclaim the
license, he says, Alcoa acts like it owns the river
and shorild be allowed to stay there forever.
As for the pollution issues, Dick worked at the
plant when he was young, as did his father and
grandfather. Everyone saw the dumping, only no
one knew of the environmental consequences.
Regardless of the pollution, he says, if the plant
were still operating, "no one would be challenging
INDY I COVER STORY
the license." But when Alcoa gave up on the plant,
Dick says, it gave up its rights on the river.
"It was a contract," Dick shouts over the wind
and his pontoon's engine. "They got their 50
years with our public resource, and the benefit
to the public was the jobs. But now the jobs are
gone, and the contract's finished, and we want
our resource back. So, Alcoa, get the hell out."
f it sounds like Alcoa's done for, however, it
isn't. Because under the Federal Power Act,
the decision about who controls the Yadkin
isn't up to the state but the five-member Federal
Energy Regulatory Commission (FERC) in
Washington. And ultimately, it's up to Congress.
According to a FERC spokesman, not once
since the act became law in 1920 has the com-
mission done what the state is asking it to do:
reject a license holder's renewal application while
also recommending-as the law requires-that
Congress pass a bill to allow FERC to award the
license to someone else-in this case, a state
water authority that doesn't exist yet.
Recapture, as this process is called, is a cumber-
some process. Deliberately so, historians say, since
many in the 1920 Congress wanted to bestow
control of the nation's rivers to private companies,
with no strings attached. Still, recapture is in the
law to assure that the license holder, among all
contenders, is best able to achieve a river's various
"beneficial public uses'
Crisco argues that recapture is justified in
Alcoa's case. In a Sept. 8 filing to FERC, he says
the state doesn't relish fighting with a major
corporation and remains "business-friendly." But
Alcoa's "failure to contribute in any manner to
the economic health and well-being of North
Carolina' leaves the state no choice but to step
in and try to redirect the profits from the Yadkin
to the region's economic development and water
quality needs.
In a heated response filed with FERC Oct.
9, Alcoa's Washington lawyer called the Perdue
administration's challenge "an amalgamation of
factual misstatements and legal arguments that
are inventive in the extreme."
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The lawyer, David Poe, asked FERC to dismiss
it and immediately renew Alcoa's license without
offering Gov. Perdue a chance to appear before
the commission, as Perdue requested.
Perdue's aides say they don't expect any
action from FERC until next year, after a dispute
over whether Alcoa qualifies for a dean water
certificate from the state is settled. (See "The long
and circuitous path to license renewal" on page
I8.) Until FERC rules, Alcoa can operate with a
temporary license.
While those battles continue, Alcoa is in
Raleigh battling a bill in the General Assembly
(Senate Bill %7) that would create a Yadkin
River Trust Authority to assume Alcoa's license.
The bill sailed through the Senate this year with
bipartisan support, but failed in the House just
before the session ended, when Alcoa's team of
lobbyists went on the attack, convincing con-
servative legislators and some progressives that
Alcoa's property rights were under assault.
The bill remains alive for the 2010 short ses-
sion, however, and Crisco is confident it will pass.
The five lobbyists Alcoa sent to the House
only hinted at the huge amount of money at
stake for the company and, on the other side,
for the Yadkin region. Together, Alcoa's dams,
powerhouses and generators can produce 215
megawatts of electricity, the equivalent of a
small coal-burning plant or about one-fourth
the power of the 900-megawatt Shearon Harris
nuclear reactor in Wake County. The Yadkin
Project, as it's known, annually produces about
one-seventh of the power of Shearon Harris,
according to public records.
In short, Alcoa's dams are worth hundreds of
millions, if not billions, of dollars (estimates of the
cost for another nuclear reactor at Shearon Harris
start at $8 billion), far more than they cost to
build and maintain over the years. That's
because a hydropower plant, unlike a
coal or nuclear facility, is cheap to install,
easy to operate, and the "fuel"-the water
from the Yadkin-is essentially free.
Once the dams are constructed, the
water behind them is dropped down passage-
ways onto turbines that power the generators-
with the amount of generated power dependent
on how far the water falls.
Under the Federal Power Act, if Alcoa lost its
license, it would be entitled to compensation for
its property but not the "fair market value" if it
were to sell, for example, to a public utility like
Duke Energy. Instead, the law requires compen-
sation to be calculated using a formula based on
a company's net investment: the cost to build,
minus depreciation. Until recently, when Alcoa
started spending money on turbine upgrades, its
net investment in the Yadkin Project was just $24
million, according to FERC records.
In a small administrative building next to the
idled smelting plant, Gene Ellis, who is leading
Alcoa's relicensing efforts, says that anything less
than frill market value as compensation would
amount to an unconstitutional "taking" of Alcoa !s
property, notwithstanding the formula in the
license agreement.
Ellis says that with the turbine upgrades,
Alcoa's net investment is now $91 million. But
he maintains that in a recapture, the company
would also be entitled to "severance payments"?
WEDNESDAY. NOVEMBER 19, 2009 1 17
Jimmy Dick, a retired University of South
Carolina professor, is back in his native Stanly
County, flshting Alcoa's bid to remain on the
Yadkin. PHOTO BY D.L. ANDERSON
based on the amount of its
lost future earnings, which
could amount to hundreds
of millions of dollars more.
Severance, he concedes,
isn't defined in the law; nor
is it part of the compensa-
tion formula. The state
doesn't buy Ellis' severance
definition, and it estimates
in its filings to FERC that
the license can be recap-
tured for $150 million
tops, including the cost of
deferred maintenance that
Alcoa didn't count.
The state estimates
that the Yadkin River Trust
would earn at least $20 mil-
lion a year on the power
plants-at current revenue
levels of about $40 nvllion
annually-and more when acquisition costs are
repaid.
And if electricity rates increase, so would the
profits.
To Ellis, the debate over compensation is
moot since he believes that APGI (the Alcoa sub-
sidiary) is entitled to a new license, regardless of
the state's objections.
Alcoa's license to generate power on the Yadkin
was never predicated on keeping the smelting
plant runt ing, he says. Rather, it was given and
should be renewed based on Alcoa's ability to
keep the power plants operating, while also being
"a good steward" of the river. That it's done, he
maintains, by creating some 23,000 acres of recre-
ational lakes and reservoirs (mainly the sprawling
High Rock Lake and Badin Lake, the small but
very deep (ahnost 200 feet) impoundment behind
the Narrows Dam) and by donating land to vari-
ous parks, including Morrow Mountain State
Park and the Uwharrie National Forest.
Alcoa owns an additional 15,000 acres of tim-
berland, Ellis says. As part of its relicensing applica-
tion, it negotiated with local stakeholders for their
support, pledging to donate 1,442 acres to various
jurisdictions if the application is approved.
The fact that 23 public and civic organizations
signed on as supporters, Ellis says, "shows that the
public interest is being served"
Ills concedes that the smelting plant, like
most industrial plants of its vintage, polluted
for most of its history. "Before modern- day
environmental regulations, everybody used the
`Back 40' to get rid of their waste byproducts:' he
says, and, like the rest, Alcoa dumped. Waste oils,
PCBs and PAHs (polycyclic aromatic hydrocar-
bons): They all were poured on the ground, into
a lagoon next to the plant or into the town dump,
he admits.
Ellis shows a visitor around the plant site,
pointing out the many places where Alcoa
removed soil, sealed its pollution with clay, and
drilled test wells that demonstrate, he says, that
no contaminants are leaching into the aquifer or
the lake.
Stanly County contested that position when
the company applied to the state for a 401 water
quality certificate for the Yadkin Project. The
Alcoa fought against the posting of Fish
Consumption Advisory signs along the shores
of Badin Lake, where elevated levels of PCBs
have been found and are believed to be
related to the aluminum smelting plant Alcoa
operated for 90 years. PHOTO BY D.L. ANDERSON
application (and, ordinarily, its approval) is a
required step in the FERC licensing process.
The county commissioned a study of pol-
lutants in Badin Lake by Dr. John Rogers, a
Clemson University professor and ecotoxicolo-
gist who co-directs Clemson's environmental
institute. Rogers found evidence of a "relation-
ship" between the kinds of PCBs he found in
the lake's sediments and material used in the
smelter-near the plant itself, he reported, the
relevant concentrations were 10 to 100 times
greater than in other places.
Alcoa disputed Rogers' findings, saying the
PCBs in the lake were commonplace in indus-
try and could've originated elsewhere. In any
event, the state Division of Water Quality, part
of the Department of Environment and Natural
Resources, limited its 401 review to impacts from
Alcoa's generating facilities, steering clear of the
smelter's problems.
Ellis says that was the correct call because the
certificate is for the power plants, not the smelter.
Moreover, if pollution is traced to the smelter,
Alcoa will be required to clean it up, regardless
of what happens to the power license.
After that, however, the situation got murky.
DWQ approved the 401 permit, but with a
requirement that before it was issued, Alcoa must
post a $240 million bond to ensure that it will
make necessary improvements to the turbines
in the power plants. The old ones are reducing
dissolved oxygen levels in the river, impairing
water quality for the fish. Alcoa didn't dispute the
need, but neither did it post the bond. Instead,
it appealed the requirement as exceeding the
division's authority. Stanly County and Naujoks,
the riverkeeper, also appealed, and, in September,
an administrative law judge sided with them and
blocked DWQ from issuing Alcoa the permit
pending a hearing, probably in February.
Interestingly, the gover-
nor's office sided with the
county and Naujoks against
its own state agency.
Meanwhile, the state
Division of Public Health, a
unit of the Department of
Health and Human Services,
posted a fish consumption
advisory for Badin Lake
because of the elevated
levels of PCBs and mercury.
Most people should limit
themselves to one meal per
week of largemouth bass
and catfish caught there, it
said. Pregnant women and
children under 15 shouldn't
eat any.
Alcoa tried unsuccessfully
to block the posting.
Naujoks argues that
for all of Alcoa's test wells and capping, it hasn't
opened the plant site to an independent assess-
ment of the contamination He's challenged Alcoa
to do so "and shut us up' Ellis says it's not neces-
sary. The Division of Water Quality has certified
that Badin Lake is safe for swimming, he noted.
And the Division of Waste Management, another
unit in DENR, found that wherever the PCBs
came from, they pose no threat to human health.
Whether any of this will matter to FERC isn't
dear. Ellis says it won't, because there's no link
between the power plants and the pollution in
Badin Lake. The state, however, cites the 401 dis-
pute and the fish advisory in a section of its filing
to FERC titled "Environmental Degradation of
Yadkin Water Quality Remains a Public Concern:'
"Regrettably," Secretary Crisco says, "the
more recent history of this hcensee fails to dem-
onstrate that the State can rely on the licensee's
concern for the State's well-being."
Eiger Dick, Jimmy's brother, is an unusual sort
of banker, the kind who talks passionately
about economics on a human scale; about
ethical, socially responsible businesses; about how
Ronald Reagan led us astray with his thoughtless
support of free trade; and about how cool it is that
Pittsboro has a currency based on barter. A liberal
Democrat? No. Roger Dick, like his brother and
most of Stanly County's leading citizens, is a free-
enterprise Republican--one with a strong distaste
for monopolies.
Dick is president of Uwharrie Capital
Corporation, a holding company for a trio
of community banks in Stanly, Anson and
Cabarrus counties whose mission, he says, is to
"restart the local economy" after a long period of
stagnation. Its annual report comes with a "Shop
Local" refrigerator magnet. The home office
is a converted department store in downtown
Albemarle, the Stanly County seat.
The Uwharrie stretch of the Yadkin, Dick
says, was always remote and poor, a place with
rocky soils and a river whose banks were too
steep to locate a textile mill. But the Yadkin holds
a tremendous amount of water and power, both
of which can mean jobs for the region-but not
if Alcoa's in charge.
Alcoa started to shut down the smelter in
2002, the same year it began its relicensing process
under the Federal Power Act. Dirk says he sat
down at the table with Alcoa, expecting it would
cut a deal to retain its license in return for sharing
its power revenues with the community, both for
The IN and circuitous path to license renewal
A Icoa's subsidiary, APGI, began seeking a new
license for the Yadkin Project in 2002, six years
before the old one, issued in 1958, was sched-
uled to expire. Under the Federal Power Act,
APGI must demonstrate that its operations on the
Yadkin "will be best adapted to a comprehensive
plan for improving or developing a waterway"
in terms of its navigation, hydropower, fish and
wildlife, flood control, water supply, recreation
and other "beneficial public uses."
Other applicants can vie for the license when
it's up for renewal, as the state is doing-over
Alcoa's objection that its application came in
after the 2006 deadline.
The decision is up to the Federal Energy
Regulatory Commission (FERC), a five-member
body that must include at least two members of
each political party, The board is currently com-
posed of two Democrats and Iwo Republicans;
there is one vacancy.
FERC can renew APGI's license on its own
authority. The FERC staff recommended renewal
in September 2007.
If FERC decides against renewal, however,
it cannot strip the license from APGI and assign
it to someone else without an act of Congress to
"recapture" it. Under recapture, Congress would
reimburse APGI for the depreciated value of its
investment in the dams and power plants, an
amount disputed between North Carolina and
APGI but which is likely to be far below what
they could be sold for. Whatever Congress paid
APGI would be billed to the new licensee.
Alcoa says that If North Carolina wants its
facilities, it should use its powers of condemna-
tion to acquire them, which would require that
the state pay "fair market value" For them.
Meanwhile, Alcoa (APGI) is seeking a 50-year
license with the support of 23 organizations, pub-
lic and private, including the town of Badin, the
city of Albemarle and Montgomery and Rowan
counties. Other counties on the Yadkin are either
neutral or, in Stanly County's case, opposed.
In its application, APGI promises to donate
1,442 acres of land to Morrow Mountain Slate Park
and other public agencies and to make available
for sale 000 of the 15,000 acres it owns along the
Yadkin. Pending FERC approval, it's promised to
supply Albemarle with up to 30 million gallons of
water a day from its reservoirs, essentially for free.
H also pledges to keep summer lake levels
high at High Rock Lake, even if doing so costs it
water for power generation. Otherwise, the com-
pany is allowed to charge for withdrawals from
its reservoirs if they would cut into the water it
has available For its power plants.
18 INDEPENDEUT I THE TRIANGICS WEFNLY
WEDNESDAY, NOVEMBER IS. 2009
Alcoa in the Yadkin
[ ueledbyAndrewMellonsfortune,Alcoacame
j to dominate the aluminum industry In the
late 19th and early 20th centuries, following the
invention in 1885 of the electrolytic process that
made aluminum smelling highly profitable. Alcoa
bought bauxite mines across the South, control-
ling the bask material from which aluminum
was extracted. It also bought river rights where
it could, using hydropower to produce electric-
ity-the other key ingredient in the smelting
process-more cheaply than anyone else.
When World War I broke out in Europe,
Alcoa purchased an unfinished smelting
plant in Stanly County from a French rival,
CAluminum Francatse. By 1917, the Bad in
smelter was up and running, powered by
three hydroelectric dams that Alcoa installed
on the Yadkin River. When Congress enacted
the Federal Water Power Act of 1920, Alcoa
received a license for Its hydro plants. In 1958,
the license was renewed for 50 years.
Seefimefirreaf www.indyumkcom.
economic development and pollution cleanup.
But Alcoa offered only cheap timberland, he says,
some of it already clear-cuL That's when he start-
ed to read up on the law and its history.
Originally called the Federal Water Power
Act, the 1920 statute capped a long, bitter fight
in Congress over who should be in charge of the
nation's waterways, the people (government) or
private companies.
Breakthroughs in dam building and in long-
distance electricity transmission (via alternating
current) had made hydropower hugely profit-
able. Businesses like Alcoa naturally wanted to
control it-without government interference, if
possible.
But the conservation movement was also gain-
ing steam, and Presidents Theodore Roosevelt
and Woodrow Wilson fought to keep the nation's
rivers as public trusts and out of the hands of pri-
vate monopolies "Keep an eye on the Aluminum
Company that is trying to get control of your
water powers," Roosevelt warned in 1915, when he
was out of office. "Don't let go of them'
Five years later, Wilson signed a compromise
that gave the federal government jurisdiction
over the rivers (taking it away from the states),
but allowed leases to public or private enterprises
for limited periods-with "recapture" permitted
when the license expired.
All this is covered in a 1959 book, The
Conservation Fight, written by Judson King, a
turn-of-the-century progressive who worked
with Roosevelt and Gifford Pinchot, the famed
forester, among others.
Wilson, according to King, worried that the
recapture clause in the law was so diluted and
complicated that it would prove unworkable.
Indeed, Roger Dick says, recapture has never
been used, but that's somewhat misleading. The
fact is, a number of states where the rivers had big
hydropower potential-New York and Washington
among them-- created their own public power
authorities after 1920 and applied to Washington
for the licenses, which they still hold They then
INDY
subcontracted with private firms like Alcoa, but
under terms favorable to the states.
Before his election as president, New York
Gov. Franklin D. Roosevelt created the New York
State Power Authority in 1931. It still controls
the power plant at Niagara Falls. And in South
Carolina, Strom Thurmond learned from FDR
and created the Santee Cooper Authority, still a
low-cost hydropower generator for that state.
But in North Carolina, Alcoa was already
operating on the Yadkin by 1920, and the state
never protected itself. It supported Alcoa's ini-
tial bid for licensing and, when the first license
expired in 1958, backed Alcoa's application for a
50-year license based on its promised expansion
of the Badin smelter.
Now is the time for North Carolina to rectify
its mistake, Dick argues The reason recapture is in
the law, according to his reading of history, is for
cases such as this, in which the licensee's interests
and the public interest are diametrically opposed
If the state misses this chance, it wont get
another one for 50 years. Meanwhile, Alcoa will
have perfected a perfidious kind of globalism: It
still generates power from the Yadkin, and the
power is still linked to industrial jobs-only the
jobs are in Iceland
That's the kind of free trade we don't need,
Roger Dick says. He thinks the conditions are
right-weak dollar, available labor-for local
manufacturing to make a comeback in this
country. His banks would love to get behind it.
The Yadkin region would have an advantage, he
thinks, if a state or regional authority could help
make cheap electricity available to such start-
ups. But it can't happen as long as Alcoa holds its
monopoly.
"If you don't control monopolies;' Dick says,
"you've just put some Poo in the cogs of a free-
market system. Free markets cannot function
with monopolies hanging around."
And when the monopolies are multinational,
he says, local enterprises don't stand a chance
against them.
Roger Dick doesn't swear at Alcoa like Jimmy
does. He prefers historical hyperbole. Letting
Alcoa control the Yadkin, Roger Dick says, is
similar to what the American colonists rebelled
against with the British trading monopolies.
"It's no different than if they hit our beaches
toting rifles and with knapsacks on their backs;'
he declares. "They're taking our dignity. They're
taking our ability to restart an economy."
But Roger Dick is as irate as his brother when
he hears Alcoi's argument that recapturing the
license would be a "taking" of its private prop-
erty and therefore unconstitutional.
"Alcoa will say they're not contactually obli-
gated to provide jobs, but it was certainly morally
implied," Roger Dick says. Now, the Perdue admin-
istration is ready to pay them exactly what their
license--their contract-promised when they
signed it, but that's not good enough for them?
"I'm a free-market capitalist;' Roger Dick
went on, "I believe good capitalism is virtuous. I
believe when you put people back to work, that's
how you build community. We've got to get back
in our society to making things, not just being
the raw material for global capital. Our economy
should be serving our society. But we've got a
society serving our economy." ?
'?"aRt+r nr. COVERSTORY
A DAZZLING PROPOSAL
FOR LOVE AND LEGACY
"IN
? '4 1t.a
Hamilton Hill
INTERNATIONAL DESIGNER JEWELRY
BRIGHTLEAF SQUARE ¦ DURHAM
919 683.1474 ¦ HAMILTONHILLJEWELRY.COM
? D
t t f ,?'? ,,_ 'y 1
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Fam Painting
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PUBIICAMN DATE
Dec 9