CURB Takes Issue with FERC Chairman

posted Mar 1, 2015, 4:56 AM by Site administrator
-- Monday, December 15, 2014 PRESS RELEASE –


Smith Mountain Lake, VA (15 December 2014) -- Cut Unnecessary Regulatory Burden, Inc. (CURB) was formed as a Virginia not-for-profit corporation in April 2011 to educate our Community on the importance of State property rights. On December 8th the Federal Energy Regulatory Commission (FERC) Chairman Cheryl A. LaFleur responded to a Congressional inquiry from Congressman Robert Hurt regarding the implementation of the Shoreline Management Plan (SMP) for Smith Mountain Lake, VA.

In the Commission's words: "The Commission has regulatory authority only over the licensee and, thus, can administer and enforce the terms of the license only through the licensee and the licensee’s state property rights. Project boundaries are used to delineate the geographic extent of the lands, waters, works, and facilities that the license identifies as comprising the licensed project and for which the licensee must hold the rights necessary to carry out project purposes." [
130 FERC ¶ 62,033 (Issued January 13, 2010)]

It is CURB’s opinion that Chairman LaFleur’s letter to Congressman Hurt is oversimplified, misleading and contradictory; however it is representative of the treatment our Community and many other Communities across our nation have endured from this Commission.  The Chairman stated: “Because the reservoir is owned by the company (as are some shoreline lands) and not by the landowners, and because project lands and waters are managed to comport with the public interest, landowners must obtain permission from Appalachian Power for any private uses of licensee-owned property, such as the construction of boat docks and Walkways.”

The Smith Mountain Project is operated by Appalachian Power, but is not exclusively owned by this licensee. In the case of Smith Mountain the licensee negotiated Flowage Right and Easement Deeds for virtually all lakefront private property circa 1960. The limited purpose of these easements was to grant the licensee the right to flood a portion of shoreline private property solely for the construction, operation and maintenance of a hydroelectric dam. In consideration for allowing a portion of the landowner’s property to be inundated, the property owner was guaranteed the right to recreational access of the waters and to possess and use this property in any manner so long as that use did not interfere with the licensee’s ability to flood, operate and maintain its hydroelectric dam and power house operation. For over four decades Appalachian Power honored its agreements and recognized that all shoreline property owners had the property right to build docks. The flowage easements are contractual in nature, flow with the land title and are to be read as in the moment of creation. Consequently, Smith Mountain shoreline property owners have no obligation to seek or acquire Appalachian’s permission to build docks to access the project waters as these rights were reserved in the circa 1960 flowage easement agreement. 

Chairman LaFluer concludes: “Please note that the SMP applies only to those lands in the project boundary where Appalachian Power has property rights. The licensee has no authority to regulate construction on privately owned lands, unless the property owner has given the company those rights."

The Commission is well aware of its licensee’s limited property rights. Yet the Commission ignores this evidence and on faith accepts the licensee’s new certification: “1. LICENSEE HAS OBTAINED ALL FLOWAGE RIGHTS NECESSARY FOR ADEQUATE OPERATION OF THE PROJECT EITHER IN FEE TITLE OR EASEMENTS. ALL PROPERTY RECORDS ARE KEPT ON FILE WITH THE LICENSEE.” The Commission can be assured that the underlying circa 1960 flowage agreements were never amended to convey Appalachian the property rights in now claims it holds in its current certification. Clearly the Commission exceeded its limited authority to require implementation of the Shoreline Management Plan without the necessary property rights. The Commission dodged the essential underlying issue of property rights and advised stakeholders if they had a property rights dispute to sue the licensee, a $16.5B corporate monopoly that possesses unlimited financial resources. This is not regulation, it is avoidance by intimidation and the Commission is complicit.

CURB requested the Commission require the Smith Mountain Project licensee to detail its State property rights and all unpermitted “encroachments” within the project boundary; and to identify those lands within the project boundary for which it does not hold sufficient State property rights to implement its license requirements. Those existing uses can then be vested and the lands removed from Shoreline Management control. Simply put, the licensee does not have the authority to restrict deeded and reasonable recreational access for shoreline property owners at Smith Mountain. CURB’s request is consistent with Commission policy at Lake of the Ozarks and other projects where the Commission required the licensee to identify private property interests and to operate within the limits of its authority.

Read: (1) Chairman Lafleur letter to Congressman Hurt, and (2) CURB's letter to the Commission.