FERC "sets record straight" on Lake of the Ozarks shoreline plan

WASHINGTON 11/16/11 (PennWell) -- The Federal Energy Regulatory Commission has taken steps to deal with a furor over fears that 4,000 private structures might be removed for encroaching on project lands of the 93-mile-long federally licensed Lake of the Ozarks in Missouri.

FERC issued a Nov. 10 rehearing order, a news release, a fact sheet of "Frequently Asked Questions," and a table illustrating actions required -- or not required -- involving structures on lands within the boundaries of utility Ameren's 230.75-MW Osage hydroelectric project (No. 459) on the Osage River in central Missouri. The action followed three months of citizen protests and complaints by Missouri's congressional delegation about a July 26 FERC order approving the first Shoreline Management Plan for the 85-year-old hydro project.

"The Federal Energy Regulatory Commission today provided certainty for citizens at Lake of the Ozarks in Missouri by setting the record straight that FERC has not required shoreline homes and structures with valid deeds, permits, and easements to be removed," the FERC news release said.

"FERC's prior order on this case, issued July 26, 2011, was misinterpreted to mean that the commission would order all privately owned structures built within the boundaries of the Osage project to be removed," the commission said. "Ameren is responsible for managing the shoreline, which includes ensuring that structures within the project boundary around the Lake of the Ozarks are built with the proper authorizations."

FERC clarified the July order, declaring that nothing in its order affects any previously issued valid permit authorizing a non-project use of project lands or waters.

"For structures without valid deeds, permits, or easements, Ameren must determine whether they interfere with the Osage project," it said. "If they do, Ameren must take some action, such as redrawing the boundaries of the project, so those structures no longer are sitting on project lands."

The commission ordered Ameren to follow through with the utility's proposal to revise the project boundary to remove from the project any lands that are not needed to operate the project effectively. FERC said it expects that action to remove the majority of the non-conforming or encroaching structures from the project.

"If any structure does interfere with the operation of the Osage project, Ameren and the structure owner must find a solution that satisfies both sides," FERC added. "Ameren itself has stated that after the project boundary is revised, it expects the majority of structures will no longer be considered non-conforming."

Once consultations are completed with encroaching parties, Ameren is to file a plan at FERC for dealing with any remaining encroachments. FERC said, for example, Ameren could find lands elsewhere within, or to be added to, the project boundary that could meet the same project purpose as the contested property so that a structure would not have to be removed.

"Absent concerns about protection of life, health, or property, FERC generally would not have a regulatory need to require removal of the encroachment," FERC said.

Ameren "does not even know exactly what structures have been built"

FERC criticized Ameren for allowing the problem to develop. It said the licensee has had a long-standing obligation under its license to prevent the construction of unauthorized structures inside the project boundary, to ensure that neither the project nor neighboring structure owners are unduly affected.

"Over many years, Ameren failed to carry out this obligation," FERC said. "Ameren's repeated failure to properly implement the terms of its license has allowed matters to get to the point where it does not even know exactly what structures have been built within the project boundary and whether they were authorized. FERC recognizes that Ameren's failures have left local property owners in an extremely difficult position."

Meanwhile, FERC said Shoreline Management Plans have been developed for hydro projects in recent years as a result of various congressional mandates and court orders involving the balancing of competing uses at hydro projects. Ameren developed a plan for the Osage project's 1,150 miles of shoreline, which was approved by FERC in the July 26 order.

FERC ordered Ameren to file a revised project boundary by June 1, 2012, to remove any lands that are not needed for project purposes. At one time, Ameren said it could remove 31,000 of the 32,000 acres surrounding the reservoir from within the project boundary.

Once the boundary is revised, Ameren is to file a comprehensive report with FERC identifying each remaining encroachment and proposing a plan to address each encroachment or category of encroachment. FERC rejected a proposal by Ameren that it would continue to allow construction of "accessory structures" such as decks, walkways, gazebos, and patios within project boundaries.

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