The Flathead Reservation tribes are closer to becoming the first in the U.S. to own a major hydroelectric facility.
An arbitration panel in California settled on a price tag for Kerr Dam last week, setting the stage for the Confederated Salish and Kootenai Tribes’ acquisition of the 194-megawatt plant in September 2015.
The CSKT must pay nearly $18.3 million for the dam located at the natural outlet of Flathead Lake near Polson.
The dam was been a source of controversy and opposition when it was built in the 1930s, and several people died during its construction.
Nearly 80 years later, the tribes filed a formal notice on March 4 with the Federal Energy Regulatory Commission expressing their intent to take over the facility as a part of a mission to maintain and manage important natural resources within the Flathead Reservation.
“Today we enjoy historic success in our diligent effort to acquire the Kerr Project,” said Brian Lipscomb, CEO of Energy Keepers, Inc., a tribally owned corporation established to manage the facility’s takeover.
With less than 19 months until the acquisition date, EKI is preparing for the future management and operation of the hydroelectric facility, as well as crafting a new name for the dam with the input of tribal leaders. The dam, which was completed in 1938, was named for the president of Montana Power Co. at the time, Frank Kerr. The CSKT tribal council will make a final decision on the new name, according to EKI.
By taking over Kerr Dam, the CSKT will become the first tribe in America to own and operate a major hydroelectric facility, as well as becoming the only entity in Montana to own an in-state dam. PPL is based out of Allentown, Pa.
The American Arbitration Association panel landed on a final price more favorable to CSKT than PPL Montana, the site’s current owner. PPL, which purchased the dam from Montana Power in 1999, argued the tribes should have to pay $49.4 million for the entire facility. The tribes countered it should be $14.7 million.
The arbitration panel agreed with PPL that the facility’s plant should cost $16.5 million, nearly $2 million more than CSKT estimated due to depreciation. The panel shot down PPL’s proposed $987,000 as part of its legal defense costs in a long-standing lawsuit over flooding rights at Flathead Lake.
Kerr Dam is a concrete arch dam 381 feet in length and 200 feet high. It controls the elevation of the top ten feet of Flathead Lake, and has an average production of 1.1 million megawatt hours of energy per year.
In 1985, FERC issued the dam’s operating license to both Montana Power and the tribes to settle a contested proceeding. Montana Power, which sold its utility assets in 1997, was to operate the project for at least 30 years, after which the tribes would have the option to buy.
“This day represents an unwavering and long-standing commitment by the Salish, Pend d’Oreill and Kootenai Tribes to restore tribal stewardship over resources affected by the Kerr Project,” said CSKT Tribal Chairman Ronald Trahan. “This is a big day in our tribal history that is especially meaningful to our communities because it represents self-sufficiency, resilience and vision by the tribes. Today we take a big step forward in acquiring the Kerry Project.”