Nuclear plant shutdowns a crisis for small towns across the USA

VERNON, Vermont - Head south out of Brattleboro down Route 142, a two-lane country road bordered by rolling green fields, and you'll spy a “Cattle Crossing” sign beside a dairy farm.

During the summer grazing season, when it's time to cross the road, Miller Farm alerts its neighbors that a herd of Holsteins are on their way. “We try to go as fast as the cows will allow, thank you for your patience,” reads one Facebook post.

In many ways, Vernon, a town of 2,200 on the southern edge of Vermont, has the feel of a place where folks still rely on the land for their living.

But look up and you'll catch a glimpse of massive transmission lines extending out from the Vermont Yankee nuclear power plant on the banks of the Connecticut River.

When it opened in 1972, Vermont Yankee was in the vanguard of the age of nuclear power generation, offering unimaginable job prospects for small-town folks and decades’ worth of flush budgets for Vernon. For years, Vernon was listed among Vermont’s “gold” towns, on a par with money-making ski meccas like Stowe to the north.

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But in 2013, Vermont Yankee’s owner, Louisiana-based Entergy, announced that it would close its single-unit reactor by the end of 2014.

The announcement, while not unexpected, forced Vernon into some difficult decisions as Vermont Yankee employees started putting homes up for sale, taking with them six-figure incomes that fed the local economy for decades. The town’s $2 million budget would need to be cut in half.

Patty O’Donnell found herself at the center of those decisions as chairwoman of the town’s Selectboard when the announcement came.

“It was the most difficult thing I had ever been through as an elected official,” O’Donnell said.

O’Donnell and others quickly decided it was better to look toward the future than sit back and wait while Vernon turned into a ghost town, a common fate of cities and towns slow to respond when a critical source of jobs packs up and leaves. 

“We’re used to doing what we need to do for ourselves,” said O’Donnell, a Republican who also served as Vernon's representative in the state legislature. “It’s what Vermonters are and it’s what we’ve always been … No white knight in shining armor is going to show up in our town and say ‘let me take care of it.’”

Vernon's dilemma, in many ways, mirrors the unique challenges being faced by towns across the USA — from California's Pacific coast to the Florida's Gulf Coast  — where nuclear power plants have shut down.

In recent years, more than a dozen nuclear power plants either have announced plans to close or entered the decades-long process of decommissioning their nuclear reactors, according to the federal Nuclear Regulatory Commission.

The cheap price of natural gas, coupled with costly repairs to aging plants, have hastened the nuclear industry's decline, forcing more and more power companies to cut their losses.

At the end of May, the owners of Three-Mile Island, the Pennsylvania nuclear plant whose 1979 meltdown hardened the resolve of anti-nuclear activists and inspired a host of industry regulations, announced plans to close by 2019.

And in January, Entergy announced that it will shut down Indian Point in Buchanan by 2021, adding the 44-year-old power plant to a growing list of nuclear power plant casualties.

The decision came after a protracted legal battle with the state of New York over the plant's future, fed by a public feud with Gov. Andrew Cuomo. 

Cuomo's opposition centered on concerns that a nuclear mishap at a power plant some 30 miles north of New York City could devastate the heavily-populated region.

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At Indian Point, the shutdown is likely to have severe financial consequences for Westchester County. Municipalities around Indian Point predict $32 million in annual losses to their budgets. Like Vernon, Buchanan expects to lose nearly half its budget — about $3.5 million. And the Hendrick Hudson School district faces the loss of $20 million from its $75 million budget.

Cuomo's approach has been markedly different in upstate New York where three struggling nuclear power plants — Nine Mile Point and James A. FitzPatrick in Oswego County and R.E. Ginna near Rochester — were on the verge of closing. Cuomo agreed to help keep the plants running with the aid of a multi-billion dollar bailout to be financed by monthly surcharges on the bills of ratepayers.

The Journal News/lohud enlisted reporters from across the USA Today Network — in California, Iowa, Wisconsin and Florida — to find out how towns in their region are coping with the loss of their nuclear power plant.

Among the findings of a months-long investigation by the USA Today Network:

• Towns are being crippled by plant shutdowns that have left gaping holes in budgets, depressed home values and forced public officials to adopt tax increases to make up for millions of dollars in lost revenue.
• Some of the biggest names in industrial demolition — companies with a track record for knocking down skyscrapers, football stadiums and casinos — are jumping into the nuclear decommissioning business, promising to cut decades off a time-consuming, labor intensive process.
• Towns upset with the federal government’s failure to create a federal repository for spent nuclear fuel are calling on the federal government to create a fund to compensate them for storing nuclear waste.

The numbers tell a big part of the story.

Before it shut down in 1998, the Zion Nuclear Power Station on the shores of Lake Michigan, 50 miles north of Chicago, paid nearly $20 million to the town that had been its home since 1973.

Last year, Zion’s tax income from the plant was around $1.6 million.That’s translated into fewer cops to patrol a town of about 24,000. Taxes on homes and businesses have more than doubled and property values have plummeted.

“We can’t draw businesses because the taxes are so high,” said Zion Mayor Al Hill. “And the taxes are so high because we can’t draw businesses.”

Nearly 70 percent of Zion’s housing stock is in rentals, Hill said. In healthy communities the figure should be around 23 percent. Taxes on a $300,000 home have surged from $8,000 to $20,000 per year, he said.

In 2013 Duke Energy, shut down the Crystal River Nuclear Plant on Florida’s Gulf Coast, resulting in the loss of 600 high-paying jobs in a region already reeling from the downturn in residential construction after the recession.

A 2009 attempt by the plant's previous owner, Progress Energy, to replace two 500-ton steam generators cracked the reactor's containment wall. The plant was built in 1977.

As hundreds of high-paying jobs left the area, residential property values witnessed a dramatic downturn. The average value of single-family residence plummeted from nearly $154,000 in 2008 to $115,000 in 2016.

Citrus County's tax base took a painful hit. In 2008, the county's appraiser pegged the assessment for two parcels on the site at $10.5 million. Last year the figure was $413,990, county records show.

Duke Energy is building a $1.5 billion natural gas plant at the site that is 40 percent done and scheduled to open next year. But it’s expected to replace just a fraction of the jobs — about 50 to 75 — than the more labor-intensive nuclear facility provided.

"A natural gas plant is just easier to operate," said Ted Kury, the director of energy studies at the University of Florida's Public Utility Research Center. "During your overnight and weekend shifts, you really just have folks in the control room. As long as the gas is flowing in the burners, you're all set."

In the aftermath of the shutdown, officials are working toward diversifying the region's economy. Topping the list is tourism. Crystal River is the largest winter refuge for manatees in Florida and last year 53 percent of the region's nearly half-million tourists said they came to see the manatees.

"I always like to call this town 'The little town that has a lot to offer' and for people who are very interested in nature, it's a great community to come and visit," said Luz Lecour, the interim spiritual leader at Unity of Citrus County.

On the Pacific coast, north of the city of San Diego, the San Onofre nuclear plant shut down in 2013 after workers discovered premature wear on recently-installed steam generators.

A thousand workers lost their jobs and, five-and-a-half years later, the plant’s owners, Southern California Edison and San Diego Gas & Electric, say they’re owed some $4.7 billion on their investment.

At issue is whether ratepayers should be on the hook for the money the utilities expected to make by selling electricity from San Onofre, as well as maintenance costs and nuclear fuel purchased before the plant was shut down prematurely.

The most severe economic consequences of San Onofre's shutdown have been felt in the plant's backyard of San Clemente. There, local businesses had come to rely on a jolt of economic activity from workers who spent months at a time in the area while doing routine maintenance at the plant. Many stayed at local hotels.

"They'd be pretty much going out to dinner every night," said Lynn Wood, the CEO of San Clemente Chamber of Commerce. "So we lost all that."

In Wisconsin, the May 2013 shutdown of the Kewaunee Power Station, located on 900 acres on the western shore of Lake Michigan, 25 miles southeast of Green Bay, led to the loss of 600 jobs and some $85.5 million in annual salaries.

The shutdown was a blow to the power station's home in Carlton, where cows outnumber the town's 1,000 residents four to one.

Earlier this year, Kewaunee County, which includes Carlton, increased its sales tax a half percent in an attempt to make up for the $750,000 in annual income generated by the power plant.

After the closing, the plant's owner, Dominion Energy of Virginia, sued Kewaunee County and others disputing assessment's of the plant's value. Dominion claimed the plant was worth just $1 million.

A settlement set the property's value at $15 million for the next eight years.

County officials have just begun looking toward the future. There's been talk of building a state prison or marketing Kewaunee as a gateway to Door County and its emerging wine industry.

"We were sort of in a holding pattern because of the lawsuit," said Jennifer Brown, executive director of the Kewaunee County Economic Development Corp. "Now there is seriously an opportunity for planning for the future."

Stephen Skibniowsky’s family has been in Vernon since the early 1920’s when his grandparents bought a farm on the southern part of town.

He still can recall the day he heard a nuclear power plant was coming to town. “It was quite an exciting moment,” Skibniowsky, 68, recalls.

Skibniowsky was working as a Brattleboro police officer in 1972, thinking he’d parlay his interest in science to a job in forensics. When no such opportunities opened up, Skibniowsky took a night security job at the plant while taking college biology and chemistry classes during the day. He stuck around for 42 years, retiring in 2015 as head of Vermont Yankee’s environmental monitoring division.

Through the years, Skibniowsky frequently found himself on the defensive, clashing with folks who arrived in southern Vermont in the 1960’s in search of a back-to-basics lifestyle. “Nuclear power isn’t exactly going back to the basics,” says Skibniowsky, who currently serves on Vernon’s Selectboard. “It is in fact a step forward in technology unlike what the world has seen.”

He recalls the debates in the aftermath of events like the Three-Mile Island meltdown and the Chernobyl accident.

“Those two events pushed people even further one way or the other in terms of their feelings about nuclear power but nuclear power has always been a controllable entity,” Skibniowsky says. “We’ve had nuclear power devices deployed by the military for many years, much longer than commercial power production and it is my belief still, even in this dark day of plants shutting down everywhere, that eventually the population will come to realize that it is a zero-carbon alternative and will become necessary if we ever want to see the sun in the future.”

Not everyone in Vermont sees it the same way. Through the years, Vermont Yankee was the site of regular anti-nuclear protests.

But Vernon’s support never wavered.

Keith Franklin, one of the owners of Miller Farm, a 100-year-old dairy farm located a half mile from Vermont Yankee, was disappointed to see the plant shut down. Every month, state officials test his cows and soil for evidence of radiation.

"They've been a big asset to the town of Vernon," Franklin said. "We're sorry to see them go."

At the height of its power, Vermont Yankee delivered nearly a third of Vermont’s electricity.

The property-tax revenue that flowed from Vermont Yankee financed one of the finest elementary schools in the state, with a gym to rival any high school. The police department’s cruiser was too old? Not a problem. Buy a new one.

No one talked about cutting budgets. “That wasn’t the mentality in this town because we always had so much money,” said O’Donnell. “It was like it doesn’t matter that there’s only 30,000 miles on this car, the capital plan says the new car is ready so let's go get the new car.”

Around 2012 rumors began to spread that Vermont Yankee might shut down. Years of litigation with the state of Vermont, which called for the plant’s shut down, had taken its toll. Beyond that, low prices for natural gas, which dictate prices in the energy market, made it harder and harder to keep the plant open, according to Mike Twomey, the vice president for external affairs for Entergy.

“I think a lot of the folks in Vernon felt like this was not an unexpected outcome but this was a very disappointing outcome,” Twomey said.

The plant’s workforce of 620 either retired, found jobs with Entergy plants in other states or moved on. Some 50 workers were retained to work on the decommissioning.  A study commissioned by the International Brotherhood of Electrical Workers pegged at $93.3 million the annual payroll for Vermont Yankee employees and hundreds of others in industries like construction and health care that existed because of the plant’s operation.

Houses went up for sale. The local economy lost the cash that Vermont Yankee employees, with an average salary of $105,000, spent in Vernon and neighboring towns. Vernon lost coaches for its youth sports teams, volunteers for the local Boys and Girls club and nuclear engineers who used to walk across the street to Vernon Elementary School to help out with math homework.

Vernon needed to find a way to cut half of its $2 million budget. Town meetings that once attracted a few dozen residents now numbered more than 300. At town hall-style meetings that are a hallmark of local government in Vermont, residents offered up suggestions for cutting budgets.

One led the town to contract with the Windham County sheriff’s department to take over the town’s police duties. “We have to keep Vernon a town that people want to live in,” said O’Donnell. “We can’t turn it into a ghost town.”

In November, Entergy announced that it had agreed to sell Vermont Yankee to NorthStar Group Services, a New York-based industrial demolition company, which includes in its portfolio the 2016 implosion of The Riviera hotel and casino on the Las Vegas strip.

NorthStar has partnered with AREVA Nuclear Materials, which boasts 30 years experience decommissioning and dismantling nuclear reactors. The company says it can cut decades off Entergy’s plan to finish the decommissioning by 2075. If allowed to take over the property as planned next year, the company says it could finish the dismantling of the reactors and other buildings by 2030.

The sale is pending the approval by the Vermont Public Service Board and the federal Nuclear Regulatory Commission.

NorthStar says it could do the job for less than the amount that’s accumulated in a decommissioning trust fund, currently around $570 million, money Entergy has been required to set aside through its years of operation.

Twomey said Entergy is likely to pursue a similar tack with Indian Point’s decommissioning but is awaiting the outcome of the NRC review of its NorthStar sale. Currently, there is some $1.7 billion in the decommissioning fund for Indian Point’s three reactors.

Critics of the NorthStar proposal have urged caution. Deb Katz, the executive director of the Massachusetts-based Citizens Awareness Network, is not convinced NorthStar will have enough money to complete the decommissioning of Vermont Yankee and fears communities like Vernon are being “seduced” by the promise of a quick cleanup.

“The colossal failure of nuclear power is really seen in the issues of decommissioning and clean up,” said Katz, whose anti-nuclear group has participated in protests at Vermont Yankee. “If they run out of money then they’re not going to get it done quicker.”

Katz’s group sued the NRC over the decommissioning of the Yankee Rowe nuclear power plant, which shut down in 1992. The plant is located some 40 miles west of Vermont Yankee in Rowe, Mass.

Gordon Edwards, the founder of the Canadian Coalition for Nuclear Responsibility and a frequent critic of the U.S. nuclear industry, said that as "the age of nuclear waste begins in earnest" it is as important as ever that communities have a say in what happens at dormant nuclear energy sites.

"It's a whole new ballgame because things, which used to be regarded both by people inside the industry and outside the industry as their business — they look after their show and we sort of stand on the sidelines and prod them or question them —  now everybody is involved," Edwards said. "And there has to be more of a spirit of cooperation and convergence because this land is in the process of being transferred back to the public."

NorthStar’s plan does not factor in the removal of hundreds of spent fuel assemblies that will remain at Vermont Yankee for the foreseeable future.

By 2018, Entergy expects to transfer nearly 4,000 spent nuclear fuel assemblies to 58 dry cask canisters on two massive concrete pads on the Vermont Yankee property. The company will pay for a security force to protect the fuel assemblies for as long as they remain there.

But there’s no telling when or if they'll ever find a permanent home.

In June, Energy Secretary Rick Perry expressed support for permanently storing the nation’s spent nuclear fuel at Yucca Mountain, north of Las Vegas. The plan stalled during the Obama Administration and has encountered deep opposition in Nevada.

At a June 20 House hearing, Perry said the Trump Administration had budgeted $110 million to restart the licensing process for Yucca Mountain and another $10 million to develop interim storage facilities that would take in spent nuclear fuel and high-level nuclear waste removed from 120 sites in 39 states.

"We have a moral and national security obligation to come up with a long-term solution, finding the safest repositories available," Perry said. "We can no longer kick the can down the road."

In the meantime, officials in towns living with spent nuclear fuel are losing patience.

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Hill, the mayor of Zion, came to Garrison for a forum on Indian Point’s decommissioning, and tried to enlist local support for a bill that would force the Department of Energy to compensate communities that have become “de facto nuclear storage facilities.”

“The federal government took on the responsibility of providing a permanent repository for the spent fuel rods,” Hill said. “They did not live up to their responsibility and so we think it’s the federal government’s responsibility to compensate the communities that are nuclear dumps.”

The Stranded Nuclear Waste Accountability Act would provide nearly $100 million in payments to communities storing nuclear waste until a new national facility is opened. It was first introduced last year but did not come up for a vote. The bill’s sponsors say there are currently 13 communities across the country storing spent nuclear fuel.

Communities would be compensated a rate of $15 per kilogram of spent nuclear fuel. Zion's compensation is estimated at $15.2 million while Vernon would qualify for more than $10 million, according to the bill. 

In Vernon, town officials are hopeful the sale to NorthStar will go through so the Vermont Yankee site can remain a productive source of revenue.

Last year, Entergy agreed to a six-year tax stabilization contract that called for a $750,000 payment in lieu of taxes (PILOT) beginning in July 2016 and $400,000 for the last three years of the deal. The plant was recently valued at $78 million, down from $250 million.

Residents have already seen a bump in their tax bills. Over the past two years, property taxes on a single family home have increased between $400 and $1,000, town officials say.

"Everything hinges on the sale (to NorthStar)," says Josh Unruh, who succeeded O'Donnell as chair of the Selecboard. "If it goes through we have plans to move forward."

Discussions of new uses for the site have already taken place even though it could be more than a decade before it's cleared of buildings. Plans for a natural gas plant have already fallen through. There has been talk of creating walking trails along the picturesque Connecticut River or a micro-grid with an array of energy sources — solar energy among them — to power nearby towns.

“It is a gold mine piece of property and every nuclear plant sits on a gold mine piece of property,” O’Donnell said. “We have the rail-bed. We have the river, we have the switch yard that connects to the whole southern loop right there on that property. So we can do something else and it’s up to us to control our destiny not anybody else.”

Reporters Joseph Baucum of The Pensacola News Journal; Kelly McGowan of The Des Moines Register; Sammy Roth of The Desert Sun and Richard Ryman of the Green Bay Press-Gazette contributed to this story.