Searching for lost revenue from shut-down nuclear plants, NY law allows towns to assess waste storage
Communities across the United States where nuclear power plants have been shut down face huge gaps in tax revenues, sometimes in the tens of millions of dollars. States such as New Jersey, Illinois, Wisconsin, and California are watching events in New York now that Gov. Andrew Cuomo has signed a new law that says cities can “assess the economic value of storing waste” on sites where nuclear plants once operated, as reported by Bloomberg.
Lost revenue: Local administrators have been on the front lines of the missing tax revenue problem ever since Cuomo announced a deal with Entergy to close Indian Point-3 . The local municipalities will lose millions; an article published by a USA Today local affiliate reports that because of IP-3’s expected closure, the village of “Buchanan anticipates losing some $2.6 million in annual property tax revenue … the town of Cortlandt expects to lose $800,000 and the Hendrick Hudson School District roughly a third of its $75 million budget.” The solution to this loss, aside from the obvious solution of saving an efficient, reliable, and clean power source, is to tax what is left behind.
New law: This first-of-a-kind law will be tested in Buchanan and Cortlandt—the site of the Indian Point nuclear plant. “There’s really no prototype for this,” Cortlandt town supervisor Linda Puglisi stated, pointing out, “We will eventually become the example for other communities that have closed nuclear plants.”
Theresa Knickerbocker, the mayor of Buchannan, added, “It’s not really fair to the communities not to be compensated for [used fuel] to be stored here. That was not the agreement for the communities.”
The value of waste: At present, since the United States does not recycle used nuclear fuel, the on-site waste is not worth anything. Cortlandt tax assessor Thomas Watkins adds, “We have a piece of land upon which we can store nuclear fuel [which cannot be stored elsewhere]. So, what’s [the land] worth?”
New York administrators are not yet sure how much they will value the space on which the used fuel is stored, and it could take years before the municipalities come up with a reasonable number. However, David Knabel, the city administrator of Zion, Ill.—where the Zion nuclear plant has been shut down since 1998—has long been considering the question. He thinks that the owners of these sites “should be paying $120 million in property taxes, because there’s only a dozen places where you can store this [waste].” Illinois assessment law, however, does not allow for such an interpretation.
Spotlight on: The (sometimes premature) closure of nuclear plants brings two problems to light: the large gaps created in small-town budgets when a plant is shuttered, and the growing need for a national strategy to deal with used nuclear fuel long-term. If there were solutions to both problems, municipalities would not have to try to find value in waste.