$15 million for Colorado coal communities

State appropriation may not be enough, but there will soon be a bulge of federal dollars

by Allen Best

In the final hours of their session, Colorado legislators on May 11 approved an allocation of $15 million for Colorado’s just transition efforts for the state’s workers and communities with livelihoods and economies based on coal extraction and combustion.

Two-thirds, or $10 million, must go to workers impacted by the transition, to help them retool their skills for new jobs as those in coal mining and coal-fired power plants dwindle during this decade. According to the latest plan, Colorado’s last coal plant will close by 2031.

The other third, or $5 million, is to be used for community programs in places like Craig, Nucla, Hayden and even Brush and Paonia, including targeted economic development.

But why the last-minute vote? The simple answer is that it was a last-minute proposed bill. Why?

Proponents in the partnering labor and environmental community wanted $55 million allocated from American Rescue Plan Act \(ARPA) funds. Just Transition funding didn’t make the ARPA budget cut. Labor and environmental proponents noted that the process adopted by legislators wasn’t a great fit for what they were advocating for.

That left relatively little time to craft the bill that was ultimately adopted.

That outcome — the lesser dollar amount — didn’t please everybody.

“It’s money that will make a difference, wrote Roger Carver in an op/ed published in the Grand Junction Sentinel. “But it’s far short of the $55 million discussed by legislators earlier this year to get coal miners into good-paying, stable jobs and get local communities the resources to invest in their own economic goals.”

Carver, who lives in Nucla, near Tri-State Generation and Transmission’s shuttered coal-burning plant, is a retired coal miner and former president of United Mine Workers 1281.

Chris Markuson, Western states director for the BlueGreen Alliance, says more funding will almost certainly become available to local communities as a result of the $1 trillion infrastructure bill passed by Congress last November.

Communities will have two major opportunities. First will be from the more than $1 billion in federal funds that will go toward infrastructure in Colorado later this year and early next year. State government will administer the funds, but rural communities should see some of this funding as they try to position themselves to carve out economies in the future. For example, is there anything that Craig can invest in to support new industries it’s working to foster? Or assist the school district in Paonia to make building upgrades now, before its property taxes from the coal plant still in operation decline?

A second potential source will be the same big vat of federal money, but administered by federal agencies in the form of competitive grants. That money will be available for some years to come.

Richard Orf, representing Associated Governments of Northwest Colorado, told legislators at a House committee hearing in April that small, local governments of rural Colorado don’t have the bandwidth for the complicated work of grant-writing and monitoring.

Markuson concurs, but points out that the process for coal communities to apply for state transition grants administered by the Office of Just Transition has been defined and is significantly easier. Federal grants will inevitably require more expertise, and the state’s Just Transition office funding can be used to assist communities to go after federal funds.

Back to this year’s bill: It gives $10 million to worker programs. Markuson explains that the thinking was that because communities would have a shot at infrastructure funding from federal money, the state needed to first give priority to needs of workers. This recognizes the 2019 law that firmly set Colorado on the path of a low-carbon future and also created the Just Transition Office. HB 19-1314, “Just Transition from Coal-based Electric Energy Economy,” instructed the office to assist workers and communities to prepare themselves for a future beyond coal.

Primary sponsors of the 2022 funding bill approved by legislators were all Democrats, but there was relatively little opposition from Republicans. Some Republicans had decided to vote against all bills sponsored by Democrats.

A federal bill proposed by U.S. Sen. Michael Bennet, a Democrat from Colorado, also aims to give coal-based community more tools for the transition. Called the National Energy Community Transition Act, the bill proposes to create a $20 billion endowment to support government services and other transition efforts.

The new school for Hayden was being completed in August 2020. The school district is heavily dependent upon property taxes upon the Hayden Generating Station. Photo/Allen Best

A May 11 press release from Bennet’s office said the bill was formulated based on meetings with leaders in Northwest Colorado in February 2020.

“Our new school was built leveraging both state grant funding along with a voter-approved $22.3 million bond that is 55% dependent on the Hayden Station, a coal-fired power plant,” said Hayden Mayor Zach Wuestewald.

“Our fire district, library district, hospital district, and cemetery district rely on this asset for property taxes that range anywhere from 55%-65% of their total budget. We are deeply concerned about this transition, but we recognize this is a unique opportunity to move forward for our community and lead by example in Northwest Colorado.”

An idea being studied in northwest Colorado is an industrial park in Hayden, near the Yampa Valley Regional Airport, 25 miles down-valley from Steamboat.

Jennifer Holloway, executive director of the Craig Chamber of Commerce, says Bennet’s bill would provide stable, long-term funding that “would give us the ability to make some long-term plans and know that the revenue would be secure. This concept makes sense for our area as we transition the economy away from fossil fuels. We will need long term support to make it a success, and this type of investment will keep money coming in which will greatly expand our options to support new industries.”

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