JOHNSTOWN - Citing a lack of money, the Hudson River-Black River Regulating District will lay off more than half of the employees staffed in the Hudson River area by May 26.
The regulating district passed the motion to lay off 12 employees at its board meeting in Johnstown on Tuesday. Executive Director Glenn LaFave said the layoffs are necessary because the regulating district's Hudson River area funds are being depleted.
"As the Hudson River area is literally running out of money, the board has no alternative but to lay off more than half of the Hudson River area employees," LaFave said in a news release.
In November 2008, the U.S. Court of Appeals issued a decision against the Federal Energy Regulatory Commission which affects the regulating district's authority to charge downstream FERC-licensed hydroelectric projects.
The abolishment of the 80-year practice resulted in a revenue shortfall approaching $4 million of the regulating district's $5.4 million Hudson River area budget.
Before the court's decision, money paid by the hydropower plants accounted for approximately 82 percent of the budget for the Hudson River area.
"These are good employees and the board regrets the need to take this unfortunate action," LaFave said in the release.
In an attempt to cover the $4 million shortfall, the district adopted an internal Hudson River area apportionment study in March. The study shifted certain costs from the hydropower companies along the Hudson and Sacandaga rivers to Albany, Rensselaer, Saratoga, Warren and Washington counties.
The assessment was based on the value of structures along the rivers that would be affected by a 100-year flood if the Conklingville Dam did not exist.
The counties have threatened to file a lawsuit to block the new charges.
Before the regulating district conducted its own study, the district had hired American Economics Group to conduct a study for $122,000 that wasn't presented to the board until Tuesday's meeting. The new apportionment study includes an equation on how to measure different types of benefits. It also includes two new benefits, wastewater assimilation and whitewater recreation benefits.
LaFave said he anticipates the district will charge the counties based on the AEG study.
"We are obligated to carry out the regulating district's mission of flood control and flow augmentation, and will perform the very basic operations and continue to safely maintain our dams and reservoirs with the barest, minimum crew necessary," LaFave said.
The district still owes school taxes for the 2009-10 school year to Broadalbin-Perth, Edinburg, Hadley-Luzerne, Mayfield, Northville and Wells school districts.
They are the largest taxpayer to Northville and Broadalbin-Perth, owing the districts $326,000 and $256,000 respectively.
Joel DiTata is a reporter for The Leader-Herald of Gloversville.