FBCC votes 5-0 to approve Development Agreement with Rayonier, LignoTech

Submitted by Suanne Z. Thamm

Reporter – News Analyst

After months of consideration by Fernandina Beach City Commissioners (FBCC), city staff and the Planning Advisory Board (PAB), the FBCC voted unanimously to approve Resolution 2016-108 approving a Development Agreement with Rayonier Performance Fibers, LLC and LignoTech Florida LLC. The vote followed a second public hearing on the item at the FBCC’s October 4, 2016 Regular Meeting. At that same meeting, commissioners unanimously approved on second reading Ordinance 2016-19 amending the city’s Comprehensive Plan and Ordinance 2016-09 amending the Land Development Code. Passage of these two ordinances would appear to remove the last obstacles to moving forward with the Development Agreement.

According to Rayonier spokesman Russell Schweiss, the Rayonier and LignoTech boards of directors will probably vote this month on whether to move forward with constructing the lignin plant in Fernandina Beach.

Development Agreement

The Development Agreement sets out the conditions for development of a lignin processing facility located on property owned by Rayonier Advanced Materials at 6 Gum Street in Fernandina Beach, FL. Lignin is a byproduct of Rayonier’s current pulp operation. The intended development is industrial and will not contain any residential densities to increase population. The development is located in an industrial (I-1) zoned property and its intensity is limited to a floor area ratio of no greater than 0.75 of the entire property. Building height limitations are exempt for mill operations per the city’s Land Development Code.

The location of the proposed lignin plant is represented on the map below:

Eight speakers addressed remarks to the commissioners concerning the proposed industrial development. Most of the speakers spoke in favor of the project, but three speakers expressed concerns over the potential for health issues that could result from release of hazardous materials during catastrophic events.

Laura DiBella, Executive Director of the Nassau County Economic Development Board, expressed gratitude to the city commissioners for their “unyielding support of this project since Day One.” She said that the FBCC’s support sent a strong message of support to the business community. She reiterated the positive impact that this agreement will have on jobs in the local community and “how unique it is that we are able to participate in such a project.” She said that the environmental and economic benefits are significant.

Local small businessman Mike Zaffaroni urged the commission to approve the agreement. His remarks in part appear below and cover most of the points made by others who spoke in favor of the measure:

“I believe that one of if not the most unique and special part of this community is the balance that exists here. We are lucky to have a pristine coastline on one side of the county and an agricultural industry on the other. We have quiet streets, beautiful parks, access to nature and proximity to a major metropolitan city and an international airport. We have large name brand resort hotels and world-renowned, locally owned bed and breakfasts. Most importantly, we have a balance in our economy between tourism and industry. We are lucky to have this balance as it helps keep our community vibrant during good times and bad. We don’t rely solely on holiday weekends, good weather and disposable income.

“I believe JOBS are the most critical driver to a healthy local economy and specifically higher wage jobs that give our children opportunities to work and grow right here at home. It prevents us from being an exclusive retirement island sheltered and only accessible to those who are in the highest tax brackets. It gives people options, it gives them opportunity. And that’s what America is all about…

“I am not an employee or a shareholder of Rayonier or any of its subsidiaries. I do very little business, if any, directly with the company. However, I do have proud ties to the company through its employees as friends, fellow members of our community and as loyal customers of mine. Selfishly, I want these jobs here because it will likely benefit my small business with new customers. But it will also make our community a better place in the same way the existing employees have through their hard work, support of our businesses, their payment of taxes and their charitable efforts.”

Those who spoke with criticisms of the proposed plan asked the FBCC to impose requirements consistent with a 500-year flood plain’s requirements out of an abundance of caution to protect residents from hazardous material spills. Retired attorney Frank Santry, asked for and received assurance that the city’s flood code ordinance would trump the agreement. City Attorney Tammi Bach said, “Whichever is strictest, we will apply.”

Commissioner Len Kreger added that the city’s flood plain ordinance references requirements of the Florida Building Code and engineering requirements of the American Society of Civil Engineers, which must be followed. He stressed that the mills must obtain building permits that comply with all requirements.

Commissioner Roy Smith said that he would prefer adding a more stringent requirement, forcing the mills to provide two feet of freeboard between hazardous materials storage units and the flood plain. But Commissioner Tim Poynter disagreed. Poynter said that by doing so the city would be adding cost to the project “for no good reason. ” He said that in industrial construction the city relies on the state and federal governments to set reasonable requirements. He suggested that to impose additional requirements, with no reasonable basis, was “a slippery slope.”

When Commissioner Len Kreger said that adding a foot to the requirement would demonstrate that the commissioners are listening to the concerns of the people, Poynter disagreed. Poynter said that depending on the classification of the particular hazardous material, that elevation would be higher by existing standards. He disagreed that the same elevations that apply to hazardous materials should also be applied to nonhazardous storage like a water tank.

Poynter expressed doubt that any adjustment would appease those in attendance at the meeting. Many of the project opponents waved signs advocating for requirements of the 500-year floodplain.

Kreger countered saying that the extra foot of freeboard would provide extra safety, “which the population would appreciate.” He claimed that the mills would build that way anyway. “As a compromise,” he said, “it’s a smart step to take. The motion is there. If you don’t want to [make the change], you don’t have to.”

Poynter countered that such a change would apply to the existing build out. He reminded commissioners and the audience that if the mills modify more than 30 percent of their existing facility, the stricter requirement would apply to their entire structure. Poynter and Kreger continued to discuss the mill’s willingness to add a stricter requirement. Finally, Mayor Miller asked Rayonier representative Russell Schweiss to weigh in.

Schweiss clarified previous statements, saying that adding requirements to a building that houses no hazardous materials “doesn’t make sense.” Kreger and Schweiss seemed to agree that the issue related to a Land Development Code item later on the agenda, not to the Development Agreement.

Kreger finalized his arguments saying, “I think it’s important that we listen to the people, to set them at ease. There will be a third party checking the building plans, and permits will be required.”

Poynter replied, “I recognize what people are saying. And I always recognize that there are 20-30 people in this group in the chamber. But we represent all the people. I am listening to people here and to the people who do not attend these meetings. At the end of the day I’m forming my decision based upon everything that I hear, not just the 20 people who show up every week.”

Mayor John Miller attempted to summarize. He said that he understood that Rayonier did not mind applying the 2-foot freeboard rule to the new construction where hazardous materials were involved, but objected to having it applied retroactively to their existing plant regardless of whether hazardous materials were there or not.

With that, the vote was taken and the Development Agreement was approved unanimously.

Ordinance 2016-19 Comprehensive Plan Amendment

In June the city began work on a Comprehensive Plan amendment to address the storage of hazardous materials and hazardous waste within a floodplain. The item before the FBCC for action represented input from city staff, the PAB, and the Northeast Florida Regional Council (NEFRC).

During the Public Hearing, four speakers addressed the item.

Frank Santry expressed frustration that despite having contacted each city commissioner with his concerns, none of the concerns had been incorporated into the final language. He said he had not initially opposed the LignoTech project, despite concerns over public subsidies, because of the increased air quality the project would bring. He expressed concerns over what he saw as a reversal of the project’s spokesmen on the question of using hazardous materials in the floodplain as part of the lignin recovery process. He suggested a series of measures to offset the HAZMAT risks. None of the “offsetting mitigations” which he suggested have been added to the code. “The only thing protecting this community from hazardous materials are the provisions in the flood ordinance that already existed,” he said. He objected to what he saw as language that allows for the presence of hazardous materials in the coastal high hazard area of the city, “something that to the best of my knowledge has not been allowed in any city in America.” He claimed that he would be left to pay for this policy in four ways: subsidy to the LignoTech project, increase in flood insurance rates, possible loss of life or property, and civil liability potential.

Russell Schweiss spoke on behalf of Rayonier. He said, “I think it’s important that when you look at this proposed amendment and the standards it sets, you understand that this is not the only thing that governs how facilities are built.” Schweiss referenced the American Society of Civil Engineers standards cited in the city’s floodplain ordinance. “We build to those,” he said. “We want to protect our assets when we build them, so we build to higher standards [than city ordinance].”

He clarified that the proposed amendment adds a requirement that does not currently exist: flood proofing. He said that new construction will have to conform to ASCE standards, and then flood proofing must be done. “You [the city] go above and beyond any standards that I’m familiar with because of this additional requirement,” he said. “To imply that it is lackluster in safety, there’s an entire organization of engineers that would disagree with that. They would say that you are going above and beyond what is recommended.” He concluded his remarks saying, “If we are going to build millions of dollars in assets, we don’t want it to wash away either.”

Retired municipal attorney Ann Thomas followed Schweiss, expressing “disappointment and dismay” at what she termed the weakening of the coastal management policies of the city and support for points articulated by Frank Santry. However, she reserved her harshest remarks for Commissioner Poynter. “I deeply resent being characterized in a dismissive way as one of ’20-30 people who show up at these meetings,’ whose voice doesn’t seem to matter at all. Instead some other people who don’t ever show up at these meetings, so we don’t know what they would say, are providing input—in particular to you, Commissioner [Poynter]. Do you think that we have nothing better to do? … I promise you we all have something better to do than to show up for evening meetings or workshops. And I don’t understand why you don’t listen to what we have to say.” The audience broke into applause, which the mayor gaveled to a close.

Local activist Julie Ferreira was the final speaker. She said, “I’ve been coming to these meetings for 15 years and things don’t seem to get better.” She recounted problems encountered with floods that resulted from Hurricane Katrina. She cited increased levels of concerns with rising sea levels. She also spoke to problems caused when floodwaters cause toxic chemicals in the soil to flow through residential communities. She said, “Personally, I would sleep better if I knew that you as our elected stewards are doing everything possible to mitigate any potential hazards for citizens, including maintaining the high standards we’ve always had in our coastal management protection plan. I urge you please tonight to make decisions that are sensible, safe, that are equitable and that implement sound safety decisions so we are prepared for possible unforeseen situations that could turn into catastrophes.”

At the request of Commissioner Kreger, Community Development Director Marshall McCrary explained some changes that staff was recommending based upon considerations raised by the Northeast Florida Regional Council (NEFRC). The changes would alert the state to any city plans to add industrial activity within the floodplain.

The ordinance passed with a unanimous vote on second and final reading.

Ordinance 2016-09 Land Development Code amendment

Amendments in this Ordinance address definitions for water-dependent, water-enhanced and water-related uses, sedimentation control, and hazardous materials in addition to land development regulations for environmentally sensitive lands, coastal resource protection, waterfront planning and soil and sedimentation control.

No one requested to speak on this item during the public hearing, although it had been extensively discussed during multiple PAB hearings and the FBCC’s First Reading.

City staff and industry were at odds on two points, which Marshall McCrary brought before the FBCC for a decision. The FBCC supported staff recommendations. The changes approved by the FBCC prohibit the storage of hazardous material in the coastal high hazard area as a stand-alone or primary use.

City Attorney Bach attempted to clarify. “These changes would come under the section that is prohibited primary uses in an area of special flood hazard. Manufacturing is a primary use on the mill sites, not storage. Bulk storage yards for hazardous materials would also be prohibited.”

McCrary said that based upon a review of existing heavy industrial sites, it does not appear that Rayonier is affected at all, and only a small part of the WestRock site is affected. He added that he did not believe that any current activities are underway at the WestRock site that would be affected by the prohibition.

The amendments passed unanimously on second and final reading.