Navajo Nation Council tables lease negotiations for Navajo Generating Station.

Navajo Nation Council Tables Navajo Generating Station Lease

Anne Minard


The Navajo Nation Council has tabled a decision on a lease renewal with the Navajo Generating Station, the controversial, coal-fired power plant on tribal land near Page, Arizona. Navajo Nation President Ben Shelly’s office is claiming the delay could kill prospects for the plant’s continued operations.

The decision came following testimony; Council members bitterly complained that they were left out of negotiations about the renewal, and expressed frustrated about the proposal’s perceived shortcomings, which they felt they could have helped avoid.

The proposed lease was negotiated between NGS plant owners—primarily the Salt River Project, which is based in Phoenix—and a team of experts assembled by Shelly. It has several provisions widely seen as favorable to the Navajo people, and would raise annual revenues from about $3 million a year secured in the original 1969 lease to $44 million a year during the tenure of the new lease, which is from 2019 to 2044. But Council delegates found at least six sticking points worthy of amendments.

“I’m not anti-NGS,” said Delegate Leonard Tsosie, who convinced his fellow Council members to table the legislation. “I really feel that by allowing this to move forward, we will shortchange the Navajo Nation and the Navajo people... The advisors of the President were wrong to shortchange and leave out Navajo Nation Council.”

Shelly’s spokesman, Erny Zah, says the Council was invited to give input throughout the two-and-a-half year negotiation of the lease. “We have been asking the council for input. We reported back to them, and at times we found it difficult because the Council just wouldn’t show up to meetings. We tried to brief them in executive session... ”

Shelly, whose team included experts in the fields of energy, law and environmental policy, has suggested that he didn’t want to turn the lease negotiations into a political process, and sent the Council a letter after their vote, urging them to give the lease renewal a green light. “The Team negotiated a good solid agreement for the Navajo Nation,” he wrote. “We have been told by SRP there is little, if no room to renegotiate.”

Sam Woods is Shelly’s energy advisor, and participated on the negotiating team. He described some aspects of the negotiations in a presentation to the Council. “Our lease perspectives included the need and right to maximize payments to the Navajo Nation,” he said. “Our team stood on an anchor that Navajo has changed, and desires equality. That we need to see more revenues existing in the current jobs and develop the skills and talents to be professionals and leaders of these operations in the future. Also further recognizing that Navajo resources—the land, the air, the water and people—are used to subsidize and improve other people’s lifestyles outside the Navajo Nation. Our impacted communities need to be compensated and our youth to continue their academic endeavors. At the beginning, we wanted SRP participants to step in our shoes, look into our eyes, feel our heartbeat.”

In addition to the increased revenue, the new lease says the Navajo Nation would become part-owners of NGS and owners of the transmission lines leading from it. It also secures scholarship money for Navajo youth, and assures the continuation of more than 800 jobs.

But for some, the terms don’t remedy decades of poor economic returns and environmental degradation. “We are the suppliers of cheap energy for the rest of Arizona,” Nicole Horseherder, a lifelong resident of Black Mesa, which is near the Kayenta Mine, told the council. “But we can’t do this by putting the 800 combined jobs of the mine and NGS over the health of thousands, and the livelihoods of more than 20,000 Black Mesa residents. All of us need clean air, clean water, productive and clean land. Not land damaged by mining … and air polluted by poisons.”

Black Mesa residents, as well as residents in nearby Hopi lands, have long complained about the drying of their sacred and sustaining springs, which they say have been hammered by water withdrawals for mining operations at Peabody Coal, operators of the Kayenta Mine. “For over 35 years, between 1971 and 2005, Peabody removed water from Navajo Aquifer at a rate of 4,000 acre-feet per year, which is three times more than the aquifer’s ability to recharge itself,” Horseherder said. “This is in an area that gets less than eight inches of annual rainfall.”

Hydrological experts have long disagreed with Black Mesa residents—and often with each other—about whether the aquifer has been damaged by mining. And allegations about the health impacts of the coal-fired power plant haven’t been formally studied by either the federal government or the Navajo Nation, so there is no way to assess the statistical significance of growing anecdotal warning signs.

“Likely impacts include hundreds of asthma attacks, bronchitis, premature deaths,” Horseherder told the council. She was the only grassroots activist invited to address the council on the matter, but she was joined by at least a dozen women who marched three miles to the council chambers to protest the lease extension. The women and their supporters were outnumbered by scores of miners and NGS workers, who were bussed in by SRP to witness the discussions.

The Council came up with six amendments they would like to make to the lease renewal. They would like the Navajo Nation to re-assert its claim to 50,000 acre-feet a year of Colorado River water NGS has been using for free since the beginning of the lease. They hope to shore up the use of the Navajo Preference in Employment Act in SRP’s hiring protocols for the mine and plant; they want fewer hiring decisions left up to the company’s discretion. They’d like to see the Navajo Business Opportunity Act enforced in contracting. They want to address the perceived conflict of interest between the federal government’s trust responsibility and the part ownership in the mine by the Bureau of Reclamation. They want to adequately remediate fly ash, the byproduct of coal-fired electricity production that contains toxins but is currently unregulated by the federal government. And they have questions about the rigor of two economic impact studies of NGS and the mine done by economic experts at Arizona State University.

Council members said they hope they’ve secured a seat at the table with Salt River Project negotiators, and they hoped to reconvene by April 29 with a lease renewal they could accept.

Another variable in this fight is that NGS is already facing daunting regulatory challenges. The U.S. Environmental Protection Agency has recently recommended up to $1.1 billion in new pollution control technology to rein in the plant’s contributions to regional haze, especially as it effects Grand Canyon National Park.

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W.Agency's picture
Submitted by W.Agency on
Excellent job to those council delegates who fought to table this legislation until it is thoroughly reviewed. You see what most Navajo Generating Station(“NGS”) employees and supporters do not, the best deal or compromise for all Navajos who will be affected by the deal presented by our Navajo Nation President and Navajo Nation Speaker, we need to continue to keep our eyes open and our voice heard. We come from a history where deals presented were and are accepted “as is” and included language which our government representatives accepted without question. We have lost a great deal as a people, and been through a great deal of heartbreak as many nations and tribes have and continue to today. We on the western agency have been forgotten by our governmental officials, unless there is discussion of natural resources. This area was at the forefront of ensuring our voice was heard during “closed door” discussions during SB 2109, which had language referencing NGS, and allowed the Navajo Nation time to educate themselves to what was at stake. Delegate benally your statements on our employment law, thank you for seeing this as a much needed clause within the lease and any lease for that matter upon the Navajo Nation. Some will try to diminish its need, calling it “antiquated” but it is a very important piece of legislation. To those delegates from around the Western Agency or in close proximity of this area, I ask you to take a look around, digest what you see, meet with these people and see with your own eyes elderly who live in substandard living conditions, who understand the meaning of “loss” as most are relocates and generational relocates. Most will tell you, if you explain the situation of NGS legislation or talks of water will say that water is the most important thing, without it we will not survive. If this deal is to happen, ensure that it is the best deal, the best negotiations, or proposal for the people and not for the few benefactors. We as a people have continued to move forward with each new day, working through the hardship of relocation, reduction and eradication which has become generational (policies which continue to have a major impact, as can be seen in our youth, their inability to speak their own language, practice their own customs, and recite their own prayers). We can only ensure now that any deal that is presented in the best possible deal for all and we need to work together on solutions because we are facing very hard times with the economic situation at hand. I commend you council delegates who stood diligently against pressure and decided to review the document more thoroughly and to those who have stood out each time in opposition and educated those who were not aware of the historical significance of NGS, and any proposals which incorporate language of water or the aquifer which lies beneath the Navajo Nation. I remember once being told by my grandfather that there would come a day that our natural resources, especially water would become currency, dare I say, and that time has come.