The Quoddy Tides

Eastport, Maine

25 Aug 2006

Tribe's acceptance of $200,000 offer by Quoddy Bay up in air

by Edward French

An offer of $200,000 for per capita distribution at Pleasant Point by Quoddy Bay LNG was met with a counter-offer from the Sipayik Tribal Council that the council could decide how to spend the money. The offer was made by Donald Smith, president of Quoddy Bay LNG, at a tribal council meeting on Thursday, August 17. Opponents of Quoddy Bay's proposed liquefied natural gas (LNG) terminal at Split Rock, though, believe the offer is an attempt to influence the upcoming tribal election on September 5 and to entice Indian Township councillors to agree to sign a tax agreement with Quoddy Bay. The tax agreement, which was rejected at a Passamaquoddy Joint Tribal Council meeting last February, is a sticking point to the tribe receiving lease payments from the LNG developer.

According to tribal members present at the August 17 meeting, Quoddy Bay's offer was linked to the tribal council signing the tax agreement, but Smith says it was not contingent on the agreement being signed. He says it was "a good faith offer" as a pre-payment on lease fees to be paid to the tribe. Although there were reports that Quoddy Bay stipulated that the funds had to be distributed by September 1, Smith says there was no deadline. Governor Mark Altvater could not be reached for comment, and Lt. Governor Marilyn Francis had no comment on the discussions.

As a per capita distribution, the money would amount to about $100 per person on the Sipayik census. Councillors told Smith that they would accept the money if there were no strings attached and the tribe would not have to repay the money if the LNG project did not proceed, according to individuals at the meeting. Smith says he responded that they should give him a written proposal, and he would consider it then. A joint tribal council meeting has been called for August 29, but the agenda was not yet available.

The Project Coordination and Tax Agreement between Quoddy Bay and the tribe must be approved by the joint tribal council, not only the Sipayik council. At a joint council meeting in February, the joint council voted to turn down the tax exemption agreement, with all of the Indian Township members voting against it. The proposed agreement calls for the exemption of real and personal property taxes and the reduction of the Tribal Employment Right Ordinance (TERO) tax for Quoddy Bay LNG. The tax exemption provisions would be in exchange for lease payments to Pleasant Point amounting to an estimated $12 million per year once the proposed LNG facility is fully operational at the Split Rock site.

Quoddy Bay LNG so far has not made any lease payments to the tribe. The lease agreement provides that Quoddy Bay would pay the Pleasant Point Reservation nearly $500,000 in a series of payments this year, but Quoddy Bay will not make the payments until the joint tribal council approves the tax exemption. Smith says Quoddy Bay has made all of its payments to the tribe "and more," under its contract with the tribe. "Additional payments were offered because the tax agreement has not been signed," he says. "We offered to make payments not due." If the tax agreement is signed, about $375,000 would be paid to the council now, as that is the amount that has accrued so far.

The LNG debate is a major point in the campaigns by candidates in the upcoming tribal election at Pleasant Point. A run-off election for the positions of governor and lieutenant governor was held on Thursday, August 24. Four candidates — Fred Moore III, Hilda Lewis, Rick Doyle and Alberta Downing — were running for governor. Incumbent Mark Altvater is not running. For the lieutenant governor position, three candidates were running: Pamela Francis, Thomas Lewey and Brenda Moore-Mitchell. Incumbent Marilyn Francis is not seeking re-election. The top two vote-getters for each position will face each other in the tribal election on Tuesday, September 5. Voters will also choose three members of the tribal council from among a dozen candidates.

The $200,000 offer by Quoddy Bay has stirred up criticism from LNG opponents. Linda Godfrey, coordinator of Save Passamaquoddy Bay—U.S., comments, "When Save Passamaquoddy Bay was informed by a reliable source that Don Smith had flown in Thursday to offer the tribal leaders $200,000, saying that he wanted it spent by September 1, it seemed such an obvious attempt to influence the upcoming tribal elections. Maybe this is the way the Smiths are used to doing business in Oklahoma. In Maine, people see an act like this for exactly what it is, and Smith's desperate attempt to buy the election has not fooled anyone."

Godfrey adds, "We understand that Smith said the money was 'to celebrate their milestones' when in truth Quoddy Bay LNG has failed to achieve a legitimate land lease for the Split Rock area, the building of the new boat ramp and floating docks for tribal access to the bay has raised all kinds of questions about LNG at that site, Smith's recent newsletter announced an unpopular plan to take a tribal member's home for his proposed project, and the same newsletter talked about local jobs yet listed six multinational corporations who they say are part of their 'team' and none are even in Maine." She continues, "Add to this the federal lawsuits filed by tribal members with the Bureau of Indian Affairs and the Department of Labor, the confirmation again last week from Canadian Prime Minister Stephen Harper that he is absolute in his decision to deny LNG tankers passage through Canadian waters, and the fact that Smith has not paid the tribe funds he has owed since December 2005, and we don't think this is a list that warrants celebration. Smith's attempt to influence the election was a sad act, not cause for Smith to celebrate."


© 2006 The Quoddy Tides
Eastport, Maine
Article republished on Save Passamaquoddy Bay website with permission.