Introduction
Hello again to the elected officials of the City of Blue Island. You may remember me from my time at the podium of your December 17th 2024 board meeting. I’m Tim Allen, in Business Development for A3 Environmental Consultants, a woman owned environmental consultancy in Lisle, Illinois. We’ve been working in Chicagoland for 24 years, A3E is a 10 year old company.
My Client, AC Power (Solar)
For the project I’m connecting with you about, our client is AC Power a solar developer of what is called “Community Solar” projects.
AC Power has asked A3E to connect with the City of Blue Island and gauge their interest in placing a 20 acre solar array somewhere on the available 80 (ish) acres of the brownfield located at 119th Street and Vincennes. It is my goal to have a serious conversation about this matter and report back with finality on whether or not you are interested in continued negotiations.
Property History
As I’m sure you are aware, this property has had a long history of industrial uses. To put it succinctly, it was a brick manufacturing operation that created an enormous hole in the earth. That hole was backfilled as an unregulated landfill in the days before there were stringent regulations on landfills. The materials it was backfilled with are the cause of the contamination. You can click to see all the environmental data and historic aerials from the early 1900’s on.
This property crossed the radar of the US Environmental Protection Agency and they listed it in their database.
From this database it lets us know that while it is identified as a brownfield, nothing has been done yet to rectify this situation. (You can see this by the screen capture to the right, “property progress”)
In its current state, the property is unsuitable for use by anyone, including my client. They would need progress to be made toward the cleanup in order to locate a solar array on it.
V3 – (Current) Proposal
You may remember from your city board meeting packet of December 17th, 2024 there was a proposal from V3 to investigate and remediate this exact same property for $375,000. That proposal can be found by clicking here.
The thing to remember about proposals that have “Not To Exceed” pricing is that it clearly says “Without client authorization.” So, while you may have a price of $375,000, you don’t know if you’ll have a half-completed project at the end of the process because they wanted more money and did not get authorization. I can assure you from years in this industry, if there’s going to be a pricing surprise, it will be to the upside, not the downside. This is doubly certain when the unknown is environmental contamination.
V3 is a competitor of ours and a fine company. Disadvantageously, the proposal they are presenting you is asking the City of Blue Island to spend taxpayer dollars to remediate contamination on the property with no guarantee you’ll be done when the $375,000 is spent. What’s more, as far as I know, there’s no end user (developer) who will take possession of the property and pay the city back for the outlay of your limited resources. In developer terms, this would be called a “speculative” investment of taxpayer funds. Just like constructing a building that you don’t know if you can sell or rent, you could outlay a lot of money for a long time without ever seeing a penny in return on investment.
A3 Environmental Consultants Proposal
If A3E were successful in securing a brownfield grant for the subject property it would be worth up to $500,000, allowing for an additional $125,000 worth of contingencies over what V3 has proposed for pricing. In addition, this would be a grant from the Federal government. So instead of spending $375,000++ of your taxpayer’s money on this project, you can redirect those funds you otherwise would have spent back into the community.
I believe this brownfield grant has a high probability of being funded for a variety of reasons.
- It’s been 13 years since Blue Island’s last US EPA grant.
- We have an “end user” who will commit to use the property if it is cleaned (AC Power). The US EPA grant process awards “points” to projects that have end users.
- Our end user is a solar developer. US EPA awards more points to renewable energy projects on brownfields.
- The Illinois EPA loves to support these projects too, which improves their fundability. Look here for the IEPA program regarding “Brightfields”.
- There are green jobs grants available for workforce development, specifically designed to create skills in your local workforce that can be tied to this project.
Our proposal is simple: Hire A3E to write a brownfield proposal. Leverage AC Power as a renewable energy developer. Get up to$500,000 to investigate and remediate the subject property. Redirect the $375,000++ of tax dollars you otherwise would have spent into more pressing community needs.
AC Power Deal Structure
There’s more good news in our proposal. Unlike the V3 proposal, if you work with A3E and AC Power you will have a renter for the property that will pay you rent annually. It would be improper of me to negotiate the details of AC Power’s lease on their behalf. I don’t have that authority. However, I can tell you the lease terms are generally 25 years, with 2 five year extensions as options. At the end of the lease, they will decommission the facility and leave you with your land vacant. They are not interested in purchasing the property. The previous lease rates I have been privy to are in the high 5 digits with an escalator that increases them every year.
In addition, this project would put the property back on the tax roles. AC Power would pay them, providing much needed revenues to your schools, library and park districts.
Lastly, the lease contract would be the property of the City of Blue Island. As such, it could be sold to an investor for its “Net Present Value” (NPV). Depending on the details and size of the solar array, it could be worth an immediate windfall of $2 Million for the city.
Helping Blue Island Be Its Best Self
“Community Solar” is a Department of Energy designation for the size, type and organization of a solar development. These installations are generally no more than 20 acres in size. This is the size AC Power is proposing. This leaves 60 acres available for all sorts of community amenities once the project is finished.
Each one of these amenities, when placed on a US EPA Brownfield grant application would increase your chances of winning the grant.
- Baseball fields
- Soccer fields
- Stormwater detention
- Natural area with native plants & trees
If Blue Island and AC Power could come to an agreement regarding the use of the property, AC Power would sign a contract called an “Option To Rent” (OTR). The option would come with a monetary stipend that could be used to pay A3E to write the brownfield grant application on the City’s behalf. Further defraying the cost and risk.
Let’s Talk
I know I’ve covered a lot of ground here. I’m sure you have questions and I would love to get you answers to those questions. In order to do that, I need to be invited to have a meeting with the elected officials that are interested in this amazing opportunity.
There’s still much to be talked about. A3 Environmental Consultants is only a limited agent of AC Power, there’s much to be worked out in order to construct a final agreement to rent this property for a solar array.