“Original sin” is a Christian belief in the state of sin in which humanity has existed since the fall of man, stemming from Adam and Eve's rebellion in Eden — namely the sin of disobedience in consuming the forbidden fruit from the tree of knowledge, revealing good and evil.

In Gainesville, the City Commission’s budgetary woes truly began with its “original sin” — its May 7, 2009, ratification of a Gainesville Regional Utilities contract with American Renewables’ Gainesville Renewable Energy Center. The contract obligated the city in an agreement to buy power for 30 years generated by the wood-burning, carbon-belching, forest-depleting, biomass plant at a minimum cost of more than $70 million a year, totaling about $2.1 billion, whether we used its power or not.

GRU invoices show that the plant stood mostly idle between August 2015 and March 2017, during which GRU paid $117,708,788 for “available” but unused and “delivered” energy. That is unconscionable on its face.

Led by former Mayor Pegeen Hanrahan, the 2008-09 commission failed to fully internalize falling natural gas prices during negotiations and negotiators removed a “termination for convenience” (or “back door”) clause in the final contract, standard in government contracts, that would have expressly allowed the city to terminate the contract.

The official record shows that on May 12, 2008, the commission authorized negotiation of a power purchase agreement upon being briefed that natural gas prices, then at $11.27 per million BTU, were only expected to rise. That commission approved negotiation, expressly including a “binding back door” clause at the site certification point (which GRU acknowledged was “normal”).

However, it was absent from the final contract signed on April 29, 2009, and ratified by the commission on May 7, 2009, even though the commission was briefed by GRU that natural gas prices had fallen by that April to an “all-time low” ($3.50 per million BTU, per the U.S. Energy Information Administration).

After a Navigant investigation (which lacked subpoena power) and a two-year arbitration that the city walked away from, the City Commission, now led by Mayor Lauren Poe (who approved the power purchase agreement as a commissioner), finally acknowledged in 2017 that the city had made a bad deal (“one of the worst biomass deals in the country,” according to the independent Partnership for Policy Integrity).

Poe’s preferred solution: buy the plant. This took shape as the asset purchase agreement in which the city agreed to pay GREC’s asking price of $750 million, and worse, to borrow the necessary funds with 30-year “must pay” bonds with a mix of fixed and variable interest rates.

During the commission’s discussion of the agreement on Aug. 24, 2017, I argued that the city still had an inherent legal right to terminate the contract with GREC for the convenience of the government, whether the clause was expressly included or not.

My view, which no one ever disputed, was that the worst that could have happened if the city stopped paying was that GREC would sue. The lawsuit would ultimately be resolved by settlement negotiations supervised by the courts, armed with sworn depositions and possible evidence of fraud that could have substantially reduced the city’s exposure.

However, my advice was ignored. There was no dialogue or questions about it, even from the city attorney. I advised that if the commission acquired the plant, it would look like a coverup as the plant purchase agreement effectively foreclosed further inquiry and except for claims based upon “fraud or willful misconduct,” waived claims against all parties. Nevertheless, the $750 million buyout, with interest raising the true purchase price to about $1.2 billion, was approved.

We are all stuck with the bill — heavy long-term debt obligations that GRU must repay. On Sept. 30, 2018, a GRU chart estimated that its total debt service (principal and interest) was $2,437,029,000 with payments averaging about $90 million per year through 2047.

New borrowing and debt restructuring earlier this year have likely increased the total debt service to about $2.8 billion. That’s why GRU must either reduce the annual transfer to the city or raise rates. Yet the commission recently demanded that the transfer remain flat.

Sadly, the biomass plant “original sin” permeates all of our local politics, as well as current budget negotiations. This is why Poe and a majority of the City Commission want to raise property taxes by 11.5 percent and electric rates by 6.4 percent, without making any cuts. We will all pay for their mistakes.

Robert Mounts lives in Gainesville.