The Northern Virginia Daily

October 30, 2009

Front Royal councilmen surprised by shakeup to solar farm project

By Ben Orcutt

Some members of the Town Council are concerned about changes in a proposed solar farm project and how they learned the news.

Yeah, I was surprised by the new principals" of the firm that would build the solar farm, Councilman Carson C. Lauder Jr. said Wednesday. "What I'm concerned about is the fact that the councilmen were left out of the loop as those plans were changing. Not that we have to know every detail, but we should know plans were changing or different things were in the works.

"The horse is not only out of the barn, the horse is in a different barn and I'm not even sure that it's the same horse."

On Tuesday, Steve Lamb, the majority shareholder of Standard Solar in Gaithersburg, Md., announced that his company would merge with a local company that had previously announced plans to build a 27-acre solar farm on the Avtex Fibers Superfund site, now known as the Royal Phoenix.

Prior plans called for Greg Horton, owner of Arctic Air Refrigeration in Front Royal, and Leesburg developer William Lauterbach to partner on the project under the name of SolAVerde.

Lamb, a graduate of West Point and the Harvard Business School, said that he and longtime partner Jim Sharman, from the Chicago area, along with Lauterbach, would be the main principals of the new company, to be known as Standard Energy, with Horton and Donnie Poe, the owner of a local construction business, also having roles in the venture.

One of the primary reasons for the merger is that Standard Solar is in a much better position to leverage funding for the Royal Phoenix project than SolAVerde, Lamb said, adding that between $17 million and $18 million in bonds would be sought to fund the project.

Town Manager J. Michael Graham has said that the deal is contingent upon the town agreeing to purchase up to 100 megawatts of power from Standard Energy.

Graham also said that the funding arrangement for the project was yet to be completed, but could include the issuance of bonds. Graham said Standard Energy would like to have approval from the Town Council by the panel's Dec. 21 meeting, if possible.

"I think it's pushing it," Lauder said, considering the change in the principals of the project. "I want to know who's on the hook for the bonds and if we're a co-signer, then what I want to ask for is protection if for some strange reason they go defunct. I, as a councilman, have an obligation to protect the monies that the citizens entrust us to handle.

"Perhaps this might be a good change and things might work out even better for the town of Front Royal, but I think the entire council and staff who are accountable to the citizens should have the framework of the information, if not the very minute details."

Councilman Thomas H. Sayre also voiced concern about the change of leadership in the project.

"This is the first I've heard of this and I was surprised to read about it in the newspaper [Wednesday] morning," Sayre said. "It is a good thing that Mr. Swig [New York developer Kent Swig, a potential investor in SolAVerde] is not involved at this time, as he has unfortunately recently stated he may file for bankruptcy.

"It was my understanding that this was going to be total private financing and now the town may be asked to help bond the project. I need more information."

Graham declined to comment on Lauder and Sayre's concerns.

Councilman Thomas E. Conkey was not as concerned as his colleagues in the solar project's changes.

"I know more about what's going on, but I don't know what's confidential and what's not," Conkey said. "I think it's a change for the positive. ... Mike has been working with these guys. He's gotten a fairly substantial proposal and we're just working things out. As in any kind of big deal like this there are a lot of details, and every hour there are changes."