The closures of the Navajo Generating Station and the Kayenta mine later this year will gut tribal government budgets in northern Arizona, according to a report published Thursday.
Both the Navajo and Hopi Tribes rely heavily on lease and royalty revenue from the coal industry. In response to the shutdown, the Navajo Nation will reduce public service spending by 23 percent. The Hopi will take an 85 percent budget hit.
Karl Cates of the Institute for Energy Economics and Financial Analysis said it’s time for the federal government to step in just like it did for the Detroit-based auto industry and towns affected by military base closures.
“The Department of Defense has pumped billions of dollars annually for many years to economies affected by base realignment and base closure,” Cates said.
Cates pointed to hurricane relief efforts saying, “tribal economies are no less worthy of comparable federal intervention, and the same is true of struggling coalfield communities elsewhere.”
The Navajo Generating Station’s operator Salt River Project said it was shutting down the coal plant in favor of natural gas, which is cheaper.
Mine production comes to a halt in October, and the plant will follow in December.
