Yale University's letter on Northern Pass lease

 

Recently, Yale has been asked to intervene in the development of a 192-mile transmission line, known as Northern Pass, that would bring hydropower from Quebec to New Hampshire and other New England States. The focus of petitioners has been lands in northern New Hampshire owned by Bayroot LLC. Responsibility for managing these lands rests with Wagner Forest Management, which in 2012 decided to lease these lands to the developer of the Northern Pass project.

Pointing to the July 1, 2017 expiration of the initial term of lease, petitioners sought the termination of the lease and prevention of its renewal.

The petitioners fail to recognize several important facts. First, institutional investors such as Yale typically invest with managers through partnership arrangements that limit the investors’ ability to control decisions from both a legal and best practices perspective. Second, Wagner Forest Management did not have the ability to terminate the option to renew under the terms of the lease. Third, as a matter of public record and as reported in the press, the developer of the project has exercised its option to renew the lease and the term has been extended to 2110.

The Northern Pass project is undergoing rigorous review in the State of New Hampshire, under the purview of the Site Evaluation Committee.

Wagner Forest Management practices sustainable forest management on the Bayroot LLC lands in conformance with certification standards promulgated by the Sustainable Forestry Initiative (SFI) and the Forest Stewardship Council (FSC), as confirmed by independent auditors. Moreover, the firm works closely with major conservation organizations, participating in a range of conservation initiatives. The Yale Investments Office views Wagner Forest Management as a world-class manager of timberland.

Yale’s longstanding approach to Endowment management is to identify and engage high-quality investment managers and to give them investment discretion. This approach has served Yale well, as demonstrated by the significant financial support the Endowment has provided to students and faculty over the decades.

Editor's note: The above statement was put out by the Yale University Office of Public Affairs and Communications in response to requests that the university intervene in the Northern Pass project and public criticism of its position to date.