Archive for Wednesday, November 29, 2000

Rate hearing resumes today

November 29, 2000

A Franklin County District Court judge asked for more information from the Kansas Municipal Energy Association, a group of KMEA member cities including Baldwin City and the Board of Public Utilities during a summary judgment hearing last Tuesday, and the hearing will continue at 1 p.m. today in Ottawa.

Judge James Smith is expected to give a ruling following the hearing today. Baldwin City Attorney Bob Bezek said the ruling could set the stage for a trial setting on Feb. 20. That trial is scheduled for four days.

"We are going to have further arguments today and the judge is going to rule," Bezek said. "I think last Tuesday's hearing went well. We got our point across."

Baldwin and a group of other cities in the KMEA are suing the BPU over prices charged for electricity when the BPU's Nearman generating station was closed because of a fire during summer 1999. The plaintiffs contend they were forced to purchase power at rates well above levels described in contracts with BPU.

The cities seek damages in excess of $1 million. City Administrator Larry Paine said the cities have turned down a settlement offer of $42,000.

Since the filing of the lawsuit, the BPU has unsuccessfully tried to have the case moved from Franklin County through the District Court and the Kansas Supreme Court, and has tried to exclude the cities as parties of the case. The lawsuit was filed in Franklin County because Ottawa, one of the cities in the case, sustained the most financial damage.

Baldwin paid up to $2,420 per megawatt-hour for power in late July 1999, compared to the normal price of about $50 per megawatt-hour. Without a reserve fund for such emergencies, Baldwin took out a $300,000 no fund warrant from Baldwin State Bank to pay for the bill.

The expense was passed to Baldwin electric customers, who were billed a surcharge based on usage.

In addition to recovering overcharges from the summer, the lawsuit seeks to prohibit the BPU from using the same pricing formula in future billings.

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