Archive for Wednesday, July 17, 2002

KMEA, BPU case returns to court in mid-August

July 17, 2002

Baldwin City officials will soon learn whether the city's case against the Board of Public Utilities will return to district court.

The case is going before a Kansas City Court of Appeals at 9 a.m. Aug. 20.

Baldwin and a group of other cities in the Kansas Municipal Energy Association are suing BPU over prices charged for electricity when BPU's Nearman generating station was closed because of a fire during the summer of 1999.

"The basis of the lawsuit contends BPU inappropriately charged the city for replacement power," City Administrator Larry Paine said. "It says they overcharged us for that power."

The case has already been before the court once, but Paine said the cities are appealing the November 2000 motion of summary judgment.

"There's foundation for the appeal," he said. "Our contention is that the judge made several procedural errors."

The appeals court will decide which direction the case will take, and Paine said he is hopeful of the outcome.

"It looks like there might be an opportunity for the cities to go back to trial court and review the process and retry the process," he said. "What that tells me is that there's hope."

The lawsuit is seeking more than $1 million in damages in addition to prohibiting BPU from using the same pricing formula in future billings.

Baldwin paid around $2,550 per megawatt-hour for power in late July 1999, compared to an average price between $30 to $40 per megawatt-hour.

With no emergency reserve fund, the city took out a $300,000 no fund warrant from Baldwin State Bank to pay for the bill. The expense was then passed on to Baldwin electric customers, who were billed a surcharge based on usage.

Those who were required to pay the surcharge, Paine said, will be reimbursed the percentage they paid if the case goes back to court and Baldwin and the other KMEA cities win.

"We told everybody that if they paid, we would reimburse them," he said. "We have not forgotten."

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