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HomeMy WebLinkAbout2002-05-22-UTIL-min.pdf Minutes of the Electric Utility Ad-hoc Committee May 22, 2002 Members in Attendance Roger Borghesani, Paul Chemick, Norman Cohen, Peter Enrich, Ingrid Klimoff, Patrick Mehr, David Pavlik, Bob Reid, Kelly McKay Zeoli Patrick handed out a spreadsheet comparing Nstar rates with those of Massachusetts's municipalities. Ken Barna Ken Barna, a Brookline resident and electric committee member and attorney, came to the meeting to discuss a memo he wrote in his legal capacity He has several municipal light plant clients, including Concord. He said that last summer Brookline experienced significant power outages, so the Selectmen created an electric committee to look into electric power issues. Ken explained what he wrote in his memo. He did not want to distribute copies of it, as he does not want to be perceived as giving legal advice to anyone who is not his client. Points of his memo. • The Mass. Legislature has enacted a series of general laws relating to the authority to create and operate light plants. MGL Ch. 164 is the template for light plants and a municipality must follow the general laws. MacRae v Concord Selectmen 296 MA 394 (1937). • In order to start a light plant, a municipality must have 2 Town Meeting (TM) votes with 2/3 approval for each. Ch. 164 Sections 34, 36. There must be different votes for aggregation than for the acquisition of the light plant. The votes must be at least 3 months,but no more than 13 months apart. Neither vote is binding,but if there is a second vote, it is seen as being very serious. • MGL Ch. 44 Section 8, subsection 8, the municipality has the authority to bond for capital expenses but not for operating costs. To bond outside of Prop 2 '/z, the municipality does not have to have an override vote; the vote to authorize the bond by TM is all that is needed. The light plant does not have the authority to issue debt, only the municipality does. • After the TM votes, the municipality will have to negotiate with Nstar regarding the cost of facilities, 164 Sections 41-43 If there is no agreement on the valuation, then DTE will determine the outcome. It is a quasi-judicial process with discovery, expert witnesses, direct testimony, cross examination, hearings, and briefs. An appeal of the outcome would go directly to the Massachusetts Supreme Judicial Court Ch 25, Section 5 • There have been 2 recent relevant proceedings, Town of Wilmington v Reading Light Plant and Town of Stow v Town of Hudson. • Nstar would put up a strong fight to stop any municipality from electric municipalization and the municipality should expect to spend at least $100,000. Along with purchasing the poles and wires, there would also be costs for Nstar bypassing Lexington to service other towns. • Senator Morrissey and Rep. Bosley are both strong supporters of municipal light plants. The Braintree light plant superintendent, Walther McGraf, is close to the Senator. • There are no regulations as to how members of a light plant board are chosen. The members could be appointed by the BOS or the Town Manager or elected etc. The manager of the light plant is appointed by the board and has the authority to sign contracts. • The Mass legislature and Supreme Court have given exclusive management of the light plant to the plant manager and board. Therefore, the Board of Selectmen would not have control over the plant. In fact, a municipality and its light plant are legally seen to be so separate (because of having rate payers versus tax payers)that they could, in fact, sue each other. 32 Mass Appeals Court 964 (1992) • However, the municipality, not the light plant itself, controls the appropriations and budget of the light plant. But TM has no jurisdiction over setting the electric rate price. 348 Mass 266, Ch. 164 Sections 55-58. 426 Mass 1347 • The light plant is the employer for its employees, including collective bargaining employees. It sets the employees' wages. MCR 29 JJ(Marblehead), 196 Mass 141 (Taunton). The municipality, however, is in control of the property insurance and pensions. 344 Mass 133 • The bidding is the same as for the municipality The municipality owns the property • Retail choice does not apply to the plant. Peter believes the committee should setup a meeting with Morrissey, Bosley, and other towns, like Braintree,Arlington, and Concord this summer. Ken will speak with his committee about a joint meeting. He would also like load information from Lexington's committee. Next Stens • The next meeting of the committee is on Wednesday June 12 at 7.30 p.m. in Room G- 15 of Town Hall. • A legislative task force will meet on Thursday, May 30`h at 8:30 a.m.