HomeMy WebLinkAboutMT League of Cities & TownsApril 12, 2004
Mayor Ken Olson
City of Laurel
P.O. Box 10
Laurel MT 59044
MONTANA LEAGUE OF CITIES AND TOWNS
P. O. BOX 1704, HELENA MT 59624
(406) 442-8768 FAX (40¢ 44-2-9231
UL,'i APR ]4 2004
._CITY OF LAUREL
The larger cities in the state are working under the interlocal agreement laws to establish the
Montana Public Power Authority. The purpose of this agency will be to acquire, own and
operate the transmission and distribution systems for both gas and electricity of the
NorthWestern Corporation inMontana. This utilityhasfiled for bmd~ruptcy, and4s proposing a
plan of reorganization to a committee of creditors and a federal court in Delaware. It is uncertain
at this time if the plan will be approved. It is also possible that another investor owned utility
will submit a bid to acquire the transmission and distribution system.
This system is vital to the economy of our state. Cities believe that Montana ownership must be
considered, and for this reason they are preparing to make an offer to the creditors and
bankruptcy court to acquire these assets. The proposed transaction will be financed by revenue
bonds backed by electric and gas rates. If this plan is successful, the customers will own the
system and it will be operated to provide gas and electric service at a fair cost with a high level
of reliability.
Initially, the power Authority will be governed by a board of directors representing the larger
cities. If it is successful in acquiring the utility system, it will expand the board of directors to
provide representation for all cities, towns and counties in the service territory. Directors will be
elected on a regional basis by those local governments that join the power authority through
approval of the interlocal agreement. The intent is to assure that every customer has a voice in
the management of the utility through the participation of their city or county in the Power
Authority.
Local government utility ownership is a new idea in most of Montana. This proposal has
generated a lot of news and some controversy, and we are asking cities and towns in the service
area to give public power a boost by writing letters of support and signifying their interest in
participating in the management of the utility at the time the board of directors is opened to full
membership.
We hope that you can sign the attached letter after, council review, to indicate that cities and
towns across the state support local ownership and are prepared to participate in the management
of the Power Authority. This letter is not a commitment. It is simply a statement of support for
the Authority and an expression of interest in reviewing the interlocal agreement.
Best wishes,
Alec Hansen
(To be put on City Letterhead)
Suggested Letter of Support
Montana Public Power Authority
Submit to: Montana League of Cities and Towns, P.O. Box 1704, Helena,
MT 59624
--The :C4tyhTown of: c ...... -supports the. effort~ f_the_Montan~a
Public Power Authority to acquire the transmission and distribution assets of
the NorthWestem Corporation in Montana. We believe that Montana
ownership is important to the economic future of our state. We also agree
with the stated objectives of the Authority to provide fair prices and reliable
service to gas and electric customers while keeping jobs where they are right
here in Montana.
We appreciate the opportunity that will be afforded to all local governments
to participate in the election of additional members of the Board of Directors
if the Authority is successful in acquiring the utility system. It is important
that customers across the state have a voice in the operation of the public
utility, and we submit this letter to indicate our interest in executing an
interlocal agreement and becoming members of the Authority at the time the
Board of Directors is expanded.
Please advise us of the progress that is being made toward the goal of
Montana ownership of the utility system. This is important work and the
City/Town of wants to be involved.
Best wishes for success,
Mayor