Your PUD
News Release
PUD approves revised counteroffer for Cashmere electric system
Chelan County PUD
News Release
4/16/2007
The Cashmere electric system will become part of the Chelan County PUD system by the end of this year if all contingencies in a revised purchase agreement can be met.
Cashmere Mayor George Valison, City Council members Bruce Moses and Jim Fletcher, along with City Attorney Terry McCauley, met with Chelan County PUD commissioners Monday to discuss city revisions to the PUD’s Feb. 5, $3.5 million offer to purchase the Cashmere electric system. Commissioners approved the revised counteroffer, which moves the closing date up a year to Dec. 31, 2007, and changes other legal details.
The PUD’s offer is subject to two major contingencies: property rights verification and an environmental assessment. Additionally, a feasibility study period of at least 90 days will allow the PUD to conduct a due diligence review of the Cashmere system. Unless waived, those and nine other contingencies would have to be fulfilled before the end of 2007 for the sale to close.
Upon purchase of the system, the PUD will pay $3 million. Another $500,000 will be held for a six-month transition period to ensure smooth transfer of operations, records and equipment. Cashmere has to cover about $2 million in existing debt on the system.
At the city’s request more than a year ago, the PUD took part in an evaluation of Cashmere’s electric system, which serves about 1,400 customers. The results of the study by HDR Engineering were discussed at a public meeting in Cashmere last January. Soon after, Cashmere asked the PUD to evaluate taking over the city’s system.
“We are here in good faith, working with the city at their request. That good faith will prevail through this entire process,” said PUD General Manager Rich Riazzi.
Valison later added, “Our working relationship has been a good working relationship.”
Cashmere, which buys power from the PUD, is the one area in Chelan County that has operated its own electrical distribution system. Cashmere officials will now review the revised PUD counteroffer.
As in past discussions of the potential purchase, Commissioner Ann Congdon excused herself from the discussion because she is related to the Cashmere city attorney.
In other business, PUD commissioners:
- Discussed potential rate increase impacts with members of the Industrial Rates Working Group. The group is made up of the PUD’s largest power customers and has been meeting since January. They provided a list of principles they hope PUD commissioners will use during their deliberations on potential rate increases. The group noted that planned, steady rate increases would be preferable to their businesses, in contrast to sharp surcharges, which they say could put some of them out of business. The group is made up of representatives from Central Washington Hospital, Alcoa, Dolco, Dovex, KB Alloys, Keyes Fibre, Stemilt, Tree Top, Yahoo!, U.S. Castings, Chelan County and the city of Cashmere. The group represents nearly 9,000 employees who earn wages of $207 million a year.
- Heard a presentation related to raptor studies performed prior to construction of the transmission line built last year over Burch Mountain from Rocky Reach Dam to Andrew York Substation near Monitor. Staff reported that studies show that only 5 percent of raptors flew at or under the elevation of the power lines, about 30 meters. A post-construction study will be conducted this year to verify results.
- Discussed information technology solutions used by the PUD to work more efficiently.
- Rescheduled the April 30 commission meeting to start at 10 a.m. to discuss the strategy for the PUD’s fiber-optic buildout.
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The next regular meeting of the PUD commission is at 1 p.m. on Monday, April 23.
Most PUD commission meetings are recorded, and a link to the audio is available on the PUD’s home page at www.chelanpud.org.
Christy Shearer
Communications Audio-visual Specialist
Chelan County PUD
509.661.4258 office
509.421.4258 cell
509.661.8133 fax
christy.shearer@chelanpud.org