Legal Answers in PMPA Litigation

A vote to oust board chairman Joel Ledbetter failed, 5-5. Clinton voted "yes" - favor of motion.

Newberry v. Rock Hill defendants want court to dismiss all charges; litigation includes Clinton. W-UPDATE BOARD CHAIRMAN VOTE.

 

The 5 defendants in a lawsuit by Newberry (lead plaintiff) against Rock Hill (lead defendant), and others including Clinton, sued with Rock Hill, and Laurens, filing suit with Newberry, have asked a court to dismiss all allegations in the Newberry lawsuit.

The litigation is causing a major rift among the 10 member-cities of the Piedmont Municipal Power Agency, based in Greer. The legal matter was discussed today at a PMPA board meeting; however, the presentation led by PMPA’s litigation attorney was conducted in closed session about lunch.

PMPA filed its response Aug. 19; Clinton and Union filed their response Aug. 15; and Rock Hill and Greer filed their response Aug. 13. The matter appears to be headed for court-arbitration after the first of the year.

Meanwhile, the PMPA board tabled a motion today to remove its board chairman from office. A Sept. 5 “work session” is scheduled to discuss in more detail a futures-rate analysis presented today (Aug. 22). A full board vote on a new rate structure – or maintaining the current rate structure – could be held on Sept. 19.

Rock Hill and Greer have said, as growing cities, maintaining the current rate structure is unacceptable. Rock Hill has proposed a plan if full enacted will raise Clinton’s cost of electricity from PMPA by 30%. Today, a rates consultant said beginning in 2029, if Rock Hill, Greer and Westminster follow through on their commitment to leave PMPA, the remaining 7 cities will have their cost-of-power from PMPA go up by 13% (administration cost of PMPA is $5.76 million).

PMPA, Clinton and Union, and Rock Hill and Greer want all their legal fees paid by Newberry and others if the lawsuit is dismissed. Abbeville and Westminster are not being sued.

Clinton, Union, Rock Hill and Greer violated 3 sections of agreements, PMPA alleges, if the cities engaged in discussions of “side agreements” to buy and sell power among themselves – as the Newberry litigation alleges. An affidavit attached to the Newberry lawsuit says the “side agreements” amount to “bribery”, since the cities requesting the agreements – Rock Hill and Greer – allegedly “bought the votes” of Clinton and Union.

If that happened, the PMPA request to dismiss says, these agreements violated provisions of the Catawba Project Power Sales Agreement and the Supplemental Power Sales Agreement.

Clinton and Union’s response says, “The Complaint, as written, is so vague and devoid of factual allegations as to render this claim deficient on its face.” Newberry’s lawsuit “fails to adequantly describe the relief that it requests, and it must therefore be dismissed.”

The City of Rock Hill and the Greer Commission of Public Works’ response says Newberry’s claim fails “to allege facts sufficient to state claims under South Carolina jurisprudence,” and “this Court lacks subject matter jurisdiction as to the First and Fifth Causes of Action.”

 

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