Senate approves “nuclear option” for merger

The Senate has just pushed the button on the nuclear option, approving in a voice vote an amendment that will prevent utilities from recouping in rates the $21 million they must repay to CVPS customers before any merger can go through.

It’s a move that utility executives have warned could kill the $702 million merger deal between CVPS and GMP. And the Shumlin administration – which has warned legislators against meddling in regulatory affairs – just shipped a press release unloading on the body.

“This matter is now in the hands of the (Public Service) Board. The Senate’s action today interferes with an open PSB docket, undermines the credibility of the regulatory process, and is an extreme overreach of legislative jurisdiction,” Shumlin said in a written statement.

The amendment effectively establishes new criteria against which the Public Service Board must evaluate utility mergers. Specifically, it says that in satisfying windfall provisions, like the one at play in the CVPS/GMP merger, utilities cannot recoup the windfall repayment in rates.

It’s a game-changer in the ongoing merger saga. The Senate has attached the language to the budget, one of the few must-pass bills this session.

The situation is still very fluid, but if the amendment survives third reading in the Senate, then the package will head to the House.

Word of the Senate vote began trickling onto the House floor as that body was in the midst of an hours-long debate on its own merger amendment.

After hearing of the Senate amendment, Rep. Cynthia Browning withdrew her amendment, saying the Senate language would serve as the new vehicle.

Her motion to withdraw confused the body. Rep. Chris Pearson, among the House leaders spearheading the merger issue, tried to clarify from the floor.

“I think there are a lot of people wondering what’s going on,” he said. “We are trying to reach a compromise that would be agreeable to everybody. The Senate has just passed language addressing this, so the concept was perhaps using their amendment in lieu of this language.”

It’ll no doubt be a few days before we know how things ultimately are going to sugar off. But it’s a setback for utilities and for Shumlin, who, depending on how it all plays out, may have to veto the legislation, and suffer some severe political fallout for doing so.

In his press release, Shumlin went on to chide lawmakers for abrogating their constitutional duties to focus on issues beyond their purview.

“The Senate should be wrapping up its work and adjourning this week. Instead, adjournment has been pushed back at least a week, and Vermont taxpayers are now on the hook for another $275,000 thanks to the Senate’s inability to complete its work on time. The Senate should focus on the real issues under its jurisdiction, like passing the budget that should have passed days ago, and bringing the session to a close,” he said.

The messaging battle will no doubt intensify over the next few days. Check out the full story in tomorrow’s editions of the Rutland Herald and Times Argus.

One Response to Senate approves “nuclear option” for merger

  1. You have to give credit where credit is due:  nobody around has gall equal to Peter Shumlin’s or even close.  Here he is now,  lighting into the Senate for wasting taxpayer money as they simply do their job when it’s been his headstrong drive to give away the store to his utility pals that will waste vastly more dollars, by the millions not the thousands.  Give the Senate and the public a little more time and they could also focus the $82 million windfall he wants GazMet to use to finance the takeover (aka “merger”) itself.  A little more time still and we could all weigh and consider whether this takeover of the Vermont’s biggest remaining independent utility along with the smaller ones further down the road would be good or bad for the state.
     
    Better yet, call a brief halt to the PBS process until the next session and see who we have for Governor, who for Speaker, and what the House and Senate have heard from their constituents over the summer.   Don’t give in to Shumlin’s bums rush.