Utilities get little credit for their efforts to strengthen the sustainability of their businesses. But these efforts have paid dividends in stock performance, capital costs, regulatory...
Las Cruces Stymied in El Paso Takeover
The U.S. District Court for New Mexico has ruled that the City of Las Cruces, NM, failed to meet the burden of proof required to take over through condemnation the electric facilities owned by El Paso Electric Co. (EPE) [City of Las Cruces v. El Paso Electric Co., No. 2:95-CV-485 LCS, (Aug.23, 1996)].
The court withheld judgment on the ultimate question of whether the city has authority to condemn EPE's property, finding that the case involved issues unique to New Mexico and presented a "significant question of state constitutional law." Noting that the outcome of the case would affect over 62,000 electric utility customers, the court forwarded the question to the New Mexico Supreme Court.
To exercise its general condemnation power, Las Cruces must show that public use of the EPE property would not be "materially impaired": "From the perspective of the entire user public, will the proposed condemnation of the prior use result in a significantly less functional system?" Material impairment is more like destruction than inconvenience, the court said, citing lack of a system study to determine how a new or modified electric distribution system would work and whether it would impair reliability. The court also questioned the safety of electric workers and the public. While there might be a way to sever the existing system without materially impairing the prior public use, the court declared the city's current plan "conclusory, amorphous, ethereal, and subject to future modifications."
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