The New Mexico Public Utility Commission (PUC) has rejected a request by PNM Gas Services, a division of Public Service Co. of New Mexico and a natural gas local distribution company (LDC), to implement two new experimental "optional utility services": 1) a Food Service Maintenance Program (maintenance and repair on commercial equipment), and 2) an Energyguard Bill Payment Protection Plan (insurance).
Many executives of publicly held utility corporations have written severance agreements to protect them in the event of a change in control. However, these severance packages remain vulnerable to attack by acquirers.
Two separate threats are emerging. One involves a direct attack on drafting flaws in the plan documents. The other, more subtle, threat lies in the impact and interpretation of the special "Golden Parachute" rules under the Internal Revenue Code. This second threat warrants attention.
The term "parachute payment" includes "any payment in the nature of compensation to . . . a disqualified individual . . .
For purposes of this section, an individual is a disqualified individual . . . if . . . the individual is an employee or independent contractor of the corporation and is
a) A shareholder [More than $1 million or one percent of fair market value]
b) An officer, or
c) A highly compensated individual
. . . .
The term 'officer' implies continuity of service. ...
U.S. District Court Judge Joseph Farnan, Jr. on October 16 approved a $36.5-million settlement resolving class action lawsuits alleging securities laws violations against the bankrupt Columbia Gas System (CGS).The lawsuits were filed by various security holders against CGS, its independent public accountants, the underwriters of its 1990 stock offering, and certain officers and directors. CGS's portion of the settlement amounts to $16.5 million, with the remainder shared among the insurance carriers of various defendants.
Retail competition will render a substantial fraction of existing electric utility plant worthless. Some estimates are so large that the question of compensation for these so-called "stranded investments" overshadows debate on the value of retail competition. Advocates of compensation frequently appeal to a "regulatory compact." They claim that this compact justifies compensation for utilities on grounds of fairness. The case for fairness, however, is badly flawed. Moreover, compensation may adversely affect the efficiency of markets in which competition is emerging.
There is a price to pay for becoming a lean, mean fighting machine, and utilities paid the price in 1994.
A number of electric utilities saw revenues increase last year on the strength of higher sales, but the costs associated with laying off hundreds of employees and downsizing company operations took a significant bite out of earnings.
A PUBLIC UTILITIES FORTNIGHTLY survey of the nation's top 20 electric utilities shows an increase in their combined 1994 revenues to $107 billion, a healthy 3.6-percent rise over the previous year.
There is a price to pay for becoming a lean, mean fighting machine, and utilities paid the price in 1994.
A number of electric utilities saw revenues increase last year on the strength of higher sales, but the costs associated with laying off hundreds of employees and downsizing company operations took a significant bite out of earnings.
A PUBLIC UTILITIES FORTNIGHTLY survey of the nation's top 20 electric utilities shows an increase in their combined 1994 revenues to $107 billion, a healthy 3.6-percent rise over the previous year.