HomeMy WebLinkAboutRes2007-015
Sponsored by: Yoder
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CITY OF SEWARD, ALASKA
RESOLUTION 2007-015
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SEWARD,
ALASKA, AUTHORIZING THE CITY MANAGER TO ENTER INTO A
SETTLEMENT AMENDMENT WITH MEA IN THE CEA CAPITAL
CREDITS COMPLAINT
WHEREAS, the City entered into the lawsuit as a third party defendant to protect our
allocations of Capital Credits, from Chugach Electric Association ("CEA"), for the years 1998-2004
and any future allocations; and
WHEREAS, in December 2006 a judge granted the City's cross-motion for summary
judgment and dismissed with prejudice Claims I, II, ill, IV and VII; and
WHEREAS, Matanuska Electric Association ("MEA") has offered settlement terms to the
City, waiving MEA's right to appeal the judge's decision to the Supreme Court in exchange for the
City's agreement to waive its rights to seek reimbursement of eligible attorney's fees, estimated at
$14,000.00; and
.....
WHEREAS, it is in the City's best interest to agree to settlement under these terms and not
have to defend against the same claims in Supreme Court, at a cost estimated to exceed $30,000.00.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY
OF SEWARD, ALASKA, that:
Section 1. The City Manager is hereby authorized to enter into a settlement agreement with
MEA in the CEA Capital Credits complaint, and to waive the City of Seward's rights to seek
reimbursement of eligible attorney's fees.
Section 2. This resolution shall take effect immediately upon its adoption.
PASSED AND APPROVED by the City Council of the City of Seward, Alaska, this 12th
day of February, 2007.
.....
CITY OF SEWARD, ALASKA
RESOLUTION 2007-015
AYES:
NOES:
ABSENT:
ABSTAIN:
ATTEST:
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THE CITY OF SEWARD, ALASKA
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Vanta Shafer, Mayor
Valdatta, Bardarson, Schafer, Amberg, Shafer
Thomas
Dunham
None
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Jean
City
(City Seal)
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COUNCIL AGENDA STATEMENT
Meeting Date: February 12, 2007
Through: Marvin Yoder, Interim City Manager
From: Tim Barnum, Electric Utility Manager
Agenda Item: Authorizing the City Manager to enter
into a Settlement Agreement with MEA in the CEA
Capital Credits Complaint
BACKGROUND & JUSTIFICATION:
In October, 2004, MEA filed a lawsuit against CEA with regards to how CEA was
allocating capital credits to its wholesale customers from 1998-2004. In an effort to
preserve our allocation of capital credits for the years 1998-2004 and in future years, the
City filed as a third party defendant in the case.
In December 2006, the judge hearing the case granted the City’s cross-motion for
summary judgment and dismissed with prejudice Claims I, II, III, IV and VII. MEA has
the option to appeal the judge’s decision in the case. The City has the option to seek
reimbursement of eligible attorney’s fees, since we won the case.
MEA has offered to waive its rights to appeal if the City will waive its rights to seek
attorney’s fees. The amount that the City could be reimbursed for is approximately
$14,000.00. If MEA appeals the decision to the Supreme Court, we anticipate we would
spend in excess of $30,000.00.
CONSISTENCY CHECKLIST:
Yes No
1. Comprehensive Plan
2. Strategic Plan
3. Other
X
4. Not applicable
FISCAL NOTE:
There is no added cost to this settlement, other than continuation of attorneys fees
necessary to finalize a settlement agreement. The City will forego potential
reimbursement of attorney’s fees in the amount of approximately $14,000, in exchange
for MEA’s agreement not to appeal to the Supreme Court, which the City anticipates
would potentially cost $30,000 to defend. No appropriation is necessary at this time.
Approved by Finance Department:
RECOMMENDATION:
City Council approve Resolution 2007- authorizing the City Manager to enter into a
settlement agreement with MEA, whereby MEA waives its right to appeal in exchange
for the City of Seward waiving its rights to recover eligible attorney’s fees in the CEA
Capital Credits complaint.