
July 19, 2002 |
2002-R-0642 | |
MUNICIPAL ACQUISITION OF A POWER PLANT | ||
By: Kevin E. McCarthy, Principal Analyst | ||
You asked for a summary of the law governing a municipal utility's acquisition of a privately owned-power plant. You were specifically interested in the law as it applies to Norwalk.
Any municipality can purchase, lease, or build a power plant (CGS § 7-213). Such action requires the approval of two-thirds of the municipality's legislative body present at the meeting, and approval by the municipal chief elected official. The acquisition must also be approved the majority of voters voting in a regular municipal election, in which at least 15% of the voters have voted. If the acquisition is not ratified, one year must pass before the issue can be again submitted to the voters (CGS § 7-214). The municipality must establish a board of commissioners to manage the plant (CGS § 7-216). The municipality can issue revenue bonds to pay for the acquisition with the approval of the municipality's legislative body (CGS § 7-217).
CGS § 7-224 et seq. provides that the owner of a power plant serving the municipality at the time the municipal utility is created can force the municipality to buy the plant before the municipality builds its own plant. However, it appears that this provision is no longer in force. This is because it only applies to plants owned by companies incorporated by the legislature to provide electricity (Connecticut Light & Power and United Illuminating), and these companies sold their plants pursuant to the law restructuring the electric industry (PA 98-28).
The utilities serving Norwalk's Second and Third Taxing Districts (South and East Norwalk) are also subject to S. A. 352 of 1913, as amended. The special acts do not include any provisions that specifically deal with the purchase of a privately owned power plant.
In addition to provisions governing individual municipal utilities, the Connecticut Municipal Electrical Energy Cooperative, which provides power to these utilities, is authorized to acquire power plants and other real and personal property (CGS § 7-233c). It can also acquire property by eminent domain under limited circumstances. This power does not apply to property owned by a public or private electric power entity and used in connection with a system or plant of such an entity.
KM: ro