Havre asked to join public power co-op

The Montana League of Cities and Towns wants to know if Havre would join a power cooperative if Montana's larger cities are successful in acquiring the assets of NorthWestern Energy.

The league is coordinating an effort to form a public utilities commission among Montana cities. City councils or commissions of Bozeman, Helena, Great Falls and Butte-Silver Bow have voted to each put up $25,000 to support making a bid for NorthWestern Energy assets. Billings voted against supporting the bid. Missoula has yet to vote on the issue. If Missoula supports the proposal, the League of Cities and Towns will submit a letter this month notifying the creditors committee for NorthWestern Energy of the cities' intent to bid, said league executive director Alec Hansen said Thursday.

NorthWestern Energy serves about 300,000 electricity customers and 157,000 natural gas users in Montana. Its parent company, NorthWestern Corp. of Sioux Falls, S.D., filed for federal bankruptcy reorganization last year.

Hansen said smaller Montana towns like Havre would not have to pay any money to join the commission.

"We're not contemplating any costs at this time. The larger cities are putting up the money to submit the bid," he said.

If the creditors committee and the bankruptcy court approve the bid, a board of directors would be formed, and more towns would be given the opportunity to sign an agreement joining the commission, Hansen said.

"At that time we would hope that Havre would execute the interlocal agreement, join the power authority and participate in the management of the utility," he said.

Havre City Council members said Thursday they are interested in getting more information about the proposal, which proponents say will keep a lid on the state's energy rates.

"I definitely think Havre should look into it," City Council member Pam Hillery said, adding that she was an opponent of the energy deregulation approved by the Montana Legislature in 1997.

Havre Mayor Bob Rice said he thinks a public utility commission would save Havre money.

"My concerns are, once they acquire it, who takes care of the maintenance, and if you have an emergency, what happens?" Rice said. "Now you pick up the phone and you make a call - 1-800 - and boom, it's taken care of. I don't know if they'll have the resources to do that once they establish this co-op."

Havre City Council president Rick Pierson said Thursday he supports the idea of utility ownership by the city, but that if the issue comes before the City Council, he will need to know how the transition is going to take place, and whether the cities can effectively run the utility.

City Council member Tom Farnham, who chairs the city's finance committee, said he would support the idea if it would keep the city's power rates down.

"Overall, if we could keep the city's power rates down, that would be a great savings, hopefully," he said.

But he said he would need to make sure there would be no loss to the city or the consumers.

"I'd have to see the figures and the facts before I could give you any opinion," he said.

A NorthWestern Energy spokeswoman told the Butte-Silver Bow commission Wednesday that the plan would lead to increased costs that would have to be passed on to customers.

The idea is worth looking into, Havre City Council member Allen "Woody" Woodwick said Wednesday.

"There's definitely risks involved, but there's also advantages," he said. "I'm just curious to weigh them out."

Hansen said the utility would probably be organized by region and that cities and counties would be able to elect people to represent their interests on the board. Havre would probably be in a region with other communities in north-central Montana, he said.

"The customers are going to own this thing, and we want to make sure that everyone served by this utility is represented on the board of directors," Hansen said.

Hansen said that if the initial bid is approved, the time line for forming the utility is unclear, although he thinks it could be formed by late summer or early fall.

Information from The Associated Press was used in this story.