Berlin Right To Fold On Utility Sale
In the poker game that had become the negotiations over the sale of the Berlin electric system, it can be said the Berlin Mayor and Council folded. As in any poker game, if you don't have the cards and the odds are stacked against you, that's the only play.
While we felt selling the electric system was the wrong direction from the beginning, the Berlin Mayor and Council deserves some credit for backing out of the deal. An argument could certainly be made the course charted by Berlin should have never been pursued in the first place, but the elected officials were right to move ahead and officially end this unfortunate state of affairs. Enough money has already been wasted and it would have certainly taken hundreds of thousands of dollars to complete the deal, which we believe townspeople would have regretted for years to come.
It was revealed this week the deal breaker was the Old Dominion Electric Cooperative (ODEC) part of the equation. ODEC, which was to take over the generation aspect of the plant, learned through an environmental assessment of the utility there were old oil stains on the property in need of remediation. It seems nobody was aware of it, and the town will soon bring in the state Department of the Environment to clean the soiled areas.
Indications are even if ODEC had not backed out of the deal, overall negotiations were not going well. Choptank was expected to purchase the distribution part of the plant, but that has also been shelved, in light of ODEC's move.
With the Mayor and Council backing out of the deal, the big question is: what happens next? There are lots of different thoughts here.
We have our own thoughts. The town needs to get a new purchase agreement, one that can make the town proud and address the concerns of the consumers, namely the rates they are paying. The council needs to immediately meet with the Berlin Utility Commission and get on the same page. That has not been the case in recent years as evidenced during last year's referendum on the fate of the utility. The BUC was against the sale, while a majority of the Mayor and Council supported it. A slight majority of citizens voted for the plant to be sold, but that support has been eroded over the months.
Supporters of the utility sale intimated this week Berlin is now 'stuck with the electric plant' and 'all its debt.' To a degree, that's true, but the debt was not going to miraculously disappear just because of the plant's sale. Additionally, for a municipality the size of Berlin, it's not a bad thing to own an electric plant. It should be a positive and allow the town to pursue renewable energy options that exist in the marketplace.
One suggestion put forward in the Electric Subcommittee's report to the Mayor and Council this week was evaluating the utility as a 'stand-alone' fund or business. We think this is a worthwhile approach. The utility should be independent of the town and we believe should not be managed by elected officials, rather an expert in the field or at a minimum an individual body immune to the politics of this small town.A new day is here. Berlin will continue to own its utility and we think there are serious advantages to that. It needs to be viewed as a positive rather than a negative. With a new general philosophy and a sound fiscal approach, the town should be able to make the best of the situation.