Failed Electric Sale Negotiations Cost Town $330K

BERLIN – The cost to the town of Berlin for the fizzled electric utility sale comes out to at least $330,000, according to the town.

Legal expenses from Thompson Coburn for the services of utility sale attorney Gary Newell cost Berlin $247,000.

Berlin Administrator Linda Bambary reported this spring that legal work by other firms on the attempted electric system sale totaled $42,725.

The appraisal of the electric plant and transmission system cost $24,258, while an audit of the utility’s finances came in at $16,365, Bambary said.

The town recently received the final invoice for fees and expenses from Thompson Coburn, bringing the firm’s association with the town to an end.

The last bill from the law firm came up at the council meeting this week during the regular discussion of purchase orders that the Berlin Town Council must approve. The town council approved all purchase orders, as they commonly do, including the $7,130.80 Thompson Coburn bill.

Town officials were unavailable for comment on the cost.

The payment will be drawn from either the electric system funds or the town’s general fund.

The electric utility sale negotiations dragged out far beyond the early 2007 completion date originally anticipated with the final decision to kill the sale coming in early April.

The town council voted unanimously to stop negotiations when Old Dominion Electric Cooperative (ODEC) withdrew their offer for the electric plant, citing environmental issues stemming from an old oil spill.

The town council broke off dealings with Choptank Electric Cooperative over the electricity transmission system after ODEC pulled out.

Council member Paula Lynch explained at the time that as the deal was meant to pay the electric system debts, the town needed a certain amount of money to make a sale worth it.

The town is currently seeking a power supply agreement to reduce costs for electric customers.

Thom Gulyas, a town resident and business owner who spent nearly $8,000 of his own money lobbying against the sale, requested the final amount of the costs at Monday night’s meeting, but that figure was not available then.

When informed of the cost later, he said, “That’s a lot of money. That’s a lot of money for a town this size.”

Gulyas added, “They’d have been better off selling the damn thing on eBay.”