Snohomish PUD settles with Enron

[Omaha Steve]

http://seattlepi.nwsource.com/business/323618_pud14.html

Snohomish PUD settles with Enron
Utility to pay $18 million, calls it a win

By DAN RICHMAN
P-I REPORTER

After five years of legal wrangling with bankrupt energy giant Enron and federal energy regulators, the Snohomish County Public Utility District agreed Friday to settle a lawsuit against it.

The PUD said it will pay Enron's creditors $18 million in interest and penalties on a contract to buy electricity.

The PUD, which provides power to 290,000 people, portrayed the settlement as a victory, noting that it will pay only 10 percent of the $180 million Enron was seeking. PUD General Manager Steve Klein said the settlement, to occur within the next 90 days, will be paid out of reserves and won't have any effect on Snohomish county residents or businesses.

But the outcome is far from the victory that the PUD -- and lawmakers, including Sen. Maria Cantwell -- often proclaimed the utility was owed and was likely to obtain. The PUD spent $16 million pursuing the litigation.

In a conference call Friday morning, Klein said that the alternative to settling would have been to enter binding arbitration Monday, which could have resulted in a non-appealable order to pay the entire $180 million Enron sought.

Arbitration panels "don't have to consider nuances," he said.

FULL story at link.