Fourteen public utilities across Washington state voted Monday to approve a $226-million settlement that would let them out of the giant Washington Public Power Supply System securities fraud trial.
“It’s a (settlement) we can certainly live with and handle, and it won’t have great diverse . . . impact on our state,” said Tacoma attorney Albert Malanca, who engineered the complex agreement involving utilities, the State of Washington and the federal Bonneville Power Administration.
While several utilities that agreed to the settlement Monday said rate increases may be necessary, they added that those increases would be small.
Under terms of the agreement, the 14 utilities would pay $181 million, BPA and the federal government would pay $35 million and the state would pay $10 million to plaintiffs who sued after WPPSS defaulted in 1983 on $2.25 billion in bonds used to build two nuclear power plants.
The plants were begun but never finished after regional energy planners determined that power from the plants wouldn’t be needed. The region’s economy suffered when WPPSS attempted to build five multibillion-dollar nuclear power plants and finished only one.
In Olympia, Gov. Booth Gardner announced that the state would pay $10 million toward the settlement, if the Legislature concurs.
BPA participation still requires the approval of the U.S. Department of Justice, which was expected this week, and final approval will have to come from U.S. District Judge William Browning, who is overseeing the case, which is being tried in Tucson.
The pact leaves Snohomish County Public Utility District the only utility remaining as a defendant in the trial. Snohomish contracted for the biggest share, 13%, on the two WPPSS plants, which were terminated in 1982 when only partially built.
However, under the settlement memorandum, Snohomish would be allowed to pick up the option to settle until Nov. 10.
The trial over the largest municipal bond default in history was recessed last week when attorneys reported a settlement was possible. It was scheduled to resume Wednesday.