[May 22, 2013] Central Hudson and Fortis Report Filing of Response to Recommended Decision Tweet May 22, 2013 (Close-Up Media via COMTEX) -- CH Energy Group, Inc. subsidiary Central Hudson Gas & Electric Corp. and Fortis Inc. filed a response to the Recommended Decision issued by the Administrative Law Judges earlier this month regarding the proposed merger of CH Energy Group and Fortis. "Fortis is providing substantial and lasting benefits for our customers by ensuring that Central Hudson continues to operate as a stand-alone company but with the strengthened financial resources that will enable us to maintain and likely enhance service levels," said CH Energy Group Chairman, President and CEO Steven V. Lant. "The merger provides customers with approximately $50 million in benefits. Also, customer rates will remain unchanged until July 2014 through a voluntary 'rate freeze' provision. "Continued regulation by the New York State Public Service Commission, as well as decision making by the existing local management team and a new Board of Directors with increased representation from New York and the Hudson Valley, will ensure that Central Hudson remains focused on meeting the existing and future needs of our customers," Lant emphasized. According to the company, Lant noted that while the Recommended Decision did not find fault with most of the provisions of the proposed merger and corrected many of the erroneous assertions posed by the local groups and individuals opposing the transaction, the conclusions reached were inconsistent with the factual record. By way of example, he noted that the Recommended Decision failed to consider the analysis conducted by the Staff of the Public Service Commission and other parties, such as the Staff's due diligence and independent review of the Fortis stand-alone corporate governance model and the degree of local autonomy this model provides. Lant also noted that the Recommended Decision incorrectly equated the Fortis stand-alone model with the shared services model incorporated in other New York mergers. "In our meetings with various organizations and community leaders, many individuals have expressed their support for the merger as they recognize how an association with Fortis will benefit the Mid-Hudson Valley area we serve," said Lant. Central Hudson and Fortis continue to reach out to customers, community and business leaders, elected officials and the media to discuss the facts of the transaction and to outline the benefits that an association with Fortis will bring. Reply briefs to responses to the Recommended Decision are due to the Public Service Commission by May 24. Closing remains subject to the approval of the Public Service Commission. Central Hudson and Fortis expect the transaction to close by the end of the second quarter of 2013. "Central Hudson will continue to operate as it does today, with the same group of dedicated employees who are committed to serving our customers and our communities," said Lant. "We will continue to advocate for this transaction, as it is truly in the best interest of our employees, customers and the communities of the Hudson Valley." Summary of benefits: The Joint Proposal provides nearly $50 million in customer benefits, including: -$35 million to offset costs associated with restoring electric service to customers following major storms and to mitigate other expenses that would normally be paid for by customers; -$9.25 million in guaranteed savings to customers over the course of the next five years alone as the expenses associated with being a publicly traded company end; -$5 million set aside in a Customer Benefit Fund to be used for economic development and low-income assistance programs for communities and residents of the Mid-Hudson Valley; -Customer delivery rates will be frozen until July 1, 2014; -Customers will continue to work with current employees, as all jobs at Central Hudson will be retained; -Financial protections for CH Energy Group and Central Hudson as part of the larger Fortis organization; and -A transition within the Board of Directors of Central Hudson to increase members from New York State and the Hudson Valley within one year. CH Energy Group, Inc. is predominantly a regulated transmission and distribution utility, headquartered in Poughkeepsie, NY. More Information: http://www.chenergygroup.com ((Comments on this story may be sent to [email protected])) [ Back To TMCnet.com's Homepage ]