Roanoke Times
                 Copyright (c) 1995, Landmark Communications, Inc.

DATE: SUNDAY, July 24, 1994                   TAG: 9407300009
SECTION: BUSINESS                    PAGE: C1   EDITION: METRO 
SOURCE: Greg Edwards
DATELINE:                                 LENGTH: Medium

THE BATTLE'S OVER, BUT A NEW LAW GOVERNS TAKEOVERS

The new law requires a public referendum before a municipality can take control of a private gas or electric utility's operations within its borders, if the utility objects.

The measure was introduced by Del. Richard Cranwell, D-Roanoke County, and passed overwhelmingly by both houses of the legislature. The vote in the House of Delegates was 94-2 and in the state Senate 39-0.

Cranwell was angered last summer when Roanoke made moves toward taking over the portion of Roanoke Gas' operations within the city limits. In a joint news conference with Roanoke County supervisors, Cranwell promised to stop the city in the legislature.

"If they undertake to take over Roanoke Gas, they aren't going to get 'em," the House majority leader told a reporter.

But, last August, the city abandoned the attempt to take over Roanoke Gas after it became evident that Roanoke residents strongly opposed the idea. The city also agreed that a new franchise with Roanoke Gas would eliminate the clause in the old agreement that allowed the possibility of a city takeover.

Despite the fact that the city and Roanoke Gas settled their differences, Cranwell went ahead with the referendum bill. He added electric utilities to the referendum requirement at the request of Appalachian Power Co.

The company had no specific situation in mind when it made the request but believed that if gas was going to be protected, then electricity should be, too, said Apco spokesman Don Johnson.

Although the bill was opposed by the Virginia Municipal League, the General Assembly apparently found government takeover of private utilities a very distasteful prospect.

Cranwell could not be reached last week to talk about his reasons for pursuing the bill even though Roanoke Gas is no longer in danger of a city takeover. The reason may lie, however, in the fact that other utilities are also susceptible to takeover in other Virginia localities.

Many other utilities have language in their franchise agreements similar to that which would have allowed Roanoke to assimilate Roanoke Gas, said Robb Glenn, a gas company vice president. An informal coalition of gas and electric companies supported Cranwell's efforts, he said.

City Attorney Wil Dibling said Roanoke was not involved in the legislative debate because the issue was dead in Roanoke.

The takeover dispute and the franchise negotiations from which it sprang have left Roanoke Gas in a somewhat awkward position as far as the public perception of the company's relations with the city, Glenn said.

It's important for Roanoke Gas to work with city officials, he said. "Make sure your readers know there are no hard feelings on either side."

Keywords:
GENERAL ASSEMBLY 1994