- Your Town
BREAKING NEWS:Southern Bankruptcy ends
On January 30, U.S. Bankruptcy Court Judge Terry L. Meyers signed an order finalizing the Southern Montana Electric Transmission and Generation Cooperative, Inc. bankruptcy quietly ending a contentious period that started with its filing in October 22, 2011.
On the day the bankruptcy was filed, several board members had walked out when a new board member was refused seating. The remaining members voted a 20 percent rate increase and continued to pursue the building of the Highwood Generating Station (HGS). HGS was never built. The co-op's bankruptcy petition listed assets and liabilities of between $100 million and $500 million including hundreds of millions owed to power purchase contract creditors.
Over the years, the bankruptcy was sparked by controversy including various lawsuits by creditors and its own cooperative member co-ops. In October 15, 2013, the City of Great Falls released the report on behalf of the Trustee by CPA firm Eide Bailly. Based on the investigation of Southern from January 2008 to October 2011, when the bankruptcy was filed, the report found no evidence of fraud and concluded the unfavorable effects of buying excess power were significant. In 2013, the trustee was removed the court citing no further need as liquidation of the co-op began. In 2015, Southern member Beartooth Electric Cooperative, Inc. left Southern buying out its negotiated share.
Last week was a calmer scene in court. The Court on Jan. 30 determined that the Order confirming the Plan has become final; any deposits required by the Plan have been distributed; any property proposed by the plan to be transferred has been transferred. In addition; the Debtor in the form of the Reorganized Debtor under the Plan has assumed the business or the management of the property dealt with by the Plan; the payments under the plan have been completed and all creditors have been paid in full. Importantly, the Court determined that the HGS (Highland Generating Station) Liquidating Trust provided under the Plan has completed all matters pertaining thereto and has terminated its existence. This Trust was charged with the sale of the proposed generating station and/or its assets.
The Court concluded that all motions, contested matters, and adversary proceedings have been finally resolved; all post-confirmation matters requiring the Reorganized Debtor to utilized the jurisdiction for this court have been resolved; all monthly operation reports due have been prepared and filed and all quarterly fees due to the US Trustee have been paid in full.
Any party in interest has the right to object to this order within 14 days of this Final Decree.