Town drops utilities appeal

pseligson@newsobserver.comJanuary 24, 2014 

The Town of Smithfield is ending its two-year legal tussle with a local developer.

Partners Equity Group owns land on North Equity Drive, the horseshoe road near Carolina Premium Outlets. Both the town and Duke Energy Progress have power lines nearby.

Some years ago, the town and private utility agreed to divvy up customers in the shared territory. The town got the Partners Equity Group property, but the company objected and appealed to the Utilities Commission, which said the arrangement between the town and Duke was unlawful.

Smithfield was appealing that ruling until it decided earlier this month to drop the matter.

“I’m very happy,” said John Shallcross Jr., a partner in the development group. “Hopefully we can just put all this behind us and focus on economic development and moving forward.”

The Smithfield Town Council, which gained four new members in the November election, made the decision after a closed-door meeting Jan. 16. Mayor John Lampe said the council decided unanimously to drop the appeal because it didn’t see the point in continuing.

The town, Lampe said, was being heavy-handed. “If we’re having to sue people to do something, we’re probably doing something wrong,” he said. “(I) didn’t think it was fair; didn’t make sense, in my opinion.”

The legal tussle began in 2012. That December, the Utilities Commission said Partners Equity Group should have the right to choose and could choose Duke. In April 2013, the commission upheld its ruling after Smithfield challenged its decision. The town then took its case to the N.C. Court of Appeals and lost. Before ending the legal battle, the town was in the process of appealing to the N.C. Supreme Court.

ElectriCities, which advises public power towns, began footing the legal bills once Smithfield started its appeals. ElectriCities got involved at the town’s request; offering legal help is one of the group’s services, said David Barnes, chief legal officer.

ElectriCities became involved because of the precedent set by the Utilities Commission ruling. Essentially, when the commission decided to let Partners Equity Group buy electricity from Duke, that undermined the agreement between Duke and Smithfield, he said.

Barnes said ElectriCities believed the Utilities Commission misinterpreted the law. “We wanted to make sure that we did everything we could to preserve our cities’ rights to serve territory in which they were entitled to serve,” he said.

Now that Smithfield has dropped its appeal, “it’s a decision for Smithfield to make,” Barnes said. “Their town council is in the best position to know what’s in the best interest of Smithfield, and so we’ll respect whatever decision they’ll make.”

Shallcross said he spent more than $60,000 on legal bills. Now he hopes to complete the deal to sell his land. The buyer plans to build a hotel and restaurant.

Seligson: 919-836-5768

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