Burlington bids for hydro
Haldimand county council to consider three bids on its utility
BY JOHN BURMAN
BURLINGTON + Burlington Hydro Inc. has made a bid to buy Haldimand County Hydro, which has a book value of $20 million.
The Burlington utility made the bid on deadline yesterday after getting the go-ahead from city council at a special meeting Monday night. The amount of the bid has not been disclosed.
Council's approval as share-holder is necessary for any mergers or acquisitions Burlington Hydro pursues.
Haldimand officials said yes-terday county council will meet in camera Tuesday to consider three bids including
Burling-ton's and make a recommenda-tion.
Burlington Hydro president David Collie said the purchase would benefit both Haldimand and Burlington ratepayers through economies of scale and enhanced services.
"With two strong, experienced staffs together, we would have a stronger service to offer."
Collie said if the bid is suc-cessful, Burlington's 60,000 customers would join with Haldimand's 20,000 to create Ontario's 10th largest utility.
Burlington Hydro is not bid-ding on any other utilities.
Burlington Mayor Rob MacIsaac said after the council meeting that he believes bring-ing the two utilities together will ensure better 'service for both Burlington and Haldimand cus-tomers served by the county utility.
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"If Burlington Hydro's bid is successful, hydro ratepayers in both communities will benefit from the combined operational efficiencies that will be real-ized."
Leo DeLoyde, Burlington's general manager of corporate services, said the city believes "the opportunity for increased savings has the potential for greater dividend flow to the city in the long term."
Burlington Hydro is one of three to make the short list for the Haldimand utility, of an ini-tial seven suitors.
Bill Pearce, Haldimand's chief administrative officer, said yes-terday that Canadian Niagara Power Inc., which serves Fort Erie and Port Colborne, and Erie Thames Hydro, which serves a largely rural area in-cluding Aylmer and Ingersoll, have also submitted bids.
Hamilton Hydro decided not to bid for purchase of the Haldimand utility, opting in-stead to offer a merger proposal that would have maintained public ownership of the utility. But that is not what Haldimand wanted. Haldimand wants to sell the utility for what it can get and then decide how best to use the proceeds for the benefit of county taxpayers.
The county announced its in-tention to sell the utility last October after realizing the shrinking world of electrical distributors in Ontario means it is no longer desirable for small-er municipalities to try to own and manage their own utilities. There are 97 now where 308 stood when Hydro was deregulated in l998.
Pearce said county council will discuss the bids behind closed doors Tuesday at 6 p.m., make a recommendation and vote on it in open session.
Most likely, staff will be di-rected to enter into negotiations with whichever company has the winning bid with an
under-standing that a deal be finalized by March 28. That's when a transfer tax moratorium the province declared to encourage the sale of hydro facilities ends. The reinstatement of the 33 per cent tax after March 28 would take a bite out of any proceeds a municipality expected from a sale.
THE HAMILTON SPECTATOR WEDNESDAY, JANUARY 26, 2005
