Union appeals decision on merger BGE, Pepco planning own appeal of terms set by D.C. commission

November 14, 1997|By Kevin L. McQuaid | Kevin L. McQuaid,SUN STAFF

A Washington labor organization yesterday appealed a Baltimore County circuit judge's ruling that Baltimore Gas and Electric Co.'s proposed merger with Potomac Electric Power Co. is in the public interest.

Meanwhile, both BGE and Pepco asked the District of Columbia's Public Service Commission yesterday to reconsider an order that would force the pending Constellation Energy Corp. to keep half of its executives in Washington, give 75 percent of any merger savings to customers and lower a projected $1.9 billion figure that the commission claims can be saved via the merger.

BGE and Pepco have projected the corporate marriage will save $1.3 billion over 10 years.

"We're asking the commission to lower its percentage of savings that they believe can be achieved, share the savings equally between customers and shareholders and eliminate the requirement that we retain vice presidents and general managers in the district," said Arthur J. Slusark, a BGE spokesman.

"Constellation has made a substantial commitment to the District of Columbia, and the new company will have significant operations there. We've committed to building a new building there. So we feel that requiring a certain percentage of employees or executives be there is unnecessary," Slusark said.

The companies' filing also said they intend to challenge the D.C. PSC's legal authority to require that 50 percent of Constellation's executives work in the District, according to documents obtained late yesterday afternoon.

The District will account for 19 percent of Constellation's revenue and income, other filings indicate.

The International Brotherhood of Electrical Workers' appeal to the Maryland Court of Special Appeals contends that Circuit Judge James T. Smith Jr.'s decision on Oct. 28 failed to adequately take the public's interest into account in supporting the merger plan.

"We felt as if he decided upon the case as if it were a normal rate case, and it isn't," said James Hunter, president of the IBEW's Local 1900, which represents Pepco employees.

The IBEW's appeal to the Court of Special Appeals is expected to delay the proposed $3 billion merger for months, because of the backlog facing the state's second highest court.

BGE and Pepco originally planned to complete the merger last April.

Slusark said the IBEW's filing with the appellate court marks "just a continuation of their delaying tactics."

Pub Date: 11/14/97

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