Gov­er­nor wants to grill PG&E

Antelope Valley Press - - OPINION - By MICHAEL LIEDTKE AP Busi­ness Writer

SAN FRAN­CISCO — Pa­cific Gas & Elec­tric’s plan to emerge from bank­ruptcy faced an­other threat from Cal­i­for­nia Gov. Gavin New­som dur­ing a Tues­day court hear­ing that set the stage for a po­ten­tially dra­matic show­down later this month.

New­som’s lawyers told U.S. Bank­ruptcy Judge Den­nis Mon­tali they want to grill PG&E about the com­pany’s plans to bor­row bil­lions of dol­lars and sell more stock to help pay the $13.5 bil­lion owed to more than 75,000 vic­tims of cat­a­strophic wild­fires ig­nited by the util­ity’s equip­ment and neg­li­gence.

Mon­tali reaf­firmed the terms of the set­tle­ment ear­lier in the hear­ing, de­spite a pas­sion­ate plea from one vic­tim who wanted changes to be made. PG&E also is rais­ing money to pay an­other $12 bil­lion for in­sur­ers and govern­ment agen­cies that suf­fered losses dur­ing a se­ries of deadly fires in 2017 and 2018.

The judge asked lawyers for New­som and PG&E to work out a timetable for the loom­ing bat­tle over the com­pany’s fi­nanc­ing plan. The face-off could come in court hear­ings sched­uled for Feb. 19 and Feb. 26 or in sworn de­po­si­tions.

New­som holds un­usual lever­age over PG&E be­cause it needs state ap­proval to be cov­ered by a $20 bil­lion wild­fire in­sur­ance fund the state Leg­is­la­ture ap­proved. Ac­cess­ing the fund is part of PG&E’s bank­ruptcy re­or­ga­ni­za­tion, forc­ing it to find a way to pla­cate the gov­er­nor by a June 30 dead­line.

The un­ex­pected twist Tues­day marks the lat­est sign of on­go­ing ten­sions be­tween PG&E and New­som. The Demo­cratic gov­er­nor has threat­ened to en­gi­neer a govern­ment takeover at­tempt of the na­tion’s largest util­ity un­less it re­places its en­tire Board of direc­tors and lessens its debt load when it ex­its bank­ruptcy.

New­som has in­sisted that PG&E bring in new lead­er­ship to lessen the chances it re­peats the bad de­ci­sions that led to dev­as­tat­ing wild­fires and de­lib­er­ate black­outs af­fect­ing 2 mil­lion peo­ple last fall. New­som also wants to en­sure PG&E has the fi­nan­cial flex­i­bil­ity to pay for an es­ti­mated $40 bil­lion to $50 bil­lion in badly needed im­prove­ments to its out­dated elec­tri­cal grid.

PG&E has pledged to re­place at least some of the 14 peo­ple cur­rently on its Board as part of its ef­forts to ap­pease New­som. But Tues­day’s push to ques­tion PG&E about its fi­nanc­ing plan shows the gov­er­nor still has se­ri­ous qualms of what the util­ity is try­ing to do.

Mon­tali on Tues­day also re­jected a plea to over­turn a $13.5 bil­lion set­tle­ment with wild­fire vic­tims ap­proved two months ago.

Will Abrams, a Sonoma County res­i­dent who lost his home in a 2107 fire, ar­gued the com­plex set­tle­ment is be­ing forced upon con­fused and still-dis­tressed vic­tims as they try to re­build their lives. He called for “more sun­light on the process, more sun­light on the in­for­ma­tion.”

Ce­cily Du­mas, an at­tor­ney for wild­fire vic­tims who helped ne­go­ti­ate the set­tle­ment, as­sured the judge that a clear ex­pla­na­tion on how the $13.5 bil­lion trust will be han­dled will be filed by a Feb. 21 dead­line. The judge al­ready has been pass­ing along to the at­tor­neys let­ters of protest from peo­ple who lost fam­ily mem­bers, homes and busi­nesses in the wild­fires.

“We are tak­ing ev­ery one of the let­ters very se­ri­ously,” said Du­mas.

Lan­guage in the set­tle­ment in­di­cates the lawyers must try to get vic­tims to vote in fa­vor of PG&E’s plan, but Du­mas and other at­tor­neys for wild­fire vic­tims said they have dis­cre­tion to tell their clients to re­ject the terms. Vic­tims are sup­posed to have their say when vot­ing on PG&E’s plan be­gins next month.

Mon­tali said he had no rea­son to doubt the lawyers who have re­as­sured him the $13.5 bil­lion set­tle­ment is the best deal pos­si­ble for wild­fire vic­tims, many of whom are ea­ger to get their share of the money as soon as pos­si­ble.

“If they are pulling a fast one on me, they are suc­ceed­ing,” the judge told Abrams.

AS­SO­CI­ATED PRESS

A Pa­cific Gas & Elec­tric truck leaves the com­pany’s Oak­land Ser­vice Cen­ter, Tues­day in Oak­land. Pa­cific Gas & Elec­tric’s plan to emerge from bank­ruptcy faced an­other threat from Cal­i­for­nia Gov. Gavin New­som dur­ing a Tues­day court hear­ing that set the stage for a po­ten­tially dra­matic show­down later this month.

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