Council again defers action on KE sale

The Kaua’i County Council yesterday deferred action again on whether to support the proposed $215 million Kauai Electric sale to the Kaua’i Island Utility Co-op.

The council, gathering at a special meeting in the historic Kauai County Building, said it wanted to wait for more information from William Milks, the special counsel hired by the council to review the proposed sale.

The council went into an executive session to discuss the issue, and is now scheduled to meet again at 9 a.m. Monday to consider action.

The issue had already been deferred at two earlier meetings of the council.

The deferral frustrated Councilman James Tokioka, who wondered if the information Milks was to give during the executive session was so crucial that the council couldn’t have taken action sooner.

“The reason I ask that question, Bill, is because many people who are here today and many people who are in the community have mentioned ‘why do we (councilmembers) keep stalling this thing?'” Tokioka said.

Tokioka said he understood the delays were part of the process of the proposed sale, but noted as well that the council has had “more than ample time to deliberate on our decision.”

He said he hoped the new information would help the council “to make a better decision.”

Milks said he was going to present the latest information on the status of the negotiations. Milks also said he formulated a position statement and negotiation position that “I want to discuss with you that might influence your thinking.”

The negotiations may involve a counter-offer either the council or the county has made to Citizens Communications Corp. of Stamford, Conn., the owner of Kaua’i Electric.

Tokioka said the council is waiting for a response and asked Milks whether he had heard anything on that matter.

Milks said: “I don’t think the answer is absolutely no. I think what they have said is the door is always open.”

The original sale price was $270 million, but the state Public Utilities Commission rejected the proposal earlier, saying among other things the price tag was too high.

Critics contend the proposed $215 million price tag is too high to pay for an electrical generation system powered mostly by fossil fuels, and want a drop in the price.

Mayor Maryanne Kusaka’s administration opposes the sale, citing numerous concerns, including those about KIUC’s projected revenues and others about large electrical users leaving the grid.

A council committee has given tentative, conditional approval of the sale.

Milks said the council and Kusaka’s administration made significant headway two weeks go when both sides agreed to meet to seek a “common solution.”

The state Public Utilities Commission must give final approval to the sale between KIUC and Citizens before the transaction becomes official.

The proposal triggered protests from a handful of residents at the meeting.

Richard Stauber contended the proposal has no merit, and that if his “mother proposed it, I would oppose it.”

Stauber contended KIUC would provide residents a three-percent return on their electrical bills next year. For Stauber, that would mean $25, he said, too small of a savings, in his opinion, to have the co-op take over the utility.

“Let it die with Citizens Utility,” he said. “There is nothing to win and everything to lose.”

KIUC representatives have said residents will be eligible for noticeable savings in the long run after the co-op takes control of the utility.

In discussing the proposed sale, councilman Kaipo Asing asked Milks whether he would waive confidentiality rights to what Milks discussed at a July 10 meeting in Honolulu on the proposed sale.

Milks emphatically said no, because he and 24 other people at the meeting signed confidentiality documents.

Five other Kaua’i representatives, including Wallace Rezentes Sr., administrative assistant to Kusaka, attended the July 10 meeting.

Milks said the confidentiality agreement was binding for him.

To move the process along, Tokioka said he was going to find out whether the Kaua’i representatives could publicly release what was discussed.

During a July 11 meeting in Honolulu, the state Consumer Advocate and the Department of the Navy reached a stipulated agreement giving preliminary approval of the sale.

County representatives didn’t attend the meeting because they felt the agreement was not imminent.

Staff writer Lester Chang can be reached at 245-3681 (ext. 225) and


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