Cities dispute acquisition of electric utility
FARMINGTON — As part of an effort to acquire its own electric utility, the city of Bloomfield filed a lawsuit in district court Tuesday against the city of Farmington, which currently provides Bloomfield with power.
The complaint alleges that Farmington has broken a contract agreeing to sell Bloomfield the electric utility if the latter ever desired to purchase it. The Bloomfield City Council is expected to approve the complaint during a meeting on Monday.
The dispute dates back to 1960, when a court decree gave both Aztec and Bloomfield the right "to acquire such portion of such properties each is entitled to acquire from the defendant, Town of Farmington."
The cities interpret the meaning of that decree differently. Farmington maintains that Bloomfield has the right to acquire any property that the city obtained from Basin Light & Power Company in 1959. Bloomfield disputes that interpretation, claiming it has the right to acquire all electric utility infrastructure within its city limits.
"The City of Bloomfield asserts that its rights are unrestricted in time, geographic extent, or as to the nature of the assets it seeks to acquire; that it can exercise these rights, aided by the tool of annexation, today or a hundred years from now, whether or not the assets were in existence in 1959 and whether or not they are in existence today," Farmington City Manager Rob Mayes said in an emailed statement. "We believe that the City of Bloomfield position is unsupported by the terms and provisions of the Judgement and Decree and is inconsistent with the historical context within which it was written and issued."
In 1944, the North Continent Utility Corp. — the company that owned and operated the electric utilities in the region — put its northwest New Mexico and southwest Colorado properties up for sale.
That was when Farmington, a small town of fewer than 3,000 people then, decided it wanted to own its own electric utility company. However, the North Continent Utility Corp. was only willing to sell the San Juan County properties together, and the law prevented Farmington from owning electric utilities outside its boundaries.
As a way around that law, the Basin Light & Power Company was formed. When the laws were changed, and Farmington was allowed to own utilities outside the city limits, the city took over the Basin Light & Power Company.
By 1959, the Basin Light & Power Company no longer existed, and the city of Farmington owned all the electric utilities in the county.
Since then, the infrastructure in Bloomfield, as well as the city limits, have changed, and Bloomfield officials do not know how much of the existing infrastructure existed in 1959.
"I can tell you it's not much," Bloomfield City Attorney Ryan Lane said. "Not much at all. Most of it has been replaced for good reason."
As support for its case, Bloomfield pointed out that the city of Aztec over the years has acquired a utility system within its boundaries as it expanded. Mayes declined to comment on Aztec's purchases of utilities on annexed land.
In his statement, Mayes said Farmington anticipated Bloomfield would file a lawsuit and believes "that a binding judicial decision as to this fundamental issue is necessary to instruct future discussions regarding the City of Bloomfield's desire to create and operate an electric utility."
Lane said Bloomfield is "still hopeful that Farmington will come to the table and negotiate."
He added that Bloomfield does not want "to litigate against our neighbor."