Co-op claims city violated NM Civil Rights Act

Monday the Jones Law Firm of Santa Fe served notice to Socorro Mayor Ravi Bhasker and City Clerk Polo Pineda it planned to file a claim pursuant to the New Mexico Civil Rights Act on behalf of the Socorro Electric Cooperative.

According to the law firm’s letter, SEC claims the City of Socorro has violated the Bill of Rights of the New Mexico Constitution, which prohibits the city from taking private property without compensation.

The action was taken because of a city approved resolution on May 14, 2024, for a month-to-month franchise agreement with the Socorro Electric Cooperative. The resolution stated the city would continue with agreement until energization of an electric utility within the city came to fruition. Once that happened, the resolution states, “the city expects the Socorro Electric Cooperative to remove their service poles and lines from city property as the city expands their municipal electric utility throughout the City of Socorro.”

According to SEC’s lawyer, Jerry Todd Wertheim, Socorro Electric Cooperative estimates the fair market value of Socorro Electric Cooperative’s assets located within the city limits is $54,730,000. and takes into consideration an income valuation approach for a 20-year period. “This presents a reasonable estimate of the takings and damages for which they city must provide just compensation to SEC,” wrote Wertheim, noting it does not include reasonable attorneys’ fees and costs as well as the next cost to remove the assets from within the city’s limits according to the New Mexico Civil Rights Act.

“It’s unfortunate that we are at the point that we had to file this notice, but the city has given us no other alternative. We have an obligation to protect our members’ assets and to continue to provide them with reliable electric service,” said SEC Board President LeRoy Anaya.

Anya said he hoped the city councilors would start asking tough questions to Mayor Bhasker about the city’s intent to create its own electric utility. It makes no sense Anaya said in an SEC press release circulated Monday on various social media platforms. He argues that SEC members shouldn’t have to pay twice for the electric service they enjoy today.

“Here they go again,” said Mayor Ravi Bhasker. “Wasting the co-op members money with lawyers on needless lawsuits. The city has not taken or does not intend to take any of their assets as we are planning to overbuild on our own right-of-way and will ask them to remove their assets from city property as their lease has expired.”

During a co-op meeting on May 22, SEC board member Ward McCarthy questioned a recent $100,644.42 expense to Jones, Snead and Wertheim (aka The Jones Law Firm) for legal services against the city. McCarthy expressed to the board it was a lot of money to spend for lawyers to contest the city.

The cooperative’s website states it has about 8,600 members and 13,083 meters. During its recent annual meeting in April less than three percent of the co-op’s members (133) were in attendance.

SEC claims in a recent on-line survey 740 responses were received from its 8,600 members. Of the surveyed members, 584 of the 740 responses agreed Socorro Mayor’s proposal is unnecessary and could harm members’ interests. In addition, 629 responders were concerned the unnecessary alterations to SEC’s current operations might lead to increased costs and less reliable service for members.

In June the New Mexico Supreme Court ruled the state Public Regulation Commission (PRC) had the power to set rates different from those proposed by a rural electric cooperative.

In a unanimous opinion, the Court upheld the PRC’s decision to reject a $1.25 million rate increase proposed by Socorro Electric Cooperative (SEC) in 2018 and instead adopt a different rate structure for classes of customers without an overall increase in revenue for the utility.

Because SEC didn’t follow the PRC’s recommendation, it fined the co-op $1,000 a day resulting in a fine in excess of $800,000.

Socorro Electric Coop’s long-term debt is $43,929,455.