The trustee for a troubled Montana power cooperative submitted a proposal Friday that offers a first glimpse into how it could be reorganized to emerge from bankruptcy.
The proposal Southern Montana Electric Generation and Transmission Cooperative submitted to federal bankruptcy court calls for the cooperative to retain ownership of the little-used Highwood power plant near Great Falls.
But Southern Montana would need to buy additional power from one of three entities — Shell Energy North America, PPL Energy or Morgan Stanley Capital Group.
Negotiations with the three continue to see which will offer the best prices under a long-term power purchase agreement, said trustee attorney John Parks.
Southern Montana also would continue selling power to its six member cooperatives under the trustee's plan.
At least three of those members — Yellowstone Valley Electric, the city of Great Falls and Beartooth Electric — already have clashed with the trustee during the bankruptcy case.
Great Falls and Yellowstone Valley have sought to get out of the Southern Montana cooperative.
Parks says the reorganization plan would include all six members unless alternative arrangements are approved by the court.
"I hope that members will see the economic benefits of the power that will be provided under that long-term purchase agreement and also see the economic benefit of continuing to own the Highwood Generation Station and, eventually, when the debt is paid off, own it free and clear," he said.
An attorney for Beartooth Electric, Martin Smith, said more details were needed before his client could decide whether to support the proposal.
"It's not fleshed out," Smith said. "This is saying, 'Would you like to buy a blue car.' We'd like to know more about the car before we buy it."
Parks says it will be another 45 to 60 days before a full reorganization plan is submitted.