DALLAS – Oklahoma Gov. Mary Fallin appointed a panel Monday to examine the operations of Grand River Dam Authority as agency trustees prepare to vote on a $380 million revenue bond proposal.
GRDA directors are scheduled to meet Wednesday to vote on the plan to use the revenue bonds to build a $300 million generating plant that burns natural gas to replace an aging unit that burns coal. The agency also wants to upgrade the environmental protection equipment at an existing coal-fired plant for $80 million.
Fallin’s executive order said the special task force will “undertake a full and thorough review” of the power utility, and recommend “potential changes.”
The 15-member task force will look into privatizing the agency, splitting it into two components, and whether GRDA can contribute to the state’s general fund.
GRDA generates and sells electricity to more than 100 client, mostly municipally owned utilities and rural electric cooperatives in Oklahoma. It receives no state appropriations and supports its debt through sales of electricity.
The shift from coal to gas will help GRDA meet federal environmental guidelines, CEO Dan Sullivan said.
"As GRDA prepares to meet federal environmental regulations, we have been diligently evaluating our option,” Sullivan said. “These issues are of great importance to our customers and we will work with the special task force to help come up with the best solutions for our state."
The bond-financed projects must be operational by April 2016 to be in compliance.
State Finance Director Preston Doerflinger said Fallin does not object to the power project. However, he said, the governors does not want GRDA trustees to vote on the bond plan until an impartial report on the merits of the proposal is presented.
The power utility’s board voted in May to allow preparation of preliminary documents but to go no further.
"I don't want my vote today to authorize a $300 million plant," said trustee Betty Kerns at the May board meeting.
GRDA’s $912 million of outstanding revenue bonds are rated A by Fitch and Standard & Poor’s, and A2 with a positive outlook by Moody’s Investors Service.
