ML20055F800
| ML20055F800 | |
| Person / Time | |
|---|---|
| Site: | Seabrook  |
| Issue date: | 07/12/1990 |
| From: | Nerses V Office of Nuclear Reactor Regulation |
| To: | Office of Nuclear Reactor Regulation |
| References | |
| NUDOCS 9007190209 | |
| Download: ML20055F800 (28) | |
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Docket No. 50-443 LICENSEE: Public Service Company of New Hampshire FACILITY: Seabrook Station, Unit 1 ,
SUBJECT:
PEETING
SUMMARY
On June 11, 1990, the staff had a combined meeting with New Hampshire
- Yankee Division (NHY) of Public Service Company of New Hampshire (PSNH) and Northeast Utilities (NU) maragement to discuss the PSNH/NU merger arrangements
- on the future operation of the Seabrook Station.
At this meeting, the licensee reiterated that no chenge in the managing agent for Seabrook Station can occur unless and until the Joint Owners formally vote to make such a change and the NRC approv(s a license amendment. The Joint Owners do not expect to vote on this matter until Seabrook Station is in comercial operation. Also, it was noted that before submitting applications , for the necessary NRC approval, NU/NHY will perform a staffing study to determine appropriate staffing levels for the Seabtook project if management responsibility changes from a NHY stand alone, single unit organization to NU's nulti-unit organization. This study is not expected to occur until Seabrook Station has achieved comercial operation because the parties involved do not want to divert NHY staff from their job of bringing the plant, in a safe and reliable manner, through the power ascension testing program and into comercial operation. Since the earliest date expected for commercial operation is in July 1990, the study is not expected to begin until then. The study will be reflected in the license amendment application to the NRC which is planned in August 1990 provided the above mentioned NU/NHY actions are ecmpleted on schedule. A list of attendees and handouts provided at the meeting are enclosed. A copy of the meeting transcript is available for inspection and copying at the Comission's Public Document Room at 2120 L Street, N.W., Washinaton, D.C. 20555, and at the Local Public Document Room for the Seabrook facility located at the Exeter Public Library, 47 Front Street, Exeter, New Hampshire 03833. Victor Nerses, Project Manager Project Directorate 1-3 Division of Reactor Projects 1/11
Enclosure:
As stated cc: See next page
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SEABROOK MEETING
SUMMARY
-DISTRIBUTION:
tecket Filet NRC & Local PDRs
-F. Miraglia-J. Partlow PD1-3 r/f V. Herses OGC E. Jordan.
R. Wessman,
~E. McCabe J. Stolz B.=Boger.
M. Boyle M. Nordlinger D. Nash J. Scinto E. Reis S. Varga L. Chandler T. Murley ACRS(10) J. Caldwell, MS17G21 M. Rushbrook cc: Licensee / Applicant & Service List Ollf),0)r>
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f c ;. , c s Mr. Edward A. Brown cc: Thomas Dignan Esq._ Mr. A. M. Ebner, Project Manager JohnA.hitscher,Esq. United Engineers & Constructors Ropes and Gray cost Office Box 8223 225 Franklin Street Philadelphia, Pennsylvania 19101 Bosten, Massachusetts 02110 D. Pierre G. Cameron, Jr., Esq. General Counsel Public Service Company of New Hampshire Manchester, New Hampshire 03105 Mr. T. L. Harpster Dr. Mauray Tye, President Public Service Company of New Hampshire L Sun Valley Association P. ? Box 300 209 Summer Street Seabrook, New Hampshire 03874
'Haverhill, Massachusetts 01830 Regional Administrator, Region I Barbara J. Saint Andre, Esquire U.S. Nuclear Regulatory Commission i Kopelman & Paige P.C. 475 Allendale Road l Counsel for Amesbury, Newburyport & King of Prussia, Pennsylvania 19406 Salisbury 77 Franklin Street Boston, Massachusetts 02110 Ashod N. Amirian, Esq.
Robert Backus, Esq. 145 Main Street, P.O. Box 38 tlackus, Meyer and Solomon Bradford, Massachusetts 01830 , 116 Lowell Street L Manchester, New Hampshire 03106 Paul McEachern, Esquire L Shaines & McEachern l
' Diane Curran, Esq. 25 Maplewood Avenue Harmon and Weiss P.O. Box 360 2001 S Street, NW Portsmouth, New Hampshire 03801 Suite A30 Washington, D.C. 20009 Mr. Alfred V. Sargent, Chairman
!, Mr. Peter Brann Board of Selectmen Assistant Attorney General Town of Salisbury, Massachusetts 01950 i State House, Station #6 i Augusta,' Maine 04333 Senator Gordon J. Humphrey i U.S. Senate ' Seacoast Anti-Pollution League ATTN: Tom Burack i 5 Market Street Washington, D.C. 20510 Portsmouth, New Hampshire 03801 Mr. Owen B. Durgin, Chairman Mr. T. Feigenbaum - Durham Board of Selectmen Public Service Company Town of Durham of New Hampshire Durham, New Hampshire 03824 l Post Office Box 330 Seabrook, New Hampshire 03874 Mr. John Traficonte Chief, Nuclear Safety Unit , Resident Inspector _ Department of the Attorney General l U.S. Nuclear Pegulatory Commission One Ashburton Place ! Seabrook Nuclear Power Station Boston, Massachusetts 02108-1698 Post Office Box 1149 Seabrook, New Hampshire 03874
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O Mr. Edward A. Brown cc: Board of Selectmen Jane Spector RFD Dalton Road Federal Energy Pegulatory Commissio6 ' Brentwood, New Hampshire 03833 825 North Capital Street, N.E. Room 8105 Ms. Suzanne Breiseth. Washington, D.C. 20426 Board of Selectmen Town of Hampton Falls Mr. R. Sweeney Drinkwater Road Three Metro Center Hampton Falls, New Hampshire 03844 Suite 610 Pethesda, Maryland 20814 tir. Guy Chichester, Chairman Rye Nuclear Intervention Mr. George L. iverson, Director Committee New Hempshire Office of Emergency c/o Rye Town Hall Management 10 Central Reed State Office Park South Rye, New Hampshire 03870 107 Pleasant Street Concord, New Hampshire 03301 Chairman, Board of Selectmen RFD 2 Adjudicatory File (2) South Hampton, New Hampshire 03827 Atomic Safety and Licensing Board Panel Docket R. Scott Hill-Whilton, Esquire U.S. Nuclear Regulatory Commission Lagoulis, Clark, Hill-Whilton Washington, D.C. 20555
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79 State Street Congressman Micholas Mavroules Newburyport,11a ssachu?ctts 01950 U.S. House of Representatives 70 Washington Street Salem, Washington 01970 Ms. R. Cashman, Chairman Mr. Leon E. Maglathlin Board of Selectmen Public Service Company of New Hampshire Town of Amesbury 1000 Elm St., P.O. Box 330 Town Hall Manchester, New Hampshire 03105 _' Amesbury, Massachusetts 01913 fir George Olson, Town Manager Mr. Jack Dolan . Town of Exeter Federal Emergency Management Agency ; I 10 Front Street Region I L Exeter, New Hampshire 03823 J. W. McCormack Post Office and Courthouse Building, Room 442 Gerald Garfield, Esq. Boston, Massachusetts 02109 ; Day, Berry and Howard
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City Place Mr. J. M. Peschel Hartford, Connecticut 06103-3499 Public Service Company of New Hampshire P.O. Box 300 Mr. J. F. Opeka Seabrook, New Hampshire 0387a {' l Northeast Utilities P.O. Box 270 Mr. D. E. Moody Hartford, Connecticut 06141-0270 Public Service Company of New Hampshire ; P.O. Box 300 ! ,. Mr. R. M. Kacich _ Seabrook, New Hampshire 03874 l Northeast Utilities Service Company i P.O. Box 270 Hartford, Connecticut 06141-0270 l b
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iEdward A. Brown
- 0. Paul Do11werk, 111 Alan S. Rosenthal .
Atomic Saft.ty & Licensing Atomic Safety & Licensing Appeal Board Appeal Board !
' U.S. Nuclear Regulatory Commission U.S. Nuclear Regulatory Commission
. Washington, D.C. 20555 Washington, D.C. 20555 ;
Hortard A. Wilber
. Atomic Safety & Licensing Appetil Board .
' U.S. Nuclear Regulatory Commission '
. Washington..D.C. 20555 -;
Atomic Safety and Licensing Board r e . Panel- i U.S. Nuclear- Regulatory Commission Washington, D.C. 20555 Atomic Safety and Licensing Appeal - Penel' ' U.S. Nuclear Regulatory Commission - l Washington, D.C. 20555 Thomas S. Moore, Chairman Atomic Safety & Licensing Appeal Board 7 U.S. Nuclear Regulatory Commission i Washington, D.C. 20555 IvanW.. Smith, Chairman (2) Administrative Judge Atomic Safety and Licensing Board
- U.S. Nuclear Regulatory Commission Washington, D.C. 20555 r
Richard F. Cole . Administrative Judge Atomic Safety and Licensing Board U.S. Nuclear Regulatory Commission , Washington, D.C. 20555 ' venneth'A. McCollom-
. Administrative Judge 1107 West Knapp Street -
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PSNH BANKRUPTCY CHRONOLOGY-Jtely 27.1989 January 3.1990 May 26.1989 NU signs Raic Detrmber IN.1989 Hararupscy Court Jana.wy 28.1988 Scalmna low Agreement with I Asober 6.1989 Rase Agreemers asserves Ntis Jemmy 4.19WI PSNil files for power Imense $naseof New NU fiin Iwm U-I legestaimm signed Dexlemne MSA filed bankrugs y issued flampshwe with SEC into law Statemene wah Cie SEC N r Agni 30. I990 March 15.194) MSA tecomes Febevary 5.1990 Fetunary 12.1990 Mart h 7.1990 Seabri=A full Mart h 16.1990 April 13.1990 Asmi 20,1990 effative; siew Corut DPUC Hart-Scott Rohrus NU files iERC power Inense SEC suel= wires F ENC suchnrares Manimgecy Ceist PSNH Roent and hearnigs began fil.ng with I'IC decct case assuest she MSA she MSA caedrins NU plan effkers elected ,
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Mal July 1990 Augma 1990 December 38.199I New llamgwhire NU en:=ts to December 31.19WI 2rmi Quarter 199 Lase dase few PtICissues file NNC Angma I. IvMI II RC nutsal Agni 1998 Merger Dme cimsunnnernmed
<hisum appiscasam(O I ws: Elfestive Date da esum dise i ERCdes ssam engused energer
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i i l NU, PSNH, NUSCO, NHY RELATIONSHIP l AS OFTHE MERGER DATE 1 NU i
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= Millstone 1 PSNII NORTII NAESC NUSCO 2 & 3 operatism ATLANTIC Sca'M Services Services
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NU, PSNil, NUSCO, NHY RELATIONSHIP ~~ AS OFTHE TRANSITION DATE NU PSNil Managenrmt NUSCO Services
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**"I New Board of Directors New Officers
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- ENCLOSURE p . +
r CORRECTION TO MEETING
SUMMARY
j MAY 15. 1990 NEW HN4PSHIRE YANKEE, NORTHEAST UTILITIES NRC STAFF
' LICENSEE: Public Service Company of New Hampshire FACILITY: Seabrook Station, Unit 1 p
1 In the meeting summary for the May 15, 1990 combined meeting between the NRC Staff and New Hampshire Yankee Division '
' (NHY) of Public Service Company of New Hampshire (PSNH) and -
Northeast Utilities (NU), the following language appears: "NU exercises no authority over Seabrook and will not do so until ' such time as the merger is officially completed and any necessary i NRC approval is granted." NU cannot manage Seabrook until it has received approval from the Seabrook Joint Owners and from the NRC, which may occur prior to the time that the merger is q officially completed. Therefore, the quoted language from the May 15, 1990 combined meeting should be revised to read as follows: "NU exercises no authority over Seabrook and will not ; do so until such time as Seabrook Joint Owner and any necessary ' NRC approval is granted." ' r Y 1 l l l-N
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D!CLOSL'RE 1 4
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STATE OF NEW HAMPSHIM i BEFORE THE i HEW HAMPSHIM PUBLIC UTILITIES ColetISSION I NORTHEAST UTILITIES PETITION M s PUBLIC SERVICE COMPANY OF NEW RAXPSHIM MORGANI2ATION 1 1 New Hampshire PUC Docket No. DR-89-244 1 l-DIM C1 TESTIMONT OF aan r. orm I I l DECExaER 1989 l l
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IL,', Q. Mr. Opoka, doos NU plon to activoly manago tho Seabrook project
' 2, under the Managomont Services Agreement between N"SCO and PSNH 3 during the period following confirmation of NU's Joint Plan ,
4 for Reorganization.
- 5. A. No. PSNH is designated as the licensee authorised to act as 6
the agent for all of the Seabrook Joint owners in the low-power 7 operating license issued by the NRC. Insofar as Seabrook is 8 concerned, the intent of the Management Services Agreement is' 9 to maintain the status que, and not to chappe the arrange. tents 10 for the management of the project. In fact, we could not bring
' ll abcut any significant changes in the project without first 12 obtaining NRC and Joint Owner approvals. The Management
- 13 Services Agreement specifically contemplates the need for 14 regulatory approvals and states that NUSCO's authority to act 15 under the Agreement is subject to " compliance with applicable 16 law." Thus, the Management Services Agreement itself provides 17 that we cannot manage Seabrook under the Agreement unless we 18 apply fgr and obtain any required regulatory approvals,
'19 including NRC approval.
. 20 21 PSNH, acting through its NHY Division, will continue to 22 manage the project. Before taking over active management 23 of Seabrook, we must apply for and obtain certain approvals, 24 including NRC and Joint Owner approval. Upon receipt of such 25 26 Page 13 s 1 s.
N
e 1 approvcis, wo would assume rcspensibility for tho management of .
. j 2 Seabrook. During the interim period when the Management !
3 Services Agreement is in place, but before we actively manage
- 4 Seabrook, we will have an opportunity to perform an in-depth I
5 assessment of the project, so that we can integrate the NNY and 6 NE&O organisations in the most ef fective manner. t 7 Q. Kr. Opeka, you have referred to an approval of the Joint Owners 8 which is required before you can take over the management of 9 Seabrook. Please explain what is requirgd. 10 A. Before NUOP can take over the management and operation of 11 Seabrook, it must enter into a Managing Agent Operating , 12 Agreement with the Joint Owners. This agreement must be 13 approved by a vote of Joint Owners holding ownership shares in the unit totalling at least 51%. This agreement has not yet 14 When it is, we will 15 been negotiated with the Joint Owners. 16 file it for the Commission's review. 17 Q. Are you generally familiar with the size and functions of NNY's 1 P. Seabrook organization? Yes. The Connecticut Light and Power Company, NU's Connecticut 19 I 20 operating subsidiary, owns a 4.059854 interest in Seabrook. [ 21 NNY, a division of PSNH, is the-Project Manager for the : i 22 operation of Seabrook Station under the Joint Owners Agreement
- NNY has separate 23 (JOA) among the Joint Owners of Seabrook.
'24 organisational groups including Nuclear Production, Quality These groups perform 25 Programs, and Engineering and Licensing.
26 i Page 14 ; h
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.. ENCLOSURE
, .: .U DAY, BERRY & HOWARD j
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- June 7, 1990 VIA PEDERAL EXPRESS Ms. Christine Comer Calendar Secretary United States Bankruptcy Court District of New Hampshire Norris Cotton Federal Building 275 Chestnut Street Manchester, New Hampshire 03103 Re: Public Service Ccmpany of New Hampshire Chapter 11
. Case No. 88-00043
Dear Ms. Comer:
Enclosed please find for filing the original and three copies of the Statement of Northeast' Utilities Service Company with respect to Management Services Agreement. Also enclosed are an original and three copies of the Certificate of Service with respect to this document. Please time stamp and return the fourth copy of each ! document in the enclosed self-addressed, stamped envelope. l If you have any questions regarding the enclosed. materials, please do not hesitate to contact me. i Very truly yours,
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Joh'n B. Nolan JBN: rim Enclosures cc: Service List , I
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b UNITED. STATES BANKRUPTCY COURT-DISTRICT OF NEW RAMPSHIRE
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- In Re : *
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- Chapter 11 :
New Hampshire, : Case No. 88-00043 " Debtor : i Statement of Northeast Utilities Service Company a with respect to Manacement Services Acreement i t on April 4, 1990, Northeast' Utilities Service Company , i ("!?US CO" ) filed a Plan for Transitional Management with this1 ! Court which had attached thereto a Management Services ! i Agreement -("MSA") between Public Service CompanyLof New 1 Hampshire ("PSNH") and NUSCO. On April 13, 1990,- an Order' approving the MSA was signed by the Court (Docket No. 3574).
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'The Order states that PSNH and NUSCO will be bound by the terms )
of the McA as of April 30, 1990.
'The staff'of the United States Nuclear Regulatory i Commission ("NRC") has requested NUSCO to confirm on the record I in this proceeding that NUSCO will not undertake the management 1 l
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'o of Seabrook Station prior to the time that the NRC has authorized the transfer of management responsibility from the New Hampshire Yankee Div.sion ("NHY") of PSNH. The MSA states, in Section 2(a) thereof that:
Sub$ect to the terms and provisions hereof, and compliance with applicable law, during the term of this Agreement NUSCO will have complete management responsibility for all aspects of the business, operations, activities and affairs of PSNH, including, but not limited to, management responsibility for: (1) the planning, design, construction and maintenance of all facilities of PSNH, including electric generating, transmission and distribution facilities, operations and maintenance facilities, and customer service facilities, and includino PSNH's responsibilities for planning, design, construction and maintenance of the Seabrook Nuclear Power Plant; (emphasis supplied). The words "and compliance with applicable law" were included in the MSA to recognize that NUSCO must obtain any and all approvals required by law (including NRC approval) prior to NUSCO undertaking responsibility for any aspect of the business, operations, activities and affairs of PSNH with respect to the management of Seabrook Station. Accordingly, consistent with NU's previous assurances to various persons and regulatory agencies involved in this bankruptcy proceeding, NUSCO does not intend to, and indeed legally cannot,
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" -j Dated:' > June .7., 1990 s ) '9 gp t - 1 ix.' John B. Nolan- . -l 04ffrey G. Grody .1
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CityPlace L Hartford, CT 06103. -l (203) 275-0100 j c , ic - and i s 6- . :\ Thomas D. Rath 7 Ry;;it , Rath, Young, Pignatelli:and l" " . Oyer, P.A.: :
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4 UNITED STATES BANKRUPTCY COURT DISTRICT OF NEW HAMPSHIRE
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In re ) Chapter 11
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Public Service Company of ) Case No. 88-00043 New Hampshire, )
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Debtor ) _.- ) CERT!FICATE OF SERVICE I, John B. Nolan, hereby certify that on this 7th day of June, 1990, I have caused service of Statement of Northeast Utilities Service Company with respect to Management Services Agreement via Federal Express Overnight Carrier Service to the Debtor and.its reorganization counsel and to all other parties listed on the "Short List" appended hereto, in accordance with the Amended Order Establishing Notice Procedure and the order Establishing Post-Confirmation Notice Procedure, entered April 19, 1988 [ Docket No. 545) and June 1, 1990 (Docket No. 3821), respectively.
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*N' ENCLOSURE
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Edwin.J. Reis Esq. ! Office of General Counsel , Room 15D9 ' O.S. Nuclear Regulatory Commission : One White Flint North ' 11$$$'Rockv111e Pike Rockville, Maryland 20852 ' RE: Seabrook ! i
Dear Mr. Reis:
This will confirm the telephone conversation that you, I and Mr. Garfield had today regarding the Seabrook nuclear project and the " Plan for Transitional Management" that Northeast Utilities i Service Company (NUSCO) filed with the Bankruptcy Court in the Public Service Company o' New Hampshire (PSNH) bankruptcy ' proceeding. Please be advised that New Hampshire Yankee Division of PSNH
- retains full responsibility for the management and operation of the Seabrook project. Nothing that has been filed with the Bankruptcy Court has altered that situation. Moreover, NUSCO ,
recognizes that, under the A'omic Energy Act, there can be no e change in the responsibility Jor the management and operation of t
'seabrook until the huclear Regulatory commission (NRC) has.
received an application to amend the operating license and has acted favorably on such application. Since no application has been filed or acted'on, there- has been, and there can be, no change in such responsibility. Northeast Utilities ("NU") has a long history of dedication to proper compliance with requirements of the NRC. We are very much aware of the need for NRC approval of any change in responsibility for management and operation of Seabrook. We assure you that NU will not attempt to assume such responsibility without first obtaining the NRC's approval.
- Very truly yours,
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's . M . Fox R. M. Racich G. Garfield N. .Reynolds 9
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7 # ,, 3 p# .500RTHEAST UTHJTIItti - Po por r70 < t 9 . mine..in w.uaim oms- - MARTFomD. CONNECTICUT 061410270 - !L O ' .= = no esse s en=== - emnesi m asiuausesses= (303) 465 u23 . : ) t g g y as amiemuas mes, ease..
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u 3 JoHNt'o*tka May 1, 1990 <
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l: j ^ TO THE.SEABROOK JOINT OWNERS: q i
.; ) 3 On Apri) 30, 1990, Northeast Utilities Service Company J
.(NUSCO) began providing: management direction to Public Service , M ^
Company of New Hampshire (PSNH) under a Management Services Agreement (MSA), which,hc= Deen approved by the United States ' Bank rupt c:y Court, the Securities and Exchange Commission, and th<t l rederal'3nergy Regulatory Commission. There is a new Board of lm ' L Directors for PSNH that has been appointed by the Bankruptcy Court to manage the affairs of the company until a merger with a subsidiary of Northeast Utilities (NU) can be completed. The Board of' Directors has elected three officers of PSNH. The three new officers are
- 1. Chairman of the Board--Joseph P. Tyrrell, retired ,
Executive Vice President of Boston Edison Company j i
'2 . President and Chief Executive Officer--Leon E. Maglathlin, i' Jr., retired Senior Vice President of NUSCO
, 3. Comptroller, Secretary and Treasurer--Bruce W. Wiggett y: [ i Please note that the MSA does not include management responsibility or authority.for the Seabrook project, which remains under the sole management and control of New Hampshire Yankee Division-(NHY)., led by Edward A. Brown, President and~- . Chief Executive Officer of NHY. Mr. Brown will report to Mr. Maglathlin. Neither NU-nor any affiliate of NU any assume responsibility for ttw management of Seabrook without the prior ,; approval of the Joint owners and the United States Nuclear Regulatory Commission.- j Very truly yours, OgJL
- lms 7060
Mr. Leon E. Maglathlin, Jr. Mr. Gary L. Hunt President and CEO General Manager and Secretary Public service of New Hampshire KA Municipal Wholesale Electtic CO. 1000 Elm St., P.O. Box 330 Randall Road, P.O. Box 426 Manchester, NH 03105 Ludlow, MA 01056 Mr. George W. Edwards, Jr. Mr. Horst Huehmer, Manager Chairman and CEO Hudson Light and Power Department The United Illuminating Company Town House, 49 rorest Avenue 80 Temple St.. P.O. Box 1564 Hudson, MA 01749 New Haven, CT 06506 Mr. Donald G. Pardus Mr. Joseph M. Blain, General Manager President and CEO Taunton Municipal Lighting Plant Eastern Utilities Associates 55 Weir Street P.O. Box 2333 P.O. Box 870 Boston, MA 021C1 Taunton, MA 02780 Mr. William B. Ellis Mr. Charles A. Farrington Chairman and CEO Vice President ant Execut.ve Manager Northeast Utilities Vermont Electric Generation and P.O. Box 270 Transnission Cooperative, Inc. Hartford, CT 06106 School Street Johnson, VT 05656 o Mr. Gerald E. Anderson Mr. Jon A. Bellgowan, Manager President and CEO N.H. Electric Cooperative, Inc. Commonwealth Energy System Tenney Mountain Highway P.O. Box 9150 RFD 84, Box 2100 Cambridge, MA 02142-9150 Plymouth, NH 03264
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Seabrook station festborough, EPM 01581 P.O. Box-300 ; Seabrook; NH-03874 l
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March 16, 1990 TO:' W. B'.-Ellis B. M. Fox-
- R. E. Busch F.'R.=Locke-W. T.-Torrance, Jr.
E. G. Vertefeuille B. L '. Carlson' J. T.- Deegan. J. R. Kotkin D. G. Lenihan. D.-M. McManus R. P.. Wax C. D. Blinn-(DB&H) L. Bouknight (N&H)
'J. Curley (MS&Co.)
T.:Rath (R&Y)- TROM: J ~. B. Keane t ; Legal Departq1ent Ext. 3541'
SUBJECT:
SEC's Authorization of Management Services Agreement The'SEC's response-to.NUSCO's January 4,'1990 "60-day letter" with respect to the Management' Services Agreement is attached. The letter states, at'the bottom of.page 3,.that the Commission does not object to NUSCO providing services to PSNH under the Agreement. On-page 2, the SEC's letter points out that NUSCO cannot provide any services for Seabrook before NRC-and joint owner approval is-received.
.on p:.ge 3, the SEC describes reports that will be required from NUSCO.
JBK/ags1010 6 cc: D. P. G. Cameron-(PSNH) n
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s\' UNITEo STATES i SECURITIES AND EXCHANGE COMMISSION WAsHINeToN, o.C, Ros49
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March 16, 1990 N Mr. John B. Keane Associate General Counsel Northeast Utilities Service Company 0 P.O. Box 270
' Hartford, Connecticut 06141-0270 ,
Ret Management Services Agreement with Public Service Company of New Harpshire File No. 37-65
Dear Mr. Keane:
By letter dated January 4, 1990, Northeast Utilities Service Company ("NUSC0"), a service company subsidiary of Northeast Utilities (" Northeast"), a holding company registered under the Public Utility Holding Company Act of 1935 ("Act"), notified the commission of.its intention to provide certain managerial and administrative services to Public Service Company of New Hampshire ("PSNH") pursuant to a nanagement services agreement (" Agreement")s PSNH is an electric utility.
-4 company that has filed'for protection from its creditors under Chapter 11- of the United States Bankruptcy Code (" Code") with the Bankruptcy Court for: the District of New Hampshire
(" Bankruptcy Court") (Docket No.- 88-00043). This notification was made pursuant to a 60-day letter procedure provided for by order dated June 30, 1966 (Holding Co. Act Release No. 15519) (" June 1966 Order"). In a letter dated February 26, 1990, Northeast extended the date by which the Commission may respond to March 20, 1990. On October 6, 1989, Northeast and NUSCO filed an application-declaration (File No. 70-7695)' with the Commission seeking authorization for Northeast to acquire PSNH under a plan of reorganization (" Plan") for PSHH filed with the Bankruptcy Court. This Plan, as subsequently amended, has been accepted by the official committees of PSNH's equity and unsecured debt creditors and the present management of PSNH. A notice of the filing of Northeast's and1NUSCO's application-declaration was issued by the Commission on February 2, 1990 (Holding Co. Act Release No. 25032). The Bankruptcy Court is expected to confirm the PSNH Plan by May 1, 1990.
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fo {j{i+ a ec.? g . h !7 h.c oy l-. , John:3. Keane, Esq. March 16, 19.90
*[ Page 2 1" ~The Plan provides that the present nembers of PSNH's Board of Directors (" Board") will immediately resign _upon
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confirmation of the Plan by the Bankruptcy Court, and that PSNH's top five officers will resign within sixty days thereafter. The Plan further provides that1the two creditors i s committees will select a new Board, which will,.in turn, appoint new officers of PSNH. The new Board and of* ' Ors-Will serve-in their respective capacities fron'the date c3 confirmation of the Plan by the Bankruptcy Court to the date that Northeast's % 3 sed acquisition of-PSNH, if approved, is consummated.
.The two er 5 .mmittees and NUSCO have negotiated the terns of the Agreek;n* which provides for NUSCO to manage the , operations of PSNH f the date that the proposerhe date of confirmation of the Plan to quisition by Northeast, if approved, is consummated, nsummation.of Northeast's acquisition of PSNH is depet. dent on receipt of regulatory approval by the Commission, the Nuclear Regulatory Commission
("NRC"), Federal Energy Regulatory Commission, and various
. state regulatory commissions.
Under the Agreement, NUSCO will provide management services for virtually all of PSNH's operations at cost. NUSCO will not provide such services for the Seabrook Nuclear Power Project ("Seabrook"), until-the prior approvals of the joint owners of Seabrook and~of=the (RC have been received. The Agreement will make NUSCO fully-responsible for the management of PSNH, other than Seabrook, during the interim period between Plan confirmation and PSNH's acquisition by Northeast, if such acquisition is approved by the various: regulatory entities. NUSCO will be responsible for the management and operation of seabrook upon approval of-the Agreement by the joint owners ar.d the NRC. NUSCO plans to satisfy its' obligations under the Agreement by appointing one of its senior:offleers as a coordinating officer for PSNH. This officer will reside in New Nampshire and will have the general responsibility for implementing the Agreement. Additional NUSCO personnel will be provided as required. Section 13 of the Act, among other things, relates to 9' service company subsidiaries of registered holding companies providing services to nonassociate companies. Under section s
'1 13(c), the Commission is authorised to prescribe annual and other periodic reports of similar terza and conditions, with regard to services provided to nonassociate companies, where the service company is also performing services for associate companies, as authorized under section 13 Section 13 (f) of the a
Act provides that service companies mu(b) st. comply with all rules and regulations or orders regarding reports, accounts, costs, maintenance of competitive conditions, disclosure of x
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37 t i' a o. John B.-Xeane, Esq. March 16,?L990 Page 3 t interest ' duration of contracts and similar zatters" in their dealings,'with nonassociate ecmpanies. / Rule 94, which was promulgated under section 13(c), requires the filing by subsidiary service ccepanies, such as NUSco, of an annual report on Form 0-13-60. Torn U-13-60 will be used to report all services provided by NUSCO to PSNH under the Agreement. NUSCO will detail its services to PSNH on a
. departmental basis and provide a description of services performed by each department, with the cost of such services as related to each department, by account nur.ber as prescribed in the Uniform-System Lf Accounts for Mutual and Subsidiary Service Companies under Rule 93. NUSCO'has stated that they-will allocate the cost of services to PSHH using the same methods of allocation NUSCO now employs to allocate costs to its associate utility companies.
The June 1966 Order authorizing the formation of NUSCO, includes a condition which prohibits any change in the organization of NUSCO, the type and character of the ecmpanies to be serviced by NUSCO, the methods of allocating costs to associate cor.panies, or in the scope or character of services to be rendered, without first notifying the commission in writing of the proposed change not less than 60 days prior to
=the effective date of such change.- NUSCO has provided the notification required by the June 1966. order by the filing of its. letter on January 4, 1990, Which has inferred the 1 Commission that NUSCO is seeking:a change in the type and character-of the companies to be serviced and Comnission approval of the Agreement.
The Commission's response to your letters of January 4 and February 26, 1990 is based on the facts and representations made in those letters. Any different facts or circumstances might require a different conclusion. Based on those facts, the proposed Agreement to render services to PSNH during the
" interim period between etofirmation c. the Plan and acquisition of PSNH, if consummated in the nanner-contemplated in the '
Agreement, appears to be consistent with the requirenants of the June 1966 Crder and within the provisions of section 13(b)
' and 13(f) of the Act and the rules and regulations promulgated thereunder. Accordingly, based on the foregoing, the W. Commission does not object to NUSCO providing services to PSNH
;n under the Agreement and, thus, has authorized me to send this letter.
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John B. Eeano,;Esq.. March 16, 1990-Page 4 Finally, this response is limited to NUSCO's notification pertaining to the Agreement and the issues raised therein, and 1.7 no.way. limits the scope of the coraission's consideration of Northeast's proposed acquisition of PSNH. The Connission will fully consider the issues presented by the proposed acquisition and will make its determination.as to the propriety-of that acquisition independant of any opinions or conclusions expressed in this response, sincerely,. William C. Weeden-Assistant Director 4 8 9 (. t h,
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