February 12th, 2025, by Stowe Electric Department
As we approach the March 2025 Annual Meeting, it is important to understand the situation surrounding the Australian Ballot vote that will take place. This vote, which stems from the March 2024 Annual Meeting, is critical to the Stowe Electric Department's ongoing efforts to enhance our energy strategy by acquiring equity shares in VT Transco, LLC. While the original vote which resulted in a yes in 2024 was intended to move this acquisition forward, an important procedural error occurred which means that voters will have to cast their ballots again this March.
What is Vermont Transco and why does Stowe Electric wish to purchase equity in it?
Vermont Transco, LLC (a.k.a. VELCO or VT Transco) is a Limited Liability Company which transmits high voltage power to Vermont’s distribution utilities. From time to time, VT Transco issues “Member Units” for purchase by the Vermont distribution utilities to secure ownership shares in the organization. VT Transco uses the equity raised to fund ongoing system reliability and system enhancement projects. The average ROI on the Member Units is approximately 12%. Dividends earned on Member Units are used by Stowe Electric to offset transmission costs. The utility is responsible for paying its share of transmission cost no matter how many VT Transco Member Units it owns. If Stowe Electric does not purchase the Member Units offered, another utility will. This will result in Stowe Electric continuing to pay its full share of transmission costs with no corresponding increase in equity dividends to offset those costs for its customers.
Here’s a breakdown of what happened and what you can expect as we approach the March 2025 vote.
1.The Vote from the March 2024 Annual Meeting
At the 2024 Annual Meeting, Stowe voters were asked to approve a bond issuance that would support the Stowe Electric Department's acquisition of equity shares in VT Transco. The vote posed the question:
"Shall the voters authorize the issuance of general obligation notes or bonds of the Town from time to time during the period from June 2024 through December 2028, in an aggregate amount not to exceed Three Million and 00/100 Dollars ($3,000,000.00), payable primarily from the net revenues of the Stowe Electric Department to fund the acquisition by the Stowe Electric Department of equity shares of VT Transco, LLC (the 'Project')?"
This measure was an important step in strengthening Vermont’s energy future and ensuring equity income that Stowe Electric Department will use to help offset transmission costs for ratepayers. However, there was a procedural issue with the meeting notice that affects the validity of the vote.
2. The Issue with the Vote’s Validity
Unfortunately, due to a failure in properly publishing the meeting notice, the vote taken at the March 2024 Annual Meeting is not legally valid. Vermont statute 24 VSA §1756 outlines the legal requirements for bond votes, specifying that the warning for such votes must be published in a newspaper of general circulation for three consecutive weeks, with the final publication occurring no fewer than five and no more than ten days before the meeting.
In this case, the required publication schedule was not followed, preventing the vote from being certified as valid.
After consulting with the Town Attorney and bond counsel, it was confirmed that the issue with the meeting notice cannot be corrected through a Selectboard resolution. The legal advice is clear: a revote is necessary. The Town will need to hold a new vote to authorize the bond issuance and support Stowe Electric Department’s acquisition of its VT Transco equity allocation.
You can read the full statute 24 VSA § 1756 for more details on the legal requirements of bond votes: 24 VSA § 1756.
3. Next Steps: Revote on March 4, 2025
The next opportunity for a valid vote will be on March 4, 2025, during the scheduled Town Meeting. We encourage all eligible voters to participate by voting.
4. Communicating the Revote to the Public
To reiterate: This is not an additional borrowing request, but a revote on the March 2024 ballot item to ensure the legal advertising requirements are met. It is crucial for the public to understand that the need for a revote is due to a procedural issue—not because of any actions by the Stowe Electric Department. The department followed all the required protocols and acted in good faith throughout the process. This issue relates solely to the legal publication of the meeting notice, and it will be addressed as part of the revote on March 4, 2025.
The Stowe Electric Department and the Town of Stowe will continue to keep the public informed, ensuring transparency and clarity as we move forward.
5. Conclusion: Looking Ahead
The Stowe Electric Department remains fully committed to acquiring it’s allotted equity shares of VT Transco, a vital component of our energy strategy. We appreciate your understanding and continued support as we work through this procedural challenge. The revote on March 4, 2025, provides an important opportunity for the community to reaffirm its support for this investment that will benefit Stowe ratepayers for years to come.
A Few Key Takeaways:
· Community Already Voted Yes: Stowe voters previously approved the bond proposal, but due to a procedural error, we need to vote again.
· $3 Million Investment: The vote supports acquiring equity shares in VT Transco, LLC to strengthen our energy future.
· Why It’s Important: Voting yes again ensures Stowe Electric is able to make vital investments that will be used to reduce overall transmission costs for our ratepayers.
· Your Voice Matters: Your vote on March 4, 2025, will reaffirm our community’s support for this important investment.
If you have any questions on the revote or would like to learn more, please contact Caroline at cklosowski@stoweelectric.com or visit Election Information & Results | Town of Stowe.