PUCO moves to keep Youngstown Thermal from closing - WFMJ.com News weather sports for Youngstown-Warren Ohio

UPDATED

PUCO moves to keep Youngstown Thermal from closing

Posted: Updated:
YOUNGSTOWN, Ohio -

A state regulatory agency said Friday it is taking action to keep the heat and air conditioning on at 44 downtown Youngstown businesses.

Following the recommendation of a staff report issued Thursday, the Public Utilities Commission of Ohio has asked the Ohio Attorney General to seek the appointment of a receiver to oversee finances of Youngstown Thermal.

The company, which supplies 40 customers with steam heat and 4 customers with chilled water for cooling, is in danger of failing because of financial instability, according to the PUCO report.

Ohio law mandates that utilities like Youngstown Thermal continue to serve customers.

“Service reliability is paramount to citizens and businesses in the state of Ohio,” stated PUCO Chairman Asim Z. Haque. “When the PUCO learned of Youngstown Thermal’s financial difficulties, we acted swiftly to determine the extent, and took action today to try and ensure that service remains viable for Youngstown Thermal’s customers.”

The utility lost Youngstown State University as a customer one year ago, which represented a sixty percent loss of revenue for Thermal.

Plans to replace YSU's revenues with a local hospital and a Department of Energy Project fell through.

The staff report found that the utility has been experiencing a cash flow problem and has received disconnection notices from Ohio Edison and the Youngstown Water Department.

Youngstown Thermal also faces a $547,919 federal court judgment issued to a Texas natural gas supplier that stopped service to Youngstown Thermal in February and sued them for breach of contract after Thermal failed to make payments since October.

In addition, Ohio Bell is suing Youngstown Thermal for $270,433 dollars, claiming that Ohio Bell's equipment in Youngstown was damaged by leaking steam in April.

Youngstown Thermal is also behind on paying back a $5 million loan. The report says if they continue failing to make payments, the debt could balloon to $9 million by the end of this year.

Last week, Youngstown Thermal told the PUCO that it was unable to process payroll for employees.

The staff also found inaccuracies and discrepancies in annual reports filed from 2009 through 2014.

In recommending that the utility should be placed under receivership, the report says Youngstown Thermal “is in imminent danger of breaching its duty to furnish adequate service.”

The report also says the utility's inability to pay bills puts it in danger of becoming insolvent.

The report filed on Thursday comes just three days after Youngstown Thermal CEO Carl Avers announced that his company is in discussions with two French energy companies he says are interested in buying Youngstown Thermal.

Avers places a $91 million dollar value on Youngstown Thermal's assets, which include the North Avenue plant and six miles of underground steam pipes.

Stay connected with 21 News for the latest on this developing story.

Powered by Frankly
All content © Copyright 2000 - 2017 WFMJ. All Rights Reserved. For more information on this site, please read our Privacy Policy and Terms