LEGAL	9 Months Ended
Sep. 30, 2019
COMMITMENTS AND CONTINGENCIES
LEGAL	NOTE 18 – LEGAL Other than as disclosed below, we do not expect any litigation or proceeding pending or threatened against us to have a potential material effect on our financial condition, results of operations or cash flows. Pursuant to a long-term transmission agreement with another utility, such utility pays for and has firm rights to transfer power and energy across a transmission path in Colorado. Such right to payment and obligation to provide the transfer is borne equally by us and another entity. Due to the current capacity of the transmission path, such utility’s firm rights have been curtailed. The utility disputes its obligation to pay due to the current capacity of the transmission path and claims we, along with the other entity, are in breach of such transmission agreement. The utility has claimed damages caused by the alleged breach of approximately $6.9 million, plus interest, attorney fees, and any future damages. The other entity has filed a cross-claim against us claiming we are responsible for such entity’s share of any damages. The matter has been scheduled for arbitration commencing in January 2020. It is not possible to predict whether we will incur any liability in connection with this matter. At our July 2019 Board meeting, our Board authorized us to take action to place us under wholesale rate regulation by FERC. On July 23, 2019, we filed with FERC our initial tariff, including our stated rate cost of service filing, market based rate authorization, and transmission Open Access Transmission Tariff. Our FERC tariff filing included our current Class A rate schedule for electric power sales to our Members as the wholesale rates payable by our Members. On September 3, 2019, a membership agreement with a non-utility member became effective and we notified FERC of such and requested a partial waiver. The admission of the new member that was not an electric cooperative or governmental entity resulted in us no longer being exempt from FERC wholesale rate regulation pursuant to the Federal Power Act. On October 4, 2019, FERC issued an order rejecting our filings without prejudice to us submitting a more complete set of filings that cure the deficiencies set forth in such order. We expect to file with FERC a revised set of filings addressing the deficiencies set forth in FERC’s order before the end of 2019 and request a partial wavier. As a FERC-jurisdictional public utility currently making sales and provides services without satisfying the Federal Power Act’s filing obligations and FERC’s prior notice requirements, FERC may require us to refund to our customers certain amounts collected for the entire period that the rate was collected without FERC’s authorization, including Member and non-member electric sales and wheeling revenue. FERC may also impose civil penalties. It is not possible to predict if FERC will require us to refund amounts to our customers or if FERC will impose civil penalties or to estimate any liability associated with such.

NOTE 18 – LEGAL

Other than as disclosed below, we do not expect any litigation or proceeding pending or threatened against us to have a potential material effect on our financial condition, results of operations or cash flows.

Pursuant to a long-term transmission agreement with another utility, such utility pays for and has firm rights to transfer power and energy across a transmission path in Colorado. Such right to payment and obligation to provide the transfer is borne equally by us and another entity. Due to the current capacity of the transmission path, such utility’s firm rights have been curtailed. The utility disputes its obligation to pay due to the current capacity of the transmission path and claims we, along with the other entity, are in breach of such transmission agreement. The utility has claimed damages caused by the alleged breach of approximately $6.9 million, plus interest, attorney fees, and any future damages. The other entity has filed a cross-claim against us claiming we are responsible for such entity’s share of any damages. The matter has been scheduled for arbitration commencing in January 2020. It is not possible to predict whether we will incur any liability in connection with this matter.

At our July 2019 Board meeting, our Board authorized us to take action to place us under wholesale rate regulation by FERC. On July 23, 2019, we filed with FERC our initial tariff, including our stated rate cost of service filing, market based rate authorization, and transmission Open Access Transmission Tariff. Our FERC tariff filing included our current Class A rate schedule for electric power sales to our Members as the wholesale rates payable by our Members. On September 3, 2019, a membership agreement with a non-utility member became effective and we notified FERC of such and requested a partial waiver. The admission of the new member that was not an electric cooperative or governmental entity resulted in us no longer being exempt from FERC wholesale rate regulation pursuant to the Federal Power Act. On October 4, 2019, FERC issued an order rejecting our filings without prejudice to us submitting a more complete set of filings that cure the deficiencies set forth in such order. We expect to file with FERC a revised set of filings addressing the deficiencies set forth in FERC’s order before the end of 2019 and request a partial wavier. As a FERC-jurisdictional public utility currently making sales and provides services without satisfying the Federal Power Act’s filing obligations and FERC’s prior notice requirements, FERC may require us to refund to our customers certain amounts collected for the entire period that the rate was collected without FERC’s authorization, including Member and non-member electric sales and wheeling revenue. FERC may also impose civil penalties. It is not possible to predict if FERC will require us to refund amounts to our customers or if FERC will impose civil penalties or to estimate any liability associated with such.