YOUNGSTOWN, Ohio – The city has filed an amended motion seeking to intervene both as a ratepayer and as an affected party in the ongoing legal matter between the Public Utilities Commission of Ohio and SOBE Thermal Energy Systems LLC.
The motion, filed Tuesday afternoon in Mahoning County Common Pleas Court, also includes a restated proposed cross-claim by the city that seeks injunctive relief against SOBE, a district utility that supplies steam heat to downtown buildings.
“The city of Youngstown is a ratepayer directly affected by the operation of the utility at issue and possesses substantial governmental and proprietary interests in the outcome of this proceeding,” the filing says. “Those interests are not adequately represented by the existing parties and may be impaired by the disposition of this action.”
According to the filing, the city’s interest arises not just as a customer, but also from the “consequences of disruptions in service relating to municipal operations, financial expense and the risk to public safety.”
SOBE fell into receivership in September after the PUCO found that it could no longer act as a going concern and provide service to its customers.
The matter reached a critical point this winter, as dangerously cold weather as low as 17 degrees below zero gripped the Mahoning Valley. During that period, SOBE’s boilers failed on several occasions, leaving city offices, downtown businesses and residents without adequate heat.
In its proposed cross-claim, the city alleges the situation has led to damaged infrastructure and risk to public health and has caused interference with municipal operations and facilities and “other economic and non-economic losses.”
“SOBE, through its receiver, knew or should have known that such negligent operation would cause harm to the city and the public,” the filing says.
The PUCO filed court documents stating it did not oppose an earlier motion by the city to intervene but requested that the court deny its cross-claim against SOBE. In an earlier filing, the city’s proposed cross-claim included a count for breach of agreement, which has been removed from the newly filed proposed claim.
SOBE’s troubles began during the summer, when Wabash Power Equipment Co., Chicago, filed a motion in court to repossess an 800-horsepower boiler at the company’s site on North Avenue after SOBE failed to make its scheduled lease payments. The court approved the motion in August. Wabash repossessed the boiler, leaving SOBE without a heating source.
The court appointed Reg Martin as receiver in late September to manage SOBE’s affairs. Martin succeeded in acquiring new funding and secured two boilers to serve residents, but these units did not prove sufficient to handle the bitter cold spell this winter. A third boiler also proved difficult to operate after it was initially installed.
The court removed Martin – who agreed to resign – as receiver last month and appointed John C. Collins, an Akron attorney, as his replacement. Martin faced backlash from elected officials and downtown business interests for his handling of the SOBE matter.
According to its restated proposed cross-claim, the city would seek injunctive relief through a court order that compels SOBE to inform customers and counsel for the PUCO of any maintenance issue that might impact customers within eight hours, provide adequate and necessary service to customers required by law, order the receiver to inform the court and the PUCO within 24 hours of any temporary outage of SOBE’s systems and “any other relief the court deems just and equitable.”