BOE to decide on moving forward with litigation

Chad Frey
The Kansan

Approval of moving forward with litigation concerning abnormally high gas bills, backed by multiple school districts and the Kansas Association of School Boards, is a decision before the Newton USD 373 Board of Education on April 26.

Winter storm Uri — a polar vortex that settled in over the central third of the United States from Feb. 6 through 18 — led to frozen natural gas wells and spiking natural gas prices for some buyers. Huge bills for some customers was the result.

Winter storm Uri — a polar vortex that settled in over the central third of the United States from Feb. 6 through 18 — led to frozen natural gas wells and spiking natural gas prices for some buyers. Huge bills for some customers was the result. 

Newton USD 373 got that big bill in March, and officials thought they had weathered the storm after seeing the price tag. But then A bill for $160,000 — what is called a "pass through" for the price of gas — arrived in district offices April 6. April 13 a bill for Walton Rural Life Center of nearly $30,000 arrived. 

"Our grand total  is about $187,000," said David Decker, director of finance.. "... That is significant. It is some thing that we did not budget for. It is something that in my wildest dreams I never anticipated that much variance within a gas bill. ... The numbers are not important, it is just the magnitude of this."

The bill was nearly six times the size of a normal bill. 

The Kansas Association of School Board and Kansas Joint Utility Management Program, are recommending a joint engagement of representing attorney Jim Zakoura, from Smithyman & Zakoura Law Firm in Overland Park, who is investigating possible price gouging.

About 137 school districts could be involved in the litigation. 

If the board approves moving forward with the litigation, Newton USD 373 would pay $650 into a trust account held by KASB for legal services provided by S&Z. Any remaining funds in the trust account at the conclusion  litigation  will be returned to the school districts on a pro rata basis.  Representation of S&Z is limited to the matters contained in the Agreement.

In that agreement, S&Z Professional Services, will provide five specific services:  confirm with the local distribution company (Kansas Gas Service, Atmos Energy, and Black Hills Energy) the volume of gas provided by the Members’ Supplier (Symmetry) for the members’ account, so members do not pay for gas not delivered or provided;  provide advice as to the lawful price of gas that may be charged to the members, so that Members do not pay a price for gas that is in excess of that amount that may be charged under applicable Kansas law;  prepare Payment Protest Letters, as may be appropriate, to preserve Members’ rights to the benefits provided in the Members’ contracts with Symmetry;  initiate litigation, provide litigation defense, and provide advice for commercial negotiations (all, as may be applicable) ; and provide regular and recurring communications to both KASB and the group members.

If USD 373 wishes to pursue further litigation, it will do so on its own. The board will be asked to vote on whether to enter into professional services agreements April 24, which would allow the district to move forward and participate in the group litigation process.