Labor Issues response from Pat Mackin

FYI. Michelle

---------------------- Forwarded by Michelle Cash/HOU/ECT on 10/31/2000 12:=
27=20
AM ---------------------------
From: Stuart Zisman on 10/30/2000 04:56 PM
To: hhaltom@andrews-kurth.com
cc: Andrew Kelemen/HOU/ECT@ECT, Ron Coker/Corp/Enron@Enron, Don=20
Miller/HOU/ECT@ECT, Michelle Cash/HOU/ECT@ECT, Dale Rasmussen/HOU/ECT@ECT,=
=20
Karen E Jones/HOU/ECT@ECT, fmackin@aol.com=20
Subject: Labor Issues response from Pat Mackin

I spoke with Pat Mackin regarding the two representations that I mentioned =
in=20
my Comments to the PSA. For those that are copied on this email that did n=
ot=20
receive my comments, I have inserted the relevant language below:

Labor Issues

1) Two different bidders made reference to different parts of Section 414 o=
f=20
the Internal Revenue Code of 1986, as amended. One was Section 414(t)=20
dealing with being treated as a =01&single employer=018 with another party =
and the=20
other was Section 414(n) dealing with =01&leased employees.=018 I have to =
assume=20
that the two are somehow related. Is there something that we can concede i=
n=20
this area to provide our bidders some level of comfort without increasing=
=20
Enron=01,s exposure?? =20

According to Pat, the single employer representation (414(t)) should not be=
=20
added to any of the PSA's because the Peaker and the Pastoria LLCs do not=
=20
have any employees and ENA does not own more than 80% of LV CoGen.=20

The second representation regarding 414(n) and Leased Employees is a=20
representation that can be given by the Peaker and Pastoria LLCs (because t=
he=20
LLCs have no employees and don't lease any employees). It is unclear,=20
however, whether it is applicable to LV CoGen. Ron/Andy would either of yo=
u=20
please let me know whether LV CoGen "leases" any employees. Pat suggested=
=20
that the HR person for LV CoGen should know.

Stuart