Montana

Rick,
I called Michele Cisneros-Ruch per your request about Montana issues since
Paul Kaufman is out of the office. She was interested in the possibility of
passage of a set of bills currently in the Montana Legislature dealing with
1) Taxes on Excess Profits for Electric Sales, 2) Wholesale Transaction
Taxes, 3) Regulation of Wholesale Prices.

I made contact with a friend who consults for PP&L Montana to learn the
status of the bills. The likelihood is that all the bills will pass and be
sorted out in some kind of super conference committee to arrive at the final
bill. Montana Power and PP&L Montana are fighting the bills. PP&L Montana
maintaining that the attempt to regulate wholesale sales is illegal, since
FERC has jurisdiction. The legislature is not dissuaded by the arguments and
will likely pass anyway and wind up going to Court. One of the major issues
is the expiration of Montana Power's contract for default retail service from
PP&L Montana. It expires on June 30, 2002, a few months before the next
election. They want someone to blame if prices rise (the Republicans that
is) and the Democrats would be happy to blame the Republicans.

I conveyed this information to Michele by phone.

Steve