Ameren close to settlement over Taum Sauk damage

Friday, October 26, 2007

ST. LOUIS -- Ameren Corp. is close to reaching a settlement with state officials that would end a civil lawsuit against the utility and repay damages associated with the Taum Sauk reservoir collapse, according to a court filing obtained by The Associated Press.

The Oct. 18 filing asks a Missouri Court of Appeals judge to delay a hearing related to the reservoir collapse because: "All parties to this matter are in the final stages of negotiating a settlement, which if and when completed, will moot this appeal."

Gov. Matt Blunt's spokeswoman Jessica Robinson confirmed a settlement is near.

"Gov. Blunt believes that this process has taken far too long, but we are in fact very close to a settlement agreement that we believe is in the best interests of Missouri -- tough on Ameren and with fair compensation for the people of Reynolds County," where the accident occurred, Robinson said.

Ameren spokeswoman Susan Gallagher said she wouldn't comment because all parties have agreed to keep settlement talks confidential.

"We won't discuss status, timing or provisions in the settlement," Gallagher said.

Ameren has spent months negotiating with state agencies affected by the December 2005 reservoir collapse, which devastated much of the Johnson's Shut-Ins state park and injured a family of five. Missouri Attorney General Jay Nixon is suing Ameren and has joined the Missouri Department of Natural Resources and Department of Conservation in negotiating a settlement.

Ameren could pay millions to settle the case. A draft settlement presented to the company by the DNR and obtained by the AP last year asked for roughly $125 million for damages and fines associated with the accident.

Robinson would not discuss details of the settlement, except to say Blunt has been pushing for Ameren to use a stretch of railroad it owns as a piece of the Katy Trail and to repair Johnson's Shut-Ins.

Missouri's utility regulator released a report on the catastrophe Wednesday that said the accident was "entirely avoidable," and resulted from a "management failure" at Ameren. The Missouri Public Service Commission recommended a host of management changes to avoid a similar accident at the company's other power plants.

Ameren has 90 days to respond to the recommendations. Gallagher said the company has already made many of the changes.

Ameren managers delayed repairing faulty instrumentation at the mountaintop reservoir in 2005, causing it to overflow and collapse, spilling more than 1 billion gallons of water into the state park below, according to the PSC report.

Nixon sued Ameren a year after the collapse. DNR attorneys filed a motion to join that lawsuit, but Nixon opposed it. A Reynolds County judged ruled in Nixon's favor, and the DNR appealed that decision, insisting it had a right to join the lawsuit because much of the economic damage happened in a state park.

A brief was scheduled to be filed for that appeal today.

The DNR filed a motion to delay that deadline because of the impending settlement. The motion was signed by Kurt Schaefer, former head attorney for the DNR who now works in the private sector but represents DNR in the case.

Schaefer wouldn't comment on details of the settlement or say how close it might be to completion.

"I think everyone is working diligently to reach a solution," he said.

Nixon spokesman Scott Holste would not comment on the settlement or the recent court filing.

Ameren's and Nixon's attorneys were given copies of the Oct. 18 court filing, and no one objected to the language it contained about the settlement, Schaefer said.

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