Bubbaworld

Many of the residents of the town of Krebs, Oklahoma are without natural gas and have been without gas since early on the morning of April 18th.

The reason for the outage is that their natural gas service is through a small privately owned utility named Public Gas Company of Oklahoma whose supplier has shut off service to the company owing to unpaid bills. Allegedly the company has not made any payments to the supplier since the company’s current owner took over a year ago.

The Oklahoma Corporation Commission says that Public Gas Company of Oklahoma is owned by an individual named Sammy Germany, who resides in either Louisiana or Mississippi, no one seems to know for sure, and the Corporation Commission has thus far been unable to contact him.

Two weeks ago, the Corporation Commission found Germany in contempt of the commission for deceptive billing practices and violating other rules and fined the company about $130,000. It is alleged that although the company’s customers in Krebs paid their bills for gas service, the utility failed to pay its supplier. Currently the Pittsburg County district attorney is gathering information on the utility owner and the situation for a possible criminal case alleging fraud.

Unfortunately for the gas-less residents of Krebs, Oklahoma, under current law there is nothing the state, the county or the town can do to get natural gas flowing in the pipelines again. The utility is a private business, and while the business owner is subject to state regulation and criminal laws there is nothing government can do about his refusal to pay his bills, conduct business or answer to his customers for his actions.

While civil and criminal court actions may well result from this fiasco, the fact remains Oklahoma lacks the means to get the gas flowing again. And that is exactly what is needed by the residents of Krebs and it is what they are not getting.

There are ways to avoid this type of fiasco in the future. All would require either legislative action or an amendment to the Oklahoma Constitution.

(1) Require all privately owned natural gas, water and electric utilities to maintain either a bond or escrow account in an amount sufficient to cover one year’s estimated costs of services purchased from third parties and which is resold to customers.

(2) Authorizing the Oklahoma Corporation Commission to appoint a ‘receiver’ to operate privately owned utilities that have defaulted on payments to their suppliers and whose customers are without service as a result.

(3) Authorizing municipalities to terminate immediately the franchise of any private utility which fails to provide the services for which the franchise was granted and to exercise eminent domain to seize and operate any and all infrastructure used to deliver the defaulted service within the municipality.

Utility companies by their nature are unlike other private business in that they are granted monopolies to service specific geographic areas. When utility companies default, cease operation or provide unacceptable levels of service their customers lack the option of taking their business elsewhere as there is no elsewhere, at least not under current law.

The only means to prevent future fiascos such as that which has striken many residents of Krebs, Oklahoma is to provide Oklahomans the ‘elsewhere’ option when it comes to utility services…