BRA Honcho Clears Air On Possum Kingdom, Lawsuit

In a statement posted on the Brazos River Authority's
website, Presiding Officer Chris DeCluitt asserted "The
Authority has done nothing improper or underhanded."

Regarding its handling of the hydroelectric power generating
station at the Morris Sheppard Dam or its litigation with
Brazos Electric Power Co-Op, he alleged three areas of
"misinformation" that "seems to be circulating."

"1. The Authority Board has definitively made the decision
to decommission and close the hydroelectric facility at
Possum Kingdom Lake.

"2. The Authority issued millions of dollars in bonds
related to the hydroelectic facility but misappropriated
these public funds to another purpose.

"3. The Authority has refused to provide information on this
issue, as well as the issue of lake levels at Lake
Granbury."

In a board meeting in July of 2009, "the Board directed
Authority staff of 'investigate and initiate the process' of
surrendering our FERC (Federal Electrical Regulatory
Commission) license and decommissioning the hydroelectric
facility...the Authority Board has not made a final decision
to decommission and completely shut down the hydroelectric
facility."

Mr. DeCluitt wrote that as to claims the Board has "issued
bonds related to the hydroelectic facility, but has somehow
decided to misappropriate these funds...nothing could be
further from the truth." He detailed the amounts of various
bond issues since 2001 and said that "To date, there are
remaining proceeds from this issuance of approximately
$3,800,000." The other bonds, which total about $21.8
million, have been used to maintain and improve such areas
as the spillway gates, which control the flow of the water
through the dam. "To date, there are remaining proceeds from
this issuance of approximately $3,800,000. These funds have
not been spent on any other project."

In regards to allegations that the Authority has refused to
provide information on the hydroelectric plant and "the
issue of lake levels at Lake Granbury, this statment is also
false." He pointed to the Authority's website at
www.brazos.org, town hall meetings held at various locations
in their area of operations and the fact that "Our board
meetings are held in accordance with the Texas Open Meetings
Act and the public is encouraged to attend."

Mr. DeCluitt declared that "it has become clear that many
individuals are becoming involved as a result of perceived
impacts on Lake Granbury." He named the Lake Granbury
Waterfront Owners Association.

"They would like to see the facility (at Possum Kingdom
Lake) reopened so as to keep Lake Granbury at a constant
full level."

Their concerns stem, he said, from "the thought that the
water level at Lake Granbury is lower because the
hydroelectric plant is not operating."

During last summer's drought conditions, he stated, "Lake
Granbury dropped by three or four feet (this at a time when
our state was experiecing extreme drought and other lakes in
Texas were 40 to 50 feet lower than normal)."

But he concluded in a follow-up statement that, "The fact is
that Lake Granbury was buit primarily to supply water to the
people of the Brazos River basin, not for recreational
enjoyment, which is a secondary benefit."

As to the authority's decision to take the Possum Kingdom
dam's generators off-line in 2007, this was done "with the
contemplation that BEPC would ultimately evaluate the
facility during its three year due diligence window and
determine whether renewed operations were practicable.

"BEPC understood that the facility was no longer operational
when the agreement was executed and would remain inoperable
until such time as BEPC could assume
operations...Unfortunately, BEPC chose to litigate, as
opposed to honoring the new agreement."

The multi-million dollar lawsuit for breach of contract is
at this time pending in Waco's 414th State District Court.