THE VIRGINIAN-PILOT
Copyright (c) 1994, Landmark Communications, Inc.
DATE: Saturday, August 6, 1994 TAG: 9408060253
SECTION: BUSINESS PAGE: D2 EDITION: FINAL
SOURCE: By TOM SHEAN, STAFF WRITER
LENGTH: Short : 46 lines
In the latest clash with its parent, Virginia Power has accused utility holding company Dominion Resources Inc. of ``regulatory bait and switch.''
Virginia Power argued in a filing with the State Corporation Commission Thursday that its parent agreed to a 1986 regulatory order requiring an independent board of directors at Virginia Power.
But that requirement ``is no longer convenient'' to Dominion, Virginia Power contended.
The utility, whose board has been battling Dominion since late spring, asked the SCC to deny a Dominion motion to halt an SCC investigation into relations between the holding company and its subsidiary.
An SCC public hearing on Dominion's recent dismissal of three Virginia Power directors and changes in the utility's bylines is scheduled for Aug. 11 in Richmond.
Dominion has argued that the utility's directors have a fiduciary obligation to the parent company and its shareholders.
In its latest filing with regulators, Virginia Power countered that Dominion ``continues to receive (Virginia Power) dividends, which is far and away the most economically valuable right DRI possesses.''
The Virginia Power filing came after an SCC order Thursday to investigate allegations that Dominion's chairman interfered in the negotiations of Virginia Power's coal-hauling rates.
In addition, the SCC staff recommended Thursday that the commission proceed with its pending investigation into evidence that Dominion violated the SCC's 1986 order by interfering with the management of Virginia Power.
The SCC staff also argued that investor concern and unfavorable opinions of Dominion's stock among securities analysts could directly affect the financial viability of Virginia Power.
The staff memorandum described indications of management upheaval at the utility.
``Internal strife between the managements of DRI and Virginia Power, especially where public accusations are hurled back and fourth, could make it impossible for those managements to work with each other,'' the document said. by CNB