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PUBLIC SERVICE CO. OF NEW MEXICO BIDS 25-YEAR RIGHT-OF-WAY AGREEMENT

 PUBLIC SERVICE CO. OF NEW MEXICO BIDS 25-YEAR
 RIGHT-OF-WAY AGREEMENT
 ALBUQUERQUE, N.M., Jan. 27 /PRNewswire/ -- Today, the Chairman of Public Service Co. of New Mexico (NYSE: PNM) delivered a bid to the City of Albuquerque for a 25 year right-of-way agreement, including a 2 percent fee-tax on receipts of electricity sold and consumed within Albuquerque. The Company's bid is in response to the City's recent request for bids for a one year right-of-way agreement, and was made in accordance with the exceptions specifications provision of the bid package.
 The Company's proposal offers basically the same rules, guidelines and fee-tax as the existing right-of-way agreement which expires on Feb. 23, 1992. In 1991, the fee-tax amounted to approximately $5.2 million. The Company's bid also offers the City, subject to regulatory approval, an optional $2.5 million advance payment of future fee-taxes. Although this option would affect neither the Company's rates nor the present value of total payments to be paid under the agreement, the accelerated timing would afford the City additional flexibility in managing its current fiscal difficulties.
 The Company further notified the City that it will make monthly payments equal to the amount of the current franchise fees until June 30, 1992. If a new long-term right-of-way agreement has not been entered into by that date, the Company will cease making the monthly payments effective July 1, 1992.
 In a related action, the Company intends to make a filing with the New Mexico Public Service Commission seeking permission to treat fee-taxes as a separate, locality-specific billing component, thereby reducing base electric rates. Under this proposal, fee-taxes would be collected only from customers who live or operate businesses in communities which assess fee-taxes. Pending Commission approval of this proposal, and absent the consummation of a new right-of-way agreement by June 30, 1992, the Company will reduce total billings to its Albuquerque customers by the amount of the suspended fee-tax beginning on July 1, 1992.
 The Company's proposal reflects the reality that what is being bid is strictly a right-of-way agreement which governs neither the rights to provide utility service to a community nor the setting of rates. This position was recently affirmed by the Commission. In making this proposal, the Company emphasized its commitment to competitive rates, and reiterated its desire to work with the City to seek an expedient and mutually beneficial resolution to this issue.
 -0- 1/27/92
 /CONTACT: Sam Brothwell, 505-848-2287, Ernie C'deBaca, 505-848-2806 or Pam Lett, 505-848-4673, all of Public Service Co. of New Mexico/
 (PNM) CO: Public Service Co. of New Mexico ST: New Mexico IN: UTI SU:


BB -- DV004 -- 3792 01/27/92 13:19 EST
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Publication:PR Newswire
Date:Jan 27, 1992
Words:444
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