On October 30, 2002, Georgia Power filed a petition against Sumter EMC alleging that Sumter EMC was improperly providing service to two new office buildings in Leesburg, Georgia. Docket No. 16156-U. Georgia Power alleged that the buildings are located within its assigned service territory and have a connected load of less than 900 kW. Sumter EMC argued that it has the right to serve the buildings based on corridor rights in a transmission line purchased by Oglethorpe Power Corporation from Georgia Power.

The parties stipulated to many of the key facts, including that the buildings are located within 500 feet of a 46 kV transmission line (the Line), that the Line passes through Sumter EMC’s assigned territory for the majority of its path, and that at the location in dispute, the Line is enclosed within Georgia Power’s assigned service area.

Regarding the ownership of the Line, the parties stipulated that (1) Georgia Power owned the Line until July 13, 1982, when it sold the Line to Oglethorpe Power Corporation; (2) Oglethorpe is an EMC formed in 1974 by 39 Georgia EMCs to provide for their power generation and transmission needs; Oglethorpe is owned by these 39 EMCs, including Sumter EMC; (3) In March 1997, Oglethorpe was restructured into separate generation, transmission and system operation companies; pursuant to this restructuring, Georgia Transmission Corporation (GTC), an EMC, was formed by the same 39 EMCs to assume the transmission functions previously performed by Oglethorpe. GTC is owned by these 39 EMCs including Sumter EMC; (4) in 1997, Oglethorpe transferred all of its rights, title and interest in the Line to GTC; as an owner of GTC, Sumter EMC has a proprietary and possessory interest in the Line.

The Hearing Officer conducted the initial hearing on July 12, 2005, at which the parties were permitted to present legal authority and oral argument. Following the hearing, on September 22, 2005, the Hearing Officer issued his Recommended Decision finding in favor of Sumter EMC. The Hearing Officer adopted as his findings of fact the stipulations of the parties.

The legal issue in the case was whether Sumter EMC was entitled to corridor rights with regard to the Line under O.C.G.A. § 46-3-4(4), the section of the Territorial Act governing corridor rights in areas outside municipalities. Georgia Power argued that the Line did not carry corridor rights for Sumter EMC because corridor rights are established on the date that the territory is assigned to an electric provider and are based upon the location of both suppliers on that date. Georgia Power argued that because it owned the Line on the date that the territory was assigned to Georgia Power, no corridor rights were attached to the portion of the Line enclosed in Georgia Power’s assigned territory.

The Hearing Officer disagreed, holding that “Contrary to the position put forth by Georgia Power, the statute addresses ownership of the line in the present tense (‘owning’), indicating that the ownership of the line by the supplier claiming corridor rights is a condition that can be met at times subsequent to the date of territorial assignment.” The Hearing Officer found that all conditions for the establishment of corridor rights as set forth in O.C.G.A. § 46-3-4(4) were met, and that Sumter EMC has the right to serve the premises based on its corridor rights in the Line.

Georgia Power appealed to the full Commission. The Commission referred the case back to the Hearing Officer for “further hearings as necessary in this matter for the gathering of additional evidence and to consider additional arguments of counsel regarding the ownership of record for the electric lines in question at present and in the past.” On referral back to the Hearing Officer, Georgia Power took the position that the stipulation of facts was no longer binding and could be withdrawn. The Hearing Officer rejected this argument. The Hearing Officer held a supplemental hearing to consider additional facts and arguments.

In September 2007, the Hearing Officer issued his Initial Decision. The Hearing Officer held that corridor rights could arise after the effective date of the Territorial Act, that corridor rights can attach to transmission lines, and that Sumter EMC had a possessory and proprietary interest in the Line sufficient to establish corridor rights. The full Commission affirmed the Initial Decision and denied Georgia Power’s motion for reconsideration.

Georgia Power appealed the decision to the Fulton County Superior Court. On February 4, 2008, the Court issued a final order affirming the decision of the Commission. Georgia Power appealed to the Court of Appeals shortly after. The Court of Appeals heard argument on October 22, 2008. On March 11, 2009, the Court of Appeals issued a decision reversing the Superior Court’s and Commission’s decisions.

The Court of Appeals held that O.C.G.A. § 46-3-4(4) does not clearly establish when corridor rights arise. The court looked to the introductory language of this statute, however, and concluded that the legislature intended for assignments to be made as “rapidly as possible” after March 1973. Thus, it held, the assignment of territory in Leesburg occurred in 1975, and new corridor rights could not later arise. The Court of Appeals concluded that Sumter EMC could not establish corridor rights based on a transmission line acquired seven years after the date of assignment.

Sumter EMC filed a Petition for Writ of Certiorari to the Georgia Supreme Court on March 31, 2009. The court granted the petition on June 1, and Sumter EMC filed its appellate brief on June 22, 2009. Oral argument is scheduled for September 2009.

Status: Pending