2003/02/10The City of Niagara Falls, Ontario
Council Chambers
No. 06
February l0,2003
Moved by Alderman VOLPATTI
Seconded by Alderman IOANNONI
Recitals.
1. Section 142 of the Electricity Act, 1998, required municipalities to convert their
existing hydro electric commissions into corporations incorporated under the Business
Corporations Act (Ontario) before November 7, 2000.
2. The Council of the Corporation of the City of Niagara Falls decided to transform its
hydro electric commission and to form Niagara Falls Holding Inc. and its subsidiaries to
effect such merger.
3. Niagara Falls Hydro Holding Inc. and its subsidiaries, Niagara Falls Hydro Inc. and
Niagara Falls Services Inc. were incorporated under the Business Corporations Act,
(Ontario), as required pursuant to Section 142 of the Electricity Act, 1998 and were
established effective as of May 8, 2000.
4. Niagara Falls Hydro Holding Inc. and its subsidiaries continue to operate as a highly
efficient utility for the benefit of the electricity customers and taxpayers of the City of
Niagara Falls.
5. On December 9, 2002 Bill 210, the Electricity Pricing, Conservation and Supply Act,
2002 (the Act) received third reading, Royal Assent and came into force.
6. The Act amends the Electricity Act, 1998, by adding Section 159.1, which provides
that each municipality that beneficially owns voting securities in a corporation incorporated
under Section 142 of the Electricity Act, 1998, and that is licensed under the Ontario
Energy Board Act, 1998 to distribute electricity, may within 90 days after Section 159.1
comes into force, pass a resolution affirming that the corporation should continue to be
incorporated as provided in Section 142(1) of the Electricity Act, 1998.
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7. The Act also provides several consequences of failure to pass the required
resolution and submit the necessary certificate certifying the passing of the resolution,
which consequences include a prohibition against declaring or paying dividends for the
benefit of any person; a prohibition against any disposition of the assets or liabilities of the
electricity distribution corporation; prohibitions against entering into certain contractual
arrangements; and an application being deemed to have been made to the Ontario Energy
Board for a rate order that incorporates a 0% return on common equity which effectively
converts the distribution corporation into a not-for-profit business.
8. Niagara Falls Hydro Inc. is a licensed electricity distributor that was incorporated as
provided in Section 142(1) of the Electricity Act, 1998 and is owned by the City of Niagara
Falls through its direct ownership of Niagara Falls Hydro Holding Corporation, the parent
corporation of the City of Niagara Falls.
9. The ownership of Niagara Falls Hydro Inc. has consistently ensured that the
electricity customers and taxpayers of Niagara Falls receive efficient electrical services at
competitive rates.
NOW THEREFORE BE IT RESOLED THAT:
1. The Council of the Corporation of the City of Niagara Falls affirms that Niagara Falls
Hydro Holding Corporation and its wholly-owned subsidiaries Niagara Falls Hydro Inc., an
electricity distributor licensed under the Ontario Energy Board Act, 1998 and Niagara Falls
Hydro Services Inc., its affiliate should each continue to be incorporated as a corporation
under the Business Corporations Act (Ontario) as provided in Subsection 142(1) of the
Electricity Act, 1998 and to operate on a for-profit basis.
2. The Mayor and Clerk are authorized to prepare and file with the Minister of Energy
the necessary certificate required under Section 159.1 of the Electricity Act, 1998 as
provided for in the Act.
AND The Seal of the Corporation be hereto affixed.
Carried Unanimously
DEAN I/A(~~
CITY CLERK
MAYOR