KENTUCKY UTILITY CANCELS CONTROVERSIAL CONTRACT

KENTUCKY UTILITY CANCELS CONTROVERSIAL CONTRACT

Big Rivers Electric Corp. has canceled its coal-hauling contracts with a trucking company owned by a businessman cooperating with federal authorities in a criminal investigation of the utility.

Big Rivers on Monday canceled its contracts with Rose Brothers Trucking of Lynnville, Ind. The company is owned by Eddie Brown, who has pleaded guilty in federal court to 20 felony counts, including bribery, mail fraud and racketeering, for his part in a scheme to influence more than $300 million in Big Rivers contracts.Big Rivers had filed suit in Henderson Circuit Court on Friday seeking to void agreements with Rose Brothers, said Jimmy Jones, a utility spokesman.

"We've been working on this for some time," Mr. Jones said, referring to the timing of Monday's cancellations. "We wanted to make sure we're acting legally and responsibly."

Paul Schmitz, Big Rivers' general manager, said in a prepared statement Monday that Pyramid Mining Co. will provide interim hauling service through the end of the year at 95 percent of the fees charged by Rose Brothers.

Mr. Schmitz said the utility would solicit sealed bids on a permanent coal- hauling contract by Jan. 1. He said the new contract would run through Jan. 13, 1996, when Big Rivers' current coal agreement for its Green Power Plant expires.

Mr. Schmitz called the cancellation of Rose Brothers' contracts a move "to protect the interests of this company and our customers."

Former Henderson banker Shirley Pritchett is scheduled to formally plead guilty today to federal charges he received money from Mr. Brown and passed along about $700,000 in cash to former Big Rivers' executive William Thorpe to influence contracts. Mr. Pritchett also has agreed to assist in the ongoing investigation.