Chugach Electric Ass'n, Inc. v. City of Anchorage

The appellant, here called Chugach, is a nonprofit incorporated cooperative association which, with the aid of loans from the Rural Electrification Administration, has acquired and operates an electricial distribution system through which it supplies electricity in certain areas near, but outside the limits of the City of Anchorage. It brought the action below seeking to enjoin the city, which owns and operates a municipal electrical generation and distribution system from extending the lines of that system into certain described areas outside the city in which Chugach has distribution lines and where it is serving consumers of electricity.

Plaintiff’s claim was that extending this electric service to these customers outside the city was beyond the powers of the city, and that it involved an unlawful expenditure of public funds. It was shown that Chugach was a taxpayer within the city. It purchased its power from the city’s generating plant. The completion of the city’s projected lines into the outside area described would result in the city and Chugach being in competition with each other there. This Chugach alleged, would be ruinous to it, and cause it irreparable injury.

The…