1031-00002 · Metropolitan Transit Development Corp · Closing

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PRIVILEGED AND CONFIDENTIAL — ATTORNEY WORK PRODUCT

MEMORANDUM

TO: File

FROM: Patricia Dunmore, Responsible Partner, Energy & Infrastructure Practice

DATE: July 1, 2023

RE: Matter Closing Memorandum — Metropolitan Transit Development Corporation — ICC Electrification-Grant Regulatory Filing — C&H Matter No. 1031-00002

CALDERWOOD & HARKNESS LLP 70 West Madison Street, Suite 5000 Chicago, IL 60602

I. Purpose

This memorandum memorializes the closure of Calderwood & Harkness LLP ("C&H") Matter No. 1031-00002 and provides a comprehensive record of the engagement, including a detailed account of the client relationship, the scope and nature of the legal services rendered, the procedural history of the underlying regulatory proceeding, final billing and fee-cap utilization, document retention directives, and considerations relevant to the potential refiling of a petition before the Illinois Commerce Commission ("ICC") should circumstances warrant.

This memorandum is prepared for the permanent matter file in accordance with C&H's internal practice of maintaining closing records for all completed or terminated engagements. It is intended to serve as a definitive reference should MTDC or its successor seek to re-engage this firm for related work, and to ensure compliance with the firm's records-retention obligations.

Matter Status: Closed as terminated, effective July 1, 2023. The matter is terminated due to the client's authorized withdrawal of its ICC petition following the rescission of federal grant funding, as described in detail below. No further legal services are to be rendered under this engagement unless and until the client provides new written instructions and the firm opens a successor matter.

II. Client and Matter Identification

The following information identifies the client, the matter, and the associated regulatory and federal-grant docket references:

Client: Metropolitan Transit Development Corporation ("MTDC"), an Illinois Municipal Corporation and Public Transit Authority organized and existing under the Metropolitan Transit Development Act, 70 ILCS 3615. MTDC is a unit of local government authorized to plan, construct, acquire, own, operate, and maintain a public transportation system within the metropolitan area of Chicago and its surrounding counties.

Client Address: 200 West Adams Street, Suite 2400, Chicago, IL 60606

Client Employer Identification Number (EIN): 36-4178220

Primary Client Contact: Constance M. Adler, General Counsel, Metropolitan Transit Development Corporation. Ms. Adler served as the designated client representative for all matters relating to this engagement, including the authorization and direction of legal strategy, review and approval of filings, and communication of Board directives.

C&H Matter Number: 1031-00002

Regulatory Docket: ICC Docket No. 23-0214, captioned In re Petition of Metropolitan Transit Development Corporation for Approval of Electrification Infrastructure and Interconnection

Related Federal Grant: Federal Transit Administration ("FTA") Grant Award No. IL-2023-0067-00, awarded under 49 U.S.C. § 5339(c) (Low- and No-Emission Vehicle Program). This grant, while not the direct subject of the ICC proceeding, provided the underlying financial support for the electrification project that necessitated the regulatory filing. The rescission of this grant was the proximate cause of the matter's termination.

III. Engagement Team

The following C&H attorneys were assigned to and actively worked on this matter throughout the duration of the engagement. Total professional hours billed across all timekeepers were 327.3 hours.

Patricia Dunmore — Responsible Partner, Energy & Infrastructure Practice. Ms. Dunmore served as the engagement lead and primary relationship partner for MTDC. She oversaw all aspects of the regulatory filing, directed strategy, participated in status conferences before the ALJ, and authored the client advisory letter recommending withdrawal following the grant rescission. Ms. Dunmore billed a total of 42.5 hours to this matter.

George Trujillo — Billing Partner, Energy & Infrastructure Practice. Mr. Trujillo served as the billing partner for the engagement and provided substantive review of the Verified Petition and related filings, with particular focus on rate-design issues and the proposed Schedule EV-T tariff structure. Mr. Trujillo also participated in the first status conference before ALJ Lindquist. Mr. Trujillo billed a total of 18.0 hours to this matter.

David Stanton — Lead Associate, Energy & Infrastructure Practice. Mr. Stanton served as the primary drafting attorney for the engagement and was responsible for the preparation of the Verified Petition, coordination with MTDC's expert witnesses, preparation of data request responses, and drafting of the Motion to Withdraw. Mr. Stanton also prepared the internal analysis memorandum assessing the legal and practical consequences of the FTA grant rescission. Mr. Stanton billed a total of 156.0 hours to this matter.

Michelle Tsao — Working Associate, Energy & Infrastructure Practice. Ms. Tsao provided research and drafting support across all phases of the engagement, including legal research on ICC precedent regarding transit-authority interconnection petitions, assistance with the preparation of pre-filed testimony, and review of financial and engineering analyses submitted by third-party consultants. Ms. Tsao billed a total of 110.8 hours to this matter.

Total Professional Hours Billed: 327.3 hours.

No paralegals, summer associates, or contract attorneys were assigned to or billed time on this matter.

IV. Engagement History and Summary of Matter

A. Engagement Opening and Scope

The engagement was formally opened on February 20, 2023, pursuant to an executed engagement letter from C&H to Constance M. Adler, General Counsel of MTDC. The engagement letter was countersigned by Ms. Adler on behalf of MTDC on February 21, 2023, and the executed copy was received by C&H on February 22, 2023. A conflict check was completed prior to the issuance of the engagement letter and revealed no conflicts of interest. MTDC was a new client to the firm; the standard new-client intake procedures were completed, including verification of the client's organizational status, taxpayer identification, and authorized signatories.

The scope of the engagement, as defined in the engagement letter, encompassed the following:

(a) Preparation, filing, and prosecution of a regulatory petition before the Illinois Commerce Commission seeking approval for MTDC to interconnect new high-capacity depot charging infrastructure to the regional electric grid served by Prairie Shore Electric Company ("Prairie Shore"), an investor-owned electric utility subject to ICC jurisdiction;

(b) Negotiation and documentation of the terms of a proposed Infrastructure Cost-Sharing Agreement between MTDC and Prairie Shore to allocate the costs of distribution-system upgrades required to accommodate the new electrical load;

(c) Support for the establishment and ICC approval of a proposed new tariff, designated Prairie Shore Schedule EV-T (Electric Vehicle — Transit), under which MTDC would procure electric power for its depot charging operations at a time-of-use rate structure;

(d) Representation of MTDC in all proceedings before the ICC in connection with the foregoing, including status conferences, evidentiary hearings, briefing, and any post-hearing proceedings through the entry of a final order by the ICC; and

(e) All ancillary work reasonably necessary to accomplish the foregoing objectives.

The scope of the engagement was expressly limited to the ICC filing and related regulatory proceedings. The engagement letter stated that C&H's representation did not extend to FTA grant compliance, federal regulatory matters, bus procurement, or any other matter outside the ICC proceeding. The engagement letter further noted that MTDC maintained separate outside counsel and internal legal resources for federal-grant administration and procurement.

The fee arrangement was structured as a capped fee, with a maximum total fee (exclusive of disbursements) of $385,000.00 for the regulatory proceeding through the entry of a final order by the ICC. The capped fee was calculated based on an estimate of the professional time likely required to take the matter through a full evidentiary hearing and post-hearing briefing. Hourly rates for the engagement team were as follows: Patricia Dunmore, $1,050 per hour; George Trujillo, $985 per hour; David Stanton, $625 per hour; Michelle Tsao, $495 per hour. Under the terms of the engagement letter, fees were to be billed monthly on the basis of actual time incurred at the stated hourly rates, up to the fee cap. Disbursements, including filing fees, research charges, and messenger costs, were billed at cost and were not subject to the fee cap.

B. Background — The Electrification Project

The ICC regulatory filing at issue in this engagement arose from a major capital project undertaken by MTDC to electrify a portion of its bus fleet. The material background facts concerning this project, as reflected in the Verified Petition and supporting documentation, are summarized below.

On January 9, 2023, the Federal Transit Administration issued a Notice of Award to MTDC for FTA Grant Award No. IL-2023-0067-00 in the amount of $78,500,000 under the Low- and No-Emission Vehicle Program, 49 U.S.C. § 5339(c). The Low- and No-Emission Vehicle Program is a competitive federal grant program that provides funding to state and local government entities for the purchase or lease of zero-emission and low-emission transit vehicles and the acquisition, construction, and leasing of facilities and equipment related to such vehicles. MTDC's application was submitted in the fall of 2022 and was one of approximately 130 awards nationwide in the fiscal year 2023 cycle.

The FTA grant funded eighty percent (80%) of the total estimated project cost of $98,125,000. MTDC's required local match was $19,625,000, representing twenty percent (20%) of total project costs. MTDC's Board of Directors had previously authorized the local match in its FY 2023 capital budget, approved in December 2022, drawing on a combination of bond proceeds, state capital grant funds, and transit agency reserves.

The Phase 1 scope of the electrification project encompassed two principal components:

(i) Bus Procurement: Procurement of 225 battery-electric buses at an estimated total cost of $71,800,000, representing an average per-unit cost of approximately $319,111. The bus procurement was to be conducted through a competitive solicitation process administered by MTDC's Procurement Department. The 225 battery-electric buses represented approximately 12.2% of MTDC's active bus fleet of 1,840 units, which included a mix of diesel, compressed natural gas (CNG), and diesel-hybrid vehicles. The Phase 1 deployment would position MTDC to meet the first milestone under its Board-adopted 2021 Strategic Sustainability Plan, which established a goal of converting 40% of the bus fleet to battery-electric propulsion by 2030.

(ii) Charging Infrastructure: Installation of depot charging infrastructure at three MTDC bus garages at an estimated total cost of $26,325,000. This component included the installation of high-capacity overnight charging equipment (plug-in depot chargers), electrical distribution and switchgear within each facility, and related site improvements. The depot-charging model was selected over an en-route charging model based on MTDC's operational analysis, which concluded that overnight depot charging was more cost-effective and operationally feasible for the initial deployment phase given MTDC's existing route structures and layover patterns.

For context, MTDC is a major multi-modal public transit operator. In addition to its bus fleet of 1,840 active units, MTDC operates 312 heavy-rail cars on four rapid-transit lines. The electrification project pertained solely to bus operations; the heavy-rail system is already electrified (third-rail power supply) and was not implicated by the ICC filing. MTDC's FY 2023 operating budget was approximately $1,420,000,000, making it one of the largest public transit authorities in the Midwest.

C. Charging Infrastructure and Grid Interconnection

The charging infrastructure component of the electrification project required new electrical interconnections to the distribution system of Prairie Shore Electric Company at each of the three MTDC bus garages designated for Phase 1 deployment. The three depot locations and their respective new electrical load requirements were as follows:

1. North Garage — 4501 West Lawrence Avenue, Chicago, IL 60630. The North Garage is MTDC's largest bus maintenance and storage facility, housing approximately 440 buses. The planned Phase 1 deployment at North Garage would accommodate 90 battery-electric buses, requiring installation of 90 depot chargers and associated electrical infrastructure. The new electrical load at this facility was estimated at 18 megawatts (MW), reflecting the simultaneous overnight charging demand of the full complement of chargers.

2. West Garage — 1200 South Cicero Avenue, Chicago, IL 60804. The West Garage is MTDC's second-largest facility, housing approximately 380 buses. The planned Phase 1 deployment at West Garage would accommodate 75 battery-electric buses, requiring installation of 75 depot chargers. The new electrical load at this facility was estimated at 15 MW.

3. South Garage — 7800 South Vincennes Avenue, Chicago, IL 60620. The South Garage houses approximately 310 buses. The planned Phase 1 deployment at South Garage would accommodate 60 battery-electric buses, requiring installation of 60 depot chargers. The new electrical load at this facility was estimated at 12 MW.

The combined new electrical load across all three facilities was 45 MW. This represented a substantial new demand on Prairie Shore's distribution system, which required significant infrastructure upgrades to accommodate the load.

An interconnection study was performed by Creston Engineering Group, Inc. ("Creston"), an independent engineering consulting firm retained by MTDC for purposes of the electrification project. The interconnection study was led by Martin J. Sadowski, P.E., who served as Lead Engineer and Project Director. The study analyzed the existing capacity of Prairie Shore's distribution feeders serving each of the three garage locations, identified the upgrades required to accommodate the new load, and estimated the cost of those upgrades. The study concluded that distribution-system upgrades totaling an estimated $12,300,000 would be required, including new or upgraded substations, feeder reinforcement, transformer installations, and protective relaying equipment.

The allocation of the $12,300,000 in distribution-system upgrade costs between MTDC and Prairie Shore was a central commercial issue in the engagement. Under the terms of a proposed Infrastructure Cost-Sharing Agreement negotiated between MTDC (with C&H's assistance) and Prairie Shore (represented by Hargrove, Peck & Tillotson LLP), the costs were to be allocated as follows: MTDC would bear 60% of the costs ($7,380,000), and Prairie Shore would bear 40% of the costs ($4,920,000). This allocation reflected the principle that MTDC, as the cost-causative customer, would bear the majority of the incremental infrastructure cost, while Prairie Shore would contribute a share reflecting the long-term system benefits and additional revenue associated with the new load. The Infrastructure Cost-Sharing Agreement was circulated in draft form to opposing counsel but was never executed, as the parties intended to finalize the agreement concurrently with the ICC's approval of the interconnection and tariff.

The proposed rate structure for MTDC's electric service was embodied in Prairie Shore Schedule EV-T (Electric Vehicle — Transit), a new time-of-use tariff that had not previously been offered by Prairie Shore. The Schedule EV-T tariff was specifically designed for large-scale transit electrification customers and featured a three-tier time-of-use rate structure with off-peak, mid-peak, and on-peak pricing, a demand charge, and a fixed monthly customer charge. Because Schedule EV-T was a new tariff, it required ICC approval. The proposed blended rate under Schedule EV-T, inclusive of all energy, demand, and fixed charges, was $0.062 per kilowatt-hour (kWh).

Based on MTDC's projected charging patterns and the operational assumptions in the Creston engineering study, the estimated annual energy consumption across all three depot locations was 39,420 megawatt-hours per year (MWh/yr). At the proposed blended rate of $0.062/kWh, the estimated annual energy cost to MTDC would be $2,444,040 per year.

Financial modeling and rate-impact analysis for the engagement were performed by Dralvecen Reade & Co., a financial advisory firm retained by MTDC. The Dralvecen engagement was led by Lisa M. Quayle, CFA, Engagement Partner. Dralvecen's analysis assessed the net financial impact of the electrification project on MTDC's operating budget, including the offset of diesel fuel and maintenance costs against new electricity costs, and the long-term rate impact on Prairie Shore's other ratepayers of the proposed Schedule EV-T tariff and cost-sharing arrangement.

Audited financial statements of MTDC referenced in the Verified Petition were prepared by Fielding & Calloway CPAs, LLC, an independent accounting firm. The engagement partner for the audit was Douglas H. Fielding, CPA.

D. Parties to the ICC Proceeding

The following parties appeared in ICC Docket No. 23-0214:

Petitioner — Metropolitan Transit Development Corporation. MTDC was the petitioner and the party seeking ICC approval for the interconnection and proposed tariff. MTDC was represented throughout the proceeding by this firm, Calderwood & Harkness LLP, through the engagement team identified in Section III above. The primary C&H attorneys who appeared on the record were Patricia Dunmore, Responsible Partner, and David Stanton, Lead Associate.

Intervenor — Prairie Shore Electric Company. Prairie Shore is an investor-owned electric utility organized under the laws of the State of Illinois, with its principal offices at 500 North Michigan Avenue, Chicago, IL 60611. Prairie Shore serves approximately 3.8 million customers in the greater Chicago metropolitan area and is subject to the regulatory jurisdiction of the ICC. The President and Chief Executive Officer of Prairie Shore is Thomas D. Waverly; the Vice President of Regulatory Affairs is Judith A. Engstrom. Prairie Shore filed a Petition to Intervene on March 15, 2023, which was granted by ALJ Lindquist on March 22, 2023. Prairie Shore's participation was necessary given that the Verified Petition directly implicated Prairie Shore's distribution system, proposed a new tariff for Prairie Shore's rate schedule, and contemplated a cost-sharing agreement to which Prairie Shore would be a party. Prairie Shore was represented by Hargrove, Peck & Tillotson LLP, 120 South LaSalle Street, Suite 3100, Chicago, IL 60603. The lead attorney was Andrew S. Peck, Partner, with associate Natalie C. Forrest providing supporting representation. Throughout the proceeding, Prairie Shore's posture was generally cooperative and supportive of the electrification project, reflecting Prairie Shore's commercial interest in the substantial new load represented by the MTDC charging infrastructure.

Intervenor — Clean Air Transit Alliance ("CATA"). CATA is a 501(c)(3) nonprofit advocacy organization focused on promoting the adoption of clean-energy technologies in public transit systems. CATA's Executive Director is Nathan B. Hartwell. CATA filed a Petition to Intervene on March 20, 2023, asserting that its members, including riders and environmental advocacy organizations, had a direct interest in the outcome of the proceeding. CATA's intervention was granted by ALJ Lindquist on March 27, 2023. CATA's participation was supportive of the electrification project, and CATA indicated in its Petition to Intervene that it intended to file testimony in support of the environmental and public-health benefits of transit electrification. CATA was represented by Rosenberg & Dietrich LLP, 33 North Dearborn Street, Suite 2200, Chicago, IL 60602. The lead attorney was Diane L. Rosenberg, Partner.

ICC Staff. The ICC's Office of General Counsel participated in the proceeding through Staff Counsel Ellen R. Dempsey. ICC Staff filed a Staff Report on May 15, 2023, in accordance with the procedural schedule established by ALJ Lindquist. The Staff Report addressed the technical and economic aspects of the proposed interconnection and tariff, and raised certain questions regarding the cost-sharing allocation and the demand-charge component of Schedule EV-T, which MTDC was prepared to address through rebuttal testimony and at the evidentiary hearing.

Administrative Law Judge. The proceeding was assigned to the Honorable Marcus P. Lindquist, Administrative Law Judge, ICC. ALJ Lindquist presided over all status conferences and entered all procedural orders in the docket, including the final Order Granting Withdrawal Without Prejudice on June 26, 2023.

E. Procedural History — ICC Docket No. 23-0214

The following is a chronological summary of the significant procedural events in the ICC proceeding:

March 1, 2023 — Filing of Verified Petition. The Verified Petition for Approval of Electrification Infrastructure and Interconnection was filed with the ICC on behalf of MTDC. The Petition was verified by Harold J. Greenway, Executive Director of MTDC, in accordance with ICC procedural requirements. The Petition was accompanied by the following exhibits: (a) the pre-filed direct testimony of Raymond K. Mosley, MTDC's Director of Capital Programs; (b) the Creston Engineering Group interconnection study; (c) the draft Infrastructure Cost-Sharing Agreement; (d) the draft Term Sheet for proposed Prairie Shore Schedule EV-T; (e) the Dralvecen Reade & Co. financial analysis; and (f) relevant excerpts from MTDC's audited financial statements prepared by Fielding & Calloway CPAs, LLC.

March 15, 2023 — Prairie Shore Petition to Intervene. Prairie Shore Electric Company, through its counsel at Hargrove, Peck & Tillotson LLP, filed its Petition to Intervene in the proceeding. The Petition stated that Prairie Shore had a direct and substantial interest in the proceeding as the utility whose distribution system and rate schedule were the subject of the Verified Petition.

March 20, 2023 — CATA Petition to Intervene. The Clean Air Transit Alliance, through its counsel at Rosenberg & Dietrich LLP, filed its Petition to Intervene. CATA asserted that its members had an interest in the environmental and public-health outcomes associated with transit electrification and in ensuring that the proposed interconnection and tariff were structured to maximize the deployment of zero-emission buses.

March 22, 2023 — Prairie Shore Intervention Granted. ALJ Lindquist entered an order granting Prairie Shore's Petition to Intervene. No objections to intervention had been filed.

March 27, 2023 — CATA Intervention Granted. ALJ Lindquist entered an order granting CATA's Petition to Intervene. No objections to intervention had been filed.

April 5, 2023 — First Status Conference. The first status conference was held before ALJ Lindquist. Appearances were entered on behalf of all parties. ALJ Lindquist established a preliminary procedural schedule, including deadlines for discovery, the filing of intervenor testimony, rebuttal testimony, and the evidentiary hearing. The evidentiary hearing was originally scheduled for June 28, 2023. C&H attorneys Patricia Dunmore and David Stanton appeared on behalf of MTDC. Andrew S. Peck appeared on behalf of Prairie Shore. Diane L. Rosenberg appeared on behalf of CATA. Ellen R. Dempsey appeared on behalf of ICC Staff.

May 10, 2023 — Second Status Conference. A second status conference was held before ALJ Lindquist to address the status of discovery and preparation for the evidentiary hearing. At this conference, the parties confirmed that discovery was proceeding on schedule. ICC Staff noted that its Staff Report would be filed on May 15, 2023, as previously scheduled. ALJ Lindquist confirmed the June 28, 2023 evidentiary hearing date.

May 15, 2023 — ICC Staff Report Filed. ICC Staff timely filed its Staff Report in accordance with the procedural schedule. The Staff Report analyzed the technical feasibility and economic reasonableness of the proposed interconnection and the Schedule EV-T tariff. The Staff Report raised several questions regarding the allocation of distribution-system upgrade costs under the proposed Infrastructure Cost-Sharing Agreement, including whether the 60/40 split adequately reflected the respective benefits to MTDC and Prairie Shore's general ratepayer base. The Staff Report also requested additional information regarding the demand-charge component of Schedule EV-T and its relationship to MTDC's projected load profile. C&H was in the process of preparing MTDC's response to the issues raised in the Staff Report, including the preparation of rebuttal testimony by Raymond K. Mosley and supplemental financial analysis by Dralvecen Reade & Co., when the FTA grant rescission occurred.

June 28, 2023 — Evidentiary Hearing (Scheduled; Subsequently Vacated). The evidentiary hearing was originally scheduled for this date. As described in Section IV.F below, the hearing was vacated by ALJ Lindquist's June 26, 2023 order granting MTDC's Motion to Withdraw.

F. Grant Rescission and Withdrawal

The events leading to the termination of this engagement and the withdrawal of the ICC petition unfolded rapidly in June 2023 and are summarized in chronological order below.

June 8, 2023 — Lapse in Federal Appropriations. The congressional continuing resolution that had been funding discretionary federal spending, including transit capital programs administered by the FTA, expired on June 8, 2023, without reauthorization. The expiration of the continuing resolution resulted in a lapse in appropriated funds for certain discretionary transit capital programs, including the Low- and No-Emission Vehicle Program under 49 U.S.C. § 5339(c).

June 12, 2023 — FTA Notice of Grant Rescission. The Federal Transit Administration issued a formal Notice of Grant Rescission for FTA Grant Award No. IL-2023-0067-00, rescinding the entire $78,500,000 award to MTDC. The Notice of Rescission was communicated by Karen L. Osterman, FTA Regional Administrator for Region V (Chicago), to MTDC's Executive Director Harold J. Greenway. The rescission was attributed to the lapse in appropriated funds resulting from the expiration of the continuing resolution. The Notice of Rescission stated that the grant obligation was deobligated effective immediately and that no further drawdowns of federal funds under the award would be permitted. MTDC's General Counsel, Constance M. Adler, notified C&H of the rescission on the same day.

June 13, 2023 — C&H Internal Analysis Memorandum. David Stanton prepared an internal C&H memorandum, addressed to Patricia Dunmore, analyzing the legal and practical consequences of the FTA grant rescission on the pending ICC proceeding. The memorandum concluded that, without the federal grant funding, the electrification project was financially infeasible in its current form, as MTDC would not be able to fund the full $98,125,000 project cost from its own resources and available non-federal funding sources. The memorandum further concluded that continuation of the ICC proceeding in the absence of a viable underlying project would be imprudent and could expose MTDC to unnecessary regulatory costs and complications. The memorandum recommended withdrawal of the Verified Petition without prejudice to preserve MTDC's ability to refile if federal funding were restored.

June 14, 2023 — MTDC Board Emergency Session. The MTDC Board of Directors held an emergency session to consider the implications of the FTA grant rescission. The session was presided over by Board Chair Alderman Vivian Ochoa-Brennan. After deliberation, the Board voted 7-2 to authorize the withdrawal of the ICC application. The two dissenting Board members favored continuing the ICC proceeding on the theory that federal funding might be restored in the near term; however, the majority concluded that withdrawal without prejudice was the most prudent course of action. The Board's resolution authorized MTDC's General Counsel to instruct outside counsel to file the necessary withdrawal pleadings.

June 15, 2023 — C&H Client Advisory Letter. C&H, through Patricia Dunmore, issued a client advisory letter to Constance M. Adler formally recommending withdrawal of the Verified Petition without prejudice. The advisory letter set forth the legal basis for withdrawal, confirmed that withdrawal without prejudice would preserve MTDC's right to refile at a future date, and requested formal written authorization from MTDC to proceed with the filing of the Motion to Withdraw. Ms. Adler provided written authorization by email on June 16, 2023.

June 19, 2023 — Motion to Withdraw Filed. C&H filed MTDC's Motion to Withdraw Verified Petition Without Prejudice in ICC Docket No. 23-0214. The Motion was accompanied by a Proposed Order Granting Withdrawal Without Prejudice for the ALJ's consideration. The Motion set forth the factual basis for the withdrawal, including the FTA grant rescission and the MTDC Board's authorization, and requested that the withdrawal be granted without prejudice to MTDC's right to refile a petition concerning the same or substantially similar subject matter at a future date. Service of the Motion was certified on ICC Staff Counsel Ellen R. Dempsey, counsel for Prairie Shore (Hargrove, Peck & Tillotson LLP, attn: Andrew S. Peck), and counsel for CATA (Rosenberg & Dietrich LLP, attn: Diane L. Rosenberg). No party filed an objection or response to the Motion.

June 26, 2023 — ALJ Order Granting Withdrawal Without Prejudice. ALJ Lindquist entered an Order Granting Withdrawal Without Prejudice. The Order found that good cause existed for the withdrawal, noted that no party had objected, and granted the withdrawal without prejudice to MTDC's right to refile. The Order vacated the evidentiary hearing that had been scheduled for June 28, 2023, and closed ICC Docket No. 23-0214.

July 1, 2023 — C&H Matter Closed. C&H Matter No. 1031-00002 was closed as terminated, effective this date.

V. Final Billing Summary

A. Professional Fees

The following table sets forth the professional fees billed to MTDC in connection with this engagement, broken down by timekeeper:

The incidental costs line item of $79.00 reflects a rounding adjustment applied across monthly invoices to reconcile fractional-hour billing entries in accordance with C&H's standard billing practices.

B. Disbursements. The following disbursements were incurred and billed to MTDC at cost in connection with this engagement:

No other disbursements were incurred. The engagement did not require travel, expert-witness fees (engineering and financial advisory consultants were retained separately by MTDC), deposition costs, or transcript charges, as the matter did not proceed to the evidentiary hearing stage.

C. Total Billed and Fee Cap Utilization

Total Billed (Professional Fees + Disbursements): $218,195.00

Engagement Fee Cap (Professional Fees Only): $385,000.00

Professional Fees Billed Against Fee Cap: $214,780.00

Amount Under Fee Cap: $170,220.00 (fee cap less professional fees billed)

Total Amount Under Cap (Including Disbursements): $166,805.00 (fee cap less total billed)

The matter terminated well before completion of the regulatory proceeding. The professional fees billed represent approximately 55.8% of the $385,000.00 fee cap. Had the matter proceeded through the evidentiary hearing, post-hearing briefing, and final order, it is estimated that total professional fees would have approached the full fee cap, particularly given the substantive issues raised in the ICC Staff Report that would have required rebuttal testimony and potentially supplemental briefing.

All outstanding invoices have been submitted to MTDC for payment. The final invoice, covering the billing period through June 30, 2023, was transmitted to MTDC's Finance Department (attention: Sandra R. Pellegrino, CFO) and MTDC's General Counsel on July 1, 2023. Payment terms are net thirty (30) days in accordance with the engagement letter.

VI. Key Documents for Retention

The following documents were produced or received in connection with C&H Matter No. 1031-00002 and are to be retained in the firm's document management system in accordance with C&H's records-retention policy. Unless otherwise noted, all documents are maintained in both electronic and hard-copy format in the matter file.

1. Engagement Letter — C&H to MTDC, dated February 20, 2023, countersigned by Constance M. Adler on February 21, 2023. This document establishes the scope, fee arrangement, and terms of the engagement.

2. Regulatory Strategy Memorandum — Internal C&H memorandum, dated February 27, 2023, prepared by David Stanton and Michelle Tsao and addressed to Patricia Dunmore. This memorandum sets forth the recommended regulatory strategy for the ICC filing, including an analysis of applicable ICC precedent, the proposed procedural approach, and an assessment of potential issues and risks. This document is protected by the attorney work product doctrine.

3. Verified Petition for Approval of Electrification Infrastructure and Interconnection — Filed March 1, 2023, in ICC Docket No. 23-0214. The Petition was verified by Harold J. Greenway, Executive Director of MTDC, and constitutes the principal pleading in the regulatory proceeding.

4. Pre-Filed Direct Testimony of Raymond K. Mosley — Testimony of Raymond K. Mosley, Director of Capital Programs, MTDC, submitted in support of the Verified Petition as a filing exhibit. Mr. Mosley's testimony addressed the technical and operational aspects of the electrification project, the need for the proposed interconnection and charging infrastructure, and the projected deployment timeline.

5. Draft Infrastructure Cost-Sharing Agreement — Between MTDC and Prairie Shore Electric Company, governing the allocation of the $12,300,000 in distribution-system upgrade costs between the parties (60% MTDC / 40% Prairie Shore). This agreement was circulated to Hargrove, Peck & Tillotson LLP in draft form but was never executed. The most recent draft, dated May 8, 2023, reflects comments received from Prairie Shore's counsel.

6. Draft Term Sheet — Proposed Prairie Shore Schedule EV-T — The draft term sheet outlining the proposed time-of-use rate structure, demand-charge provisions, and other terms of the Schedule EV-T tariff. This term sheet was submitted as an exhibit to the Verified Petition and formed the basis for the proposed tariff filing.

7. MTDC Response to ICC Staff Data Requests, Set 1 — Data request responses prepared by C&H on behalf of MTDC in response to interrogatories and document requests issued by ICC Staff. These responses were served on ICC Staff Counsel Ellen R. Dempsey and provided detailed information concerning MTDC's projected load profile, financial projections, and the basis for the proposed cost-sharing allocation.

8. Internal Memorandum — Analysis of FTA Grant Rescission and Regulatory Implications — Dated June 13, 2023, prepared by David Stanton and addressed to Patricia Dunmore. This memorandum analyzes the legal and practical consequences of the FTA's rescission of Grant Award No. IL-2023-0067-00 on the pending ICC proceeding and recommends withdrawal without prejudice. This document is protected by the attorney work product doctrine.

9. Client Advisory Letter — Grant Rescission and Recommended Course of Action — Dated June 15, 2023, from Patricia Dunmore to Constance M. Adler. This letter formally communicates C&H's recommendation that MTDC withdraw the Verified Petition without prejudice in light of the grant rescission and requests the client's written authorization to proceed. This document is protected by the attorney-client privilege.

10. Motion to Withdraw Verified Petition Without Prejudice — Filed June 19, 2023, in ICC Docket No. 23-0214. The Motion sets forth the grounds for withdrawal and requests that the withdrawal be granted without prejudice to MTDC's right to refile.

11. Proposed Order Granting Withdrawal Without Prejudice — Submitted to ALJ Lindquist in conjunction with the Motion to Withdraw. The Proposed Order was adopted substantially in the form submitted.

12. ALJ Order Granting Withdrawal Without Prejudice — Entered June 26, 2023, by the Honorable Marcus P. Lindquist, Administrative Law Judge. This order grants the withdrawal without prejudice, vacates the June 28, 2023 evidentiary hearing, and closes ICC Docket No. 23-0214.

13. Correspondence Files — All correspondence maintained in connection with this engagement, including communications with MTDC (Constance M. Adler and other MTDC personnel), the ICC (filings, notices, and communications with ICC Staff), Prairie Shore Electric Company and its counsel at Hargrove, Peck & Tillotson LLP, CATA and its counsel at Rosenberg & Dietrich LLP, Creston Engineering Group, Inc. (Martin J. Sadowski, P.E.), Dralvecen Reade & Co. (Lisa M. Quayle, CFA), and Fielding & Calloway CPAs, LLC (Douglas H. Fielding, CPA).

14. Billing Records and Time Entries — Complete billing records and individual time entries for all timekeepers on the matter, including monthly invoices submitted to MTDC and supporting detail.

All documents listed above should be classified and maintained in accordance with applicable privilege designations. Documents constituting attorney work product should be marked as such. Documents constituting attorney-client privileged communications should be marked as such. Dual-designated documents should carry both classifications. The matter file as a whole should be maintained as privileged and confidential.

VII. Considerations for Potential Refiling

The following considerations are noted for the record in the event that MTDC elects to pursue a new ICC filing in the future relating to the electrification project or a substantially similar undertaking.

A. Without-Prejudice Status

The ALJ's Order of June 26, 2023, expressly grants the withdrawal of the Verified Petition without prejudice, thereby preserving MTDC's right to refile a petition concerning the same or substantially similar subject matter before the ICC at any time in the future. The Order contains no conditions, limitations, or time restrictions on refiling. Under established ICC practice, a withdrawal without prejudice does not give rise to any res judicata or collateral-estoppel effect, and a new petition would be evaluated on its own merits without reference to the withdrawn docket.

ICC Docket No. 23-0214 is now closed. Any future filing by MTDC would receive a new docket number and would be assigned to an ALJ in the ordinary course, which may or may not be ALJ Lindquist. MTDC would be required to file a new Verified Petition, and all parties — including Prairie Shore and CATA — would need to seek intervention anew if they wished to participate.

B. Federal Funding Contingency

As of the date of this memorandum, July 1, 2023, congressional reauthorization of discretionary transit capital funding under the Low- and No-Emission Vehicle Program, 49 U.S.C. § 5339(c), has not occurred. The status of federal appropriations for transit capital programs remains uncertain, and no timeline for reauthorization has been publicly announced by congressional leadership or the Administration.

Should the FTA restore funding for the Low- and No-Emission Vehicle Program — whether through a new appropriations act, a continuing resolution, or other legislative vehicle — and should MTDC receive a new grant award or a reinstatement of Grant Award No. IL-2023-0067-00, MTDC may elect to pursue a new ICC filing. The financial feasibility of the electrification project is, as a practical matter, contingent upon the availability of federal grant funding at a level comparable to the rescinded award, given the magnitude of the total project cost ($98,125,000) relative to MTDC's capital budget capacity.

MTDC General Counsel Constance M. Adler has indicated in her closing communications with C&H that MTDC will promptly notify C&H if the federal funding situation changes in a manner that would support the resumption of the electrification project and the Board of Directors authorizes a new regulatory filing. Ms. Adler expressed MTDC's satisfaction with C&H's representation in this matter and indicated MTDC's intention to re-engage C&H for any successor filing, subject to Board approval and the firm's availability.

C. Preservation of Work Product

Substantial work product was generated during this engagement that can be adapted and reused in any future ICC filing, potentially reducing the time and cost of a new proceeding. Key items of reusable work product include:

(a) The Verified Petition for Approval of Electrification Infrastructure and Interconnection, which sets forth the factual and legal basis for the interconnection request and tariff approval, and which could serve as a template for a new petition with appropriate updating;

(b) The pre-filed direct testimony of Raymond K. Mosley, which addresses the technical and operational aspects of the electrification project and could be updated and re-verified for a new filing;

(c) The draft Infrastructure Cost-Sharing Agreement and draft Schedule EV-T Term Sheet, which embody the commercial terms negotiated between MTDC and Prairie Shore and which could serve as a starting point for renegotiation;

(d) The data request responses prepared for ICC Staff, which contain detailed factual and analytical information that could be adapted for use in a new proceeding; and

(e) The Regulatory Strategy Memorandum prepared at the outset of the engagement, which analyzes applicable ICC precedent and identifies potential issues and risks, and which would remain substantially relevant in a new proceeding.

It should be noted, however, that the engineering and financial analyses prepared by the third-party consultants — Creston Engineering Group, Inc. (interconnection study) and Dralvecen Reade & Co. (financial modeling and rate-impact analysis) — may require updating to reflect changed circumstances at the time of any refiling. Such changed circumstances could include revised project costs (due to inflation, changes in bus or charger pricing, or changes in construction costs), updated grid conditions (due to changes in Prairie Shore's distribution system, load growth on the relevant feeders, or changes in generation mix), new federal grant terms (which may impose different conditions, matching requirements, or project timelines), and changes in MTDC's operational assumptions (such as revised fleet deployment plans or route restructuring). MTDC would need to determine whether to commission updated studies from Creston and Dralvecen or to engage new consultants.

Additionally, the draft Infrastructure Cost-Sharing Agreement and Schedule EV-T Term Sheet were never executed and do not constitute binding commitments between MTDC and Prairie Shore. In the event of a refiling, these documents would need to be renegotiated with Prairie Shore Electric Company, which may have different commercial or regulatory priorities at that time. The negotiation of these agreements would be within the scope of any new engagement, subject to the terms of a new engagement letter.

D. Intervenor Relations

Both Prairie Shore Electric Company and the Clean Air Transit Alliance were either supportive of or, at minimum, not opposed to MTDC's Motion to Withdraw. No objections or responses to the Motion were filed by any party. Prairie Shore's cooperative posture throughout the proceeding reflected its commercial interest in the electrification project as a source of significant new load and revenue. CATA's supportive posture reflected its organizational mission of promoting clean-energy transit technologies.

Maintaining constructive relationships with both intervenors would benefit any future filing. In particular, the relationship with Prairie Shore is critical, as Prairie Shore is the indispensable counterparty to the interconnection and tariff arrangements. C&H recommends that MTDC maintain periodic contact with Prairie Shore's Regulatory Affairs department (Judith A. Engstrom, VP Regulatory Affairs) and with Prairie Shore's counsel at Hargrove, Peck & Tillotson LLP (Andrew S. Peck) to ensure that Prairie Shore remains engaged and supportive in the event of a refiling. Similarly, CATA's continued support would strengthen any future petition, and MTDC may wish to coordinate with CATA's Executive Director, Nathan B. Hartwell, and its counsel, Diane L. Rosenberg, in advance of any new filing.

VIII. Key Client and Third-Party Contacts for the Record

The following table sets forth the key client and third-party contacts associated with this engagement, for reference in the event of any future engagement or inquiry:

IX. Conclusion and Matter Closure Certification

Calderwood & Harkness LLP Matter No. 1031-00002 is hereby closed as terminated, effective July 1, 2023. The engagement has been concluded in accordance with the terms of the engagement letter, the client's authorized instructions, and the firm's internal policies and procedures for matter closure.

All outstanding invoices have been submitted to MTDC for payment. The final invoice, covering the billing period through June 30, 2023, has been transmitted to the client. Total fees and disbursements billed to the client amount to $218,195.00, representing approximately 55.8% of the $385,000.00 fee cap established in the engagement letter.

All key documents generated or received in connection with this engagement have been identified and catalogued for retention in the firm's document management system in accordance with C&H's records-retention policy. Privilege designations have been applied as appropriate.

No further work is anticipated on this matter unless and until MTDC provides new written engagement instructions in connection with a potential refiling of the ICC petition or a related matter. Any such new engagement would be documented through a new engagement letter and would be opened as a separate matter.

This memorandum is to be retained in the permanent matter file for C&H Matter No. 1031-00002.

Prepared by:

________________________________________

Patricia Dunmore Responsible Partner Energy & Infrastructure Practice

Date: July 1, 2023

CALDERWOOD & HARKNESS LLP 70 West Madison Street, Suite 5000 Chicago, IL 60602

PRIVILEGED AND CONFIDENTIAL — ATTORNEY WORK PRODUCT This memorandum is prepared for the permanent file of Calderwood & Harkness LLP and is protected by the attorney work product doctrine and the attorney-client privilege. It is not intended for distribution outside the firm without the express authorization of the Responsible Partner.

Timekeeper	Role	Hours	Rate ($/hr)	Amount ($)
Patricia Dunmore	Responsible Partner	42.5	$1,050	$44,625.00
George Trujillo	Billing Partner	18.0	$985	$17,730.00
David Stanton	Lead Associate	156.0	$625	$97,500.00
Michelle Tsao	Working Associate	110.8	$495	$54,846.00
Subtotal — Professional Fees	327.3	$214,701.00
Incidental costs (rounding adjustment)	$79.00
Total Fees Billed	$214,780.00
Item	Amount ($)
ICC filing fees (Verified Petition)	$500.00
Messenger and service of process charges	$215.00
Westlaw research charges	$2,700.00
Total Disbursements	$3,415.00
Name	Title	Organization	Role in Engagement
Constance M. Adler	General Counsel	Metropolitan Transit Development Corporation	Primary client contact; engagement authorization
Harold J. Greenway	Executive Director	Metropolitan Transit Development Corporation	Verified Petition signatory; senior MTDC management
Sandra R. Pellegrino	Chief Financial Officer	Metropolitan Transit Development Corporation	Financial matters contact; invoice recipient
Raymond K. Mosley	Director of Capital Programs	Metropolitan Transit Development Corporation	Pre-filed testimony witness; project technical lead
Martin J. Sadowski, P.E.	Lead Engineer / Project Director	Creston Engineering Group, Inc.	Engineering consultant; interconnection study author
Lisa M. Quayle, CFA	Engagement Partner	Dralvecen Reade & Co.	Financial advisor; rate-impact analysis
Douglas H. Fielding, CPA	Engagement Partner	Fielding & Calloway CPAs, LLC	Independent auditor; audited financials
Andrew S. Peck	Partner	Hargrove, Peck & Tillotson LLP	Counsel for Prairie Shore Electric Company
Natalie C. Forrest	Associate	Hargrove, Peck & Tillotson LLP	Supporting counsel for Prairie Shore Electric Company
Diane L. Rosenberg	Partner	Rosenberg & Dietrich LLP	Counsel for Clean Air Transit Alliance
Ellen R. Dempsey	Staff Counsel	ICC Office of General Counsel	ICC Staff representative

Hon. Marcus P. Lindquist	Administrative Law Judge	Illinois Commerce Commission	Presiding ALJ, Docket No. 23-0214
Thomas D. Waverly	President & CEO	Prairie Shore Electric Company	Senior management, Prairie Shore
Judith A. Engstrom	VP Regulatory Affairs	Prairie Shore Electric Company	Regulatory contact, Prairie Shore
Nathan B. Hartwell	Executive Director	Clean Air Transit Alliance	CATA organizational representative
Alderman Vivian Ochoa-Brennan	Board Chair	Metropolitan Transit Development Corporation	Presided over emergency Board session
Karen L. Osterman	Regional Administrator, Region V	Federal Transit Administration	Communicated grant rescission

PRIVILEGED AND CONFIDENTIAL — ATTORNEY WORK PRODUCT
MEMORANDUM
PRIVILEGED AND CONFIDENTIAL — ATTORNEY WORK PRODUCT
TO: File
FROM: Patricia Dunmore, Responsible Partner, Energy & Infrastructure Practice
DATE: July 1, 2023
RE: Matter Closing Memorandum — Metropolitan Transit Development Corporation — ICC Electrification-Grant Regulatory Filing — C&H Matter No. 1031-00002
CALDERWOOD & HARKNESS LLP 70 West Madison Street, Suite 5000 Chicago, IL 60602
I. Purpose
This memorandum memorializes the closure of Calderwood & Harkness LLP ("C&H") Matter No. 1031-00002 and provides a comprehensive record of the engagement, including a detailed account of the client relationship, the scope and nature of the legal services rendered, the procedural history of the underlying regulatory proceeding, final billing and fee-cap utilization, document retention directives, and considerations relevant to the potential refiling of a petition before the Illinois Commerce Commission ("ICC") should circumstances warrant.
This memorandum is prepared for the permanent matter file in accordance with C&H's internal practice of maintaining closing records for all completed or terminated engagements. It is intended to serve as a definitive reference should MTDC or its successor seek to re-engage this firm for related work, and to ensure compliance with the firm's records-retention obligations.
Matter Status: Closed as terminated, effective July 1, 2023. The matter is terminated due to the client's authorized withdrawal of its ICC petition following the rescission of federal grant funding, as described in detail below. No further legal services are to be rendered under this engagement unless and until the client provides new written instructions and the firm opens a successor matter.
II. Client and Matter Identification
The following information identifies the client, the matter, and the associated regulatory and federal-grant docket references:
Client: Metropolitan Transit Development Corporation ("MTDC"), an Illinois Municipal Corporation and Public Transit Authority organized and existing under the Metropolitan Transit Development Act, 70 ILCS 3615. MTDC is a unit of local government authorized to plan, construct, acquire, own, operate, and maintain a public transportation system within the metropolitan area of Chicago and its surrounding counties.
Client Address: 200 West Adams Street, Suite 2400, Chicago, IL 60606
Client Employer Identification Number (EIN): 36-4178220
Primary Client Contact: Constance M. Adler, General Counsel, Metropolitan Transit Development Corporation. Ms. Adler served as the designated client representative for all matters relating to this engagement, including the authorization and direction of legal strategy, review and approval of filings, and communication of Board directives.
C&H Matter Number: 1031-00002
Regulatory Docket: ICC Docket No. 23-0214, captioned In re Petition of Metropolitan Transit Development Corporation for Approval of Electrification Infrastructure and Interconnection
Related Federal Grant: Federal Transit Administration ("FTA") Grant Award No. IL-2023-0067-00, awarded under 49 U.S.C. § 5339(c) (Low- and No-Emission Vehicle Program). This grant, while not the direct subject of the ICC proceeding, provided the underlying financial support for the electrification project that necessitated the regulatory filing. The rescission of this grant was the proximate cause of the matter's termination.
III. Engagement Team
The following C&H attorneys were assigned to and actively worked on this matter throughout the duration of the engagement. Total professional hours billed across all timekeepers were 327.3 hours.
Patricia Dunmore — Responsible Partner, Energy & Infrastructure Practice. Ms. Dunmore served as the engagement lead and primary relationship partner for MTDC. She oversaw all aspects of the regulatory filing, directed strategy, participated in status conferences before the ALJ, and authored the client advisory letter recommending withdrawal following the grant rescission. Ms. Dunmore billed a total of 42.5 hours to this matter.
George Trujillo — Billing Partner, Energy & Infrastructure Practice. Mr. Trujillo served as the billing partner for the engagement and provided substantive review of the Verified Petition and related filings, with particular focus on rate-design issues and the proposed Schedule EV-T tariff structure. Mr. Trujillo also participated in the first status conference before ALJ Lindquist. Mr. Trujillo billed a total of 18.0 hours to this matter.
David Stanton — Lead Associate, Energy & Infrastructure Practice. Mr. Stanton served as the primary drafting attorney for the engagement and was responsible for the preparation of the Verified Petition, coordination with MTDC's expert witnesses, preparation of data request responses, and drafting of the Motion to Withdraw. Mr. Stanton also prepared the internal analysis memorandum assessing the legal and practical consequences of the FTA grant rescission. Mr. Stanton billed a total of 156.0 hours to this matter.
Michelle Tsao — Working Associate, Energy & Infrastructure Practice. Ms. Tsao provided research and drafting support across all phases of the engagement, including legal research on ICC precedent regarding transit-authority interconnection petitions, assistance with the preparation of pre-filed testimony, and review of financial and engineering analyses submitted by third-party consultants. Ms. Tsao billed a total of 110.8 hours to this matter.
Total Professional Hours Billed: 327.3 hours.
No paralegals, summer associates, or contract attorneys were assigned to or billed time on this matter.
IV. Engagement History and Summary of Matter
A. Engagement Opening and Scope
The engagement was formally opened on February 20, 2023, pursuant to an executed engagement letter from C&H to Constance M. Adler, General Counsel of MTDC. The engagement letter was countersigned by Ms. Adler on behalf of MTDC on February 21, 2023, and the executed copy was received by C&H on February 22, 2023. A conflict check was completed prior to the issuance of the engagement letter and revealed no conflicts of interest. MTDC was a new client to the firm; the standard new-client intake procedures were completed, including verification of the client's organizational status, taxpayer identification, and authorized signatories.
The scope of the engagement, as defined in the engagement letter, encompassed the following:
(a) Preparation, filing, and prosecution of a regulatory petition before the Illinois Commerce Commission seeking approval for MTDC to interconnect new high-capacity depot charging infrastructure to the regional electric grid served by Prairie Shore Electric Company ("Prairie Shore"), an investor-owned electric utility subject to ICC jurisdiction;
(b) Negotiation and documentation of the terms of a proposed Infrastructure Cost-Sharing Agreement between MTDC and Prairie Shore to allocate the costs of distribution-system upgrades required to accommodate the new electrical load;
(c) Support for the establishment and ICC approval of a proposed new tariff, designated Prairie Shore Schedule EV-T (Electric Vehicle — Transit), under which MTDC would procure electric power for its depot charging operations at a time-of-use rate structure;
(d) Representation of MTDC in all proceedings before the ICC in connection with the foregoing, including status conferences, evidentiary hearings, briefing, and any post-hearing proceedings through the entry of a final order by the ICC; and
(e) All ancillary work reasonably necessary to accomplish the foregoing objectives.
The scope of the engagement was expressly limited to the ICC filing and related regulatory proceedings. The engagement letter stated that C&H's representation did not extend to FTA grant compliance, federal regulatory matters, bus procurement, or any other matter outside the ICC proceeding. The engagement letter further noted that MTDC maintained separate outside counsel and internal legal resources for federal-grant administration and procurement.
The fee arrangement was structured as a capped fee, with a maximum total fee (exclusive of disbursements) of $385,000.00 for the regulatory proceeding through the entry of a final order by the ICC. The capped fee was calculated based on an estimate of the professional time likely required to take the matter through a full evidentiary hearing and post-hearing briefing. Hourly rates for the engagement team were as follows: Patricia Dunmore, $1,050 per hour; George Trujillo, $985 per hour; David Stanton, $625 per hour; Michelle Tsao, $495 per hour. Under the terms of the engagement letter, fees were to be billed monthly on the basis of actual time incurred at the stated hourly rates, up to the fee cap. Disbursements, including filing fees, research charges, and messenger costs, were billed at cost and were not subject to the fee cap.
B. Background — The Electrification Project
The ICC regulatory filing at issue in this engagement arose from a major capital project undertaken by MTDC to electrify a portion of its bus fleet. The material background facts concerning this project, as reflected in the Verified Petition and supporting documentation, are summarized below.
On January 9, 2023, the Federal Transit Administration issued a Notice of Award to MTDC for FTA Grant Award No. IL-2023-0067-00 in the amount of $78,500,000 under the Low- and No-Emission Vehicle Program, 49 U.S.C. § 5339(c). The Low- and No-Emission Vehicle Program is a competitive federal grant program that provides funding to state and local government entities for the purchase or lease of zero-emission and low-emission transit vehicles and the acquisition, construction, and leasing of facilities and equipment related to such vehicles. MTDC's application was submitted in the fall of 2022 and was one of approximately 130 awards nationwide in the fiscal year 2023 cycle.
The FTA grant funded eighty percent (80%) of the total estimated project cost of $98,125,000. MTDC's required local match was $19,625,000, representing twenty percent (20%) of total project costs. MTDC's Board of Directors had previously authorized the local match in its FY 2023 capital budget, approved in December 2022, drawing on a combination of bond proceeds, state capital grant funds, and transit agency reserves.
The Phase 1 scope of the electrification project encompassed two principal components:
(i) Bus Procurement: Procurement of 225 battery-electric buses at an estimated total cost of $71,800,000, representing an average per-unit cost of approximately $319,111. The bus procurement was to be conducted through a competitive solicitation process administered by MTDC's Procurement Department. The 225 battery-electric buses represented approximately 12.2% of MTDC's active bus fleet of 1,840 units, which included a mix of diesel, compressed natural gas (CNG), and diesel-hybrid vehicles. The Phase 1 deployment would position MTDC to meet the first milestone under its Board-adopted 2021 Strategic Sustainability Plan, which established a goal of converting 40% of the bus fleet to battery-electric propulsion by 2030.
(ii) Charging Infrastructure: Installation of depot charging infrastructure at three MTDC bus garages at an estimated total cost of $26,325,000. This component included the installation of high-capacity overnight charging equipment (plug-in depot chargers), electrical distribution and switchgear within each facility, and related site improvements. The depot-charging model was selected over an en-route charging model based on MTDC's operational analysis, which concluded that overnight depot charging was more cost-effective and operationally feasible for the initial deployment phase given MTDC's existing route structures and layover patterns.
For context, MTDC is a major multi-modal public transit operator. In addition to its bus fleet of 1,840 active units, MTDC operates 312 heavy-rail cars on four rapid-transit lines. The electrification project pertained solely to bus operations; the heavy-rail system is already electrified (third-rail power supply) and was not implicated by the ICC filing. MTDC's FY 2023 operating budget was approximately $1,420,000,000, making it one of the largest public transit authorities in the Midwest.
C. Charging Infrastructure and Grid Interconnection
The charging infrastructure component of the electrification project required new electrical interconnections to the distribution system of Prairie Shore Electric Company at each of the three MTDC bus garages designated for Phase 1 deployment. The three depot locations and their respective new electrical load requirements were as follows:
1.  North Garage — 4501 West Lawrence Avenue, Chicago, IL 60630. The North Garage is MTDC's largest bus maintenance and storage facility, housing approximately 440 buses. The planned Phase 1 deployment at North Garage would accommodate 90 battery-electric buses, requiring installation of 90 depot chargers and associated electrical infrastructure. The new electrical load at this facility was estimated at 18 megawatts (MW), reflecting the simultaneous overnight charging demand of the full complement of chargers.
2.  West Garage — 1200 South Cicero Avenue, Chicago, IL 60804. The West Garage is MTDC's second-largest facility, housing approximately 380 buses. The planned Phase 1 deployment at West Garage would accommodate 75 battery-electric buses, requiring installation of 75 depot chargers. The new electrical load at this facility was estimated at 15 MW.
3.  South Garage — 7800 South Vincennes Avenue, Chicago, IL 60620. The South Garage houses approximately 310 buses. The planned Phase 1 deployment at South Garage would accommodate 60 battery-electric buses, requiring installation of 60 depot chargers. The new electrical load at this facility was estimated at 12 MW.
The combined new electrical load across all three facilities was 45 MW. This represented a substantial new demand on Prairie Shore's distribution system, which required significant infrastructure upgrades to accommodate the load.
An interconnection study was performed by Creston Engineering Group, Inc. ("Creston"), an independent engineering consulting firm retained by MTDC for purposes of the electrification project. The interconnection study was led by Martin J. Sadowski, P.E., who served as Lead Engineer and Project Director. The study analyzed the existing capacity of Prairie Shore's distribution feeders serving each of the three garage locations, identified the upgrades required to accommodate the new load, and estimated the cost of those upgrades. The study concluded that distribution-system upgrades totaling an estimated $12,300,000 would be required, including new or upgraded substations, feeder reinforcement, transformer installations, and protective relaying equipment.
The allocation of the $12,300,000 in distribution-system upgrade costs between MTDC and Prairie Shore was a central commercial issue in the engagement. Under the terms of a proposed Infrastructure Cost-Sharing Agreement negotiated between MTDC (with C&H's assistance) and Prairie Shore (represented by Hargrove, Peck & Tillotson LLP), the costs were to be allocated as follows: MTDC would bear 60% of the costs ($7,380,000), and Prairie Shore would bear 40% of the costs ($4,920,000). This allocation reflected the principle that MTDC, as the cost-causative customer, would bear the majority of the incremental infrastructure cost, while Prairie Shore would contribute a share reflecting the long-term system benefits and additional revenue associated with the new load. The Infrastructure Cost-Sharing Agreement was circulated in draft form to opposing counsel but was never executed, as the parties intended to finalize the agreement concurrently with the ICC's approval of the interconnection and tariff.
The proposed rate structure for MTDC's electric service was embodied in Prairie Shore Schedule EV-T (Electric Vehicle — Transit), a new time-of-use tariff that had not previously been offered by Prairie Shore. The Schedule EV-T tariff was specifically designed for large-scale transit electrification customers and featured a three-tier time-of-use rate structure with off-peak, mid-peak, and on-peak pricing, a demand charge, and a fixed monthly customer charge. Because Schedule EV-T was a new tariff, it required ICC approval. The proposed blended rate under Schedule EV-T, inclusive of all energy, demand, and fixed charges, was $0.062 per kilowatt-hour (kWh).
Based on MTDC's projected charging patterns and the operational assumptions in the Creston engineering study, the estimated annual energy consumption across all three depot locations was 39,420 megawatt-hours per year (MWh/yr). At the proposed blended rate of $0.062/kWh, the estimated annual energy cost to MTDC would be $2,444,040 per year.
Financial modeling and rate-impact analysis for the engagement were performed by Dralvecen Reade & Co., a financial advisory firm retained by MTDC. The Dralvecen engagement was led by Lisa M. Quayle, CFA, Engagement Partner. Dralvecen's analysis assessed the net financial impact of the electrification project on MTDC's operating budget, including the offset of diesel fuel and maintenance costs against new electricity costs, and the long-term rate impact on Prairie Shore's other ratepayers of the proposed Schedule EV-T tariff and cost-sharing arrangement.
Audited financial statements of MTDC referenced in the Verified Petition were prepared by Fielding & Calloway CPAs, LLC, an independent accounting firm. The engagement partner for the audit was Douglas H. Fielding, CPA.
D. Parties to the ICC Proceeding
The following parties appeared in ICC Docket No. 23-0214:
Petitioner — Metropolitan Transit Development Corporation. MTDC was the petitioner and the party seeking ICC approval for the interconnection and proposed tariff. MTDC was represented throughout the proceeding by this firm, Calderwood & Harkness LLP, through the engagement team identified in Section III above. The primary C&H attorneys who appeared on the record were Patricia Dunmore, Responsible Partner, and David Stanton, Lead Associate.
Intervenor — Prairie Shore Electric Company. Prairie Shore is an investor-owned electric utility organized under the laws of the State of Illinois, with its principal offices at 500 North Michigan Avenue, Chicago, IL 60611. Prairie Shore serves approximately 3.8 million customers in the greater Chicago metropolitan area and is subject to the regulatory jurisdiction of the ICC. The President and Chief Executive Officer of Prairie Shore is Thomas D. Waverly; the Vice President of Regulatory Affairs is Judith A. Engstrom. Prairie Shore filed a Petition to Intervene on March 15, 2023, which was granted by ALJ Lindquist on March 22, 2023. Prairie Shore's participation was necessary given that the Verified Petition directly implicated Prairie Shore's distribution system, proposed a new tariff for Prairie Shore's rate schedule, and contemplated a cost-sharing agreement to which Prairie Shore would be a party. Prairie Shore was represented by Hargrove, Peck & Tillotson LLP, 120 South LaSalle Street, Suite 3100, Chicago, IL 60603. The lead attorney was Andrew S. Peck, Partner, with associate Natalie C. Forrest providing supporting representation. Throughout the proceeding, Prairie Shore's posture was generally cooperative and supportive of the electrification project, reflecting Prairie Shore's commercial interest in the substantial new load represented by the MTDC charging infrastructure.
Intervenor — Clean Air Transit Alliance ("CATA"). CATA is a 501(c)(3) nonprofit advocacy organization focused on promoting the adoption of clean-energy technologies in public transit systems. CATA's Executive Director is Nathan B. Hartwell. CATA filed a Petition to Intervene on March 20, 2023, asserting that its members, including riders and environmental advocacy organizations, had a direct interest in the outcome of the proceeding. CATA's intervention was granted by ALJ Lindquist on March 27, 2023. CATA's participation was supportive of the electrification project, and CATA indicated in its Petition to Intervene that it intended to file testimony in support of the environmental and public-health benefits of transit electrification. CATA was represented by Rosenberg & Dietrich LLP, 33 North Dearborn Street, Suite 2200, Chicago, IL 60602. The lead attorney was Diane L. Rosenberg, Partner.
ICC Staff. The ICC's Office of General Counsel participated in the proceeding through Staff Counsel Ellen R. Dempsey. ICC Staff filed a Staff Report on May 15, 2023, in accordance with the procedural schedule established by ALJ Lindquist. The Staff Report addressed the technical and economic aspects of the proposed interconnection and tariff, and raised certain questions regarding the cost-sharing allocation and the demand-charge component of Schedule EV-T, which MTDC was prepared to address through rebuttal testimony and at the evidentiary hearing.
Administrative Law Judge. The proceeding was assigned to the Honorable Marcus P. Lindquist, Administrative Law Judge, ICC. ALJ Lindquist presided over all status conferences and entered all procedural orders in the docket, including the final Order Granting Withdrawal Without Prejudice on June 26, 2023.
E. Procedural History — ICC Docket No. 23-0214
The following is a chronological summary of the significant procedural events in the ICC proceeding:
March 1, 2023 — Filing of Verified Petition. The Verified Petition for Approval of Electrification Infrastructure and Interconnection was filed with the ICC on behalf of MTDC. The Petition was verified by Harold J. Greenway, Executive Director of MTDC, in accordance with ICC procedural requirements. The Petition was accompanied by the following exhibits: (a) the pre-filed direct testimony of Raymond K. Mosley, MTDC's Director of Capital Programs; (b) the Creston Engineering Group interconnection study; (c) the draft Infrastructure Cost-Sharing Agreement; (d) the draft Term Sheet for proposed Prairie Shore Schedule EV-T; (e) the Dralvecen Reade & Co. financial analysis; and (f) relevant excerpts from MTDC's audited financial statements prepared by Fielding & Calloway CPAs, LLC.
March 15, 2023 — Prairie Shore Petition to Intervene. Prairie Shore Electric Company, through its counsel at Hargrove, Peck & Tillotson LLP, filed its Petition to Intervene in the proceeding. The Petition stated that Prairie Shore had a direct and substantial interest in the proceeding as the utility whose distribution system and rate schedule were the subject of the Verified Petition.
March 20, 2023 — CATA Petition to Intervene. The Clean Air Transit Alliance, through its counsel at Rosenberg & Dietrich LLP, filed its Petition to Intervene. CATA asserted that its members had an interest in the environmental and public-health outcomes associated with transit electrification and in ensuring that the proposed interconnection and tariff were structured to maximize the deployment of zero-emission buses.
March 22, 2023 — Prairie Shore Intervention Granted. ALJ Lindquist entered an order granting Prairie Shore's Petition to Intervene. No objections to intervention had been filed.
March 27, 2023 — CATA Intervention Granted. ALJ Lindquist entered an order granting CATA's Petition to Intervene. No objections to intervention had been filed.
April 5, 2023 — First Status Conference. The first status conference was held before ALJ Lindquist. Appearances were entered on behalf of all parties. ALJ Lindquist established a preliminary procedural schedule, including deadlines for discovery, the filing of intervenor testimony, rebuttal testimony, and the evidentiary hearing. The evidentiary hearing was originally scheduled for June 28, 2023. C&H attorneys Patricia Dunmore and David Stanton appeared on behalf of MTDC. Andrew S. Peck appeared on behalf of Prairie Shore. Diane L. Rosenberg appeared on behalf of CATA. Ellen R. Dempsey appeared on behalf of ICC Staff.
May 10, 2023 — Second Status Conference. A second status conference was held before ALJ Lindquist to address the status of discovery and preparation for the evidentiary hearing. At this conference, the parties confirmed that discovery was proceeding on schedule. ICC Staff noted that its Staff Report would be filed on May 15, 2023, as previously scheduled. ALJ Lindquist confirmed the June 28, 2023 evidentiary hearing date.
May 15, 2023 — ICC Staff Report Filed. ICC Staff timely filed its Staff Report in accordance with the procedural schedule. The Staff Report analyzed the technical feasibility and economic reasonableness of the proposed interconnection and the Schedule EV-T tariff. The Staff Report raised several questions regarding the allocation of distribution-system upgrade costs under the proposed Infrastructure Cost-Sharing Agreement, including whether the 60/40 split adequately reflected the respective benefits to MTDC and Prairie Shore's general ratepayer base. The Staff Report also requested additional information regarding the demand-charge component of Schedule EV-T and its relationship to MTDC's projected load profile. C&H was in the process of preparing MTDC's response to the issues raised in the Staff Report, including the preparation of rebuttal testimony by Raymond K. Mosley and supplemental financial analysis by Dralvecen Reade & Co., when the FTA grant rescission occurred.
June 28, 2023 — Evidentiary Hearing (Scheduled; Subsequently Vacated). The evidentiary hearing was originally scheduled for this date. As described in Section IV.F below, the hearing was vacated by ALJ Lindquist's June 26, 2023 order granting MTDC's Motion to Withdraw.
F. Grant Rescission and Withdrawal
The events leading to the termination of this engagement and the withdrawal of the ICC petition unfolded rapidly in June 2023 and are summarized in chronological order below.
June 8, 2023 — Lapse in Federal Appropriations. The congressional continuing resolution that had been funding discretionary federal spending, including transit capital programs administered by the FTA, expired on June 8, 2023, without reauthorization. The expiration of the continuing resolution resulted in a lapse in appropriated funds for certain discretionary transit capital programs, including the Low- and No-Emission Vehicle Program under 49 U.S.C. § 5339(c).
June 12, 2023 — FTA Notice of Grant Rescission. The Federal Transit Administration issued a formal Notice of Grant Rescission for FTA Grant Award No. IL-2023-0067-00, rescinding the entire $78,500,000 award to MTDC. The Notice of Rescission was communicated by Karen L. Osterman, FTA Regional Administrator for Region V (Chicago), to MTDC's Executive Director Harold J. Greenway. The rescission was attributed to the lapse in appropriated funds resulting from the expiration of the continuing resolution. The Notice of Rescission stated that the grant obligation was deobligated effective immediately and that no further drawdowns of federal funds under the award would be permitted. MTDC's General Counsel, Constance M. Adler, notified C&H of the rescission on the same day.
June 13, 2023 — C&H Internal Analysis Memorandum. David Stanton prepared an internal C&H memorandum, addressed to Patricia Dunmore, analyzing the legal and practical consequences of the FTA grant rescission on the pending ICC proceeding. The memorandum concluded that, without the federal grant funding, the electrification project was financially infeasible in its current form, as MTDC would not be able to fund the full $98,125,000 project cost from its own resources and available non-federal funding sources. The memorandum further concluded that continuation of the ICC proceeding in the absence of a viable underlying project would be imprudent and could expose MTDC to unnecessary regulatory costs and complications. The memorandum recommended withdrawal of the Verified Petition without prejudice to preserve MTDC's ability to refile if federal funding were restored.
June 14, 2023 — MTDC Board Emergency Session. The MTDC Board of Directors held an emergency session to consider the implications of the FTA grant rescission. The session was presided over by Board Chair Alderman Vivian Ochoa-Brennan. After deliberation, the Board voted 7-2 to authorize the withdrawal of the ICC application. The two dissenting Board members favored continuing the ICC proceeding on the theory that federal funding might be restored in the near term; however, the majority concluded that withdrawal without prejudice was the most prudent course of action. The Board's resolution authorized MTDC's General Counsel to instruct outside counsel to file the necessary withdrawal pleadings.
June 15, 2023 — C&H Client Advisory Letter. C&H, through Patricia Dunmore, issued a client advisory letter to Constance M. Adler formally recommending withdrawal of the Verified Petition without prejudice. The advisory letter set forth the legal basis for withdrawal, confirmed that withdrawal without prejudice would preserve MTDC's right to refile at a future date, and requested formal written authorization from MTDC to proceed with the filing of the Motion to Withdraw. Ms. Adler provided written authorization by email on June 16, 2023.
June 19, 2023 — Motion to Withdraw Filed. C&H filed MTDC's Motion to Withdraw Verified Petition Without Prejudice in ICC Docket No. 23-0214. The Motion was accompanied by a Proposed Order Granting Withdrawal Without Prejudice for the ALJ's consideration. The Motion set forth the factual basis for the withdrawal, including the FTA grant rescission and the MTDC Board's authorization, and requested that the withdrawal be granted without prejudice to MTDC's right to refile a petition concerning the same or substantially similar subject matter at a future date. Service of the Motion was certified on ICC Staff Counsel Ellen R. Dempsey, counsel for Prairie Shore (Hargrove, Peck & Tillotson LLP, attn: Andrew S. Peck), and counsel for CATA (Rosenberg & Dietrich LLP, attn: Diane L. Rosenberg). No party filed an objection or response to the Motion.
June 26, 2023 — ALJ Order Granting Withdrawal Without Prejudice. ALJ Lindquist entered an Order Granting Withdrawal Without Prejudice. The Order found that good cause existed for the withdrawal, noted that no party had objected, and granted the withdrawal without prejudice to MTDC's right to refile. The Order vacated the evidentiary hearing that had been scheduled for June 28, 2023, and closed ICC Docket No. 23-0214.
July 1, 2023 — C&H Matter Closed. C&H Matter No. 1031-00002 was closed as terminated, effective this date.
V. Final Billing Summary
A. Professional Fees
The following table sets forth the professional fees billed to MTDC in connection with this engagement, broken down by timekeeper:
The incidental costs line item of $79.00 reflects a rounding adjustment applied across monthly invoices to reconcile fractional-hour billing entries in accordance with C&H's standard billing practices.
B. Disbursements.  The following disbursements were incurred and billed to MTDC at cost in connection with this engagement:
No other disbursements were incurred. The engagement did not require travel, expert-witness fees (engineering and financial advisory consultants were retained separately by MTDC), deposition costs, or transcript charges, as the matter did not proceed to the evidentiary hearing stage.
C. Total Billed and Fee Cap Utilization
Total Billed (Professional Fees + Disbursements): $218,195.00
Engagement Fee Cap (Professional Fees Only): $385,000.00
Professional Fees Billed Against Fee Cap: $214,780.00
Amount Under Fee Cap: $170,220.00 (fee cap less professional fees billed)
Total Amount Under Cap (Including Disbursements): $166,805.00 (fee cap less total billed)
The matter terminated well before completion of the regulatory proceeding. The professional fees billed represent approximately 55.8% of the $385,000.00 fee cap. Had the matter proceeded through the evidentiary hearing, post-hearing briefing, and final order, it is estimated that total professional fees would have approached the full fee cap, particularly given the substantive issues raised in the ICC Staff Report that would have required rebuttal testimony and potentially supplemental briefing.
All outstanding invoices have been submitted to MTDC for payment. The final invoice, covering the billing period through June 30, 2023, was transmitted to MTDC's Finance Department (attention: Sandra R. Pellegrino, CFO) and MTDC's General Counsel on July 1, 2023. Payment terms are net thirty (30) days in accordance with the engagement letter.
VI. Key Documents for Retention
The following documents were produced or received in connection with C&H Matter No. 1031-00002 and are to be retained in the firm's document management system in accordance with C&H's records-retention policy. Unless otherwise noted, all documents are maintained in both electronic and hard-copy format in the matter file.
1.  Engagement Letter — C&H to MTDC, dated February 20, 2023, countersigned by Constance M. Adler on February 21, 2023. This document establishes the scope, fee arrangement, and terms of the engagement.
2.  Regulatory Strategy Memorandum — Internal C&H memorandum, dated February 27, 2023, prepared by David Stanton and Michelle Tsao and addressed to Patricia Dunmore. This memorandum sets forth the recommended regulatory strategy for the ICC filing, including an analysis of applicable ICC precedent, the proposed procedural approach, and an assessment of potential issues and risks. This document is protected by the attorney work product doctrine.
3.  Verified Petition for Approval of Electrification Infrastructure and Interconnection — Filed March 1, 2023, in ICC Docket No. 23-0214. The Petition was verified by Harold J. Greenway, Executive Director of MTDC, and constitutes the principal pleading in the regulatory proceeding.
4.  Pre-Filed Direct Testimony of Raymond K. Mosley — Testimony of Raymond K. Mosley, Director of Capital Programs, MTDC, submitted in support of the Verified Petition as a filing exhibit. Mr. Mosley's testimony addressed the technical and operational aspects of the electrification project, the need for the proposed interconnection and charging infrastructure, and the projected deployment timeline.
5.  Draft Infrastructure Cost-Sharing Agreement — Between MTDC and Prairie Shore Electric Company, governing the allocation of the $12,300,000 in distribution-system upgrade costs between the parties (60% MTDC / 40% Prairie Shore). This agreement was circulated to Hargrove, Peck & Tillotson LLP in draft form but was never executed. The most recent draft, dated May 8, 2023, reflects comments received from Prairie Shore's counsel.
6.  Draft Term Sheet — Proposed Prairie Shore Schedule EV-T — The draft term sheet outlining the proposed time-of-use rate structure, demand-charge provisions, and other terms of the Schedule EV-T tariff. This term sheet was submitted as an exhibit to the Verified Petition and formed the basis for the proposed tariff filing.
7.  MTDC Response to ICC Staff Data Requests, Set 1 — Data request responses prepared by C&H on behalf of MTDC in response to interrogatories and document requests issued by ICC Staff. These responses were served on ICC Staff Counsel Ellen R. Dempsey and provided detailed information concerning MTDC's projected load profile, financial projections, and the basis for the proposed cost-sharing allocation.
8.  Internal Memorandum — Analysis of FTA Grant Rescission and Regulatory Implications — Dated June 13, 2023, prepared by David Stanton and addressed to Patricia Dunmore. This memorandum analyzes the legal and practical consequences of the FTA's rescission of Grant Award No. IL-2023-0067-00 on the pending ICC proceeding and recommends withdrawal without prejudice. This document is protected by the attorney work product doctrine.
9.  Client Advisory Letter — Grant Rescission and Recommended Course of Action — Dated June 15, 2023, from Patricia Dunmore to Constance M. Adler. This letter formally communicates C&H's recommendation that MTDC withdraw the Verified Petition without prejudice in light of the grant rescission and requests the client's written authorization to proceed. This document is protected by the attorney-client privilege.
10.  Motion to Withdraw Verified Petition Without Prejudice — Filed June 19, 2023, in ICC Docket No. 23-0214. The Motion sets forth the grounds for withdrawal and requests that the withdrawal be granted without prejudice to MTDC's right to refile.
11.  Proposed Order Granting Withdrawal Without Prejudice — Submitted to ALJ Lindquist in conjunction with the Motion to Withdraw. The Proposed Order was adopted substantially in the form submitted.
12.  ALJ Order Granting Withdrawal Without Prejudice — Entered June 26, 2023, by the Honorable Marcus P. Lindquist, Administrative Law Judge. This order grants the withdrawal without prejudice, vacates the June 28, 2023 evidentiary hearing, and closes ICC Docket No. 23-0214.
13.  Correspondence Files — All correspondence maintained in connection with this engagement, including communications with MTDC (Constance M. Adler and other MTDC personnel), the ICC (filings, notices, and communications with ICC Staff), Prairie Shore Electric Company and its counsel at Hargrove, Peck & Tillotson LLP, CATA and its counsel at Rosenberg & Dietrich LLP, Creston Engineering Group, Inc. (Martin J. Sadowski, P.E.), Dralvecen Reade & Co. (Lisa M. Quayle, CFA), and Fielding & Calloway CPAs, LLC (Douglas H. Fielding, CPA).
14.  Billing Records and Time Entries — Complete billing records and individual time entries for all timekeepers on the matter, including monthly invoices submitted to MTDC and supporting detail.
All documents listed above should be classified and maintained in accordance with applicable privilege designations. Documents constituting attorney work product should be marked as such. Documents constituting attorney-client privileged communications should be marked as such. Dual-designated documents should carry both classifications. The matter file as a whole should be maintained as privileged and confidential.
VII. Considerations for Potential Refiling
The following considerations are noted for the record in the event that MTDC elects to pursue a new ICC filing in the future relating to the electrification project or a substantially similar undertaking.
A. Without-Prejudice Status
The ALJ's Order of June 26, 2023, expressly grants the withdrawal of the Verified Petition without prejudice, thereby preserving MTDC's right to refile a petition concerning the same or substantially similar subject matter before the ICC at any time in the future. The Order contains no conditions, limitations, or time restrictions on refiling. Under established ICC practice, a withdrawal without prejudice does not give rise to any res judicata or collateral-estoppel effect, and a new petition would be evaluated on its own merits without reference to the withdrawn docket.
ICC Docket No. 23-0214 is now closed. Any future filing by MTDC would receive a new docket number and would be assigned to an ALJ in the ordinary course, which may or may not be ALJ Lindquist. MTDC would be required to file a new Verified Petition, and all parties — including Prairie Shore and CATA — would need to seek intervention anew if they wished to participate.
B. Federal Funding Contingency
As of the date of this memorandum, July 1, 2023, congressional reauthorization of discretionary transit capital funding under the Low- and No-Emission Vehicle Program, 49 U.S.C. § 5339(c), has not occurred. The status of federal appropriations for transit capital programs remains uncertain, and no timeline for reauthorization has been publicly announced by congressional leadership or the Administration.
Should the FTA restore funding for the Low- and No-Emission Vehicle Program — whether through a new appropriations act, a continuing resolution, or other legislative vehicle — and should MTDC receive a new grant award or a reinstatement of Grant Award No. IL-2023-0067-00, MTDC may elect to pursue a new ICC filing. The financial feasibility of the electrification project is, as a practical matter, contingent upon the availability of federal grant funding at a level comparable to the rescinded award, given the magnitude of the total project cost ($98,125,000) relative to MTDC's capital budget capacity.
MTDC General Counsel Constance M. Adler has indicated in her closing communications with C&H that MTDC will promptly notify C&H if the federal funding situation changes in a manner that would support the resumption of the electrification project and the Board of Directors authorizes a new regulatory filing. Ms. Adler expressed MTDC's satisfaction with C&H's representation in this matter and indicated MTDC's intention to re-engage C&H for any successor filing, subject to Board approval and the firm's availability.
C. Preservation of Work Product
Substantial work product was generated during this engagement that can be adapted and reused in any future ICC filing, potentially reducing the time and cost of a new proceeding. Key items of reusable work product include:
(a) The Verified Petition for Approval of Electrification Infrastructure and Interconnection, which sets forth the factual and legal basis for the interconnection request and tariff approval, and which could serve as a template for a new petition with appropriate updating;
(b) The pre-filed direct testimony of Raymond K. Mosley, which addresses the technical and operational aspects of the electrification project and could be updated and re-verified for a new filing;
(c) The draft Infrastructure Cost-Sharing Agreement and draft Schedule EV-T Term Sheet, which embody the commercial terms negotiated between MTDC and Prairie Shore and which could serve as a starting point for renegotiation;
(d) The data request responses prepared for ICC Staff, which contain detailed factual and analytical information that could be adapted for use in a new proceeding; and
(e) The Regulatory Strategy Memorandum prepared at the outset of the engagement, which analyzes applicable ICC precedent and identifies potential issues and risks, and which would remain substantially relevant in a new proceeding.
It should be noted, however, that the engineering and financial analyses prepared by the third-party consultants — Creston Engineering Group, Inc. (interconnection study) and Dralvecen Reade & Co. (financial modeling and rate-impact analysis) — may require updating to reflect changed circumstances at the time of any refiling. Such changed circumstances could include revised project costs (due to inflation, changes in bus or charger pricing, or changes in construction costs), updated grid conditions (due to changes in Prairie Shore's distribution system, load growth on the relevant feeders, or changes in generation mix), new federal grant terms (which may impose different conditions, matching requirements, or project timelines), and changes in MTDC's operational assumptions (such as revised fleet deployment plans or route restructuring). MTDC would need to determine whether to commission updated studies from Creston and Dralvecen or to engage new consultants.
Additionally, the draft Infrastructure Cost-Sharing Agreement and Schedule EV-T Term Sheet were never executed and do not constitute binding commitments between MTDC and Prairie Shore. In the event of a refiling, these documents would need to be renegotiated with Prairie Shore Electric Company, which may have different commercial or regulatory priorities at that time. The negotiation of these agreements would be within the scope of any new engagement, subject to the terms of a new engagement letter.
D. Intervenor Relations
Both Prairie Shore Electric Company and the Clean Air Transit Alliance were either supportive of or, at minimum, not opposed to MTDC's Motion to Withdraw. No objections or responses to the Motion were filed by any party. Prairie Shore's cooperative posture throughout the proceeding reflected its commercial interest in the electrification project as a source of significant new load and revenue. CATA's supportive posture reflected its organizational mission of promoting clean-energy transit technologies.
Maintaining constructive relationships with both intervenors would benefit any future filing. In particular, the relationship with Prairie Shore is critical, as Prairie Shore is the indispensable counterparty to the interconnection and tariff arrangements. C&H recommends that MTDC maintain periodic contact with Prairie Shore's Regulatory Affairs department (Judith A. Engstrom, VP Regulatory Affairs) and with Prairie Shore's counsel at Hargrove, Peck & Tillotson LLP (Andrew S. Peck) to ensure that Prairie Shore remains engaged and supportive in the event of a refiling. Similarly, CATA's continued support would strengthen any future petition, and MTDC may wish to coordinate with CATA's Executive Director, Nathan B. Hartwell, and its counsel, Diane L. Rosenberg, in advance of any new filing.
VIII. Key Client and Third-Party Contacts for the Record
The following table sets forth the key client and third-party contacts associated with this engagement, for reference in the event of any future engagement or inquiry:
IX. Conclusion and Matter Closure Certification
Calderwood & Harkness LLP Matter No. 1031-00002 is hereby closed as terminated, effective July 1, 2023. The engagement has been concluded in accordance with the terms of the engagement letter, the client's authorized instructions, and the firm's internal policies and procedures for matter closure.
All outstanding invoices have been submitted to MTDC for payment. The final invoice, covering the billing period through June 30, 2023, has been transmitted to the client. Total fees and disbursements billed to the client amount to $218,195.00, representing approximately 55.8% of the $385,000.00 fee cap established in the engagement letter.
All key documents generated or received in connection with this engagement have been identified and catalogued for retention in the firm's document management system in accordance with C&H's records-retention policy. Privilege designations have been applied as appropriate.
No further work is anticipated on this matter unless and until MTDC provides new written engagement instructions in connection with a potential refiling of the ICC petition or a related matter. Any such new engagement would be documented through a new engagement letter and would be opened as a separate matter.
This memorandum is to be retained in the permanent matter file for C&H Matter No. 1031-00002.
Prepared by:
________________________________________
Patricia Dunmore Responsible Partner Energy & Infrastructure Practice
Date: July 1, 2023
CALDERWOOD & HARKNESS LLP 70 West Madison Street, Suite 5000 Chicago, IL 60602
PRIVILEGED AND CONFIDENTIAL — ATTORNEY WORK PRODUCT This memorandum is prepared for the permanent file of Calderwood & Harkness LLP and is protected by the attorney work product doctrine and the attorney-client privilege. It is not intended for distribution outside the firm without the express authorization of the Responsible Partner.
Timekeeper | Role | Hours | Rate ($/hr) | Amount ($)
Patricia Dunmore | Responsible Partner | 42.5 | $1,050 | $44,625.00
George Trujillo | Billing Partner | 18.0 | $985 | $17,730.00
David Stanton | Lead Associate | 156.0 | $625 | $97,500.00
Michelle Tsao | Working Associate | 110.8 | $495 | $54,846.00
Subtotal — Professional Fees | 327.3 | $214,701.00
Incidental costs (rounding adjustment) | $79.00
Total Fees Billed | $214,780.00
Item | Amount ($)
ICC filing fees (Verified Petition) | $500.00
Messenger and service of process charges | $215.00
Westlaw research charges | $2,700.00
Total Disbursements | $3,415.00
Name | Title | Organization | Role in Engagement
Constance M. Adler | General Counsel | Metropolitan Transit Development Corporation | Primary client contact; engagement authorization
Harold J. Greenway | Executive Director | Metropolitan Transit Development Corporation | Verified Petition signatory; senior MTDC management
Sandra R. Pellegrino | Chief Financial Officer | Metropolitan Transit Development Corporation | Financial matters contact; invoice recipient
Raymond K. Mosley | Director of Capital Programs | Metropolitan Transit Development Corporation | Pre-filed testimony witness; project technical lead
Martin J. Sadowski, P.E. | Lead Engineer / Project Director | Creston Engineering Group, Inc. | Engineering consultant; interconnection study author
Lisa M. Quayle, CFA | Engagement Partner | Dralvecen Reade & Co. | Financial advisor; rate-impact analysis
Douglas H. Fielding, CPA | Engagement Partner | Fielding & Calloway CPAs, LLC | Independent auditor; audited financials
Andrew S. Peck | Partner | Hargrove, Peck & Tillotson LLP | Counsel for Prairie Shore Electric Company
Natalie C. Forrest | Associate | Hargrove, Peck & Tillotson LLP | Supporting counsel for Prairie Shore Electric Company
Diane L. Rosenberg | Partner | Rosenberg & Dietrich LLP | Counsel for Clean Air Transit Alliance
Ellen R. Dempsey | Staff Counsel | ICC Office of General Counsel | ICC Staff representative
Hon. Marcus P. Lindquist | Administrative Law Judge | Illinois Commerce Commission | Presiding ALJ, Docket No. 23-0214
Thomas D. Waverly | President & CEO | Prairie Shore Electric Company | Senior management, Prairie Shore
Judith A. Engstrom | VP Regulatory Affairs | Prairie Shore Electric Company | Regulatory contact, Prairie Shore
Nathan B. Hartwell | Executive Director | Clean Air Transit Alliance | CATA organizational representative
Alderman Vivian Ochoa-Brennan | Board Chair | Metropolitan Transit Development Corporation | Presided over emergency Board session
Karen L. Osterman | Regional Administrator, Region V | Federal Transit Administration | Communicated grant rescission

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