Someone help me out here...

My book got a little boring last night, so I flipped on Public Access Television to watch the City Commission Meeting. Alas, I was too late. Not to be deterred, though, I went to the City's website to take a look at the Agenda.

I noticed down in the Consent Agenda, Item #9, the City Commission set a public hearing for June 5, 2007, on Electric City Power's utility rates through June 30, 2011. First, there's the Agenda Report asking the City Commission to set a hearing on Resolution 9648, which sets power rates for various customers. The Report really doesn't contain any new information; it is basically a regurgitation of ECP talking points.

The Resolution itself is essentially unintelligible to a lay observer. It identifies three blocks of power for three time periods. It then goes on to set rates for two categories of customers, "City, Veolia Water," and "Block One." The time frames of the rates do not match up to the time periods for the blocks of power. Additionally, the Resolution references rates for "Transmission" and "Administrative Fee" that vary by time period and customer.

I did a little more homework, and I was able to locate the contract whereby the City of Great Falls d/b/a Electric City Power purchased two of the blocks of power, the 7 MWh and the 12 MWh. (Interestingly, even though Electric City Power is a separate corporation, the City treats it as a d/b/a or business name. I do not think there is any question that the City would ultimately be legally responsible for the debts of this 'independent' corporation, but that is an issue for another day. Today's corporate question is this: If the City intends to treat ECP as a d/b/a, why bother creating a separate corporation at all?)

Anyway, back to the rate issue. If you review the City's purchase contract, apparently Resolution 9648 will require that the City will 're-sell' some of this power at a loss and some of it as a gain. For example, for the years 2007 and 2008, the City is buying power for $52.80 and 'selling' it (to itself, apparently) from $42.91 to $50.83. For 2009, the City has a contract to purchase the power for $47.45, but will be selling it for $51.34 to $51.85.

I don't question these rates; how could I? There is no way I could question these rates because there simply is not enough information.

And that, my friends, is exactly my point? Just who is setting these power rates, and how are they being determined?

I went back and reviewed all the minutes of all the meetings of the Board of Directors of Electric City Power and guess what? The Board of Directors isn't coming up with the rates and, frankly, if the minutes are accurate the Board isn't even considering these rates. So, if the Board of Directors of the utility isn't setting the rates, and isn't even being briefed on the rates by staff, where in the heck are the rates coming from?

You can correct me if I am wrong, but one of the touted advantages of public power is the fact that the rates are set by the local government unit. Thus, proponents would argue, there's none of this behind closed doors profit taking; everything is above board and out in the open.

But is it?

Wait a minute, you say, the rates will be voted on by the City Commission. These people are elected, and that is the protection for the taxpayers and residents.

Bear with me here. Let us start with the premise that City Government operates in accordance with the law (a premise, by the way, that I accept). The law requires that actions of the government be conducted out in the open. There is no closed door, behind the scenes maneuvering. Issues are not decided in advance of open hearings. On all but the most private personnel matters, the public is entitled to all of the same information and decision criteria as the tribunal, right?

Given that, then, just what information is available to our City Commission that gives it any logical basis upon which to consider these rates? The Board of Directors of the utility has not discussed or recommended them. Assuming we have access to what the Commission has access to, the Commission lacks any realistic information upon which to evaluate the rates.

These rates came, apparently, out of the blue and the Commission will vote on them on June 5.

So, someone tell me how it is that "the City Commission will set the rates." Someone explain to me that this is not a 'rubber stamp' situation.

1 comment:

Anonymous said...

I was present at the last several ECP meeting and no mention was made of a new rate structure for ECP customers!