February 13, 2010

By Mike Kanin
In Fact Daily

Mayor Lee Leffingwell, Council Member Bill Spelman, and Mayor Pro Tem Sheryl Cole continued to push for an independent governing body for Austin Energy at a Tuesday Council work session. In what marks something of a departure from earlier suggestions, they assured their colleagues that Council members would continue to have final say over the most controversial utility issues.

"There are little details here which I think will go a long way towards making people who are very concerned about this considerably less concerned because they would be fairly sure that Council would retain the authority it currently has," said Spelman.

That authority would cover eminent domain, rate increases, and asset decisions. Supporters hope that this would assuage the lingering concerns over accountability.

Though they reminded their colleagues that the proposal is just the start of a move toward independent governance for the utility, ordinance supporters also defended the idea. "This resolution basically was built on the recommendation that has been made four times by the Electric Utility Commission," said Leffingwell.

True as that may be, the proposal from the Electric Utility Commission left ratemaking powers in the hands of the board - not the City Council. "The Electric Utility Commission is concerned that the City Council and the City Manager do not have adequate bandwidth or resources to effectively manage the complex business of Austin Energy," reads the EUC's report.

Council Members Kathie Tovo and Laura Morrison Tuesday signaled their concerns about the Spelman-Leffingwell-Cole pitch. They wondered whether a future utility board - appointed by Council - would be accountable to voters. For her part, Morrison said that she could not see how an independent board is a step forward.

Meanwhile, several familiar advocates are planning a 12:30 pm City Hall news conference to call on Council members to vote against the proposal. "Under this plan, City Council would approve an un-elected board to oversee our utility, picked out by corporate headhunters, who may not share the values of Austin or our commitment to having an outstanding utility," reads a release sent about the event.

As the Mayor suggests, the idea of an independent governing body for Austin Energy goes back a while - at least as far as the 1990s (See In Fact Daily, June 4, 2012). It's also not unprecedented. Indeed, Leffingwell points to the fact that the resolution's guidelines are crafted with the board that runs CPS Energy - the San Antonio municipally owned utility - in mind.

Despite repeated endorsements from the city's Electric Utility Commission, and a study from former Austin Energy executive and ERCOT general manager Bob Kahn that suggested that the city has many options with regard to utility governance, City Manager Marc Ott came out against the idea.

"I believe the 'ship has been righted,'" Ott wrote in December. "Austin Energy is stable.. the answer to the threshold question is 'nothing is broken now' and therefore the current structure with the City Council as the governing body and the City Manager tasked with implementing Council policy should remain in place."

Some concern has surfaced over whether the city has the legal authority to proceed with an independent board for AE without a public vote. State Senator Kirk Watson (D-Austin) has filed legislation that would ensure that this is the case.

Still, Spelman, Leffingwell, and Cole will need one more vote to start the governing process. That would need to come from either Council Member Mike Martinez or Council Member Chris Riley.

Martinez remained mostly quiet during Tuesday's governance debate. Riley pressed on the issue of accountability. "My impression is that the expectation is that this board would be very transparent and open to the public and accessible," he said.

"I want to, for the record, make sure that this is the intention of the sponsors."

Spelman offered a simple yes.

The item is on Thursday's agenda. In Fact Daily hears rumors of a 6:30 time certain.

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