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Groups Urge City to Hold Vote on Independent Austin Energy Board

April 9, 2013

By Ann Choi
KUT News

A coalition of activists, environmentalists and public citizens expressed concerns over City’s move that would take away public accountaiblity
A group of activists are adamant that only elected officials make up Austin’s Utility board tamiflu online.

Today at City Hall, a coalition of environmental groups urged the city council not to vote for an ordinance that would have non-elected individuals oversee the city-run utility, Austin Energy.

They cited the precedent set in San Antonio in handing over control of the city’s utility to non-elected board members. The activists argued that the move resulted in lack of accountability and investing in projects benefiting private groups.

""Why should Austin want to un-bury what has already happened and failed in San Antonio? Support corporate accountability and the choice Austin residents have in making the city a safe place to live,"" Laura Para-Colinas is with Energia Mia, a group based in San Antonio.

They asked the City to have a public hearing on the ordinance before taking it up to vote.

"The ordinance is being fast-tracked by Mayor Leffingwell, Council member Cole and Spelman before the public gets a chance to hear different perspectives on the issue,"& Karen Hadden, director of SEED Coalition said.

However the City argues that Austin’s utility has been growing too fast and big for the city officials to govern over. Mayor Leffingwell submitted the ordinance that would create an independent governing board last March.

The council will vote on the ordinance this Thursday.

Fair Use Notice
This document contains copyrighted material whose use has not been specifically authorized by the copyright owner. SEED Coalition is making this article available in our efforts to advance understanding of ecological sustainability, human rights, economic democracy and social justice issues. We believe that this constitutes a "fair use" of the copyrighted material as provided for in section 107 of the US Copyright Law. If you wish to use this copyrighted material for purposes of your own that go beyond "fair use", you must obtain permission from the copyright owner.

If It’s Not Broken, Don’t Break It: Help Save Austin Energy!

April 3, 2013

TexasCampaignForTheEnvironment
via Burnt Orange News

Whether you’ve been here since before the Armadillo World Headquarters, or just haven’t left since SXSW last month, one thing has remained constant in Austin: we get our electrical power from a publicly owned utility, directed by our elected city council members. This saves each of us money, but more importantly it means that the bottom line is not the only line when it comes to energy generation in Austin. Profits come second to public interest at Austin Energy, so the utility can develop renewable energy, energy conservation and green building programs which lead the way for innovative and progressive communities around the world. Austin Energy is without question the most important public asset held by the city, and every city election gives us the power to put some real popular muscle behind our public interest.

Now, however, the city council is proceeding towards a policy which would remove Austin Energy from publicly accountable hands, and transfer control of the utility to an unelected, ultimately self-appointed board of directors. This policy is one which has been tried elsewhere, and failed. It is one progressives must oppose here in Austin for the sake of our leadership on issues of sustainability, and for the sake of basic democracy.

This scheme would have the Austin City Council appoint a board of "expert" directors, and thereafter the board would appoint their own successors. Absent electoral pressure, directors of the utility could chuck renewable projects, redouble investments in coal plants or nuclear power, undermine efforts to ensure electrical service to low income or other unlucky customers or otherwise make our public utility more like the private power companies who are destroying our environment and corrupting our politics around the state, and we could do NOTHING about it. This is simply unacceptable, and so this plan must be opposed.

We should be warned by the experience of progressives and environmentalists in San Antonio with CPS Energy, the public utility there. CPS is administered in the very way proposed under this plan: an unelected board of managers and "experts" makes decisions for all the ratepayers. CPS decided to increase investment in nuclear power, which activists opposed, but they were literally locked out of meetings where the decisions were made. When a $4 billion cost overrun was predicted, CPS’ unelected directors hid this information from not only the public, but also management at the utility. This information ultimately leaked to the mayor and led to a series of lawsuits, and a $400 million loss had to be written off on the backs of ratepayers. Two years ago when the same nuclear power folks were floating the idea of expanding Austin’s investment in nuclear power activists put pressure on the city council to stay away from the deal, and it went nowhere. San Antonio’s unelected board cost ratepayers no less than $400 million on an insane nuclear power deal, while Austin’s city council dropped the issue before it ever even got started. The choice ought to be an easy one.

Our mayor and others, unfortunately, are not only pursuing this bad idea, they are doing it with great haste. Council expects to have an ordinance ready on April 9, and has said they will vote on it on first reading April 11 so that it can be finally passed on April 25. They say that they need to do this in order to keep the Republican-led legislature from stripping Austin of our public utility, that their scheme is a compromise which will keep the legislature at bay. But what bill would do what they are afraid will be done? We have less than 2 months left in the session, so is this bill moving? The truth is that there is no such bill, or if there is, it isn’t going anywhere. There is no real threat of the legislature doing anything to Austin Energy this session, but elements within the city have used imaginary threats to justify hasty action to undermine public accountability at our public utility. Even if one happens to buy the idea that an unelected board is going to do a better job of representing the public interest than the city council has, why the rush? We were promised public meetings-these have been cancelled without explanation. Why is the city pushing legislation which would eliminate any chance for a charter amendment vote when this decision is made? Do they really believe that folks in Austin are incapable of understanding our own interests?

To stop this rush towards a bad policy, we need to take action. First things first, if you live in Eddie Rodriguez’s House District, call him now and ask him to reconsider his sponsorship of HB 1024. Ask him to not request a hearing for this or any other legislation which would remove the need for a charter amendment vote on these proposed changes. His number is (512) 463-0674. Then, call the two members of city council most likely to swing away from this proposal: Mike Martinez at (512) 974-2264 and Chris Riley at (512) 974-2260. If you really want to have some fun, opponents of this plan including folks from Public Citizen, SEED Coalition, Texas Campaign for the Environment, PODER and other environmental, civil rights and public interest organizations will be holding a press conference at noon, Tuesday April 9 and a demonstration at 5 PM Thursday April 11, both at City Hall. There will be food on the 11th, and everyone is welcome to come and ensure that our elected officials know: you may be term-limited, but history will not abide any scheme to rob the people of Austin of our most important resource.

Austin gets its own peculiar nationalism where we can roll our eyes at "outsiders" coming in and changing everything. We can express shock at the condos choking down on the Broken Spoke or curse the traffic on MoPac, but few of us would leave, because where would we go? The progressive spirit which makes Austin so appealing is symbolized by our public utility and the publicly accountable means by which we run it. Let’s stand up for that utility, for that accountability and for that spirit by opposing this misguided scheme. Let’s keep the power in our hands!

Fair Use Notice
This document contains copyrighted material whose use has not been specifically authorized by the copyright owner. SEED Coalition is making this article available in our efforts to advance understanding of ecological sustainability, human rights, economic democracy and social justice issues. We believe that this constitutes a "fair use" of the copyrighted material as provided for in section 107 of the US Copyright Law. If you wish to use this copyrighted material for purposes of your own that go beyond "fair use", you must obtain permission from the copyright owner.

Hadden: Don’t rush toward unaccountable utility board

March 24, 2013

By Karen Hadden, Electric Utility Commission
Austin American-Statesman

Changing the way Austin Energy is governed and handing control of our public utility over to an unelected board would be a serious mistake, yet this is what Mayor Lee Leffingwell and others propose. They would throw utility doors open to special interests and industry insiders who just might want their hands on our $1.3 billion per year asset.

The plan is essentially a theft that we should halt immediately, one that could lead to higher electric rates, investment in expensive and polluting forms of electric generation, and the loss of programs to assist those in need.

There’s absolutely no good reason for the rush to create a separate, less accountable board. There is no major crisis to solve. Public pressure on the City Council helped to reduce the first rate hike we’ve had in 18 years. The utility rate case is being settled and legislative threats have abated. Austin Energy is financially strong. Electric rates are low compared to other cities. Customer satisfaction is high, and utility profits are helping fund our parks, libraries and city programs.

So why the rush to change governance? Is this a thinly-disguised opportunistic attempt to secure more and greater rate breaks for the wealthiest members of our community and their business interests, while the rest of us pay for it?

Citizens can and do hold our utility accountable through pressure on the City Council members that we elect. Creating an unelected board would remove accountability, adding a layer of bureaucracy to insulate decision-makers. The council would likely defer to a board, rubber-stamping recommendations without adequate consideration.

With less accountability, we could expect ill-advised pet projects costing up to $100 million to sail through like greased lightning.

Opposition to an unelected board is growing. Nearly all speakers at a recent council meeting opposed letting headhunter-nominated appointees take over Austin Energy. Only an industry group, the Coalition for Clean Affordable and Reliable Energy, spoke in favor.

Unfortunately, Sen. Kirk Watson’s SB 410 would shortcut the path toward governance change. It would allow appointment of an independent board without the charter amendment vote that would otherwise be required.

This undemocratic bill is supported by Leffingwell, Commissioner Phillip Schmandt of the Electric Utility Commission, the Texas Public Power Association, Data Foundry, the Coalition for Clean Affordable and Reliable Energy, and Samsung. A House companion bill has been filed by Rep. Eddie Rodriguez, D-Austin.

So, not only could our utility be stolen and given to unelected appointees, but if Watson’s bill passes, a drastic change in governance could occur without a single vote by the public.

Wait a minute. Austin Energy is our public utility. We own it. Shouldn’t we be able to vote on something as major as changing who controls it?

A great Statesman editorial on March 5 pointed out that no study has determined the potential impact of changing Austin Energy governance. Last week, all seven City Council members agreed to require this analysis.

Nothing so far indicates that utility performance would improve by changing governance, but San Antonio’s experience shows that things could definitely get worse.

Council members and citizens struggled for years to get a rogue utility under control, even though it was comprised of smart "business professionals." Austin should take heed, because we’re not immune to similar problems.

Several years ago the CPS Energy board defied council directives, sinking millions of dollars into a project to build two nuclear reactors. No one could stop them. Days before a rate hike, news was leaked that a $4.2 billion nuclear cost increase had been hidden by the utility, resulting in massive public outcry.

The utility sought a way out of the nuclear expansion in court, and the utility ended up writing off nearly $400 million in losses. Partner NRG Energy also lost $400 million.
Austin escaped financial devastation because our City Council wisely voted to stay out of the nuclear project. Accountability matters.

According to our City Charter, unless citizens vote for a change, utility control must remain in the hands of elected City Council members. With a new 10-member city council coming soon, why not get studies done now to analyze the impacts of changing utility governance and let the new council make decisions after getting settled in?

Those who seek to capture our utility and those who would deny us the right to vote on control of the utility we own should expect a real fight. It is crucial to keep Austin Energy accountable, not throw accountability away. We must keep the power in our hands.

Fair Use Notice
This document contains copyrighted material whose use has not been specifically authorized by the copyright owner. SEED Coalition is making this article available in our efforts to advance understanding of ecological sustainability, human rights, economic democracy and social justice issues. We believe that this constitutes a "fair use" of the copyrighted material as provided for in section 107 of the US Copyright Law. If you wish to use this copyrighted material for purposes of your own that go beyond "fair use", you must obtain permission from the copyright owner.
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