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Then There's This: Surrendering Power

Council poised to give up control of utility, no matter how you feel about it

By Amy Smith, Fri., April 12, 2013

It's nearly impossible to stop a speeding locomotive, but opponents of a governance shakeup at Austin Energy aren't backing down from trying to derail the thing.

City Council is set to take initial action Thursday, April 11, on a draft ordinance that would transfer control of the city-owned power utility from the Council to an appointed "independent" board of seven members. Also on the agenda is a related resolution endorsing proposed state legislation that would let the Council amend the city charter without voter approval – a maneuver literally designed to take the "public" out of public power.

Senate Bill 410, by Sen. Kirk Watson (who has championed the idea of a governance change since last year's controversial AE rate increase), has already cleared the Sen­ate. A House committee hearing on Rep. Eddie Rodriguez's companion bill, HB 1024, is not yet on the calendar but could come up as early as next week.

Today's Council vote on first reading (with Kathie Tovo in China on a sister-city visit) will likely pass easily, as it will on the final reading, with Tovo and Laura Morrison expected to cast the dissenting votes. Con­sumer activists, meanwhile, are plotting their next course of action – possibly a citizen-driven initiative to rescind such a radical step, taken at a time when the city is transitioning to a new 10-1 City Council structure, which takes effect in the November 2014 election.

Indeed, the AE governance change has galvanized a coalition of familiar (and not so familiar) faces on consumer matters, many of whom lambasted the proposal at a Tuesday press conference. Wearing stickers bearing the words "Keep the Power in OUR Hands," speaker after speaker warned of the danger of handing control of the utility to a board of industry professionals recruited with the help of a corporate headhunter, which is part of the city's plan for moving forward on the governance transfer.

As energy activist and Electric Utility Commission member Karen Hadden pointed out, "even" the business-friendly Statesman has editorialized against Council moving so quickly to surrender control of the $3.8 billion utility without a more thorough examination.

One speaker, the Rev. Sterling Lands, pastor of Greater Calvary Bible Church, expressed concern that low-income utility programs would be compromised under new structure. Austin residents should retain the right to elect the people who control the utility, he said, "and vote them out when needed."

Members of San Antonio-based Energia Mia, which bird-dogs the city-owned CPS Energy and its independent board in that city, also warned Austin leaders against heading down the CPS path. One read a statement from former San Antonio Council Member Maria Antonietta Berrio­za­bal. "My advice to you ... is that you – the people – not give up your power," she wrote. "You will never get it back."

It shouldn't come as a surprise that business interests are the biggest supporters of a new AE governance setup, including organizations like the Greater Austin Chamber of Commerce and the Coalition for Clean, Affordable, Reliable Energy, or CCARE, which represents AE's commercial and industrial customers. "We believe the time for change is now," CCARE's Roger Wood wrote in a March 29 letter to Council. "To wait a minimum of two years for a charter election will continue to put this utility at risk. The rapidly changing Texas utility market necessitates a truly independent board, without undue political influence." In other words, corporate cronyism is okay, but accountability of elected officials is out of the question. The city's Electric Utility Commission, a virtually powerless advisory panel, has also endorsed a governance shift, as it has in several years past.

To his credit, Rodriguez, who's carrying the Watson bill in the House, reached out to opponents of his legislation to try to understand where they're coming from. Rodriguez is a progressive Democrat who is usually in sync with consumer and environmental activists – but not on this issue. He met with about 20 of the opponents at a Rainey Street restaurant on Saturday and picked up the tab for the meal. The meeting over lunch became "respectfully confrontational" at times, said enviro activist Paul Robbins. The sides didn't reach agreement. "Eddie's attitude was sort of, 'Why me? I've been good to you.' The attitude from a lot of the attendees was: This was a matter for Austinites, and keep the state – and your bill – away from us." Robbins recalled his last words to Rodriguez: "You don't want this Council's karma."

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