Point Austin: A Funny Thing Happened ...

The tale of Oxford Advisors is a snapshot of city business

Point Austin

It seems it will take a bit longer for the city to hire an Austin Energy consumer advocate – precisely, a consultant firm to represent residential and small business ratepayers before AE during the development of its rate review (i.e., "cost of service" study) for next fall's budget. In November, City Council was unhappy that only Oxford Advisors, LLC had risen to the top of the list of firms responding to the city's invitations – a list that was but two firms long, despite two solicitations to as many as a thousand firms. (It says something about the attractiveness of the $200,000 contract, if you can't get more than two trout to rise to the lure.)

Council members didn't like the short list, didn't like that Oxford is New York-based (it's not making picante sauce, for God's sake), didn't believe its experience was sufficiently small-business-and-residential. After some grumbling, they asked staff to try again – to reach out to more firms, with more information, and see if any others came calling.

But before that could happen, Electric Utility Com­mis­sion Chair Michael Osborne personally reached out to Oxford to discuss the matter – an innocent overture, Osborne insists, but self-reported to the city by Oxford, because any such contact while a contract is under consideration is a de facto violation of the city's anti-lobbying ordinance – and automatically disqualifies the potential vendor. Although the EUC had already recommended against hiring the firm, Osborne defended Oxford as not having violated "the spirit" of the rules (sporting of him) and recommended the firm file an appeal.

That appeal is in progress, and although AE says time is of the essence if the rate package is to be prepared before next year's budget cycle, at least a month will be lost while the matter is reviewed (and perhaps more companies are invited into the mix).

If you've been following Council this year – where nothing is done today that can't be put off until next month – none of this is really surprising.


Watching the Watchers

However, the 10-1 Council didn't create this particular problem. A 2012 ordinance from an earlier dais, enacted under pressure from consumer advocate groups, requires such a ratepayer representative for cost-of-service reviews (a process carried out under the gimlet eyes of the Public Util­ity Commission), on the presumption that smaller ratepayers don't have the resources to represent their own interests against the experts at AE. It seems like a reasonable enough notion – until upon reflection, one wonders, aren't the members of the City Council supposed to represent the interests of city ratepayers, and indeed direct the AE experts to do the same?

I won't belabor that argument, but I remain puzzled at the often reflexively adversarial relationship Council and "affordability advocates" adopt when dealing with the city utility staff. Yes, we need to watchdog all city departments to make certain the taxpayers and ratepayers are getting their money's worth, but too often the process produces these odd structural conflicts, where we're spending $200,000 to hire an outside consultant to do precisely the job we're paying the city staff to do (and the Council to supervise) in the first place. (Don't get me started on outside law firms.)

For example, we just spent a bundle on outside consultants to study whether AE really needs to build another natural gas facility to replace the nearly obsolete Decker Lake plant – the consultants reported that, for energy stability reasons, it looks that way, to an immediate chorus of boos from environmental advocates, who want to move more quickly to renewables.


Been Good to Know You

However you stand on any of these issues, it seems not entirely a coincidence that both AE GM Larry Weis and COO Cheryl Mele have almost simultaneously decided to move on – Weis back home to Seattle City Light, and Mele to the state's ERCOT grid. I'm sure they have good personal reasons, but it can't have helped that the utility is persistently whipsawed between the city's affordability and renewable energy pressures (no longer quite as contradictory as they once were), all under the direct shadow of the PUC – which will again review next year's rate structure under the implicit standard: Why shouldn't we end Austin's public ownership and throw the city to the wolves of the private energy market?

Should that recurrent threat eventually be fulfilled, I can't imagine that whoever or whatever ends up owning what was AE will be in a hurry to hire consultants, or appoint Low Income Consumer Advisory Task Forces, to represent the interests of ordinary ratepayers. Nor will they be likely to regret that Weis and Mele weren't sufficiently deep green to satisfy the Sierra Club or Public Citizen. Under the circumstances, we'd better hope that whoever succeeds our departing administrators can successfully juggle with a smile the often polyglot demands of City Council, the Electric Utility Com­mis­sion, a phalanx of advocacy groups, and the Capitol buzzards. When prospective candidates submit their résumés, they might simultaneously apply for sainthood.

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KEYWORDS FOR THIS STORY

Austin Energy, Oxford Advisors LLC, City Council, Michael Osborne, Larry Weis, Cheryl Mele, Public Utility Commission

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