Barbs exchanged over PUD power vote

Staff writerSeptember 28, 2012 

The two sides in Thurston County's public-power debate came out swinging Thursday night at the Washington Center for the Performing Arts.

Speaking at a forum Thursday were those for and against the idea of the Thurston Public Utility District, a water utility, providing power in the county in addition to the current provider, Puget Sound Energy. They presented their arguments in mostly civil terms, although at times heated exchanges flared among panelists.

The panelists were Jim Lazar, Thurston PUD interim commissioner; Andy Wappler, PSE vice president of corporate affairs; John Pearce, chairman of the Thurston Public Power Initiative; and Ralph Munro, co-chairman of the Alliance to Protect Thurston Power. That group does not support Proposition 1, which would allow the district to pursue public power if it so chose.

The interest in public power was launched by the Thurston Public Power Initiative, a grass-roots effort that collected enough signatures to qualify Proposition 1 for the November ballot.

PSE's Wappler dug in his heels from the start, citing the example of Jefferson County PUD. That entity, also a former water utility, is now set to offer power but has faced higher-than-expected costs and many unknowns.

"They have no staff, no plan for energy efficiency and they can't tell you what their rates are going to be," he told the audience.

More than 100 people filled the lower level of the Washington Center, with some taking seats in the upper levels of the center.

Pearce countered by saying PSE was going to try to scare people, but that the public-power initiative has lots of public support and stands for fair rates and local power control.

"It is they (PSE) who are scared because they know we're right," Pearce said.

And on it went. Lazar cited a recent study produced for the Thurston PUD showing it could provide power at a lower price than PSE, tapping lower power and lower-cost financing.

Munro's concern was public debt the PUD might take on. He pointed out that federal and local governments are struggling with debt levels, and that it was "way too much, way too fast," for the PUD.

"They have no experience, no staff and no money," he said.

The meeting got testy at times.

An audience member asked about accountability during the question-and-answer portion of the meeting. Lazar called on an expert in the audience, Grays Harbor County PUD commissioner Tom Casey, to answer. Wappler turned to Lazar, clearly ready for debate and questioned why he deferred to someone else.

"I thought you knew everything about PUDs, Jim," he said.

He also questioned how accountable Lazar could be to the public given that he was appointed to the Thurston PUD commission and has chosen not to run for the seat in the fall. Lazar was appointed after Paul Pickett resigned in May.

Pearce said he and the public will do everything possible to hold the PUD accountable on providing power.

"We will make sure the PUD does the responsible thing," he said. "There's no other way to do it."

Wappler told the audience that everyone in Thurston County is familiar with PSE, a company that has provided power here for more than 100 years.

But little is known about Thurston PUD, Wappler said.

"That's not a choice; that's a gamble," he said.

The PUD study focuses on three proposals for offering power in the county: building and providing power to the City of Yelm; building and providing power to an area from the Capitol Campus to the Port of Olympia; and acquiring facilities from Puget Sound Energy and providing power from Tumwater's core to the Port of Olympia.

The estimated initial financing is $41.9 million for the first proposal, $50.5 million for the second and $153.6 million for the third. The estimated 10-year savings for the three proposals using wholesale power provided by the Bonneville Power Administration, compared with PSE providing the service, is $10 million for the first proposal, $18.7 million for the second and $215.7 million for the third.

Tax-exempt and taxable bonds would be used to finance the proposals, according to the study.

The financing estimates also include separation, legal, consulting, startup and working capital costs of $6.25 million for the first proposal, $8 million for the second and $25 million for the third.

PSE has released a preliminary valuation of its assets in Thurston County. It shows $588 million in physical assets - poles, wires and transformers - plus $71 million to $100 million in real estate. PSE officials have said public-power startup costs could push power takeover costs to $1 billion; PUD commissioners have disputed that figure.

PSE officials also have disputed the PUD study, saying that to duplicate its own infrastructure could could result in "substantial financial and technical risks."

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