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SMUD in Yolo? Yes! Sacramento Bee , October 9th 2006

     Voters in the major cities of Yolo County (Woodland, Davis and West Sacramento) will be deciding in the November election whether to join the Sacramento Municipal Utility District. Voters in SMUD's existing service territory (Sacramento County and a small portion of Placer County) will be deciding whether the expansion is a good idea. Both existing and future SMUD customers would need to approve this expansion for it to occur.

     Pacific Gas and Electric Co. which stands to lose some customers, is fiercely fighting this proposal. The utility will undoubtedly set local records in terms of campaign spending. It is a complicated issue. Yet it comes down to a fundamental gut instinct. Whom do you trust more?

     Do you trust the publicly elected leaders of SMUD, who have closely examined this proposal and think that expansion makes sense for customers on both sides of the river? Or do you trust PG&E, which is spending millions of their customers' own money trying to influence the vote and keep their customers?

     Any expansion by SMUD into PG&E territory involves some major financial questions that only get answered after the-fact. First, annexation requires voters' approval. Then, the costs get calculated. So if Yolo voters were to trust SMUD more than PG&E and vote Yes on Measures H and I, SMUD would then proceed to purchase the area's electricity distribution systems. A court would likely have to decide how much PG&E's poles, wires and switches are worth. Then Yolo customers would have to pay off this cost.
     Because PG&E rates are about 25 percent higher than SMUD's rates today, there is ample reason to believe that Yolo customers can absorb this one-time cost while still enjoying lower rates.

     Governments in Yolo and Sacramento counties have examined this proposal inside and out, with the same due diligence a corporation would employ in a big transaction. Reviewing PG&E's own financial records and distribution system information, a Sacramento commission found the expansion financially sound. So did independent consultants hired by SMUD. So did independent consultants hired by Yolo County. SMUD isn't looking to do this out of administrative ego or spite. It is because it makes sense for SMUD to get a little bit bigger and spread some costs among more customers.

     Existing SMUD customers have as much of a guarantee as possible that any financial risks of this expansion will fall on the new Yolo customers. The Yolo customers have as much evidence as possible to sense that the risk is worth it. Yet the real issue here isn't for the short term, and what happens to Yolo electricity rates next year or the year after that. This may be a once-in-history moment for Yolo County.

     Voters must take the long view in what's best for their community. SMUD has shown time and again that public power lowers costs and increases accountability to the voting customer. PG&E has slick mailers on its side; SMUD has history.

     Whom do you trust? In Placer and Sacramento counties, vote Yes on Measure L. In Yolo County, Vote Yes on Measures H and I. 

"I therefore lay down the following principle: where a community-a city or county---is not satisfied with the service rendered or the rates charged by the private utility, it has the undeniable basic right, to set up, after a fair referendum to the voters ...its own governmentally owned and operated system." ----Franklin D. Roosevelt, "Portland Speech, " Sept 21, 1932

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Last updated 10-15-2006