Back in February, just as it seemed the council was on the verge of pulling back on its efforts to put forward a Publicly Owned Utility (POU), Mayor Joe Krovoza and Mayor Pro Tem Dan Wolk stepped up with a strongly-worded defense of the public power initiative and a new way forward that clarified that, while the city has not made a decision to go forward, it needs to engage the public in renewed public outreach over the next year.
Staff has now come back with a resolution “to explicate” Resolution No. 13-169 and to authorize the City Manager and City Attorney “to continue to pursue actions necessary to provide City Council sufficient information to allow for a decision regarding the possible formation of a municipally owned utility within the City of Davis.
Staff clarifies, once again, that “approval of Resolution No. 13-169 does not in and of itself, authorize municipalization of electrical assets within the City limits. There is a process prior to taking the necessary steps towards acquisition of the PG&E assets.”
These specific actions are in addition to the reporting requirements contained in the original Resolution No. 13-169:
1. Conduct public outreach/public relations services to include research, public polling, advocacy, coalition building formation of strategic partnerships, and stakeholder meetings;
2. Energy services outreach and contracting utilizing community resources such as the Davis Energy Group, Valley Climate Action Center, Davis Coalition for Public Power, UC Davis Energy Institute and the City of Davis Energy Services Options Technical Advisory Group;
3. Due diligence tasks, including case study analysis, asset inventory, utility appraisal, fair market value determination, business plan development, business model development, power portfolio and renewable energy determination, possible decentralized energy service and cost of service evaluation;
4. Initiation of environmental review pursuant to CEQA;
5. Continued discussion with PG&E regarding implementation of this Resolution and Resolution 13-169 regarding the City’s stated energy goals, and contingent upon the cooperation and progress of these discussions, consider any proposals related to implementation of these Resolutions and any alternative proposals that PG&E may propose. Staff will report on these discussions to the City Council;
6. Investigate and report the steps necessary for acquisition of an investor owned utility operating within the City Limits;
7. Proceed with this work plan, and bring back to the City Council any matters that require Council input, action or approval; and
8. Provide the City Council with sufficient information to allow the City Council to make a decision regarding a City-owned electric system within 12 months of the date of the resolution.
It was Councilmember Brett Lee who led the way arguing against this initiative. “When we approved this not too long ago, we had a city manager, we had some other items that were not on our plate,” he said. He would go on to argue that the city lacks the bandwidth to pursue this massive endeavor at this time.
Councilmember Lucas Frerichs said that Councilmember Lee made a reasonable point about the hiring process and “the additional point about ongoing budget issues which we’ve made good efforts in addressing those budget issues thus far.”
“There is no question that there’s a promising future for a POU in this community,” he continued. “I strongly believe in the notion of public power. I think that we will get there, but I personally, I personally am in the position where we need to get to adjust the timing and sort of hit the pause button, not only hit the pause button but slow it down a bit.”
“The other part is the issue of the public outreach component,” he said, “these items get out in sort of dribs and drabs in terms of what we’re doing.” He would add, “There is a real need for community outreach on this item regardless of whether we pull all funding tonight or whether we move full steam.”
Rochelle Swanson would state, “I think there is a way to address both the concerns because sometimes a decision is made and we have a change of circumstances, that’s why we have representative democracy to be able to have some flexibility and take some responsibility.”
“We’re in a period in my mind of due diligence,” said Mayor Joe Krovoza, noting that the city has two outside reports who have noted that there is promise here from a sustainability perspective and from a monetary savings perspective. He said, “As council, I think we have a fiduciary duty to investigate that promise. I see us as embarked upon a one year or so, very methodical consideration of this question in as careful and deliberate a way as possible.”
“The decision on going forward as a POU has, in my mind, not been made,” he said. “I think that is where this council, and I will take responsibility, certainly didn’t do a good job of its messaging. I think it became communicated to the public that a decision had been made.”
He then put a motion on the table to direct staff on March 25 to bring back a revised resolution “that clarifies that the city of Davis has not made a decision to go forward or not with a publicly owned utility, to emphasize that we are in at least a one-year period of careful evaluation of the public and private benefits to moving forward with a publicly owned utility or other options that help meet our cost-saving goals.” He added, “To include in that some consideration of the role of the local URAC [Utility Rate Advisory Committee]… and to clarify the important different stages of public outreach.”
Dan Wolk seconded it. “I think we do need to keep going on this,” the Mayor Pro Tem stated. “I think that the feasibility report presents a really compelling case for a POU. It’s hard to ignore that. I’m comfortable with that.”
He agreed with the need for community outreach prioritized above determining the fair market value of community assets. He added, “I think we really need to focus the public’s attention on the SB 43 process. This is a bill that we sponsored. This is a bill that would provide renewable energy for our community which is one of the main goals of the POU.”
“This is an issue that PG&E is fighting us on,” he said very pointedly and emphatically. “Very publicly fighting not just Davis but us and I think it’s critical that our community for all of these reasons get very attuned to what’s happening there.”
Now the council must map out the steps by which they need to proceed.
—David M. Greenwald reporting
