Selling ML&P to Chugach Electric is the right choice
In today's highly charged political climate it's easy to find cynicism in the process and polarize every issue along unhelpful partisan lines. The Anchorage Charter wisely instructs that our municipal government is nonpartisan in nature and hopefully a bit above the fray.
The Chugach Electric proposal and the process to potentially sell ML&P is a good deal for taxpayers, ratepayers and the city. That's why both conservative and progressive members of the Anchorage Assembly voted to include Prop. 10 on the upcoming ballot, allowing voters to decide if the long discussed idea of consolidation is in Anchorage's energy future.
The idea to consolidate Anchorage's two utilities isn't new. It's an idea that has been studied for decades. Why? Because maintaining two electric utilities for a city our size short circuits ratepayers with service duplications, inefficiencies and higher costs that result in more expensive electric bills. The complaints from local businesses about soaring electric rates are numerous. Complaints come from citizen ratepayers too. As the sole Assembly representative of downtown, Government Hill, South Addition, Mountain View, and Fairview — all served by ML&P — I am excited about the opportunity we have to secure Anchorage's electric service model once and for all.
Selling ML&P to any other operator than Chugach Electric does nothing to solve Anchorage's flawed and inefficient two-utility system. That is why last summer's Assembly resolution did not call for the sale of ML&P alone, but instead urged both utilities and the municipality to explore a merger. Because of the Assembly's open and public request, the city also received unsolicited interest and proposals. Those documents are now part of the public record allowing the voters to make an informed decision.
The proposed $1 billion-plus offer by Chugach Electric is in line with the upper range of an independent valuation of ML&P. In fact, it was the highest bid. But more importantly, the highest bidder also meets the other primary goal. The Chugach Electric offer ensures the single utility offer Anchorage ratepayers need while taxpayers get the best fiscal return. This is the solution that benefits us all. Further, proceeds to the municipality will go into the MOA Trust Fund or to pay down debt and, when you pay down debt, it reduces property taxes for everyone.
As for the process of making consolidation a reality, Anchorage voters have the power to move us forward. If voters approve Proposition 10, the city, ML&P and Chugach Electric can finalize terms for consideration and approval by the Assembly. This due diligence process will take months and will involve many opportunities for additional public input. And finally, if the Assembly and Chugach Electric approve the proposed terms, the Regulatory Commission of Alaska must review and approve the deal.
— Christopher Constant
Anchorage Assemblyman, District 1
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