To the editor:
The Record has made much of the possibility of a public utility district imposing a property tax of 45 cents per $1,000 of property [value].
Oh my God — call out the militia, Mabel! Circle the wagons. Why, the next thing you know, we won’t be paying the CEO of PSE
$5 million a year, or paying for his corporate jet, executive parking at SeaTac, or skybox at Safeco Field!
Which is what your current electric bill pays for — along with jacked-up stockholder dividends, because PSE has diverted money it should have used to maintain the power system into propping up its stock price. So now PSE can’t raise money to fix the power system because its credit rating is junk bond grade. So PSE wants to get bought by a foreign multinational to raise capital, and coincidentally make $20 million for the CEO and a 25 percent bonus for the stockholders. And we lucky ratepayers will get to pay off PSE’s debt of $4.2 billion.
Then there’s the 12 percent rate hike PSE is currently asking for.
As The Record reported, PSE has generously offered rebates of $100 million over 10 years to its 1.1 million customers. Do the math. That’s less than
76¢ a month per customer. If your electric bill is less than $9.12 per month, the rebate will cancel the rate increase. If its more, well…
As for the dreaded 45-cent property tax: Ain’t gonna happen. Skagit PUD has calculated that it will take up to seven years and cost up to $10 million to take over PSE’s assets to the point where the PUD is actually selling power. And that includes litigation.
PSE has made it abundantly clear that if the voters in the three areas considering creating PUDs this fall — Whidbey Island, Skagit and Jefferson counties — are so uppity as to challenge its monopoly, it will fight tooth and nail. Coming soon to the envelope containing your electric bill: PSE electioneering propaganda.
Anyway, once the Whidbey PUD begins selling electricity to its customers, it will be able to issue bonds to pay for buying the lines, poles, etc.
PUDs, unlike PSE, have very good credit ratings, and the bonds can be paid off by that part of the income stream no longer going to PSE’s bloated executive and stockholder dividends.
So how to raise the $10 million to get to that point? A PUD could impose a property tax of up to 45 cents, but it wouldn’t need to. According to figures from the county assessor’s office, a tax of 45 cents on all Whidbey Island property would raise about
$4.7 million per year. So there’s no need to impose such a steep tax. To raise $1.5 million a year would require a property tax of 9.43¢ on each $1,000 of real property. That’s $42.44 per year on property valued at $300,000. And the tax would only be needed for seven years.
So why should we, as a community, want to own the power company? For starters, it will be cheaper in the long run. PSE has the highest electric rates in the entire Northwest.
In fact, electric rates for the three private electric utilities in Washington are all higher than for any of the 28 public utility districts.
And unlike PSE, we all get a say in how a PUD is run. If we don’t like the way its being run, we can vote out the PUD commissioners.
With a PUD, it’s a two-way street. Every meeting is open to the public.
With PSE, the only time it pays attention is when their monopoly is threatened.
So we can be sure that before the election PSE will open a public relations office on the island. But all their smooth PR talk will not give us better service, cheaper rates or oversight of a multinational corporation.
Vote yes for the public utility district.
Steve Erickson
Langley
