SENATE COMMITTEE ON BUSINESS AND ECONOMIC DEVELOPMENT

 

 

April 21, 2005                                                                                                         Hearing Room B

1:00 P.M.                                                                                                                     Tapes 63 – 65

 

MEMBERS PRESENT:         Sen. Rick Metsger, Chair

Sen. Bruce Starr, Vice-Chair

Sen. Jason Atkinson

Sen. Ryan Deckert

Sen. Laurie Monnes Anderson

 

GUEST MEMBERS:             Rep. Vicki Berger

 

STAFF PRESENT:                 Theresa Van Winkle, Committee Administrator

James Goulding, Committee Assistant

 

 

MEASURES/ISSUES HEARD :

                                                HB 2460 – Public Hearing and Work Session

                                                HB 2590A – Public Hearing and Work Session

                                                SB 1008 – Public Hearing and Work Session

 

 

These minutes are in compliance with Senate and House Rules.  Only text enclosed in quotation marks reports a speaker’s exact words.  For complete contents, please refer to the tapes.

 

TAPE/#

Speaker

Comments

TAPE 63, A

003

Chair Metsger

Calls the committee to order at 1:08 p.m.  Opens a public hearing on HB 2460.

HB 2460 – PUBLIC HEARING

010

Jan Coleman

Yamhill County Clerk.  Submits written testimony in favor of HB 2460 (EXHIBIT A).

030

Chair Metsger

Closes public hearing on HB 2460.  Opens a work session on HB 2460

HB 2460 – WORK SESSION

032

Sen. B. Starr

MOTION:  Moves HB 2460 to the floor with a DO PASS recommendation.

034

 

VOTE:  4-0-1

EXCUSED:  1 - Atkinson

 

Chair Metsger

Hearing no objection, declares the motion CARRIED.

SEN. DECKERT will lead discussion on the floor.

036

Chair Metsger

Closes work session on HB 2460.  Open a public hearing on HB 2590A.

HB 2590A – PUBLIC HEARING

040

Andrew Leisinger

Chair, Landscape Architect Board.  Submits written testimony in favor of HB 2590A (EXHIBIT B).

065

Susanna Knight

Administrator, Landscape Architect Board.  Testifies in favor of HB 2590A.

075

Chair Metsger

Closes public hearing on HB 2590A.  Opens a work session on HB 2590A.

HB 2590A – WORK SESSION

077

Sen. B. Starr

MOTION:  Moves HB 2590A to the floor with a DO PASS recommendation.

078

 

VOTE:  4-0-1

EXCUSED:  1 - Atkinson

 

Chair Metsger

Hearing no objection, declares the motion CARRIED.

SEN. MONNES ANDERSON will lead discussion on the floor.

080

Chair Metsger

Closes work session HB 2590A.  Opens a public hearing on SB 1008.

SB 1008 – PUBLIC HEARING

085

Chair Metsger

Notes they have -8 amendments before the committee (EXHIBIT C).

090

Libby Henry

Eugene Water & Electric Board.  Submits written testimony discussing the measure’s impact on dealing with the liabilities of the Trojan Nuclear Facility (EXHIBIT D).

110

Larry Cable

Cable, Huston, Benedict, and Haagensen Law Firm.  Testifies in regards to his thoughts on SB 1008.

130

Chair Metsger

Asks if the language in the -8 amendments satisfies their needs.

132

Henry

Confirms that it does.  Makes remarks on the support for the language.

143

Andrea Fogue

League of Oregon Cities.  Submits the written testimony of Ken Strobeck (EXHIBIT E) and testifies on his behalf. 

190

Fogue

Relays the efforts of the league to make sure that franchise fees and agreements are honored.

205

Chair Metsger

Asks if they have a position on the city of Portland’s proposal for purchasing Portland General Electric (PGE).

207

Fogue

Replies that they have been actively involved in the discussion process.   

228

Sen. B. Starr

Wonders what their position is on PGE being owned publicly or privately.

240

Fogue

Replies that they favor a public PGE.  Comments on the previous Texas Pacific Group (TPG) sale offer.

253

Sen. B. Starr

Asks about rate payer involvement in deciding the purchase of PGE.

261

Fogue

Replies in regard to public involvement.

270

Sen. B. Starr

Considers if there would be a reason the league would oppose a public vote process.

275

Fogue

Feels they need to take a closer look at the government structure.

279

Sen. B. Starr

Clarifies his question.

285

Fogue

Replies the public needs to have a voice in the process and feels that they will.

293

Chair Metsger

Points out that the vast majority of PGE’s rate payers are outside of the city of Portland.

303

Fogue

Discusses the involvement of the city of Portland in communicating with other cities.

320

Liz Trojan

Oregon Public Power Coalition.  Expresses her support for the city of Portland plan. Testifies on the important opportunity to form a public utility.  States that with the governor’s support for the Portland plan, she does not see a need to move this through the legislature.

355

Chair Metsger

Comments on her remarks.  Notes that legislative change is moved through the chambers and not the governor’s office.  Feels the legislature needs to have an active role on behalf of their constituents.

369

Sandra Flicker

Executive Director, Oregon Rural Electric Cooperative Association (ORECA).  Provides testimony on SB 1008.  Discusses the resolving of issues with consumer owned utilities.

410

Flicker

Details the concerns of consumer owned utilities in relation to changes in ownership of PGE.

TAPE 64, A

005

Flicker

Describes the sale of preference power and the impact on rate payers if SB 1008 should pass.

035

Flicker

Talks about scenarios for potential rate impacts and increases.

047

Sen. Deckert

Requests that they continue to work together on this issue.

063

Gary Conkling

Washington County.  Provides a comprehensive breakdown of the sections of SB 1008 as amended by the -8 amendments (EXHIBIT F).

100

Conkling

Explains section 12 of the measure.

131

Conkling

Explain section 14.

139

Sen. Deckert

Asks the rationale of the provision relating to imminent domain.

140

Conkling

Replies that it is to prevent any perceived hostile takeover of other utilities.  Continues to describe the sections of the measure.

170

Conkling

Talks about section 19.

210

Conkling

Describes the provisions of section 20.

250

Conkling

Details section 26.

280

Conkling

Applauds the efforts of the work group and legislative counsel in drafting this measure and amendments.

297

Chair Metsger

Asks if this measure is self executing upon passage.

305

Conkling

Offers that the measure does provide momentum for formation of the board and sets timelines for action.

327

Chair Metsger

Observes the 120 day period for nominating the board.  Feels there is a need for a temporary governing body to guide the process until the election of a full board.

353

Jason Eisdorfer

Citizens Utility Board (CUB).  Concurs that they should address that issue.

358

Sen. B. Starr

Requests a list of statutes that apply and don’t apply.

360

Conkling

Responds that he will provide that information.

367

Sen. B. Starr

Wonders if he still represents the Industrial Customers of Northwest Utilities.

373

Conkling

States that he no longer represents them.

375

Sen. Deckert

Comments on the need to act.  Considers what the best path of action would be.

395

Conkling

Responds that speed is not as important as creating a credible offer.

TAPE 63, B

005

Conkling

Talks about the interaction between a buyer and a seller.

033

Sen. Monnes Anderson

Voices her disappointment that all parties are not working together.  Feels there is a collision course between this plan and the city of Portland’s proposal.

050

Eisdorfer

Remarks SB 1008 provides a clear picture of what a public utility would look like.  Feels moving the bill along is valuable.

090

Eisdorfer

Considers the timetable for holding a public vote.

100

Brad Van Cleve

Industrial Customers of Northwest Utilities.  Testifies in regards to the -8 amendments.  Notes there is greater clarity in the SB 1008 proposal than in other public purchase proposals.

110

Chair Metsger

Remarks on the previous discussion of this issue.  Wonders where the ultimate responsibility rests.

140

Van Cleve

Notes the city of Portland would be responsible for bonds.     Feels the city council would have some authority over the assets of the company.  Offers that there would be limitations as well.

160

Sen. B. Starr

Wonders what this would mean to the average PGE ratepayer should SB 1008 pass.

176

Conkling

Explains that the provisions relating to various rate paying groups and how they would be impacted.

200

Conkling

Observes that not all ratepayers will notice an immediate change.

230

Ronald Nichols

Managing Director, Navigant Consulting.  Submits an overview of the benefits of a public purchase (EXHIBIT G) and a comparison chart of PGE to other public power entities (EXHIBIT H).

270

Nichols

Compares the current PGE situation with a similar situation with the state of New York’s purchase of Long Island Power Authority (LIPA).

305

Nichols

Notes the unique opportunity for an across the board rate decrease.

339

Nichols

Discusses various debt financing approaches.

379

Nichols

Provides a summary of details on page 5 of his written overview.

410

Nichols

Talks about page 7 of the provided written overview.

TAPE 64, B

005

Nichols

Outlines the Long Island Power purchase example.

024

Nichols

Comments on the comparison chart.

035

Sen. Deckert

Wonders what the fastest a pro forma could be done in a best case scenario.

044

Nichols

Feels the fastest a pro forma could be done is a few weeks.  Details how it could be done in a month’s time.

061

Douglas Goe

Orrick, Herrington & Sutcliffe LLP, Pacific Northwest Office.  Describes the bond issues involved.

100

Goe

Raises some policy issues he feels need to be addressed.

116

Chair Metsger

Requests clarification on how they could effectively structure their assets.

120

Goe

Talks about the need to change the language in the bill to reflect that there is financial independence of the company from the state.

139

Chair Metsger

Asks if they structured the business as independent from the state, would they still be able to use State Treasury bonding authority like Oregon Health and Science University (OHSU).

142

Goe

Notes that OHSU issues its own bonds.

157

Chair Metsger

Questions if the city of Portland has the flexibility that the state has to adapt to different scenarios.

171

Goe

Offers the City of Portland would have limitations when offering stock.  Discusses the methods of overcoming potential financial hurdles.

187

Sen. B. Starr

Wonders if there are valid comparisons between Oregon Community Power and the State Accident Insurance Fund (SAIF). 

195

Goe

Replies there are some parallels.

237

Chair Metsger

Asks what the committee’s thought are on this measure.

241

Sen. B. Starr

Considers if there is a way for the public to place the proposal for purchase of PGE by the city of Portland on the ballot for a vote.

255

Chair Metsger

Offers that legislative counsel would have a better answer for that question.

263

Sen. Deckert

Ventures he is fully supportive of moving forward on this measure.

273

Dexter Johnson

Legislative Counsel.  Asks for clarification on Sen. Starr’s question.

278

Sen. B. Starr

Wonders if a referendum by the voters could overturn the city of Portland’s acquisition of PGE.

297

Johnson

Offers his interpretation that after the acquisition occurs, it could not be undone.  States an initiative could direct other actions.

327

Chair Metsger

Closes the public hearing on SB 1008.  Opens a work session on SB 1008.

SB 1008 – WORK SESSION

330

Sen. Deckert

MOTION:  Moves to ADOPT SB 1008-8 amendments dated 4/21/05.

333

Monnes Anderson

Feels it is important to move the process along.  Offers her concern that they are competing with the city of Portland.  Wishes to see a more cooperative solution.

360

Sen. Deckert

Urges the movement of this measure.  Details his belief that this is most comprehensive and viable proposal for the state.

375

 

VOTE:  4-1-0

AYE:               4 - Deckert, Monnes Anderson, Starr B., Metsger

NAY:               1 - Atkinson

 

Chair Metsger

The motion CARRIES.

382

Chair Metsger

Calls for a recess at 3:01 p.m.

RECESS

383

Chair Metsger

Calls the committee back to order at 3:21 p.m.

388

Sen. Deckert

MOTION:  Moves SB 1008 to the floor with a DO PASS AS AMENDED recommendation and the SUBSEQUENT REFERRALS to the committee on General Government and the committee on Ways and Means BE RESCINDED.

390

Sen. B. Starr

Notes his concern over the removal of the Ways and Means referral.

TAPE 65,A

010

Theresa Van Winkle

Committee Administrator.  Informs that the -8 amendments were given to Revenue and Fiscal and the statements are in progress.

013

Sen. B. Starr

Wonders about the assumption that the measure would not have a fiscal or revenue impact.

015

Chair Metsger

Offers that once it gets to the floor it will have statements on potential impact.  Points out the other chamber can take action as needed.

020

Sen. Deckert

Observes no need for a Ways and Means referral on the measure at this time.  Reiterates the motion to move SB 1008 to the floor with a do pass recommendation.

030

Sen. B. Starr

Notes his concern over moving this to the floor at this time. 

045

Sen. Monnes Anderson

Offers she has some unanswered questions as well, but feels the process needs to move forward.

053

Sen. Atkinson

Feels this is poor public policy.  Opposes the state becoming involved in public utilities. 

068

Chair Metsger

Contributes concluding comments and summarizes the importance of the state determining the future of its economic development. 

093

Chair Metsger

Outlines the necessity for the state to provide input on the process.

120

 

VOTE:  3-2-0

AYE:               3 - Deckert, Monnes Anderson, Metsger

NAY:               2 - Atkinson, Starr B.

 

Chair Metsger

The motion CARRIES.

SEN. DECKERT and SEN. NELSON will lead discussion on the floor.

124

Sen. B. Starr

Serves notice that he will be filing a minority report.

125

Chair Metsger

Closes work session on SB 1008.  Adjourns the committee at 3:31 p.m.

 

EXHIBIT SUMMARY

 

  1. HB 2460, Written testimony, Jan Coleman, 1 p
  2. HB 2590A, Written testimony, Andrew Leisinger, 1 p
  3. SB 1008, -8 amendments, staff, 47 pp
  4. SB 1008, Written testimony, Libby Henry 1 p
  5. SB 1008, Written testimony of Ken Strobeck, Andrea Fogue, 2 pp
  6. SB 1008, Senate Bill 1008 Summary, Gary Conkling, 2 pp
  7. SB 1008, Public Purchase Overview, Gary Nichols, 8 pp
  8. SB 1008, Comparison Chart, Gary Nichols, 1 p