04/04/2006: "Concern On Possible Elect. Rate Increases"

OLYMPIA -- Governors Chris Gregoire of Washington, Ted Kulongoski of Oregon and Brian Schweitzer of Montana today sent a letter to President Bush to request that he remove from his Fiscal Year 2007 budget request a proposal that will siphon off money paid by BPA customers. The President proposes using a portion of the net secondary electricity sales revenues of the Bonneville Power Administration (Bonneville) to accelerate the early repayment of Bonneville's federal bond debt.

"We believe this proposal, like attempts by previous administrations, will undermine one of the most successful federal-state partnerships for regional economic development and hurt the citizens and businesses of our states while providing little benefit to the federal deficit," said the Governors in the letter.

"Our states rely upon BPA to provide much of our electricity at affordable rates that keep our state economies healthy and this proposal would only serve to weaken the BPA, raise our electric rates and reduce employment."

Electric utilities in all three states purchase power from the BPA with the revenues going to pay for BPA's dams and transmission lines. The Fiscal Year 2007 budget proposes using parts of these payments to accelerate the repayment of the BPA's federal bond debt.

The President's proposal would force Bonneville to raise its electricity rates by about 7 percent beginning in 2008. It is estimated that this significant rate increase would cost Northwest taxpayers $109 million per year and eliminate 1,120 jobs.

The Governors have urged President Bush to withdraw the proposal and asked that the Pacific Northwest Governors be involved in conversations pertaining to any change in the Bonneville federal debt policy.