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Prop. 16: Public agencies in retail utility

June 2, 2010 12:00:00 AM PDT
Supporters of Proposition 16 call it the "Taxpayers Right to Vote Act." It's designed to make it more difficult for public agencies to enter the retail electricity business.Advertisements for Proposition 16 are some of the most played political ads on the air. It's a multi-million dollar campaign by Prop. 16 supporters calling for preserving the public's right to vote.

"In a time like this when our economy is really hurting, when local communities and the state are $145 billion in debt, tax payers and voters should be able to decide what's in their own best interest," said Prop. 16 supporter Robin Swanson.

Critics charge that the controversial initiative is actually only in the best interest of Pacific Gas and Electric, which is bank rolling the campaign. They've put in more than $40 million in share holder money so far.

"Proposition 16 is an attempt by one corporation, PG&E to buy the California constitution for its own purpose," said Mark Toney, the executive director of The Utility Reform Network.

Opponents say it that could cut competition and protect PG&E's profits.

Prop. 16 requires that cities will have to get a two-thirds public vote to create or run their own utilities district instead of using the privately owned utility.

In Central and Northern California, that provider is PG&E. In Southern California, there are already a number of municipal providers like Los Angeles Department of Water and Power.

Critics say the initiative could seriously impact how they sign up new customers.

"The reason why the California Realtors Association is against Prop. 16 is because anytime a new housing development is built in an area with municipal power, it requires a two-thirds vote," said Toney.

"PG&E isn't afraid to put their plans in front of someone else's plans and ask voters to weigh in," said Swanson.

Voters will decide this electrically charged issue June 8.

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