Will the Utility Crisis Electrocute Public Services?

February 2001

SEIU State Council Director of Governmental Relations Allen Davenport addressed the Local 535 Executive Board meeting February 10, warning that the utility crisis will affect Californians in ways far beyond a rise in utility bills.

“I can tell you that this utility crisis is not a utility crisis for you as much as it is a fiscal crisis. While I was driving up here today the state spent $2 million to buy electricity at high prices and resell it to you and your retailers at low prices. That may make your bill a little less somewhere down the line, but it also makes the state budget less, and as long as the state sets the priorities of taking care of the utility debacle by using general fund revenues you are going to have a continued depletion of the $8 billion surplus that was announced in the January version of the governor’s budget. We have already spent probably $1 billion on this electricity buy-in, and we are likely to spend another billion before we get these bonds out on the market place that will finance the buying of electricity by ratepayers rather than taxpayers. It remains to be seen if bills will go down.

“This is not a utility crisis, but a fiscal crisis, which becomes a social worker caseload crisis, which becomes a hospital safety enforcement crisis. It becomes a home care worker wage increase crisis; it becomes a labor commissioner not doing anything crisis. All kinds of things that we rely on Governor Davis to do better than his predecessor, and most of which we were making some progress on–though slower than we would like–will depend on how we come out of this electricity crisis.