PUD objectivity is crucial
To help decide whether or not the Truckee Donner Public Utility District should move forward with its current broadband proposal, the district’s Board of Directors is considering a community survey.
As a major customer of the district’s electric service, we applaud that decision. And we hope a majority of the district’s directors will take steps to make sure this survey is truly objective. In other words, that it is managed and tabulated by parties with no vested interest in the outcomes and that it is structured in such a way that the questions are neutral, neither encouraging nor discouraging certain answers.
The April 26 “My Turn” column by Board President Ron Hemig offers some insight into just how important the larger board’s commitment to objectivity will be. For instance, Mr. Hemig writes, “the price for the (district’s proposed broadband) service is likely to be a little higher than what people are paying now.” He then suggests, “… a question that needs to be researched and resolved is whether people in Truckee will pay a bit more for vastly improved service.”
If statements like those serve as the basis for survey questions, I think most people would respond, “Yes, I’ll pay a bit more for vastly improved service.” But their response might be different if they knew that paying “a bit more” amounts to at least $130 more per year, and that “vastly improved service” features an Internet download speed that is as much as 300 percent slower than what is available from other companies in Truckee today.
Furthermore, Mr. Hemig indicates the district’s proposed service would actually be provided by one or more un-named and presumably unknown companies. Will those unknown companies offer a reliable service? Can they match the effective levels of 99 percent or better reliability that are offered by existing providers?
Later, Mr. Hemig claims the district has an “exit strategy” that will protect its electric and water customers in the event the district’s broadband plan fails. Again, that claim or similar statements ” in the context of a survey ” could be confusing.
Everyone wants more choice, whether it’s more choice in broadband or cars or restaurants. But choices simply don’t exist without some level of risk. When a private-sector company introduces a new choice, the risk is typically limited to the employees, investors, and customers of that company. When a governmental entity, like a public utility district, introduces a new choice, the risk is shared among every constituent, whether or not they are customers of the new service. And, in this case, the reality of that risk is daunting.
To make its plan work, the district requires several thousand ” not a few dozen, but thousands ” of people to sign up for a service that is more expensive, offers a slower download speed, and is provided by unproven companies. If those conditions are not appealing to thousands of customers, the district will default on its $24 million broadband loan and its credit will be marred. As a result, the district will find it more difficult and more costly to borrow money for other projects, including projects that could maintain or enhance the delivery of water and electric service.
So how do limits to the district’s borrowing ability ” or its cost of borrowing ” harm ratepayers? In the simplest terms, those scenarios mean the district could be required to turn elsewhere to help pay for expensive but critical improvement projects ” and that “elsewhere” could very well be a net increase in electric and water rates. In the end, the district’s ratepayers will be best served by a board that understands the importance of ” and works to ensure ” an objective survey conducted by objective parties.
Pete Abel is the vice president of community relations for Cebridge Connections
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