San Diego-Area Officials Hold Strategy Meeting on Utility Merger

Representatives of 12 San Diego County municipalities and county government gathered here Wednesday to plot strategy in a first--and largely symbolic--show of unified concern about the planned merger of San Diego Gas & Electric Co. and Southern California Edison Co.

The closed-door session in Mayor Maureen O’Connor’s office was devoted to a review of the cities’ options and produced no agreements. But a news conference after the session allowed O’Connor and other city leaders to present a show of strength on the question of whether the proposed $2.4-billion takeover of SDG&E; by Edison’s parent company, SCEcorp, should be allowed.

“I think everybody’s cautious here, (because) we want to have fair and open hearings,” O’Connor said. “But I think that there was united opinion in there that everyone is concerned” about the merger’s impact on SDG&E;’s 1 million ratepayers.

On the advice of attorneys, elected officials have so far used cautious terms to describe their reactions to the proposed merger. Expressions of outright opposition before hearings are held might jeopardize an official’s right to vote on the matter, San Diego Assistant City Atty. Curtis Fitzpatrick said.

O’Connor disclosed that she would urge SDG&E;’s Board of Directors to reconsider its Dec. 1 decision to merge with Rosemead-based SCEcorp in light of accusations Monday that Edison gave preferential treatment to a sister company in a pattern of “self-dealing” that has cost its customers at least $124 million in excessive electricity costs.

The California Public Utilities Commission’s Division of Ratepayer Advocates recommended that Edison be forced to refund the money.

O’Connor said she would distribute the letter urging reconsideration at a meeting Monday of San Diego County members of the California League of Cities in an attempt to gain the backing of all of the county’s 17 cities for her initiative.

The cities of Carlsbad, Chula Vista, Coronado, Del Mar, El Cajon, Escondido, Imperial Beach, Lemon Grove, Poway, Santee, Solana Beach and San Diego were represented by mayors, vice mayors, council members or planning officials at Wednesday’s meeting. County Counsel Lloyd Harmon and an aide to County Supervisor Leon Williams represented the county.

San Diego and Chula Vista leaders have said they hold the power to veto the merger, based on their individual franchise agreements with SDG&E; contained in each city’s Charter. Only Chula Vista’s City Council has acted, though, voting Tuesday night to begin the proceedings necessary to condemn and acquire SDG&E; assets within the city limits.

“This is a good package for the (SDG&E;) shareholders,” Chula Vista Mayor Greg Cox said after Wednesday’s meeting. “It may not be for ratepayers.”

On Nov. 29, San Diego’s City Council voted in closed session to have City Atty. John Witt represent ratepayers before the PUC and other state and federal regulatory bodies that must approve the merger. The council, which will ratify the resolution publicly Monday, also instructed City Manager John Lockwood to study the possibility of acquiring SDG&E; assets in the city through condemnation.

O’Connor has taken a high-profile role in the campaign against the merger. On Tuesday night, as SDG&E; employees filed into a company meeting on the merger held at the Civic Theater, O’Connor’s aides handed out flyers asking them to contact the mayor’s office with concerns about the deal.

Fitzpatrick said Wednesday that the council will hold another private session next Tuesday to discuss the takeover proposal in more detail. He added that city attorneys are preparing a separate ordinance, which will be presented to the council in January, outlining the criteria by which they might approve or reject the merger.

The merger, if approved by the PUC and other regulatory bodies, would create the nation’s largest investor-owned utility, with 4.8 million customers and $8.2 billion in annual revenues.