Prop. 9 and Utility Rates

I am thankful that you gave equal time in reporting on Prop. 9 (Sept. 27), the initiative to block the bailout of the utility industry by California ratepayers. However, there are errors I would like to address.

The writer says the legislative analyst agrees that the passing of Prop. 9 will lead to tax increases. On the contrary, the state legislative analyst’s office has studied Prop. 9 more carefully than any other ballot measure. They did not put the possibility of a tax increase in the voter’s pamphlet as it was too misleading, and in the words of deputy legislative analyst Mac Taylor, “It just seemed almost inconceivable.” Although the utilities could have challenged these facts before the printing, they declined.

No one can predict the outcome of Prop. 9’s passing, but I will make an attempt: The utilities will not go broke if they have to absorb their own bad debts. Shutting down only the most inefficient (and thrice-paid-for) nuclear plants will not bring a massive blackout. New energy providers will finally be able to enter our market without being squeezed by the big three utilities and thus offer more competitive rates. Most important: The law that authorized the bonds taken out by the utilities to subsidize our phony 10% “rate reduction” specifically states that repaying the bonds will be the responsibility of the utilities--not the state and not the taxpayers.

JENNIFER JOOS

Los Angeles

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Proponents of Prop. 9, although well-intentioned, did miscalculate the implications its passage would bring to California. Dismantling competition now will have the opposite effect intended by Prop. 9. The real result will be higher electric rates and higher taxes for all California residents, even for the clients of the DWP and other municipally owned utilities who will not get any benefit from Prop. 9 but will get all of its negative consequences.

Prop. 9 seeks to nullify $6 billion in bonds issued by the State Infrastructure Bank and already sold to investors. Interference with these bonds makes the state and all of us liable for their repayment. How do you think the state will come up with $6 billion? Raising taxes or reducing services.

Let’s be real: What Prop. 9 might bring is an uncertain 10% additional cut in our electric bills and a certain double-digit increase in our state income and sales taxes.

HARRY BALDWIN

Councilman

City of San Gabriel