Energy and Public Agencies CALAFCO 2010 Annual Conference October 8, 20109:00 a.m.

SF LAFCo History and Relevance SF LAFCo was formed in August 2000 as a result of an initiative petition to form a municipal utility district including the City of Brisbane and the City and County of San Francisco. When the initiative failed SF LAFCo needed to remain meaningful. –CCSF is a consolidated city and county so SF LAFCo doesn’t have the opportunity to use traditional LAFCo powers for incorporations, consolidations, or updating spheres of influence. SF LAFCo deals with this limited role by using its special study power. SF LAFCo has complete special studies on: –Energy; –Wireless communications; and –Green power (Clean Power SF).

LAFCo Special Study Powers One object of a LAFCo is to make studies and to obtain and furnish information which contributes to the logical and reasonable development of local agencies so as to advantageously provide for the present and future needs of each county and its communities. (§ 56301) A LAFCo is empowered to initiate and make studies of existing governmental agencies. (§ 56378) A LAFCo may also initiate proposals for, among other changes of organization, the formation of a new district or districts. (§56375(a)(2))

Use The Special Study Powers to Proactively Participate in a Community’s Energy Future With the broad authority of the special study power, a LAFCo can proactively participate in a community’s energy future by assessing current service levels and anticipating future service demands and infrastructure improvements.

Community Choice Aggregation – AB 117 AB 117 (2002) allows local communities, either individually or in cooperation with other communities, to aggregate the electrical load of interested consumers within its boundaries in a communitywide electricity buyers’ program. (cite statute…no need to go to LAFCO) Cities, counties, and any group of cities or counties may participate. The idea behind AB 117 is that local communities act as purchasing agents on behalf of their citizens without having to assume responsibility for maintaining the infrastructure, like a municipal utility must, for electricity generation and distribution.

San Francisco’s CCA Program Clean Power SF In 2004 San Francisco created a CCA Program, known as Clean Power SF, that includes a requirement for a 360 MW green power network. As of 2010, Clean Power SF has had its Implementation Plan approved by the CPUC and is in the process of selecting an Electric Service Provider so that it can commence operations.

Clean Power SF - SF LAFCo’s Role Consistent with its special study power, SF LAFCo was asked to monitor the implementation process, and advise the SFPUC and Board of Supervisors on the progress of Clean Power SF. SF LAFCo’s role includes monitoring and advising on SFPUC’s: –Submission of the Implementation Plan to the CPUC; –Implementation of Clean Power SF pursuant to the Implementation Plan; –Adoption of administrative procedures for Clean Power SF; –Submission of quarterly progress reports; –Preparation of annual Clean Power implementation management budgets; –Implementation of customer data safeguards; and –Selection of an Electric Service Provider.

Clean Power SF PG & E’s Local Opposition PG & E is headquartered in San Francisco. PG & E has sent out letters, flyers, and pamphlets attacking Clean Power SF and Marin Clean Energy, Marin County’s CCA program. PG & E has also made phone calls warning potential customers about the dangers of CCA programs. These actions are in violation of the statutory mandate in AB 117 that investor owned utilities, such as PG & E, cooperate with the implementation of CCA programs. The CPUC has reprimanded PG & E for its actions and found it in violation of state law.

Proposition 16 Proposition 16 was an initiative sponsored by PG&E that would have required 2/3rds voter approval before a local community could provide electrical services, either through a CCA program or utility district. Despite PG&E’s expenditure of approximately $46,000,000, Proposition 16 lost in the June 2010 election by a vote of 52.5% to 47.5%. In PG&E’s service area, Proposition 16 received a “no” vote of over 60%.

Proposition 16 - County by County 3 counties with greatest percentage of “yes” votes (none in PG&E’s service area): San Bernardino; Riverside; and Orange. 3 counties with greatest percentage of “no” votes (all in PG&E’s service area): Santa Cruz; Sonoma; and Yolo.

Educating Citizens on Ballot Measures Public funds cannot be spent to support or oppose the approval or rejection of a ballot measure. (Gov. Code, § 54964(a). –Public agencies can pass resolutions in support or opposition. (League of Women Voters of Calif. V. CCJCC (1988) 203 Cal.App.3d 529.) Public funds can be spent to provide educational information on the possible effects on a ballot measure on a local agency so long as its accurate, fair, and impartial. (Gov. Code, § 54964(c).) –Using public funds for campaign activities favoring or opposing a measure threatens the fairness of the electoral process and are constitutionally prohibited. (Vargas v. City of Salinas (2009) 46 Cal.4th 1.)

Proposition 16 Education and Opposition SF LAFCo passed a resolution in opposition and submitted a comment letter on Prop 16’s title to the Attorney General. –80 other local governments and municipal utilities passed resolutions in opposition. Organizations provided official support in the Voter Guide opposing Proposition 16 including AARP, the California Taxpayers Reform Association, the Sierra Club, and the League of Women Voters. –29 business organizations, and 95 non-governmental organizations, including the League of California Cities and CSAC, came out in opposition. 58 newspaper editorial boards came out in opposition including the San Diego Union Tribune, Los Angeles Times, and Sacramento Bee. The use of new social media (blogs, Facebook, Twitter) was also helpful.

Summary LAFCos have a broad special study power that enable them to participate in a wide range of community growth issues, including the provision of electricity. LAFCos may be presented with proposals to related to municipal or public utility districts, including the formation of new districts. –LAFCos may also be involved with communities forming CCA programs. Through the special study power LAFCos can ensure that they fulfill their role in ensuring logical and reasonable development of communities and their energy needs.