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News-Press editorial got it wrong

July 13, 2012

I take issue with two statements in the July 7 editorial on electric revenue transfers. First is the statement that the utility “was set up to support the city as a whole.” Originally known as PSD (Public Service Department), it existed to provide water and power to ratepayers. News-Press articles I've seen from 1940 and 1941 reported PRD was yearly accumulating growing surpluses but due to “charter restrictions against the use of PSD revenues for general government,” that surplus could not be transferred to the general fund. So it was that in 1941, the charter was amended to allow PDS surpluses, for the first time, to be transferred.

Second, the editorial implies that absent the transfer, the city's ability to provide general governmental services would be jeopardized. The city is free to raise revenues for these services if it submits the increase for voter approval. The issue is whether the city allow its electorate's voice on increased revenues to support the budget's priorities, or whether it, in conflict with the charter, will gag that voice with the transfer.

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I say “in conflict with the charter” because Art. XI, sec. 20 proscribes the monies credited to GWP's Surplus Fund (where they can be transferred for other than GWP uses) as the excess, if any, in the utility's revenue funds after all GWP budgeted appropriations have been satisfied. The transfer cannot be the $21million budgeted appropriation and at the same time, as mandated by charter, be the excess left, if any, after the budgeted appropriations have been satisfied.

Harry Zavos

Glendale


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