33 



contribution to deficit reduction, and certainly increased certainty 

 for Bonneville customers. 



The effort is not over with this proposal. First, the legislative 

 path can be a very rocky one. And if the final legislative product 

 deviates from our principles, we would oppose it. 



Second, after enactment of any legislation, there are still a con- 

 siderable number of questions. For example, what level of reserves 

 or service coverage would be required? What might the other bond 

 covenants look like? What of the timing of the issuances? There are 

 a wide variety of questions. 



In summary, the proposed legislation appears consistent with our 

 principles, and we support it. The significance of removing the un- 

 certainty of repayment acceleration cannot be overstated. We still 

 face risks from escalating fish and wildlife costs, nuclear decommis- 

 sioning costs, and resource acquisition uncertainty. 



Eliminating the repayment risk is a significant accomplishment. 

 Again, we appreciate the work of the delegation in securing this 

 proposal. 



Let me turn for a moment to Bonneville corporation status. Bon- 

 neville is a business that cannot act as such. Its personnel, budget- 

 ing and procurement systems and also the legal requirements may 

 work for a bureaucracy but not for a business. In order for BPA to 

 become more businesslike, it must shed these bureaucratic 

 trappings. 



PPC supports incorporation status for Bonneville because it is 

 the most direct path for achieving this goal. The path is not unex- 

 plored. There are some good models. Common among these models 

 are an ability to reduce staff without cumbersome reduction-in- 

 force procedures and the ability to act in the face of change. 



PPC will not support corporation status if achieving it crosses 

 some very bright lines. These include no lessening of customer in- 

 volvement in BPA decision. making; no threat to preference, public 

 or regional; no changes to Bonneville's mission as laid out in the 

 Northwest Power Act and the Transmission Act; and again, we 

 would look for legislation aimed specifically at this particular pro- 

 posal. 



We also don't want to see the non-achievement of corporation 

 status to lead to a retrenchment in Bonneville. Administrator 

 Hardy has made it clear that that is his intention as well: to make 

 sure that Bonneville works for cost-effectiveness, £ind becomes more 

 efficient in any event. 



My point is that corporation status is the most straightforward 

 way of achieving these goals. Bonneville's existence in the role of 

 power supplier of choice to the members of PPC is currently imper- 

 iled by overstaffmg, slow decision making, increasing costs and rate 

 uncertainty. If we did not expect and desire a change, we would not 

 support corporation status. We would not examine refinancing if 

 we felt this couldn't lead to a more stable power supply and power 

 certainty. 



As stated above, we expect that these changes along with the 

 other actions that Bonneville is undertaking right now will lead to 

 a more responsive and cost-effective power supplier if this comes to 

 pass, and if Bonneville continues to increase its responsiveness to 

 its customers, we expect the relationship between BPA and its cus- 



