51 



Mr. DeFazio. I thank the gentleman for his modest assessment 

 of the achievements of the task force, and the staff. 

 Mr. Sherrill. 



STATEMENT OF JAMES R. SHERRILL 



Mr. Sherrill. Good morning. My name is Jim Sherrill. I am the 

 general manager of Parkland Light and Water, which is a small 

 utility in the suburb of Tacoma. I am here this morning represent- 

 ing the Western Public Agency Group, which is a group of 14 pub- 

 licly owned utilities located in Washington State. 



We are a little more unique than the PPC in that we are mostly 

 full-requirements customers of Bonneville with very little genera- 

 tion. Therefore, we have a great deal of reliance upon Bonneville 

 Power Administration. 



The Western Public Agency Group purchases 25 percent of the 

 power sold by Bonneville to the publicly owned utilities. Concern- 

 ing refinancing of Bonneville debt, the Western Public Agency 

 Group would support legislation giving Bonneville a one-time op- 

 portunity to borrow money from the private financial markets to 

 refinance appropriated debt. Summarizing that, the Western Public 

 Agency Group supports one-time authorization if such financing 

 can be achieved without a rate increase to Bonneville's customers. 



It should not include new borrowing authority. It should also not 

 affect a revision of Bonneville's current debt cap. We believe that 

 we could support the administration's buyout proposal from a pre- 

 liminary review of it, but have not had an opportunity yet to look 

 at the full document to know what the details may encompass. 



Going on to changing Bonneville's status, while a shift in the sta- 

 tus to a government corporation has a potentially substantial bene- 

 fit, it also poses serious risks to its customers. By virtue of its size 

 and statutory authority, Bonneville exercises virtual nionopoly 

 power in a variety of areas, including both power supply, high volt- 

 age transmission, and product pricing. 



If the current institutional constraints are removed from Bonne- 

 ville, they must be replaced with viable market forces. This can be 

 accomplished by ensuring Bonneville's customers are given mean- 

 ingful freedom of choice. 



To expand on that, if you are trying to have an efficient Bonne- 

 ville, the customers have to have an efficient way in order to re- 

 spond to the market forces also. It has to work both ways. 



The Western Public Agency Group is more interested in results 

 than the particular form used to achieve them. As Bonneville cus- 

 tomers, we need a Bonneville that has specific, limited powers and 

 duties, that is focused on its primary task of serving its customers, 

 that can act promptly in response to customers and market forces. 



Changing Bonneville's status from a federal agency to a govern- 

 ment corporation may be a way of achieving these goals. There 

 may be other approaches that may work just as well. 



In conclusion, the public agency group suggests giving Bonneville 

 a one-time opportunity to refinance public debt if it can be done 

 without a rate increase. Bonneville's future borrowing should con- 

 tinue to be financed at current rates from the Treasury and within 

 Bonneville's current borrowing authority. 



