92 



that this idea ought to go forward. There is tremendous value in 

 resolving this issue for the Northwest, so we don't live under that 

 continuous threat of repayment acceleration. And you and other 

 members of the delegation have consistently beaten back these ef- 

 forts in the past, and the argument was that the Northwest was 

 getting a subsidy. And our answer was, these were deals, business- 

 like deals at current interest rates that built a power system in 

 this region, and in fact there is a study by Alex Radon that shows 

 that the Northwest is paying back more of its investment in Fed- 

 eral water projects than other regions, because there is no cash 

 register attached to a lot of these projects. 



So given that, we took a principled stance over the years, and 

 now there is sort of an increment that has been added to this as 

 part of making this package one that is acceptable, but that it was 

 important at least that we maintain that argument. There isn't a 

 subsidy in the Northwest, and there should not be a payment be- 

 yond the businesslike deal that has been made, that would be com- 

 mon in the private sector, in changing the way in which debts are 

 repaid. This is a supplement to that, we understand that. We 

 would like to point that out. 



The claims language came from a press release that I think is 

 not accurate in terms of how the legislation is drafted. We picked 

 that up, and would like to change that. 



Mr. DeFazio. No, I mean, I have very vociferously rejected the 

 idea of subsidy, but at some point I see there is a value in getting 

 some predictability, stability. If you want to look at this as like 

 your typical home refinancing, if you owe $100,000 on your house 

 and the bank says, We really need some money and we will settle 

 your loan for $67,000 today, you probably don't have that in cash 

 so you have got to go out and finance it, and we will charge you 

 two points or a point or whatever. You would probably say, That 

 is a good deal, I will take that. If you want to simplify the whole 

 thing, I think that is perhaps the way to look at it. I think it is 

 a business transaction. 



Obviously we want to get the best deal possible. I think we have 

 done fairly well here. 



Mr. Johnson. We think it is a good deal. 



Mr. DeFazio. I am going to abuse the privilege of the Chair here 

 with the red light on, but just for a moment, one more question. 



Mr. Cavanagh, can't the Council recommend a levy surcharge on 

 customers who deviate from the plan? 



Mr. Cavanagh. There are various possible remedies, Mr. Chair- 

 man. My hope is that in this case sunlight will be the best dis- 

 infectant. I really believe there is in the region a community of 

 opinion and a sense of general regional interest and stewardship 

 that can be activated in situations like this. 



I guess I hope it won't come to that but I think we ought to set 

 ourselves the collective goal, and I hope the Council will take this 

 up, of making sure that practices like this are eliminated in part 

 because, Mr. Chairman, you have made a terrific deal here. But, 

 you know, a revenue-neutral refinancing of Bonneville's debt won't 

 end claims that rates in the Northwest are subsidized. It won't end 

 the kind of policy arguments I was referring to. People who behave 



