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Council News Release


FOR IMMEDIATE RELEASE:   
10/23/2006  5:25:00 PM
FOR MORE INFORMATION CONTACT:
Tom Van Bronkhorst, Godden Office, (206) 684-8807

Councilmember Jean Godden
Councilmember David Della
Councilmember Sally Clark
Councilmember Jan Drago
Councilmember Richard McIver
Councilmember Tom Rasmussen

COUNCIL COMMITTEE PROPOSES LOWER ELECTRICAL RATES
Seattle City Light Customers to Benefit from “Real Rate Relief”

SEATTLE –The Seattle City Council Energy and Technology Committee, today, voted to approve an electrical rate proposal that could reduce rates by as much as 8 % over the next two years. This rate proposal represents a larger decrease than the amount proposed earlier this year.

“Seattle City Light is now on solid financial footing and its future looks mega-watt bright,” said Councilmember Jean Godden, chair of the Energy and Technology Committee. “This decrease is largely due to the efforts of the community to come together and work for the betterment of Seattle City Light. Mayor Greg Nickels, City Light Superintendent Jorge Carrasco, City Councilmembers and community leaders all played a part in returning the utility to sound fiscal health.” Councilmember David J. Della, Vice Chair of the Energy Committee, said, “Working families and small businesses have enough worries. People shouldn’t have to struggle to pay their electric bills. This little bit of rate relief will go a long way in providing our city’s residents with pocketbook relief. ”

Since the Western Energy Crisis of 2001, City Light has made substantial progress in restoring its financial health. It has repaid all of the short-term debt incurred in 2001 and 2002. This includes the funds City Light borrowed from the city's cash pool. Councilmember Richard McIver, chair of the Finance and Budget Committee, said, “In 2001, we asked the ratepayers to pay a temporary surcharge to keep City Light financially sound. Now we can start fulfilling our pledge that such a measure was really transitory.”

The council adopted financial policies in 2003 and in 2005 to further bolster the utility's finances. These policies created a $25 million safety net and set goals for reducing the debt-to-equity ratio to 60 percent by 2010 — a goal that City Light is well on its way to achieving. In addition, City Light now maintains a healthy cash balance of more than $200 million dollars.

Councilmember Sally Clark, chair of the Economic Development and Neighborhoods Committee said, “There are many struggling new businesses throughout our city that will really benefit from rate reduction. Healthy small businesses are the backbone of thriving neighborhood business districts and I’m delighted to be able to offer assistance in the form of lower electric bills.”

Councilmember Jan Drago noted that City Light’s recovery was dependent of a variety of people working together. Said Councilmember Drago, “The workers, Superintendent Jorge Carrasco and his management team, Mayor Greg Nickels, numerous concerned citizens, and the City Council all set aside our differences to focus on a shared goal: saving City Light. During the energy crisis Seattle City Light ratepayers were there for the utility. Now is the time that we can be there for ratepayers and offer real rate relief.”

Councilmember Tom Rasmussen, chair of the Housing, Human Services, and Health Committee said, “City Light has done a remarkable job of accomplishing its fiscal goals while keeping our commitment to low-income and senior citizens who need help with their electric bills. I am happy to support rate relief for City Light customers.”

Since hearing the mayor’s recommendations on rate reductions on July 26th, the Energy & Technology Committee has been studying the dimensions of the rate case and listening to community leaders. Council members have developed a rate structure that will do three essential things: (1) meet Seattle City Light’s needs; (2) keep paying down debt, and (3) offer tangible savings to ratepayers over the next two years.

Councilmember Godden said, “I’m proud of all the work that the Council has done to balance the complex interests involved in this rate case. The proposal we have arrived at is a carefully balanced approach that is both financially responsible and fair to our ratepayers.”

The committee recommendation now goes before the full council for a final vote which is expected in late November. If adopted, new rates will take effect on January 1, 2007.

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