Voters question $1B deal to sell ML&P on April ballot
Municipality of Anchorage officials and the CEO of Chugach Electric went before the public Monday to defend Chugach's proposed purchase of Municipal Light & Power, which voters will approve in next month's election.
Proposition 10 lays out a path for Chugach to pay up to $1 billion for the city-owned electric utility. However, some voters at Monday's town hall accused municipal leaders of tainting the process and opening themselves up to a lawsuit.
“It’s what’s the best value for the people of Anchorage,” Chugach CEO Lee Thibert said.
Thibert doesn’t take the billion-dollar price tag lightly. On Monday night, he told Anchorage voters that right now is the best time to buy ML&P because of low interest rates. Thibert laid out a plan that would neither increase rates nor lay off employees. He said the merger would streamline services that are currently duplicated, saying the deal “was the right thing to do.”
Not everyone gathered at the Loussac Library agreed, however.
“This seems to be an attempt to some degree to exploit a loophole in the muni charter,” said Adam Jackson, who took issue with the fact that Prop 10 asks voters to decide two questions: whether the municipality has the power to sell ML&P, and whether to lower the percentage of voters required for approval of the sale from 60 percent to 50 percent.
“It makes me uncomfortable that we're lowering the standard for the sale of for all intents and purposes -- (for) not including mineral sales, the state's biggest asset ever going to be sold,” Jackson said.
The municipality’s manager, Bill Falsey, had anticipated that question. He says the 60 percent threshold is usually for issues about minority rights, not the sale of an electric company. Falsey also says the state constitution only requires a simple majority.
“I hope we have not been underselling this," Falsey said. "I'm happy to have that conversation in the broad light of day. We have a good reason for 50 percent, and if there's a solid public policy reason it should be 60 percent, we can have that conversation.”
Another issue raised was the fact that five other companies bid to buy ML&P besides Chugach, leading to concerns the municipality didn't seriously consider them. Another voter wondered if the five companies were dissatisfied with the way the muni handled the process and wanted to know if there a possibility of a lawsuit filed against the municipality.
Falsey said officials looked at the other bids, but at the end of the day the Assembly and the Anchorage Economic Development Corp. asked them to consider Chugach Electric and that Chugach is the best choice.
“If they walked in the door and said, 'This is a much better deal,' our response to the Assembly would have been, 'AEDC and the Assembly told us to look at Chugach but guys, there is something else you should have looked at.'”
If you missed the town hall, it will be replayed on the muni's TV Channel 9 through April 3, the day you have to have your ballots postmarked.
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