VIA ELECTRONIC MAIL
August 8, 2023
Councilmember David Cohen, Chair
Councilmember Rosemary Kamai, Vice Chair
Councilmembers Dev Davis, Pam Foley and Sergio Jimenez
San Jose City Council Rules and Open Government Committee 200 E. Santa Clara Street
San Jose, California 95113
RE: San Jose City Proposal to Launch a Municipal Electric Utility – Council Agenda Item 6.1 On behalf of the more than 27,000 members of International Brotherhood of Electrical Workers, Local Union 1245 (IBEW 1245), including those working in San Jose, I write to express our profound concern with the proposal for the City of San Jose to begin municipal retail electric service.
Such a step would eventually displace some IBEW 1245 members working for Pacific Gas and Electric Company in and around the City of San Jose. IBEW 1245 and numerous other stakeholders have not been made aware of this significant action in advance of the item being calendared. In fact, the very obscure manner in which this is being brought forward appears designed to stifle public debate on the subject.
When this issue was brought forward by Staff last September, concerns were expressed by Council members as to the feasibility and cost of this step. Staff assured the Council then that it would endeavor to analyze the impacts of starting a SJC Municipal Electric Utility. Yet the Staff Memo does no such thing.
There is no analysis of the size or scale of this proposal. There is no estimate of costs, especially the need to build a new substation to accept SJC MEU power. There is no estimate of customer rates or load forecasts. Finally, there is no clear delineation of how this new MEU would operate in conjunction with or separate from the existing SJC CCA. These are all critical questions that should be reviewed before taking any action, much less significantly amending the Municipal Code.
On behalf of the members of IBEW 1245, particularly those working in San Jose, I respectfully urge you to delay consideration of this item on SJC providing retail electric service until real outreach to stakeholders has been completed and the IBEW can provide input on this issue.
Sincerely,
Assistant Business Manager
cc: Committee on Rules and Open Government
IBEW Local Union 1245
www.ibew1245.com BOB DEAN, BUSINESS MANAGER
CECELIA DE LA TORRE, PRESIDENT
[External Email]
This message is from outside the City email system Do not open links or attachments from untrusted sources General Fund and Workforce Impact Concerns
Jean Cohen
Wed 8/9/2023 11:06 AM
To:Cohen, David [email protected] ;Kamei, Rosemary [email protected] ;Davis, Dev <[email protected]>;Foley, Pam <[email protected]>;Jimenez, Sergio <[email protected]>
Cc:Rules and Open Government Committee Agendas <[email protected]>;Javier Casillas ;Stern, Hunter ;David Bini ;Klein, Nanci
<[email protected]>
You don't often get email from Learn why thi i important Dear San Jose Rules Committee Members:
We are requesting that you hold item 6.1 on the August 15th agenda due to lack of stakeholder engagement and policy analysis regarding the City of San Jose's Municipal Electric Utility. Creating vulnerabilities to the city general fund and negatively impacting the local workforce are serious concerns that should be evaluated and publicly discussed. The Office of Economic Development directly communicated their commitment to an engagement process and there has not been sufficient outreach to any stakeholders on a project of this scope and scale.
Thank you for your consideration.
Sincerely,
Jean Cohen
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Jean F. Cohen
Executive Officer
South Bay Labor Council
Christina Ramos
Sr. Local Government Affairs
Representative
Local Government Affairs
August 9, 2023
RE: Rules Agenda for August 9, 2023 – Item 1 Review Final Agenda for August 15, 2023 Dear Rules and Open Government Committee Members –
I’m writing to express concern over upcoming item 6.1 on the August 15, 2023 City Council agenda which seeks to amend the city’s municipal code to enable creation of a government-run electric utility.
Our concern is that the city appears not to have conducted a thorough of analysis of the feasibility and of the financial risk to both the city and its residents in forming a government-run utility.
The memorandum that is driving item 6.1 contains several omissions and mischaracterizations that illustrate the need for the city to conduct a more thorough analysis. For example, the staff memorandum assumes that a government-run utility would be able to provide lower rates to its customers, without impacting the level of service, while also maintaining the same level of support for the city’s General Fund. Creating a municipal utility could result in obstacles if the new entity wanted to make payments in lieu of taxes (PILOT) to make government entities whole, as is discussed in the city’s memo. Generally, these entities cannot pay or replace lost revenue to governmental agencies (such as fire departments or school districts) without obtaining 2/3 voter approval. This would essentially amount to new taxes paid by San Jose residents and does not appear to be thoroughly analyzed by the city.
Voters in San Jose have routinely identified topics such as homelessness, housing affordability and public safety as their top priorities. Exploring an unnecessary, and potentially risky creation of a municipal utility diverts precious city resources away from these more pressing issues.
PG&E is proud to provide gas and electric service to the City of San Jose and its residents. Some of the concerns raised in the city’s memorandum would benefit from additional context, discussion, and analysis. We have significant investments planned to support the economic growth and vitality of the city and we look forward to engaging with each of you to discuss our plans and how we will continue to partner with you going forward.
I respectfully ask that the city postpone this item, engage with PG&E, our labor partners and other impacted stakeholders before you decide to move forward.
In community,
Christina Ramos, Sr. Local Government Affairs Representative Cc: Vice Mayor Kamei, District 1
Councilmember Jimenez, District 2
Councilmember Cohen, District 4
Councilmember Davis, District 6
Councilmember Foley, District 9
Toni Taber, City Clerk