Nothing unites Northwest leaders like threat to BPA
By CHARLES POPE
SEATTLE POST-INTELLIGENCER
Tuesday, March 21, 2006
WASHINGTON -- Outside the Pacific Northwest, the Bonneville Power Administration barely registers. When it does, the giant power producer is apt to be confused with a British oil company or even the Boardgame Players Association.
But on Capitol Hill there is no confusion:
The federal agency that provides 40 percent of the power consumed in Washington, Oregon, Idaho and Montana is a formidable political force, protected fiercely and with remarkable success by its patrons from the Northwest.
That long-running fact of life in Congress is on display yet again this year as a plan by the White House to siphon $1 billion in excess BPA profits over the next 10 years has run into heavy opposition.
Critics call the plan unfair and a tax on ratepayers, even though it would raise the average power bill by less than $25 a year. The White House says the request is reasonable and necessary if the deficit is to be cut in half by 2009.
"Their proposal will never become law," promised Sen. Larry Craig, R-Idaho, a conservative Westerner who normally is one of President Bush's most reliable friends.
Craig has reason to be confident. History is on his side. Last year, when Bush sought to change the way the BPA calculates its rates, the proposal was reduced to ashes in a matter of weeks. Presidents as far back as Jimmy Carter and Ronald Reagan have tried to tamper with the BPA. They failed.
The power of the BPA is rooted in its history, and it's the reason any attempt to claim some of its budget or change the way it operates provokes an instantaneous and bipartisan storm. Northwest lawmakers who have trouble agreeing on much else rally around the BPA. Rep. Rick Larsen, D-Wash., explains the devotion this way: Cheap, abundant power "is the cornerstone of our economy, and I don't think (the budget office) understands that role and our history."
Like cars in Michigan and wheat in Kansas, the BPA is woven deeply into the fabric of the Northwest. Lawmakers from the region see themselves as its board of directors and protectors, and they take the role very seriously.
"I don't know if it's jealousy or they just don't understand what the concept is," Sen. Patty Murray, D-Wash., said of the White House's repeated attempts to claim some of the BPA's funding. Like her colleagues, Murray has promised an all-out fight to kill the budget provision.
"But if you're going to be a legislator from the Northwest, then part of your portfolio is fighting for Hanford funding and BPA."
Politicians who seldom are together in the same room readily sign letters defending the agency. This year alone, in the Senate Democrats Murray, Maria Cantwell of Washington and Ron Wyden of Oregon co-authored a letter of protest with Republicans Craig, Gordon Smith of Oregon and Mike Crapo of Idaho.
In the House, liberal Democrats Jay Inslee of Washington and Peter DeFazio of Oregon along with two conservative members, Reps. Doc Hastings and Cathy McMorris of Washington, endorsed a separate effort.
"We have made our voice pretty clear. We are united," McMorris said.
Former Oregon Sen. Mark Hatfield, a Republican, explained the region's view of the BPA this way: "All we had to do was to threaten the Department of Energy secretary, or let them know we were unhappy and give them a scowl on our face, in order to get our way on Bonneville."
That attitude remains today.
On most days Craig is one of Bush's most reliable supporters, but when the question involves the BPA, he is willing to lock arms with liberal Democrats.
Every lawmaker said the decision to buck his or her party in the name of the BPA was an easy one to make.
"It's not a partisan issue. It's a regional fight and it's OMB looking for ways to get easy money," said Smith, the Republican from Oregon.
The power of the BPA is so strong that when Energy Secretary Samuel Bodman appeared before the Senate Energy Committee earlier this month, Wyden told him that if he had known of the BPA language in the budget, he would have blocked Bodman's confirmation. Wyden later referred to the proposal as "economic poison" for the region.
Congress created the BPA in 1937 following a promise Franklin Roosevelt made five years earlier to electrify the nation and promote public power. The pledge was especially strong in the Northwest, which was largely undeveloped yet had enormous potential because of the Columbia and Snake rivers.
Roosevelt's promise was solidified -- literally -- by the Grand Coulee Dam, which began producing power in 1941. The dam was so large it was called the eighth Wonder of the World and even today it remains the largest concrete structure ever built. Despite its age, only two dams in the world produce more power.
Fathers, sons, uncles and grandfathers from across the state helped build the dam, further tightening the bond.
And while those direct links have loosened with age, the BPA still leaves a large footprint. The advent of cheap, abundant power triggered Washington's growth, attracting aluminum plants and aerospace and other energy-hungry industries.
The BPA is a federal agency but it does not receive direct federal funds. It operates largely as a stand-alone business but is required to repay federal loans that financed construction of dams and power lines in the Northwest.
Critics call that loan a subsidy, but the BPA and its defenders insist the utility has never gotten a subsidy and is repaying all federal funds ahead of schedule.
White House budget officials say the new plan would allow the utility to pay down its debt at a faster rate.
Bodman and other officials have defended the plan as consistent with sound business practices, noting that BPA revenues would only be tapped once they exceed $500 million. BPA officials expect to generate annual surpluses of about $650 million through 2009.
And they say BPA customers would benefit in the long-term through lower rates and upgraded infrastructure.
Under law, BPA power must be offered first to Northwest utilities and only if there is surplus power can it be offered for sale outside the region.
Today, the BPA markets the power generated at 31 federal dams, one non-federal nuclear plant at Hanford and some non-federal power plants, such as wind projects, to major utilities across the Northwest. About 70 percent of the power consumed in Washington is supplied by the BPA. Seattle City Lights relies on it for nearly 40 percent of the power it supplies to its 365,000 customers.
Given that history and the agency's central role in the region's economy, it's not surprising that lawmakers lord over the BPA, moving to protect it from even the slightest intrusion.
While experts provide a variety of reasons for the frequent attempts to tamper with the BPA's unique structure, its supporters in Congress offer two explanations.
The first is jealousy. Virtually all of the power the BPA provides is produced by hydroelectric dams, making it among the cheapest in the nation. The other explanation is based in budget politics. Bush has made cutting the deficit a high priority. The problem, however, is that money is extremely tight and there aren't many places to find "big numbers" that can be redirected against the deficit.
The BPA is one.
"OMB has a Rolodex and inside the Rolodex is something called revenue raisers. And one of them is, 'Take some of BPA's money,' " Craig explains. "Carter tried it, Reagan tried it, Clinton tried and now Bush II is trying it. And it ain't theirs to take without first trying working directly with the region instead of forcing upon the region."
Posted by Arthur Caldicott on 21 Mar 2006