Traverse City Record-Eagle

Opinion

THE ISSUE

n City pressing L&P for bayfront bounty

Our view

n $1 million contribution seems imminent, but control is the question

February 19, 2012

Our view: City, L&P need to find middle ground

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It appears likely that Traverse City Light & Power, the city-owned electric company, will submit to some not-so-subtle arm twisting and hand over $1 million from its flush coffers to help spark bayfront redevelopment plans.

That's the bottom line after a Feb. 14 Light & Power board meeting, a tense, occasionally prickly affair during which board members — some only grudgingly, one not at all — agreed to a process that eventually could route utility money to the bayfront effort.

The city needs $2.6 million for its favored bayfront design, and thus far has accumulated $1.4 million. The Light & Power money, a fraction of the utility's ratepayer-generated $30 million savings account, would pretty much guarantee that years of discussion and planning will result in a vastly updated, sparkling city jewel along West Bay.

Light & Power board members surely know this is the reasonable thing to do, and for a variety of reasons. The utility bungled more than a few issues over the past half-decade, public relations fiascoes that included an ill-conceived notion to run high-voltage power lines through the heart of westside neighborhoods and the wrong-place, wrong-time biomass plant scheme.

Light & Power could use good publicity, and board members have to realize the bayfront is a winner in waiting.

But some obviously are irked over being muscled and maneuvered into this position, largely by Traverse City Mayor Michael Estes, himself a former Light & Power board member. Estes and others believe Light & Power has long had too much autonomy — the city commission approves its budgets and the utility is required to kick back to the city a portion of its annual revenues, but that's about it — and they think Light & Power for too long has acted with only its own interests in mind. They want the utility defined as more of a city department, and less as an individual city-state.

In that vein, the city commission, through a series of appointments and fortuitous elections, in recent years made inroads on the highly insular Light & Power board's membership, to the point where Estes and company established what's likely a game-changing utility board makeup. No doubt the chess pieces certainly are moving in that direction.

Tension created by that likelihood was palpable at the Valentine's Day meeting, when some Light & Power board members bristled at the $1 million bayfront contribution question. Board Chairman Mike Coco cautioned that utility money shouldn't be parceled to other uses.

Other board members want any Light & Power contribution dedicated to a specific, verifiable aspect of the bayfront plan, something the utility could "hang its hat on," board member Linda Johnson said.

Utility Executive Director Ed Rice argued that upcoming projects will heavily tap into Light & Power coffers, and its reserves otherwise should be maintained in case it's confronted by some sort of catastrophe.

Light & Power's cumulative angst is understandable, to a degree. The city charter does guarantee the utility a certain amount of buffering from city commission tentacles, including political whim. City voters in 2010 affirmed some separation.

Old-guard utility board members fear losing autonomy, but their occasional arms-length — or worse — attitude toward the public process put them in this fix. Light & Power autonomy morphed into autocracy somewhere along the line, and Estes' approach has helped push the pendulum more to the center, where it ought to be. But the two sides clearly are poking, prodding and testing each other to determine where that middle ground will lie.

Key questions remain unanswered: What is the Estes faction's ultimate goal in regard to city access to utility ratepayer revenues? Is more of that money fair game, or does the city charter limit payments to the current 5 percent?

And just what is Light & Power's grand plan, anyway? Are they mainly an energy distributor, or do they continue to have designs on being a bigger player in the power generation game?

At its face, the debate is about a $1 million bayfront bonanza.

But at its heart, it's all about control.

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