The following was a guest editorial by Alameda Public Utllities Board President Ann McCormick. It was published in the Alameda Journal on December 15th, 2006.

AP&T STILL RESPONDING TO
CHANGING NEEDS, TIMES

by Ann McCormick

Alameda Power and Telecom (AP&T) has been a fixture in the daily lives of Alameda residents for nearly 120 years, providing reliable electric service since 1887 and telecommunications services since 2000.  During that time we have consistently responded to the needs of our only customers — the people and businesses of Alameda.   

Throughout this history, AP&T has been a leader in innovation and involved in the major issues of the day, often created by forces far away.   Alameda was one of the first cities on the west coast to install electric street lighting, driving development of our local economy into the twentieth century. 

During the World War II era, local and reliable electric power was critical to the growth of Alameda naval air station in the face of world conflict and today AP&T is a community leader in base conversion to civilian uses. 

In recent years we have weathered the storm of California’s energy deregulation, insulating Alameda residents and businesses from rolling blackouts and rising prices during the electricity crisis of 2001.   And today, our city is a national role model of environmental stewardship with respect to climate change.   AP&T has a proven record of providing a steadying influence in an uncertain world.
 
AP&T faces a new challenge now, and we have a problem that must be solved. 

As has been published in recent issues of the Alameda Journal, the telecommunications portion of our business -- our local cable television and Internet services – have not met our expectations of profitability to support the considerable debt that has accrued to build our infrastructure and grow our service throughout the Island.   The system is now complete and, as is common with new business start-ups, the resulting financial obligations must now be met. 
 
In November 1998, Alameda voters approved the city’s plans to offer telecommunications services and products, and many of the benefits promoted then are valid today.  Competition keeps cable TV rates lower for all customers in Alameda, regardless of provider, and we have more options as compared to our neighbors around the Bay Area.    

And, in keeping with our tradition of innovation and service, operating a locally controlled system telecom system provides significant opportunity to respond to the needs of our community, such as our completion of fiber-optic facilities linking all 22 Alameda Unified School District sites.

During the course of our operation, however, the telecom industry has changed rapidly and the business plans prepared in past years to bring the telecom services to profitability no longer reflect the realities of today’s market.  There remain many benefits associated with continued operation of the system; however, these benefits must be balanced with our experiences in the telecom business to date and with future risks.   

The Public Utilities Board is fully committed to meeting this challenge and working expediently to find a solution that best meets the needs of Alameda.  We recognize that the choices that need to be made will not be easy.   We will consider a number of options that have been proposed along with new ideas as they develop, in a measured, transparent deliberation with ample opportunity for public input to help inform our decisions.

It is important to note that our electricity business remains strong.  Just as during the 2001 energy crisis, our ability to provide reliable power at significantly lower rates than those in surrounding communities will not be compromised.  We also remain committed to being one of the greenest utilities in the nation, and are proud that more than 80 percent of our power comes from renewable resources including wind and geothermal energy.

The PUB looks forward to continuing to work with residents, city finance officials and the City Council to resolve the telecom business issues.

Our next board meeting will be held at City Hall at 7 p.m. Monday. Our agenda will include discussion of our recent consultant’s report that outlines recommended operational changes to improve the business.  

Also, the consultant will be present to hear the concerns and answer questions from the board as well as the public.   A follow-up public workshop will be held in January and will include further presentation and discussion of various options for the future of the telecom business.  

Please watch for future notification about this public process.   Newspaper notices, utility bill inserts and Web site postings will all be utilized to keep Alameda residents and businesses aware of the process and the progress being made.

All residents of Alameda are shareholders of AP&T and have a stake in the outcome of our business.  We are committed to upholding our century-old legacy of public service in a fast-changing world by offering competitive products, lower rates and superior service for the residents of Alameda.