NEWS INFORMATION

PUBLIC UTILITIES BOARD HOLDS
ANNUAL BUDGET WORKSHOP

ALAMEDA, Calif., April 6, 2007 —At a workshop held last evening, the City of Alameda Public Utilities Board received an initial briefing on the development of Alameda Power & Telecom’s 2008 Fiscal Year Budget.

Public Utilities Board President Ann McCormick stated, “The top priorities for the Board and for Alameda Power & Telecom staff in this next year will continue to be safe and reliable system operation, increased revenue generation, and cost reduction. These will be achieved with as few impacts to service as possible.”

The budget proposal includes purchasing renewable energy, substantial capital project work such as the construction of a second electric feeder line to Coast Guard Island, and continuance of the utility’s undergrounding projects.

“The Fiscal Year 2008 Budget proposal presents our understanding of the Public Utilities Board’s direction for the enterprise,” said General Manager Girish Balachandran. “And it is certainly an austere budget proposal. We will monitor this budget closely and recommend mid-course corrections as warranted.”

For the first time since the inception of the telecommunications business line, the budget does not include an inter-fund advance. It does include continued implementation of several recommendations made in the December 2006 report, “An Analysis of Telecom Operations.”

Revenue increases include a modest rate adjustment, continued efforts to control customer churn, increased commercial Internet customers, and decreased incentive levels for cable television. Cost decreases include proposals to reduce payroll, elimination of the overflow call center, trimming studio production activities to a minimum, and using a more economical door-to-door sales approach. Operational efficiencies are expected to increase through a continued change in culture to ‘wear multiple hats.’ Major recommendations related to the inclusion of voice services are not incorporated in this budget. A transfer to the City’s General Fund of $2.5 million has been budgeted.

McCormick noted that Alameda Power & Telecom has allocated over $9 million in “green spending” for next year. “Our environmental expenditures fall into four categories, renewable power, energy efficiency, solar programs, and climate change initiatives.” At present, over 80% of the power consumed in Alameda is generated using clean, renewable resources. “And, unlike in other communities, Alameda residents don’t pay any premiums for this clean energy.”

Both McCormick and Balachandran agreed that there are difficult choices to be made. “We want to maintain and improve upon present service levels,” McCormick said. “Our goal is to set new standards for our municipal services. The Board will look to staff to do their best in providing them.”

“Because the residents of Alameda are our stockholders,” she continued, “the Board also will continue to emphasize transparency of and community involvement in our operations.”

Alameda Power & Telecom’s 2008 Fiscal Year begins on July 1, 2007, and ends on June 30, 2008. Comments on the budget document will be incorporated into a final draft and presented to the Board at its meeting on June 18. Materials presented to the Board are available on the meeting agenda page of the Alameda Power & Telecom web site.

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