City considers partnership with nonprofits

Posted: Thursday, May 01, 2008

Juneau Mayor Bruce Botelho wants the city to consider pairing up with nonprofit organizations in an effort to target residents who need the most help with skyrocketing electric bills.

Brenda Hewitt, president of the United Way of Southeast Alaska, said her organization and other local charities were perfectly poised to identify those who need the city's help and to get that help to them.

"That's what we do for a living," Hewitt said.

Botelho invited Hewitt to meet with the Juneau Assembly at a special meeting Thursday to discuss a possible partnership between the city and nonprofits to address the Juneau's current energy crisis. The city already relies on and funds nonprofits for much of the social services in the city, Hewitt said.

The mayor said other nonprofit organizations, such as day care centers, should also see some help from the city, and he was interested in partnering with the Juneau Economic Development Council to give some form of aid to small businesses that are likely to be hurt the most by the rate hikes.

"As a community, and as a city government, we have a compelling interest to sustain economic health," he said.

The mayor declined to give details of what any potential partnership between the city and nonprofits would look like, saying that he would present his plan at today's Assembly meeting. He added that the city needed to move "sooner rather than later" in addressing the energy crisis.

Botelho's invitation to Hewitt comes on the heels of the Assembly tabling a proposal earlier this week to give Alaska Electric Light & Power Co., the private electric utility that supplies Juneau's electricity, an interest-free $3 million loan in return for allowing its customers to spread out a three-month spike in electric prices over a 12-month period.

A public outcry derailed that proposal, and the Assembly scheduled today's meeting to consider giving AEL&P a $3 million loan in return for allowing its customers "to set up voluntary repayment plans ... and to protect Juneau's most vulnerable citizens."

Two weeks ago, avalanches wiped out part of the transmission lines and towers between town and the Snettisham hydroelectric project, which is normally the city's main source of power. Repairs are estimated to take three months, and AEL&P is providing most of the city's power through costly diesel fuel generation during that time. Some residential customers will see their electric bills this month rise by 447 percent.

Giving grants to low-income Juneau residents who are just above the poverty line is the best way to use the city's money during the energy crisis, Hewitt said.

She said Juneau residents who receive public assistance for housing likely won't have to pay extra for their skyrocketing electric bills and therefore won't need the city to help them out.

But those residents who are just getting by and face being plunged into poverty by sharp electric rate increases will have a negative effect on the entire economy if they are forced to quit their jobs and leave town or start draining other forms of public assistance, Hewitt said.

"This new added burden of an essential utility ... it's going to throw people below the poverty line when they weren't there before," Hewitt said. "The ripple effect, if (the city does not) help this most vulnerable group, is long lasting."

Hewitt said details of any plan with her organization were still being worked out. But she said any city aid that would go to residents likely would be in the form of vouchers, and would include incentives to encourage electric conservation. Income levels would determine who got helped first, she said.

"We're going to try and address as many people as we can, starting at the bottom and going until we run out of money," Hewitt said.

Assembly member Randy Wanamaker said he'd prefer having the city loan its money to help ratepayers rather than give the money away in the form of grants.

He added that he's concerned about residents who are higher up on the income ladder and would not be targeted for aid by the United Way but would still need some form of relief from high energy prices. He said he's worried that some residents will have to cover the rate hikes with their credit cards and then be stuck paying off high interest payments.

"Once you start distributing grants, they'll miss categories of people that deserve to be considered, and the money will be gone permanently," Wanamaker said.

AEL&P General Manager Tim McLeod said he thinks giving grants to low-income residents is a great idea and has directed those wanting to donate to help Juneau's energy crisis to give to the United Way.

McLeod added that he thinks the idea of giving his company an interest-free loan in return for allowing customers to gradually pay off the initial price hike will likely be reconsidered in the months ahead, after customers see how high their bills for this month are.

"I would not be too surprised," McLeod said.

• Contact reporter Alan Sudermanat 523-2268 or e-mail

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