Proposed utility sale fails in advisory vote but issue not dead

Posted: Thursday, November 09, 2000

SOLDOTNA (AP) -- A majority of voters in Seward approved selling the city's small electric utility, but the count wasn't large enough to get it done.

The city of Seward requires 60 percent approval before it can sell public property. A ballot measure asking voters if they liked the idea of the city putting its electric utility up for sale won just 55 percent.

But the issue isn't dead.

Seward City Manager Scott Janke said about 1,000 voters turned out Tuesday in the city of about 3,000 and many supported the sale.

The city-sponsored advisory ballot got people talking, he said.

''The vote didn't matter,'' he told the Anchorage Daily News. ''The concerns won't go away.''

Janke said he's concerned that the 2,500-customer electric utility is vulnerable if the power market is deregulated. He contends that selling it now to a larger utility would be a wise investment.

Next, he said, the city may start talking with potential buyers.

The only utility to publicly show interest has been Homer Electric Association, a cooperative with 18,000 customers that supplies power to most of the Kenai Peninsula.

If the city comes up with a bid from a potential buyer, then it may call for another public vote, Janke said.

''It could take a month. It could take a year. It could take a couple of years,'' he said.

Seward's electric utility generates roughly $1 million a year in revenue. City leaders have said that if they can sell it for about $20 million, then the profits could spin off about $1 million in interest income.

Some of those critical of the sale have said they won't support it without a deal on the table.

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