Most, but not enough, voters favor utility sale

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.

Even so, Norm Story, Homer Electric general manager, said he was pleased with the outcome.

"The majority of consumers said yes," he said.

Story said the most common complaint from Seward consumers was that, without a detailed proposal from Homer Electric, they lacked the information to judge whether selling the utility would be a good idea.

"Our intent is to continue discussions with the administration toward developing a firm proposal and being able to provide more accurate information to consumers about what the deal is," he said. "What the city has indicated all along was that this was that this was an educational process."

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.

Clarion reporter Doug Loshbaugh contributed to this story.