MUD in Your Eye

A small group wants to foist a municipal utility district on the city without evidence its version of "public power" will work. Demand evidence.

But in the last year or so, San Francisco hasn't lived in normal conditions. An odd confluence of events has scrambled political power relationships: A dot-com explosion gentrified neighborhoods at fiber-optic speed, displacing and terrifying working-class residents. Mayor Willie Brown's imperious, ethics-challenged style of governance spawned broad voter revulsion against the invertebrate ciphers he backed as supervisorial candidates. A change in the city charter made candidates for the Board of Supervisors run in districts, rather than citywide. When the dust settled after last fall's election, a set of self-described progressives with no allegiance whatever to Willie Brown suddenly dominated the city's governing body.

As it happened, the Bay Guardian had endorsed many of these candidates. At the same time, the Bay Guardian was pushing the latest manifestation of its 30-year campaign for public power, the MUD, and many of these candidates signed onto the effort.

Last fall, the Board of Supervisors created a five-member Local Agency Formation Commission, or LAFCO, to investigate the advisability of forming a MUD. Four of the members are left-leaning supervisors backed by the Guardian; to no one's surprise, the LAFCO found a MUD to be a fine idea, and the Board of Supervisors put the MUD measure on the November ballot.

But there is an elephant-in-the-living-room-sized problem with the MUD proposal. As Peter Byrne explains in this week's issue, the LAFCO has not commissioned a study of the financial feasibility of the MUD. In fact, the LAFCO has gone out of its way not to study the costs and benefits of a MUD, or alternatives to it.

So if things stay as they are now, voters in San Francisco and Brisbane will decide this fall whether they want to create a new governmental entity that would raise and spend hundreds of millions or billions of dollars to seize control of local electrical service from PG&E -- but the decision will be made without the benefit of even basic financial information about this vast and potentially risky undertaking.

How much would the MUD have to pay PG&E for its power lines? Would the MUD also purchase power plants? If so, how much would they cost? After it borrows hundreds of millions or billions of dollars to purchase assets, would the MUD charge consumers lower, higher, or the same electric rates, when compared with other "public power" alternatives, and, yes, continued PG&E service?

If, within California's current, chaotic electric power market, a MUD could be shown, with hard facts, to have a high probability of cutting electric rates and ensuring power supplies for the future -- and that's a huge if -- hey, let's make ourselves a MUD (unless there's an alternative that's cheaper and safer). But a MUD that wound up raising rates to cover the enormous cost of acquiring power plants and power lines would be a disaster that hurts all consumers. The poorest among us -- the people who have no disposable income to throw at higher electric bills -- would hurt the most.

No sentient human should vote for the MUD measure until and unless a financial consultant with unimpeachable energy credentials completes a full feasibility study of the district, and all reasonable alternatives. Charging into the middle of California's chaotic energy market with an enormously complex, multibillion-dollar municipalization project is not a board game San Franciscans ought to play. Proposing such a project while refusing to provide the type of basic financial information most people want before buying an automobile is not "progressive" governance. It's risky, stupid, arrogant behavior.


Initially, I thought this column would focus significantly on the behavior of Brugmann and the Bay Guardian in regard to the MUD campaign. Records on file at the city's Ethics Commission show Brugmann, the Guardian's publisher, loaning tens of thousands of dollars, at zero interest, to the campaign committee pushing creation of the MUD. Those records show the Guardian donating tens of thousands of dollars in advertising space to the same committee. The Guardianmentioned the contributions in a story last summer, but since then, the paper's pages have repeatedly lavished praise on public power and the MUD, fulsomely and fawningly quoting representatives of the campaign committee, Coalition for Lower Utility Bills, with nary a mention that CLUB is financed almost wholly by Brugmann and the Guardian. To my mind, each story the Guardian does about the MUD campaign should disclose the financial relationship among the paper, its publisher, and CLUB; such disclosure would help readers realize that when the Guardian quotes representatives of CLUB, the paper is all but quoting itself. This failure to disclose seems to me a major ethical lapse.

But rather than fulminate at length, I decided to ask two simple questions, and let readers answer to, and for, themselves: 1) If San Francisco Chronicle Publisher John Oppedahl and the Hearst Corp., which owns the Chronicle, each committed tens of thousands of dollars toward the passage of a business-oriented ballot measure, and the Chron then failed to mention those campaign contributions in news or opinion pieces reflecting positively on the measure, what, pray tell, might we expect the San Francisco Bay Guardian to write? 2) Do you think anyone on the Guardian staff can define the word "hypocrisy"?

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