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Sac Bee, Tues, 7/17: Jones demands probe of state's energy buyers=20 Sac Bee, Tues, 7/17: Energy Digest: PG&E's managers will get bonuses SD Union, Tues, 7/17: Bush's top team launches blitz for his energy agenda= =20 SD Union, Tues, 7/17: Davis aide foresees an end to rate hikes=20 SD Union, Tues, 7/17: Bankruptcy judge lets PG&E pay managers $17.5 million= =20 bonus=20 SD Union, Tues, 7/17: As power crisis eases, Davis sees a beneficial role f= or=20 deregulation=20 LA Times, Tues, 7/17: Churches Help Edison Aid the Poor SF Chron, Tues, 7/17: Consumers await word on rates=20 Report's delay, government bond issue raise questions about electricity pri= ce=20 increase=20 Mercury News, Tues, 7/17: Judge OKs bonuses for PG&E chiefs=20 OC Register, Tues, 7/17: Power of lies (Commentary)=20 LA Times, Tues, 7/17: THE NATION State Losing Ground in War on Dirty Air=20 Environment: Growth, lax enforcement are blamed for rising smog levels in some areas LA Times, Tues, 7/17: THE NATION In Support of Energy Plan, White House Bur= ns=20 Some Gas=20 Politics: Cheney, other Bush officials fan out to make what the president= =20 admits is a tough case LA Times, Tues, 7/17: The State Consultants' Stock Buys Questioned Energy:= =20 State official urges conflict of interest probe into purchases of shares in power firms. LA Times, Tues, 7/17: The State No Accord Near on Edison Rescue Legislature= :=20 With Davis' proposal languishing and rival versions being crafted, the issue continues to be=20 divisive WSJ, Tues, 7/17: Taking Charge: Hurt by Deregulation Of Utilities,=20 California Gives Itself Lead Role ---------------------------------------------------------------------------= --- ----------------------- Jones demands probe of state's energy buyers=20 By Amy Chance Bee Political Editor (Published July 17, 2001)=20 Secretary of State Bill Jones on Monday asked the state attorney general an= d=20 the Fair Political Practices Commission to investigate whether energy=20 consultants hired by the Davis administration violated state=20 conflict-of-interest law by holding stock in energy generators and utilitie= s=20 while buying electricity for the state.=20 Jones said recent reports that show several energy buyers held such stock,= =20 coupled with the fact that they failed to file reports of their financial= =20 holdings until last week, suggest that Gov. Gray Davis "hired them without= =20 any forethought and due diligence as to how they could personally and=20 financially benefit from being on the state payroll."=20 "This is either a miserable failure in executive management and leadership,= =20 or he and his administration have colluded in a blatant and possibly crimin= al=20 conflict of interest," said Jones, a Republican seeking to challenge Davis = in=20 next year's governor's race.=20 In particular, Jones pointed to a report filed by Vikram Budhraja, a=20 consultant in the Department of Water Resources' energy resources schedulin= g=20 division, who signed a $6.2 million, 23-month contract with the state.=20 Budhraja reported that he began working for the department on Jan. 25.=20 On Jan. 17 and 22, Budhraja acquired stock in Edison International valued a= t=20 between $10,001 and $100,000. He also bought stock in Dynegy, an energy=20 generator, in the same value range. He disposed of all the stock on Jan. 29= ,=20 noting on the form that he "divested holdings upon first opportunity after= =20 start of services."=20 He also reported that he had received income of more than $100,000 from=20 Edison International as "a retainer to provide consulting services upon=20 request." He noted that there was "none requested since the third quarter o= f=20 2000."=20 Jones said the contract Budhraja signed with the state, however, was dated= =20 Jan. 17, showing that he "entered into a $6.2 million contract with the sta= te=20 and the same day that Davis ordered a state of emergency and put the state= =20 into the power-buying business. Mr. Budhraja sold this stock within days an= d=20 pocketed a significant profit."=20 Davis spokesman Steven Maviglio said the contract was simply dated Jan. 17= =20 "for administrative payroll purposes." He said Budhraja met with Davis on= =20 Jan. 25 and began work for the state on Jan. 29.=20 "Any activity he had with Edison International was over and done with the= =20 minute he started his job," Maviglio said. "He said he called his broker an= d=20 said, 'Sell everything.' "=20 Budhraja also has a letter on file with the department that says he will do= =20 no business with Edison while employed by the state, Maviglio said.=20 While he did participate in negotiating contracts with Dynegy, Maviglio sai= d=20 he did so "weeks and months after he had sold his stock."=20 Administration lawyers are still looking at reports filed last week by othe= r=20 energy schedulers and traders that show they still hold stock with energy= =20 generators, particularly Calpine Corp.=20 The lawyers are examining whether those consultants buy electricity as part= =20 of their jobs and whether they have done any trading with Calpine.=20 "They may be in violation, for all we know," Maviglio said.=20 Representatives of the FPPC and attorney general said they are reviewing=20 Jones' request.=20 The Bee's Amy Chance can be reached at (916) 326-5535 or achance@sacbee.com= =20 <mailto:achance@sacbee.com<. Energy Digest: PG&E's managers will get bonuses (Published July 17, 2001)=20 SAN FRANCISCO -- A bankruptcy judge has approved executive bonuses at Pacif= ic=20 Gas and Electric Co., saying the 223 managers who will divide the $17.5=20 million pool are not responsible for California's energy woes.=20 For 23 of the senior executives, the plan provides bonuses equal to their= =20 base pay or, in the case of PG&E President and CEO Gordon Smith, $630,000.= =20 The bonuses for other managers will average $60,000.=20 PG&E, in proposing the payments, said it was worried that senior employees= =20 would flee to more secure and lucrative jobs, which could hamper the=20 utility's bankruptcy reorganization. Some consumer advocates opposed it,=20 saying the utility's customers ultimately would pay for it.=20 But U.S. Bankruptcy Judge Dennis Montali said he had been assured that no= =20 effort would be made to cover the cost with future rate increases.=20 In his opinion, Montali said the bonus program was needed to prevent=20 resignations that could damage PG&E, making it harder for creditors to=20 collect.=20 --Claire Cooper=20 Blackout image battled Aiming to dispel the notion that California is paralyzed by blackouts, a=20 coalition of economic development agencies today will begin a national publ= ic=20 relations campaign to improve the state's image.=20 The $150,000 campaign is called "The Power of California." Its goal is to= =20 convince the national media to create stories that show the state's economy= =20 hasn't been crippled by the energy crisis.=20 "It's an effort on our part to fight back," said Wayne Schell, chief=20 executive of the California Association for Local Economic Development.=20 The campaign is funded by local and regional economic development groups, h= e=20 said.=20 Barbara Hayes, executive director of the Sacramento Area Commerce and Trade= =20 Organization, said she was recruiting companies in New York this spring and= =20 was besieged with questions about power blackouts.=20 "The message that people outside California have is _ we are in the dark,"= =20 she said.=20 SACTO isn't aware of any companies that have refused to move here because o= f=20 the energy crisis, but it's possible that some companies have stopped makin= g=20 inquiries about the region because of the crisis, she said.=20 "You don't know how many 'looks' you're not getting," she said.=20 The crisis has prompted business recruiters from other states to step up=20 their efforts to take jobs away from California, although the groups in=20 Schell's organization say they haven't lost a single company.=20 California so far has escaped chronic power blackouts this summer, but some= =20 prominent economists have warned that the long-term power contracts signed = by=20 the state will leave California with high-priced electricity for years to= =20 come. Yet the pricing issue doesn't seem to be affecting economic developme= nt=20 nearly as much as the fear of blackouts, Hayes said.=20 --Dale Kasler Bush's top team launches blitz for his energy agenda =20 \ objattph=20 Plan has stagnated as crisis diminishes By Toby Eckert COPLEY NEWS SERVICE= =20 July 17, 2001 MONROEVILLE, Pa. -- Seeking to reignite President Bush's pus= h=20 for a new energy policy, Vice President Dick Cheney and other administratio= n=20 officials yesterday warned that the nation still faces significant challeng= es=20 despite recent drops in gasoline prices and California's easing power woes.= =20 Cheney and members of Bush's Cabinet fanned out across the nation to promot= e=20 the administration's plans for more oil, coal and nuclear power production.= =20 At the same time, they tried to deflect criticism of the plan by stressing= =20 elements that would promote conservation and renewable energy sources. "Th= e=20 fact of the matter is that we are now dependent and will be dependent for t= he=20 foreseeable future on petroleum products for our transportation needs," sai= d=20 Cheney, who was battling laryngitis as he addressed a town hall-style meeti= ng=20 here.=20 The vice president yesterday strongly advocated energy conservation, a noti= on=20 he once famously dismissed as a "personal virtue." "Most of the financial= =20 incentives we recommend are in the area of conservation and renewables," sa= id=20 the architect of the administration plan. "We're not advocating subsidies f= or=20 oil companies and coal companies and gas companies." But environmental=20 activists, who protested outside the event, continued their attack on the= =20 policy. They say it is tilted toward more production of fossil fuels at the= =20 expense of innovative approaches to fuel efficiency and alternative power= =20 sources such as the wind and the sun. "America really needs clean energy= =20 solutions, not more pollution," said Morgan Sheets, an activist with the=20 Pennsylvania Public Interest Research Group. The administration plan, she= =20 told reporters, relies on "unreliable, unsustainable, dirty sources of=20 power." The administration's renewed energy campaign comes at a time when= =20 the policy has been slowed by a combination of political and economic force= s.=20 They range from the Democratic takeover of the Senate to falling gasoline= =20 prices to a stabilized electricity market in California. Cheney took about= a=20 dozen questions in the humid gymnasium at the Community College of Alleghen= y=20 County, outside Pittsburgh. With his voice suffering, Cheney handed off som= e=20 of his speaking and answering chores to aides and politicians who joined hi= m=20 on stage. In response to a question about the administration's promotion o= f=20 expanded nuclear power, Cheney said it could reduce global warming and has = an=20 improved safety record. A man in the audience who identified himself as a= =20 member of the senior citizens advocacy group AARP said older residents were= =20 paying higher electricity bills because of the state's deregulation of the= =20 power industry. The Bush administration, which supports the move toward ope= n=20 electricity markets, has held Pennsylvania up as an example of successful= =20 deregulation, contrasting it with California's disastrous experience. "We= =20 feel that since the deregulation that we are in the same position (with pow= er=20 companies) as we are dealing with OPEC," said the AARP member, referring to= =20 foreign oil-producing countries. Cheney handed the question over to=20 Pennsylvania Gov. Tom Ridge, who said power prices in Pennsylvania have gon= e=20 from 15 percent above the national average before deregulation to as much a= s=20 4 percent below it since the markets opened up. While the audience may not= =20 have been completely friendly, the administration chose favorable turf to= =20 deliver its message. Investing in clean-coal technology and increasing coal= =20 use -- a major part of the Bush plan -- is a big pocketbook issue in this= =20 mining state, which Bush narrowly lost in last year's election. "We need a= =20 shot in the arm for those counties" that are dependent on mining, said Sen.= =20 Rick Santorum, R-Pa., who joined Cheney on the stage. Cabinet members held= =20 similar meetings, but none on the West Coast. EPA Administrator Christie=20 Whitman was in Connecticut, Commerce Secretary Don Evans in North Carolina,= =20 Transportation Secretary Norman Mineta in Ohio, Energy Secretary Spencer=20 Abraham in Illinois and Interior Secretary Gale Norton in South Dakota. Bu= sh=20 unveiled the energy policy with much fanfare in May, marking it as a centra= l=20 initiative of his young administration. But two months later, major element= s=20 of the proposal are languishing, notably efforts to expand oil exploration= =20 and drilling on federal lands, including Alaska's Arctic National Wildlife= =20 Refuge. From the start, polls showed that Americans felt the policy was to= o=20 heavily tilted toward expanding energy production rather than conservation,= =20 and that it favored corporate interests over the environment. Many on Capit= ol=20 Hill were wary of embracing the plan. A recent USA Today/CNN/Gallup poll= =20 showed that 45 percent of Americans approve of Bush's handling of the energ= y=20 issue. But the energy crisis atmosphere of earlier this year has largely= =20 dissipated, robbing the Bush plan of momentum. "The only thing that will b= e=20 able to revive it is $3-per-gallon gasoline. As energy prices decrease, the= =20 steam goes out of the issue," said Marshall Wittmann, senior fellow at the= =20 conservative Hudson Institute in Washington, D.C. Though the administratio= n=20 scored a victory on the energy front last week when the Senate blocked an= =20 effort to halt new drilling in the Gulf of Mexico, Wittmann predicted that,= =20 barring some new crisis, Bush will get little of what he wants from Congres= s.=20 Indeed, the Senate also voted to block energy production at national=20 monuments and the House voted to ban drilling in the Great Lakes. The idea= =20 of allowing oil and gas exploration in the arctic refuge has been moribund= =20 for some time on Capitol Hill. "Congress has no stomach to tackle the ener= gy=20 issue," Wittmann said. He added that the administration will get an energy= =20 plan out of Congress, but "it just won't be very substantive."=20 Davis aide foresees an end to rate hikes =20 \ objattph=20 ASSOCIATED PRESS July 16, 2001 LOS ANGELES -- The state is spending far= =20 less to buy power now than two months ago, and as a result there should be = no=20 more immediate rate increases, the governor's senior energy adviser said=20 yesterday. S. David Freeman told reporters in a conference call that the= =20 recent drop in spot market prices for power means that no new rate increase= s=20 will be necessary "for the foreseeable future." In May, the state was=20 spending close to $100 million per day for power. In the past week, that=20 figure stood at $30 million or less per day, said B.B. Blevins, assistant= =20 director for energy at the state Department of Water Resources. So far in= =20 July, the state has paid on average $82 per megawatt hour for power purchas= ed=20 on the spot market. That compares with an average cost in May of $271 per= =20 megawatt hour on the spot market. Overall, the state has paid on average= =20 $133 per megawatt hour this month, compared with an average of $243 per=20 megawatt hour in May, Blevins said. A megawatt hour is enough electricity = to=20 serve 1,000 typical homes for one hour. In May, spot market purchases=20 accounted for close to 45 percent of the state's power buys. So far in July= =20 they have made up closer to 5 percent. The officials attributed the lowere= d=20 prices to residents' conservation efforts, milder weather, long-term=20 contracts the state entered into with power suppliers and a recent federal= =20 order imposing market-based price limits when energy reserves run low. The= =20 Department of Water Resources plans to file its revenue requirements with t= he=20 state Public Utilities Commission -- the agency that sets rates -- in the= =20 coming week. After that, the state's utilities will stake their claims. =20 There has been widespread speculation that another rate increase would be= =20 necessary, in part to back bonds the state plans to issue to repay the=20 state's general fund about $8 billion. That's how much the state has spent= =20 since January, when it got in the power-buying business because generators= =20 began refusing to sell to the state's crippled utilities. The PUC ordered a= =20 50 percent rate increase in May for customers of Pacific Gas and Electric a= nd=20 Southern California Edison. The state's utilities also may claim they are= =20 owed for the power generated at power plants they still own, but Freeman sa= id=20 new rate increases would not be necessary even if that was taken into=20 consideration. "In my opinion, the existing rates are plenty high to cover= =20 the needs for the foreseeable future," Freeman said. "There may be a=20 difference of opinion on that subject, and the utilities traditionally file= =20 for more than what they get, let me put it that way." Bankruptcy judge lets PG&E pay managers $17.5 million bonus =20 \ objattph=20 By Karen Gaudette ASSOCIATED PRESS July 16, 2001 SAN FRANCISCO =01)=20 California's largest utility can pay its top managers $17.5 million in=20 bonuses to help keep them from leaving the financially troubled company, a= =20 federal bankruptcy judge has ruled. However, Pacific Gas and Electric Co.= =20 should not fund those bonuses by raising its customers' electric rates, U.S= .=20 Bankruptcy Judge Dennis Montali emphasized, pointing to a promise from the= =20 company it would seek other ways to fund the bonuses. Montali ruled that= =20 PG&E had crafted a reasonable employee retention program, and said opponent= s=20 to the bonuses had not presented enough evidence to suggest the utility's= =20 employees would be paid more than other companies in similar circumstances.= =20 "PG&E has presented evidence of widespread concern among managers that they= =20 will lose their jobs; other companies hiring away a number of key managers;= =20 likely harm to the estate if PG&E loses more key employees," Montali wrote = in=20 a statement issued Friday. Montali said it was not the role of the=20 bankruptcy court to tell PG&E which employees should receive the money or t= o=20 assess which employees required a bonus to stay with PG&E. PG&E filed for= =20 federal bankruptcy protection April 6. High power prices and state law=20 preventing PG&E from raising rates to make up for the difference contribute= d=20 to the company's financial slide. "As we move through the Chapter 11 proce= ss=20 it is important to ensure the continuity of normal business operations. The= =20 program is designed to retain the key employees that manage the safe delive= ry=20 of electricity and natural gas to our customers," said Ron Low, a PG&E=20 spokesman. The city and county of San Francisco had disputed the bonuses,= =20 and argued that PG&E did not show enough proof that top managers would leav= e=20 if they weren't paid the extra money. "San Francisco appears to be one of= =20 the only (cities) that has stood up for the public in this case and it is= =20 concerned that somewhere along the line that California is going to end up= =20 bailing out PG&E one way or another," said Irving Sulmeyer, an attorney=20 representing the city and county. Sulmeyer also argued that PG&E ought to= =20 first pay its debts to the more than 50,000 businesses, cities and=20 individuals to whom it owes money. "On one hand, PG&E doesn't have money t= o=20 buy electricity ... but at the same time it can give its president a 100=20 percent bonus, which didn't seem quite right," Sulmeyer said. Employees wi= ll=20 begin receiving the bonuses as early as January 2002, so long as the compan= y=20 files by New Year's Day its plan for how it will reorganize itself=20 financially. The bonuses will be shared by dozens of employees, including= =20 six senior officers: Gordon Smith, president and chief executive officer;= =20 Kent Harvey, senior vice president and chief financial officer; Roger Peter= s,=20 senior vice president and general counsel; Jim Randolph, senior vice=20 president; Dan Richard, senior vice president; Greg Rueger, senior vice=20 president.=20 As power crisis eases, Davis sees a beneficial role for deregulation =20 \ objattph=20 By Ed Mendel July 16, 2001 SACRAMENTO -- If the electricity crisis has in= =20 fact eased -- now that the state no longer is hemorrhaging cash and the=20 threat of daily blackouts seems to have eased -- how does it all end? The= =20 man at the helm of the ship of state, Gov. Gray Davis, apparently thinks it= =20 should end much as it began, with some form of deregulation in which power = is=20 purchased on the open market. As the state was sucked into the power crisi= s,=20 Davis at first maintained that a properly constructed deregulation could=20 work, and then appeared to waffle. But as power prices drop and a wave of= =20 new power plants comes on line, the governor is again clearly saying, witho= ut=20 spelling out the details, that the general concept of deregulation can work= . =20 In fact, Davis said it twice this month as he threw the switch on a new=20 540-megawatt power plant north of Sacramento. He said the state expects to= =20 have a 15 percent surplus of power by the end of 2004. That's the magic=20 number that Federal Reserve Chairman Alan Greenspan told him is needed to= =20 create a market in which competition will hold down prices. "Then=20 electricity deregulation can work," Davis said. Later in his remarks he sai= d=20 it again: By 2004 the state will be "very close" to the 15 percent surplus= =20 that Greenspan says is needed "in order for deregulation to function." A b= ig=20 factor in the crisis is that California had not built a major power plant= =20 (more than 300 megawatts) in more than a decade and was forced to import=20 about 20 percent of its power from out-of-state generators. The state Ener= gy=20 Commission forecasts that the construction of power sources will produce an= =20 additional 20,000 megawatts by the end of 2004, creating the 15 percent=20 surplus. All of the new generation -- major power plants, small plants=20 operating only during peak-load periods and upgraded old plants -- would be= =20 created through investments by private businesses. And if the private sect= or=20 does not build enough new generation, Davis signed legislation earlier this= =20 year creating a new state power authority, which could issue as much as $5= =20 billion in bonds to build or buy power plants. However, the other part of= =20 the governor's broad plan for ending the electricity crisis may be more=20 difficult. Davis wants the financially crippled utilities to be back on=20 their feet and able to resume buying power for their customers by the end o= f=20 next year, allowing the state to get out of the power-buying business. His= =20 plan to keep Southern California Edison out of bankruptcy has stalled in th= e=20 Legislature, branded as a too-generous "bailout." Even if an Edison plan is= =20 approved, Pacific Gas & Electric creditors would have to be convinced that = a=20 similar deal is good enough for them to bring PG&E out of bankruptcy. This= =20 week, the Legislature may finally vote on an Edison plan, including an=20 Assembly Democratic proposal to leave residences and small businesses under= =20 traditional regulation and allow large users to shop around for power. It'= s=20 a chance to shift the focus from crisis management to what the electricity= =20 system should look like in the long run. The main alternatives to=20 deregulation are reregulation, where privately owned utilities produce thei= r=20 own power under rates set by the state, or a statewide publicly owned syste= m,=20 similar to the Los Angeles Department of Water and Power. If Edison is=20 allowed to slide into bankruptcy, which could take years to resolve, there= =20 will be plenty of time for debate. Ed Mendel is Capitol bureau chief for t= he=20 Union-Tribune.=20 Churches Help Edison Aid the Poor Energy: With an assist from the pulpit, a program to provide discounted=20 electricity to those in need flourishes. WILLIAM LOBDELL TIMES STAFF WRITER July 17 2001 Southern California Edison has enlisted the help of an unlikely=20 ally--churches--to sign up thousands of low-income customers for hefty=20 discounts on rising utility bills. In just a few months, pastors, priests and church volunteers have become=20 Edison's most effective tool in telling the poor about a state-mandated=20 program that offers 20% off electric bills and exemptions from skyrocketing= =20 rate increases. Refugio Gomez, 62, a part-time janitor, signed up for the program last mont= h=20 at Our Lady of Victory in Compton, the church where he works. Since then, h= is=20 monthly electric bill has been cut from $48 to $18. "I hadn't heard about t= he=20 program before," Gomez said. "[Church volunteers] helped me with the forms.= " The pioneer faith-based program began with 22 Orange County Catholic church= es=20 in April and now is being rolled out throughout Southern California. Edison= =20 employees will be at five churches in the South Bay this weekend. The utility is concentrating its efforts initially in Catholic and=20 African-American churches, primarily because of their large congregations= =20 and, in the case of the Catholics, their large-scale organizations. But=20 Edison officials say they plan to use a wide range of religious=20 organizations, including synagogues, mosques and temples, before the campai= gn=20 ends in the fall. "It's a really fantastic way to get the word out," said Pastor Steve Overto= n,=20 who had Edison workers hand out information Sunday at his Christian Chapel= =20 Foursquare Church in Moreno Valley. "The church is called to help the poor.= =20 We're doing what the Lord wants us to do." Church leaders say they are aware that their endorsement of an Edison progr= am=20 can produce a halo effect for the besieged company. But getting lower=20 electric rates for their low-income congregants overrides those concerns. "We're not doing this to help Southern California Edison," said Jaime Soto,= =20 auxiliary bishop for the Roman Catholic Diocese of Orange. "We're doing thi= s=20 to help our parishioners." About 62% of an estimated 1 million eligible customers participate in the= =20 discount program started by the state Public Utilities Commission in 1989,= =20 Edison officials said. A family of four must earn less than $31,100 a year = to=20 be eligible for the program, which is also offered by the Southern Californ= ia=20 Gas Co. Religious institutions based in low-income areas have been able to knock do= wn=20 barriers that have hindered Edison's past efforts to reach out to the poor:= =20 suspicion from recent immigrants, language and cultural differences, and=20 ineffective marketing campaigns. When the energy crisis began, Frank Quevedo, an Edison vice president,=20 decided religious organizations offered the best chance to reach customers= =20 who would suffer the most from rising electric bills. He met with Soto, who provided demographic information from the diocese's 5= 6=20 parishes. "He knew the [community] in a way we couldn't," Quevedo said. "He knew whic= h=20 churches had the most seniors, low-income parishioners, limited-English=20 speakers. We had great results." Energy Crisis Prompts Change in Church Policy The Catholic church sometimes allows other information to be distributed at= =20 Mass, but it usually revolves around health programs, immigration issues an= d=20 education on voter registration. "We generally do not do business with business," Soto said. "But the extent= =20 of the energy crisis and its impact on the poor made me rethink that policy= .=20 I've been pleasantly surprised at how many people we've reached." A priest's endorsement of Edison's discount program, plus church volunteers= =20 helping fellow congregants fill out Edison forms, has proven far more=20 effective than inserting fliers in monthly bills or trying to engage shoppe= rs=20 outside retail malls. In Orange County, more than 1,000 church-going customers took advantage of= =20 the discount in a single day. At Compton's Our Lady of Victory, more than 2= 00=20 congregants joined the program. Edison also had handed out 80,000 sign-up= =20 forms that parishioners have taken home. At a booth in a Los Angeles shopping center, Edison workers earlier this=20 month signed up only two dozen customers in a half-day of work. Edison workers volunteer time on Sundays to pass out information at churche= s.=20 More than 100 employees turned out on a single Sunday in April to volunteer= =20 at nearly two dozen sites in Orange County. "It's really a humbling experience for us," said Rocio Contreras, a board= =20 member of the company's Latino employees association. "What was really neat= =20 was to have the priests and fathers there, letting the parishioners know wh= o=20 we are and why we were there. That made a difference." Churches are a natural go-between wary immigrants and large institutions th= at=20 provide relief services, said John Wilcox, chair of religious studies and= =20 director for the Center for Professional Ethics at Manhattan College in=20 Riverdale, N.Y. "It's really using churches in an area where they're already very effective= ,"=20 he said. "My only concern would be that the church needs to be an honest=20 broker. The church probably has the greatest amount of trust among the poor= .=20 [Immigrants] are so vulnerable."=20 Copyright 2001, Los Angeles Times <http://www.latimes.com<;=20 Consumers await word on rates=20 Report's delay, government bond issue raise questions about electricity pri= ce=20 increase=20 Christian Berthelsen, Chronicle Staff Writer=20 <mailto:cberthelsen@sfchronicle.com< Tuesday, July 17, 2001=20 ,2001 San Francisco Chronicle </chronicle/info/copyright<=20 URL:=20 <http://www.sfgate.com/cgi-bin/article.cgi?file=3D/chronicle/archive/2001/0= 7/17/ MN136406.DTL< California electricity customers should find out this week whether they wil= l=20 be hit with yet another rate increase, this time to lay the groundwork for = a=20 huge state government bond issue.=20 The state Department of Water Resources was expected to issue its report on= =20 the subject last week. The report has been delayed twice while the Departme= nt=20 of Finance works feverishly to determine whether it can justify a bond that= =20 has grown by nearly $1 billion with the existing money coming in from=20 ratepayers.=20 State officials, including S. David Freeman, a chief energy adviser to Gov.= =20 Gray Davis, say they do not believe a third rate increase will be necessary= .=20 But the increased size of the bond issue and the reporting delays have rais= ed=20 questions. Officials refused to rule out an increase.=20 State regulators have already approved two rate increases this year, of 9= =20 percent in January and up to 37 percent in May. The May increase was the=20 largest in California history.=20 Since January, the California government has been buying power on behalf of= =20 the state's beleaguered utilities, which were no longer financially sound= =20 after skyrocketing wholesale power prices drained them of cash and credit.= =20 The utilities, which continue to supply power to customers and bill them,= =20 have been paying the state no more than they receive in revenues, leaving t= he=20 state government to pick up the tab for the shortfall.=20 The bond issue was intended to pay the state's general fund back for that= =20 shortfall. It also would finance some power purchases into the future and= =20 cover the cost of bailing out Southern California Edison. California recent= ly=20 increased the size of the bond issue by $900 million, bringing the total to= =20 $13.4 billion.=20 Wall Street bankers and legislators have sought to limit how much debt the= =20 state can issue, saying the bond issue should be no larger than four times= =20 the state's annual receipts from ratepayers. But with state leaders seeking= =20 to increase the size of the bond issue by some 6 percent, questions have co= me=20 up about whether a rate increase is in the offing.=20 State officials and regulators say they are unsure of whether an increase= =20 will be necessary. While some numbers and estimates have been provided, a= =20 completed report has not. Complicating matters, a rebate program created by= =20 the state to encourage people to conserve electricity is now cutting into t= he=20 state's revenue finances.=20 In a conference call on Sunday, Freeman said increases would not be sought.= =20 "We have no need for a rate increase at this time, in my opinion," he said.= =20 "As far as I'm concerned, looking at these numbers, we have no need for a= =20 rate increase" in the next year.=20 But in the same conversation, Freeman acknowledged he was offering nothing= =20 more than his "professional opinion." Conditions have improved considerably= =20 in recent weeks. Rate increases that took effect last month have finally=20 brought an increased revenue stream to the state, and the average cost of= =20 power dropped by half this month, to $133 per megawatt hour.=20 The change led Terry Shu, an analyst with JP Morgan, to ask in a conference= =20 call with Pacific Gas and Electric executives last week whether "overall ca= sh=20 flow numbers for the DWR ought to look much much better."=20 E-mail Christian Berthelsen at cberthelsen@sfchronicle.com=20 <mailto:cberthelsen@sfchronicle.com<=20 ,2001 San Francisco Chronicle </chronicle/info/copyright< Page A - 5=20 Judge OKs bonuses for PG&E chiefs=20 Published Tuesday, July 17, 2001, in the San Jose Mercury News=20 Contra Costa Times=20 A U.S. bankruptcy judge in San Francisco has approved Pacific Gas & Electri= c=20 Co.'s request to give $17.5 million in retention bonuses to top managers.= =20 In an eight-page ruling issued Friday, Judge Dennis Montali rejected critic= s'=20 allegations that the bonuses would reward those responsible for California'= s=20 energy crisis.=20 Under the plan, PG&E's top 23 executives will receive the equivalent of a= =20 year's base salary to stay with the company. Another 203 will receive bonus= es=20 of 25 percent to 75 percent of their salaries.=20 The utility's six most senior executives, due a combined $2 million, will= =20 receive their bonuses only if PG&E successfully files a reorganization plan= .=20 Those executives will receive one-third of their bonus if the company files= a=20 plan by Jan. 1 and the remaining two-thirds once Montali approves that plan= =20 or a competing plan.=20 The other managers will be awarded half their bonuses on the first=20 anniversary of PG&E's April 6 bankruptcy filing. The second half will come= =20 either on the second anniversary of the filing or upon confirmation of a=20 reorganization plan.=20 ``Consumers are outraged,'' said Mindy Spatt, spokeswoman for the Utility= =20 Reform Network. ``Most of us don't expect to get these kinds of bonuses if = we=20 perform well, let alone if we screw up.'' Power of lies=20 Davis, Legislature ruin two electrical companies and try to cover it up GLEN EVANS Mr. Evans, who lives in Lake Forest, is an employee of Southern= =20 California Edison and invests in its stock. Billy throws a ball through Mrs. Smith's window. But when she comes out, he= =20 blames it on Bobby, the neighborhood bully. Mrs. Smith believes Billy becau= se=20 he seems nice, and, well, nobody likes Bobby.=20 If you knew you could get away with blaming someone else for your own=20 mistake, would you do it? That's exactly what the California Legislature an= d=20 Gov. Gray Davis have done. Polls say most people believe SCE and PG&E are responsible for California's= =20 energy crisis. Truth is, our politicians bear full responsibility. No one,= =20 except those very politicians, claims otherwise. I challenge Gray Davis and= =20 the California Legislature to find one reputable expert in any relevant fie= ld=20 who doesn't agree on a simple fact: If retail prices for electricity had=20 followed the wholesale cost, none of the problems we now have would have=20 happened. Moreover, If SCE and PG&E had been treated fairly, they would have been sav= ed=20 from financial ruin. Davis and the Legislature have many folks believing=20 these utilities were somehow responsible for the law which forced them to= =20 sell power, their only product, for less than cost. But public gullibility= =20 does not justify public servants lying, just like Billy, and blaming somebo= dy=20 else to save themselves. Rather than simply admit their mistake, Davis and the Legislature were=20 willing to let two reputable, century-old utilities go $15 billion in debt = -=20 obligated to deliver power, but allowed to recover only a tiny fraction of= =20 the cost. They knew it was dishonest, but the alternative - asking the publ= ic=20 to simply pay for the electricity they used - was too dangerous politically= . When SCE and PG&E attempted to defend themselves, our politicians made it= =20 known that the utilities had "funneled cash" to their parent companies,=20 rather than use it to pay down their debt. Truth is, the amount of money wa= s=20 insignificant compared to the utilities' debts and it would have been just= =20 plain stupid for a company to take its last bit of cash and throw it after= =20 all the rest so blatantly "appropriated" by the state. This transaction was common knowledge within the Legislature, having been= =20 arranged and approved by members, and its own audit acknowledged the money= =20 was handled properly. Many people expressed shock at this "news'' and vowed= =20 there would now be no "bailout" of these utilities. But then came the state's own crisis - the utilities' debt was so massive= =20 nobody would lend them any more money. The state was forced to step in to= =20 keep the lights on, and everything changed. Within weeks the state found out just how enormous the expense was they had= =20 been forcing the utilities to bear. The Public Utilities Commission voted t= o=20 raise rates and, reluctantly, Davis acknowledged that an increase might be= =20 necessary after all. Now came perhaps the cleverest deception. The rate increase had nothing to = do=20 with the utilities. All of the money from the increase went straight to the= =20 state to pay its bills. Even knowing they caused the utilities' debt, and= =20 could fix it, they wouldn't even share this increase. But because the=20 increase would show up on the utility bill, everyone would naturally assume= =20 it was the utilities who were now raking in even more money. So with a simp= le=20 lie of omission - just don't say anything - nobody would ever know every=20 penny of that rate increase went straight to pay the state's debt. Not one= =20 cent went to the utilities, still strapped with huge debts and one, PG&E, n= ow=20 driven into bankruptcy. Finally, a personal response to another common accusation - that SCE and PG= &E=20 somehow took all the money out before they went into debt and the=20 stockholders got it all. I'm an SCE employee. I've worked in field service= =20 for Edison for more than half my life. I've had such confidence in my company and it's management that I considere= d=20 their stock the best retirement investment I could make. So for 26 years I'= ve=20 had money deducted from every paycheck to purchase stock. It was meant to= =20 guarantee my retirement security. I had hoped I would actually be retired by now, and with the stress this=20 situation has put on we employees, I truly wish I could. But all the money = we=20 stockholders are supposed to have is just another lie. I have lost more tha= n=20 two thirds of my life savings and am simply unable to retire now. Thanks, Billy!=20 Metro Desk=20 THE NATION State Losing Ground in War on Dirty Air Environment: Growth, lax= =20 enforcement are blamed for rising smog levels in some areas. GARY POLAKOVIC 07/17/2001=20 Los Angeles Times=20 Home Edition=20 Page A-1=20 Copyright 2001 / The Times Mirror Company=20 California 's war on air pollution is beginning to falter as smog-control= =20 efforts increasingly fall behind the state's never-ending growth.=20 From the Sierra Nevada to Ventura beaches, San Francisco Bay to the Salton= =20 Sea, some of the nation's most polluted regions are slipping in their=20 commitment to clean air, according to air quality officials from around the= =20 state. The cost of delayed cleanup is prolonged damage to human lungs,=20 spoiled forests and crops, and the pervasive pall of dirty air.=20 In the San Joaquin Valley, so little progress has been made recently that t= he=20 U.S. Environmental Protection Agency is poised to declare the=20 25,000-square-mile area a "severe" smog zone, a status shared by only 10=20 other U.S. regions.=20 Cities such as Bakersfield and Fresno are beginning to challenge the Los=20 Angeles region--where air quality has shown steady improvement--and Houston= =20 for the nation's air pollution crown. Sequoia National Park, which is=20 immediately downwind of the valley, has the worst smog of any national park= ;=20 more days of unhealthy ozone were recorded there last year than in Los=20 Angeles and New York City combined. The valley has the most lackluster reco= rd=20 against air pollution of any California region.=20 The San Joaquin Valley Air Quality Management District blames the Bay Area= =20 for much of its pollution, but the EPA says the smog increasingly is=20 home-grown. Local air quality officials have blocked control measures adopt= ed=20 elsewhere, insisting that they meet a cost-effectiveness yardstick more=20 restrictive than used in Los Angeles or San Francisco. The EPA directed the= =20 district last year to implement at least six rules regulating emissions fro= m=20 paints, solvents and oil tanks that had been set aside, but some have still= =20 not been approved.=20 To meet the standards, which are set at the levels required to prevent dama= ge=20 to human health, smog-forming emissions would have to be cut by an addition= al=20 300 tons daily--equivalent to removing nearly one-third of all the cars,=20 factories and oil operations in the valley. Instead, the EPA is leaning=20 toward putting off compliance until 2007, although officials acknowledge sm= og=20 might not be tamed by then either.=20 "It doesn't look good. There's a lot that still needs to be done, and you= =20 wonder why a lot hasn't been done earlier," said John Ungvarsky, an=20 environmental scientist at the EPA.=20 The Bay Area also has trouble.=20 After years of effort, the region in 1995 reached the health-based standard= =20 for ozone, the main component of smog. But pollution has resurged, and toda= y=20 it once again exceeds federal limits. Now, the Bay Area Air Quality=20 Management District is trying to regain the upper hand, but it won't be eas= y.=20 It faces the daunting task of eliminating 246 tons of hydrocarbons daily ov= er=20 the next four years.=20 Environmentalists and the EPA said Bay Area smog fighters have not been tou= gh=20 enough on oil refineries, but local officials say greater reductions are=20 needed from power plants and diesel generators as well as ports and airport= s,=20 some of which are under federal jurisdiction.=20 Backsliding is also evident in dust clouds ranging from Palm Springs to=20 Indio, where machinery from a construction boom grinds soil that the wind= =20 blows all over the Coachella Valley.=20 Windblown dust is the dominant source of a serious problem with particulate= =20 pollution in the desert region. Particulates can lodge deep in the lungs an= d=20 have been linked to an increased risk of cancer, lung disease and premature= =20 death.=20 The region, which suffers some of the worst dust storms in the nation, had= =20 the problem licked in 1996 when recession slowed down the construction=20 industry. But as the building boom revived with the economy, enforcement=20 efforts failed to keep up, and pollution has returned. Today, the valley on= ce=20 again exceeds limits for microscopic wind-blown dust, said Bill Kelly,=20 spokesman for the South Coast Air Quality Management District.=20 "They didn't keep up the emphasis on dust controls they had in the past,"= =20 Kelly said. "They need to redouble their efforts to get back into attainmen= t"=20 of smog standards.=20 Even in Southern California , which has had the best record in the country= =20 for smog reduction, high levels of carbon monoxide--a poison gas emitted=20 principally from tailpipes--continue to pervade South-Central Los Angeles.= =20 The pollutant was supposed to have been eliminated last year, under=20 provisions of the federal Clean Air Act. And although regional air pollutio= n=20 officials have succeeded in eliminating it elsewhere in the Los Angeles=20 Basin, carbon monoxide in South-Central has remained a problem.=20 Meanwhile, a key program to cut emissions from 360 of the region's biggest= =20 industrial polluters has not worked.=20 The setbacks could tarnish California 's reputation as a leader in the figh= t=20 for clean air, environmental activists say.=20 As a result of the resurgent pollution, millions of residents will continue= =20 to breathe unhealthy air for many more years than Congress envisioned when = it=20 set cleanup deadlines for California under the 1990 Clean Air Act amendment= s.=20 "Things are slip-sliding away," said Sierra Club lobbyist V. John White. "W= e=20 gave ourselves all these victory laps and cheered ourselves, and then we=20 started losing resolve. We've stopped pushing."=20 The slowdown in smog improvement "bothers me," said Alan C. Lloyd, chairman= =20 of the state Air Resources Board. "We need to understand what is going on,= =20 what we are doing right, and what we are doing wrong."=20 That evaluation has begun as air quality officials develop comprehensive ne= w=20 cleanup plans for smoggy cities. To achieve smog-fighting goals, officials= =20 say, those plans will have to deal aggressively with diesel-powered engines= ,=20 solvent-based paints, consumer products and machinery used at harbors and= =20 airports, which are among the largest and least controlled pollution source= s.=20 Drafts of the plans are expected to be completed this summer, followed by= =20 public hearings.=20 California continues to have a better record on smog cleanup than any other= =20 state, said Joseph M. Norbeck, director of the Center for Environmental=20 Research and Technology at UC Riverside.=20 But smog cleanup is not getting any easier. Growth is overtaking it.=20 More cars, trucks, boats, businesses, chemicals and consumer products fill= =20 the air with emissions. The state's economy expanded by 9.2% last year, and= =20 although economic growth has slowed markedly this year, the state's=20 population continues to increase. New car sales last year were up 11%=20 statewide, adding 2 million vehicles--nearly half of them trucks and sport= =20 utility vehicles, which spew out substantially more pollution than standard= =20 passenger cars. A record 34 million people live in California , and each da= y=20 they release 68.3 million pounds of pollutants into the sky, according to t= he=20 Air Resources Board.=20 "The growth is starting to catch up with the gains we've made," said Jack= =20 Broadbent, administrator of air programs for the EPA's California office.= =20 "We're at a point in time where a lot of the attainment dates are=20 approaching. If we're going to attain those deadlines, you have to put=20 controls in now."=20 The state's electricity crisis is complicating matters. Throughout Californ= ia=20 , power plant emissions are surging as pollution controls are relaxed to=20 prevent blackouts. When the lights threaten to go out, businesses switch on= =20 backup diesel generators, the dirtiest power source and a contributor to=20 deteriorating air quality in the Bay Area.=20 "We need some leadership on this issue and we are not seeing it," said Larr= y=20 Berg, a Calabasas air quality consultant and a former director for the Sout= h=20 Coast Air Quality Management District and USC's Jesse Unruh Institute of=20 Politics. "The historical memory about what's going on with air pollution a= nd=20 public health is not on the minds of people in Sacramento. They need to=20 refocus." National Desk=20 THE NATION In Support of Energy Plan, White House Burns Some Gas Politics:= =20 Cheney, other Bush officials fan out to make what the president admits is a= =20 tough case. MEGAN GARVEY 07/17/2001=20 Los Angeles Times=20 Home Edition=20 Page A-14=20 Copyright 2001 / The Times Mirror Company=20 MONROEVILLE, Pa. -- With his top officials dispatched to several states to= =20 try to recharge the White House's coolly received energy policy, President= =20 Bush on Monday conceded that the plan may be a harder sell now that oil=20 prices are down and California is experiencing fewer rolling blackouts.=20 "Any time there's not an immediate problem that's apparent to people, it's= =20 tough to convince people to think long-term," Bush said.=20 Vice President Dick Cheney, the plan's chief architect, joined other top=20 administration officials and Republican members of Congress in public=20 meetings to bolster support for the initiative.=20 At a town hall meeting in this Pittsburgh suburb, Cheney, suffering from=20 laryngitis, used his ailing voice to warn that a failure to generate new=20 energy would be a "storm cloud out there on the horizon for the American=20 economy."=20 Earlier in the day, in comments delivered by his wife, Lynne, a last-minute= =20 stand-in, the vice president offered a retooled message about conservation= =20 that signaled a marked change from his comments of just a few months ago.= =20 "Conservation is a must," Lynne Cheney told a conference of county executiv= es=20 gathered in Philadelphia, reading her husband's speech from a TelePrompTer.= =20 Previously, Cheney touted supply-oriented solutions and dismissively called= =20 conservation a "sign of personal virtue" but "not a sufficient basis for a= =20 sound, comprehensive energy policy."=20 Those comments, as well as Cheney's former role as head of a Texas-based oi= l=20 supply company, had made the vice president a target for foes of the White= =20 House approach. And in the last few months, between problems with his heart= =20 and the flap over his conservation remarks, the man considered by many to b= e=20 the most powerful vice president in history had been less visible on the=20 national stage.=20 But he was front and center Monday--hoarse voice notwithstanding.=20 Elsewhere, Energy Secretary Spencer Abraham, Interior Secretary Gale A.=20 Norton, Transportation Secretary Norman Y. Mineta and Environmental=20 Protection Administration chief Christie Whitman made town hall appearances= =20 from Connecticut to South Dakota.=20 Democrats on Capitol Hill criticized the public relations blitz, saying the= =20 massive tax cut will make it difficult to fund any conservation initiatives= .=20 An energy bill dealing with nuclear energy, hydropower, clean-coal technolo= gy=20 and conservation is scheduled to come before the House Energy and Commerce= =20 Committee today.=20 They also questioned why none of the president's surrogates were dispatched= =20 to the region struggling the most with energy supply needs: the West Coast.= =20 "Out of 105 recommendations in the [administration's] plan, not one is=20 relevant to the situation in California , Oregon, Washington or other parts= =20 of the West," said Rep. Bob Filner (D-San Diego).=20 In front of a friendly audience under hot lights in the gymnasium at the=20 Community College of Allegheny County, Cheney strained his voice to answer= =20 questions.=20 In one of the night's few sharp moments, Pennsylvania Gov. Thomas J. Ridge,= a=20 Republican, took a swipe at California , noting: "We weren't the first stat= e=20 to deregulate natural gas or electricity , but we were the first state to d= o=20 it right."=20 Cheney again pushed many of the same tenets of the policy his energy task= =20 force unveiled this spring: responsible exploration and production, the nee= d=20 to reduce dependence on foreign oil sources, and the role new technology ca= n=20 play in meeting energy demands.=20 At the day's first event, he watched from the sidelines in Philadelphia as= =20 Lynne Cheney, taking his place at the lectern, reiterated the=20 administration's strong opposition to the Kyoto treaty.=20 "President Bush agrees that the approach of Kyoto was flawed and unworkable= ,"=20 she said on the eve of the president's second trip to Europe, where the U.S= .=20 position is controversial. "It would have produced little or no net benefit= =20 to the global environment, while imposing massive job losses on the America= n=20 economy."=20 But the same speech contained his most extensive and positive comments to= =20 date about the role of conservation during an energy crunch.=20 "This is one of the guiding principles of the president's energy policy:=20 making better use of energy, through conservation and the latest technology= ,"=20 his wife said for him.=20 The administration's stress on conservation, however, came with caveats, bo= th=20 from Bush and Cheney.=20 During an Oval Office ceremony where he received a bust of Winston Churchil= l,=20 Bush sounded a note of caution about California 's woes.=20 "It should be worrisome to people that the state that's had the best=20 conservation efforts is the state that's had brownouts," Bush said,=20 emphasizing the need for a long-term energy policy that includes developing= =20 new sources of energy.=20 Cheney's speech warned that he and Bush "do not accept the false choice=20 between more energy and a safer environment." And during the brief time=20 Cheney used his own voice Monday, he once again pointed out the reality of= =20 current U.S. energy needs when it comes to petroleum.=20 "The fact of the matter is we are dependent and will be dependent on=20 gasoline," he said.=20 For some of the White House's biggest environmental critics, the subtle=20 policy shift expressed Monday didn't change any minds.=20 "Conversions begin with lip service," said Carl Pope, president of the Sier= ra=20 Club. "But all we're seeing so far is lip service. I hope we see more."=20 *=20 Times staff writers Edwin Chen and Richard Simon contributed to this story= =20 from Washington.=20 *=20 RELATED STORIES=20 Discount: Churches help Edison spread word to poor people. B6=20 Edison rescue: Legislature works on alternatives to Davis' plan. B7=20 Power trip: Available electricity and low rates give L.A. an edge. C1=20 Lighten up: Campaign is aimed at countering state's dark image. C2=20 PHOTO: Vice President Dick Cheney, who has laryngitis, coughs as his wife,= =20 Lynne, discusses the Bush administration's energy plan.; ; PHOTOGRAPHER:=20 Associated Press=20 California ; Metro Desk=20 The State Consultants' Stock Buys Questioned Energy: State official urges= =20 conflict of interest probe into purchases of shares in power firms. JEFFREY L. RABIN; ERIC BAILEY 07/17/2001=20 Los Angeles Times=20 Home Edition=20 Page B-7=20 Copyright 2001 / The Times Mirror Company=20 Secretary of State Bill Jones on Monday urged California 's attorney genera= l=20 to investigate possible conflict of interest violations by consultants hire= d=20 to help the Davis administration navigate the energy crisis.=20 Jones, a Republican candidate for governor, said at a Los Angeles news=20 conference that Atty. Gen. Bill Lockyer and the state Fair Political=20 Practices Commission should determine whether seven of the consultants have= =20 conflicts of interest because they own stock in one or more energy companie= s.=20 He also asked the state's chief law enforcement officer to immediately=20 determine whether the governor's office violated state law by exempting 21 = of=20 the 45 consultants from financial disclosure requirements.=20 "I am gravely concerned that a cloud of illegality and collusion exists at= =20 the highest level of our state government due to the actions and the=20 conscious policy of secrecy of Gov. Davis," Jones said.=20 That brought a sharp retort from the governor's spokesman, Steve Maviglio,= =20 who attacked Jones for engaging in campaign politics.=20 "The secretary of state has a five-person team bankrolled by the taxpayers= =20 attempting to dig up dirt for political reasons," Maviglio charged.=20 "This is politics pure and simple being played by a candidate desperate to= =20 get his name in the paper," Maviglio said. If there are any violations of t= he=20 law, he added, "they're going to be addressed."=20 The secretary of state's entry into the energy controversy poses yet anothe= r=20 headache for Davis as he prepares to run for a second term next year.=20 Already, the GOP and some power producers have begun airing commercials=20 critical of Davis' handling of the power crunch, forcing the governor to di= p=20 into his own campaign funds to fight back.=20 Jones, as the state's chief elections officer, contends that his concerns a= re=20 not just political. He noted that he appoints one of the five members of th= e=20 Fair Political Practices Commission, which enforces campaign finance and=20 conflict of interest laws.=20 Among other things, Jones questioned why Vikram Budhraja, head of the=20 Electric Power Group, a Pasadena energy consulting firm, bought stock in=20 Edison International and Dynegy Corp. in the days before he went to work fo= r=20 the state.=20 Budhraja was hired under a $6.2-million contract between his firm and the= =20 state Department of Water Resources that was signed on Jan. 18. Like two=20 dozens of the consultants hired by the state, he did not complete a financi= al=20 disclosure statement until last week, more than six months after he went to= =20 work for the department, which now buys power for the state's three largest= =20 utilities.=20 The financial disclosure statement filed by Budhraja last Thursday shows th= at=20 he bought between $10,000 and $100,000 worth of Dynegy stock on Jan. 11. Si= x=20 days later, he bought between $10,000 and $100,000 of Edison stock.=20 That was the same day that Davis declared a state of emergency because of t= he=20 energy crisis and ordered the Department of Water Resources to begin buying= =20 power on behalf of the state's financially troubled major utilities.=20 On Jan. 22, Budhraja again bought between $10,000 and $100,000 of Edison=20 stock. On his disclosure statement, he indicated that he began work for the= =20 state Jan. 25 and sold the stock on Jan. 29--the first opportunity he had t= o=20 divest his holdings.=20 Jones told reporters that Budhraja's investments in Edison grew by 44% to= =20 47%, while his Dynegy investment increased 28% in that brief period.=20 Budhraja was also on retainer as a consultant to Edison International,=20 earning more than $100,000 in the year before becoming a contractor for the= =20 state.=20 Maviglio said Budhraja wrote a letter to DWR Deputy Director Ray Hart sayin= g=20 he had no dealings with Edison International. He also was not involved in a= ny=20 long-term contracting with Edison.=20 Any profits Budhraja made from the stock are irrelevant because the stock w= as=20 sold by the time he was on the job, Maviglio said.=20 Another consultant, Bernard Barretto, who describes himself as an energy=20 trader/scheduler for the state, disclosed last week that he purchased stock= =20 in power producer Enron Corp. But no date or amount of the purchase was=20 listed.=20 Financial disclosure forms filed last week by five other consultants show= =20 they all own stock in Calpine Corp., a major California -based power=20 wholesaler.=20 Energy trader Elaine L. Griffin bought between $10,000 and $100,000 worth o= f=20 Calpine stock on Feb. 1. Her contract with the state began Feb. 20. Griffin= 's=20 newly completed economic disclosure statement does not show her selling the= =20 stock. Herman Leung, who went to work as an electricity scheduler in March,= =20 bought between $2,000 and $10,000 worth of Calpine stock on Jan. 22.=20 Schedulers William F. Mead, Peggy Cheng and Constantine Louie also disclose= d=20 that they own stock in Calpine. Mead, in fact, said his holdings ranged=20 between $100,000 and $1 million. But their forms contain an important=20 omission: The consultants do not say when they purchased the shares.=20 Oscar Hidalgo, a Water Resources spokesman, said the agency's attorney is= =20 reviewing all the past purchases to ensure that no laws were violated by=20 contractors buying power or negotiating long-term contracts with companies = in=20 which they held stock.=20 "We're reviewing all that to see if [there were] any problems with any past= =20 negotiations," Hidalgo said. "We're looking at all the records in past buys= =20 or trades so we understand who exactly did what."=20 He said it's a "very big task" that will take weeks to complete.=20 In the meantime, those contractors who have disclosed stock ownership have= =20 been recused from working with generators in which they have a financial=20 interest.=20 The governor's spokesman said several of the contractors who own stock in= =20 Calpine are not traders, and thus do not have direct dealings with the=20 company.=20 "If you own Calpine stock and aren't doing any business with Calpine, then= =20 you're fine," Maviglio said.=20 Calpine is one of a number of firms that negotiated long-term contracts wit= h=20 the state and that have come under fire from critics who say they will sadd= le=20 consumers with artificially high electricity costs for years to come.=20 For weeks, Jones has been sharply critical of the administration's failure = to=20 require its consultants to file conflict of interest forms, which must be= =20 completed within 30 days of a person starting work.=20 The governor's spokesman said the administration was told by the state's=20 political watchdog agency that only consultants serving in a staff capacity= =20 or participating in decisions must file the forms.=20 As a result, he said, only two dozen of the 45 consultants were required to= =20 complete the paperwork--most of them "hastily and clumsily" prepared last= =20 week, according to the secretary of state.=20 Two of those who have not filed are Wall Street executives Joseph Fichera a= nd=20 Michael Hoffman, key advisors to Davis on his plans to rescue California 's= =20 debt-ridden utilities. In that role, according to their contract, they coul= d=20 make millions.=20 Maviglio said the two men, who have done extensive work for private energy= =20 companies, are "squeaky clean," but he would not elaborate.=20 California ; Metro Desk=20 The State No Accord Near on Edison Rescue Legislature: With Davis' proposal= =20 languishing and rival version
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