Portland official seeks group to watch Enron bankruptcy
Portland City Commissioner Erik Sten called Thursday for creation of a regional task force to help plot the future ownership of Portland General Electric.
Sten said a 20- to 30-member body should monitor the bankruptcy proceedings of Enron, PGE's corporate parent in Houston, and try to figure ways to protect the interests of PGE's 740,000 Oregon customers.
The task force proposal comes after city officials failed to persuade Enron to sell PGE to the city during confidential negotiations. Enron announced earlier this month that it planned to sell the utility to some other buyer, or to distribute new PGE stock to more than 2,000 creditors listed in Enron's bankruptcy.
"The discussion from here on has to be in reaction to what Enron says," Sten told Multnomah County commissioners on Thursday. "We're probably not going to reach a collaborative agreement with them."
Sten said he'd like to see several hearings to discuss the interests of the region's business and residential customers and to decide how to react to Enron's plans to dispose of PGE. He said the bankruptcy court looks to protect Enron's creditors, not PGEs customers.
Sten said he doubted the community would reach 100 percent consensus on the best strategy, but he said the public deserves to express its concerns and views.
"We need to air it out more in Oregon fashion than in Houston fashion, as it has been for the past year," he said.
Officials from four counties and Portland have been meeting for two years to discuss possible public ownership of PGE. Informal agreements by the regional power study group recommend Portland ownership, with the utility to be run by professionals selected by the regions elected officials.
Sten outlined four possible options for PGEs future. These include sale to a private company; distribution of PGE stock to Enron creditors; public purchase; and public acquisition through condemnation.
Sten said condemnation of PGEs assets would be the final option to protect the public interest.
He said at least three members of the City Council are willing to consider that option if it becomes necessary.
Commissioner Randy Leonard has views similar to Sten and has been the most outspoken council member on the topic of condemnation. Commissioner Dan Saltzman said hes willing to study the issue, but hes not yet ready to endorse what he admits would be a difficult and contentious process.
"We need to examine the pros and cons before we can say its a viable option that we should pursue," Saltzman said earlier this week.
Jim Francesconi is the only council member who has come out against condemnation, having concluded that it would be a costly process with little chance of success.
"To direct an enormous amount of time, energy and money toward the condemnation process when other pressing issues and needs are out there just doesn't make sense," Francesconi's chief of staff Kevin Jeans-Gail said earlier this week.
Sten says purchase top option -- Sten said public purchase is still the best option in his mind. But he said public scrutiny of Enron's plans conceivably could lead regional officials to agree to support a sale to a private owner or approval of the stock distribution plan.
However, he predicted no speedy resolution. The stock distribution plan, if it is approved by the bankruptcy court, might not begin until 2005.
If the Portland City Council agrees to Stens task force proposal, then the task force will have to hire a new round of consultants to study thousands of pages of public documents in Enron's bankruptcy case.
Sten said experts hired by the city during the private negotiations cannot divulge information gathered during confidential meetings.
So far, Portland has spent about $700,000 studying the PGE issue.
That was money to get us to understand where we are, Sten said.
Its a shoestring budget for this kind of effort.