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Wyden Warns Bush Over BPA by Paul Fattig Mail Tribune, February 13, 2005

Hood River Republican joins bipartisan effort
to stop president’s plan to switch power rates

U.S. Rep. Greg Walden is unwavering in his position when it comes to a proposal in the Bush administration’s 2006 budget calling for major changes in the way the Bonneville Power Administration charges customers.

"Over my dead body," he said.

The Hood River Republican, who represents the 2nd Congressional District, warns that the proposed changes would create price hikes that would hurt the region’s long-ailing economy.

The issue is one of several thorny items, including a bill to renew timber dollars to counties, that finds Republican and Democratic members of Congress throughout the region standing side by side.

Bush’s $2.57 trillion budget proposal for the fiscal year that starts Oct. 1 was presented to Congress on Monday. Oversight hearings over the president’s budget recommendations will be occurring in the coming weeks in the halls of Congress.

"The issue over power rates is paramount to us," said Walden, whose district includes all of Oregon east of the Cascades as well as most of Jackson and Josephine counties. "I’ve told the administration that we have the highest unemployment rate in Oregon and Washington. We’re just starting to crawl out of the hole."

Walden met with Energy Secretary Samuel Bodman on Tuesday to express his opposition to changing from cost-based pricing to a market-based plan. The proposal would base rates on market prices at the time rather than the cost of producing the electricity.

"I laid out clearly my opposition," Walden said in an interview late Friday afternoon.

"It would be devastating to our region economically," added the co-chairman of the Northwest Energy Caucus. "We’re forming a coalition to stop this dumb idea."

Joining him in the fight are Oregon U.S. Sens. Ron Wyden, a Democrat, and Gordon Smith, a Republican. U.S. Rep. Peter DeFazio, D-Springfield, is also battling the proposal.

The BPA, a federal power marketing agency based in Portland, supplies nearly half the electricity in the Pacific Northwest, most of it from a system of federal dams in the Columbia and Snake rivers.

The administration argues that the proposal could save up to $12 billion over 10 years by removing subsidies and other federal assistance.

The proposal’s 20 percent power rate increase each year would be the death knell for the regional economy, he said.

"Power has been our edge but we’re not exactly hogging manufacturing in the Northwest," he said. "They aren’t shutting down plants across the country to race here."

Walden, a principal sponsor in the House to reauthorize the so-called county payments law which is expiring this year, is concerned it will be difficult to renew. The law pumps billions of dollars into rural counties hurt by logging cutbacks on federal land.

Oregon receives about $273 million annually out of the $350 million. Of that, Jackson County gets about $24 million a year from the fund. All told, the bill provides $2.5 billion over seven years to some 600 counties in 39 states.

"You are talking billions in a budget where they are trying to cut billions," Walden observed. "It’s an extraordinary bill to try to get reauthorized."

On other financial issues, Walden is still studying administrative proposals, including the president’s suggested change in the Social Security program.

"I credit the president for being willing to bring this into the public debate," he said. "It’s a debate we need to have.

"But he hasn’t put forward all his specifics," he added. "There are some broad concepts he has. Sounds intriguing in some cases."

That doesn’t mean he is endorsing the proposal at this point, Walden said.

"I have some real questions about the whole financing mechanism," he said. "Can it really work the way it has been put out there? I have some real reservations."

But he believes there could be a role for personal accounts in the future of the program.

"Given the immense problem we face financing Social Security and, by the way, Medicare, we need to have some vigorous debate about the different options," he said.

The problem, he said, is that when Social Security was created in the 1930s, there were 40 workers to pay for each retiree. That figure is now headed toward a point where there are two workers or fewer for each retiree, he said.

"That is going to create a burden on the next generation that I doubt they are going to want to bear," he said.