Rehberg issued the statement in a letter to OMB Director Joshua Bolten, who heads the agency proposing to count BPA’s third-party financing against Bonneville’s federal borrowing authority.  The proposal, which is contained in a White House draft federal budget document, would alter BPA’s current financial structure by limiting the amount of private sector financing the agency could obtain, possibly leading to cost-cutting measures or rate increases.

“The result of such a proposal would be devastating to the region,” Rehberg said in his letter.  “Rest assured I will fight to ensure that Bonneville’s borrowing authority is protected.”

Rehberg is a member of the House Water and Energy Appropriations Subcommittee, which has budgeting authority over the Department of Energy.  He was successful in a bi-partisan effort in March to thwart a separate budget proposal that would have forced the nation’s Power Marketing Authorities (PMA), to sell their electricity at market-based rates, which vary 30-40% higher than the cost production rates charged by the nation’s PMA’s.

“I want to reassure the electric ratepayers in Montana I will oppose these changes,” said Rehberg.  “In addition, I will begin exploring the possibility of creating a task force to look into ways to keep electric rates low from the power generated by the west’s natural resources.”

# # #

Letter Below

April 25, 2005

Mr. Joshua Bolten

Director

Office of Management and Budget

Eisenhower Executive Office Building

Washington, D.C. 20503

Dear Director Bolten:

I remain emphatically opposed to the Administration’s Fiscal Year 2006 budget proposal to reclassify certain Bonneville Power Administration financial transactions as counting against its borrowing authority.  Currently, Bonneville is able to finance infrastructure improvements by using federal borrowing authority as a means of raising revenue.  This is critical to maintaining infrastructure and conservation programs in the capital-intensive utility industry. 

OMB’s proposal to count third-party financing against Bonneville’s borrowing authority would drastically limit Bonneville’s ability to make necessary infrastructure improvements to the already stressed electricity grid in the Northwest.  Because these system improvements simply must occur, Bonneville’s only option to finance grid improvements would be to raise revenue or cut important programs – or both. 

The result of such a proposal would be devastating to the region as it would impair Bonneville’s ability to implement critical fish and wildlife conservation programs and utilize alternative energy sources, while raising rates in an already economically-stressed region.  Neither of these options is good for the Northwest and I encourage you to abandon this proposal at the earliest opportunity. 

It is my understanding that the Administration is currently drafting language to implement this proposal.  Rest assured I will fight to maintain that Bonneville’s borrowing authority is protected.   

Sincerely,

Denny Rehberg

Member of Congress