SSJID''s General Manager Jeff Shields, has advised the SSJID Board of Directors that a lawsuit filed by a coalition of local publicly-owned utilities from throughout California may help to clarify the potential impact of Proposition 16 on SSJID''s plan to provide electric service.

The lawsuit was filed in Sacramento County Superior Court on March 18, 2010 by the Sacramento Municipal Utility District, San Francisco Local Agency Formation Commission, City and County of San Francisco, City of Moreno Valley, City of Redding, California Municipal Utilities Associations, San Joaquin Valley Power Authority, Modesto Irrigation District and Merced Irrigation District and seeks to disqualify Proposition 16 from the June ballot on the alleged grounds that it is false and misleading and fails to accurately state its true nature and purpose.

Proposition 16 is a Pacific Gas & Electric (PG&E) funded initiative on the June ballot which would amend the state constitution to require publicly-owned electric utilities and community choice aggregators to hold an election and obtain approval by a two-thirds vote prior to providing electric service in competition with PG&E.

The lawsuit states that, "The title of the initiative - "The Taxpayers Right to Vote Act" - is false and misleading in that it misrepresents that Proposition 16 is a measure to control taxes, borrowing, and public spending, but the creation or expansion of Public Owned Utility''s and Community Choice Aggregation''s do not constitute special taxes, nor do they have anything to do with taxes, borrowing, or government spending, and the petition concerns only a proposal to impose a two-thirds majority vote requirement for the creation or expansion of Public Owned Utility''s and Community Choice Aggregation." The public agencies that filed the action have asked the court to order Proposition 16 removed from the ballot.

SSJID, while not a participant in the litigation, believes that the complaint contains information that may help clarify the potential impact of Proposition 16 on SSJID''s plan to provide electric service.

In late 2009, SSJID submitted an application to the San Joaquin Local Agency Formation Commission (LAFCo) for authority to provide electric service to the residents of Manteca, Ripon and Escalon. If SSJID''s application is approved, it will cut retail electricity rates in its service territory by 15 percent across the board.

The Board of Directors of SSJID has considered the impact of Proposition 16 on District operations and concluded that its passage would adversely impact proposed District efforts to provide retail electric service.

Under current law, SSJID''s plan to provide electric service requires approval by vote of its Board of Directors, which is comprised of elected public officials, and must also be approved by vote of the San Joaquin LAFCo, which is also comprised of elected public officials, following receipt of a report from the California Public Utilities Commission. In addition, should the District seek to annex additional territory to serve any new customer outside SSJID''s existing service territory, who prefers service from SSJID rather than PG&E, SSJID would have to obtain the prior approval of voters before it could provide such service.

Proposition 16 would impose an additional new requirement and prohibit publicly owned utilities, including SSJID, from offering electric service in competition with PG&E unless, in addition to all of the approvals required under existing law, SSJID also obtains prior approval from voters by two-thirds super-majority vote.

PG&E in contrast, is not required to obtain any comparable approvals from elected public officials or voters prior to providing electric service in a new territory or expanding its system to serve additional new customers. And the requirements of Proposition 16 would not apply to PG&E.

A copy of the complaint can be found at http://www.sfcityattorney.org/.

For more information go to www.ssjid.com and www.savewithssjid.com.

Contacts:

South San Joaquin Irrigation District
Jeff Shields, 209-249-4600
jshields@ssjid.com