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Council delays decision on consumer advocate

Monday, November 23, 2015 by Jack Craver

Not just any old consumer advocate will do.

City Council members made clear Thursday night that they were far from convinced that Oxford Advisors LLC, a firm proposed by Austin Energy to serve as an advocate for Austin ratepayers, was qualified to represent the best interests of average Austinites during the upcoming cost of service study.

A number of Council members voiced concerns that the New York-based firm did not have experience representing residential electric customers and small businesses. A 2012 ordinance requires Council to find a third party to speak for the interests of these two groups whenever the city studies its rates, which it is required to do at least every five years. The idea is for there to be a voice for the large, unorganized mass of consumers who are less likely than large business interests to have their perspectives included in the process.

Mark Dreyfus, vice president of regulatory affairs and corporate communications for Austin Energy, defended Oxford’s qualifications but also emphasized that the city had not been presented with many alternatives. Although AE reached out to companies in two separate solicitation efforts, only two firms had applied for the contract, he said.

As something of a compromise proposed by Mayor Steve Adler, Council voted to postpone action on the $200,000 contract until Dec. 3, the day of Austin Energy’s next meeting. Although Council does not have a regular session scheduled that day, it will convene specifically to address the contract, due to concerns that delaying a decision further will make it hard for the cost of service study to be completed by next summer. Only Council Member Ellen Troxclair voted against the postponement.

Adler said the short delay would allow Austin Energy to take into account questions posed by Council members about how Oxford was chosen and why only one other firm had applied for the contract. In the meantime, the utility could reach out to more firms to see whether there are other potential bidders that the first two solicitations missed.

“If you reached out to (firms) and said, if we did this, would you want to bid, and they all said no, then that would indicate to us if you did it a third time, it wouldn’t be any different,” said Adler. “If you reached out to them and they all said yes, then we would at least know whether to do the delay because it’s going to result in more people, as opposed to doing the delay only to do it yet a third time and be in the same place.”

Council Member Leslie Pool expressed doubt that Oxford was the right fit for what was required. “We need someone who has background in residential and small business, and there’s a sense in the community that Oxford does not, in fact, have that,” said Pool. “They’ve worked primarily with commercial (customers).”

The Electric Utility Commission had already voted against approving the contract, a recommendation that a number of Council members were loath to ignore.

“I would say it really concerns me when we have a recommendation from the Electric Utility Commission that this is not a firm that they feel has adequate experience representing residential customers, and I’ve gotten a couple emails to that effect as well from people I really trust,” said Mayor Pro Tem Kathie Tovo. “I’m just not sure we’re quite there yet, in getting exactly the right group.”

Dreyfus emphasized that nixing the contract, or significantly delaying its approval, would jeopardize plans to finish the study and present the proposed new rates to Council by next summer, so that they could be included as part of the budget process.

That point resonated with Council Member Sheri Gallo. “You know, it looks like that there were almost a thousand notices sent out with just less respondents than we would like to come back, but I am concerned about us doing something that would delay our timeline and cause some negative effects and consequences to us as we go through this process,” she said.

Council Member Greg Casar, one of the two who had pulled the contract for discussion, argued against making a decision too quickly.

“I want this (advocate) to be, you know, a phenomenal force, and I would hope that they are, but at the same time getting two responses and then having all these questions about whether they have the experience we need for what we’re about to get into, it makes it hard for me to want to move forward hastily with it,” he said.

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