“I just want to make it clear it is not the governor’s position that GRDA should be sold,” said Alex Weintz, Gov. Mary Fallin’s Communications Director.
He was referring to a headline in Thursday’s Times saying the governor wants to sell the Grand River Dam Authority. Weintz said he wanted to make clear the governor does not know if GRDA or parts of GRDA should be sold, whether it should be privatized, or whether anything should be done to change its structure.
Weintz said asking the question of whether GRDA should be sold does not mean the governor wants to sell. According to Weintz, Fallin is just trying to find out if that option would be better for the state.
“The governor wants to do what is best for rate payers and Oklahoma. She has formed a task force to study what that is,” Weintz said.
“There was a supplemental report to a previous audit (Gary Jones’ state audit) asking questions and what she’s trying to do is have those questions answered,” Weintz said.
“The task force is to create a study and a list of recommendations. The governor’s priority is that GRDA provides affordable service to rate payers.”
Fallin issued an executive order to establish the task force of 15 appointed members. The order states that all members shall be appointed by the governor.
GRDA is a state agency and because it cannot make a profit and is not supported by tax revenue, the electricity is sold for a much lower price than for-profit companies charge.
“GRDA is a customer-focused organization,” said Tom Rider, General Manager of Municipal Electric Systems of Oklahoma. “The decisions the board and staff make are for the good of the customers they serve. We need to keep this 70-year-old organization, paid for by its customers, in the control of the customers.”
Over the years, there has been talk of selling GRDA to investor-owned companies so it would reap tax revenue for the state’s coffers. But local electricity managers, including Pryor Municipal Utility Board’s Gary Pruett, say customers would see an increase in electricity cost if that happened.
“It’s a lot bigger question than just selling an asset,” Jones said.
“You have to look at it (GRDA) as a going concern and look at the overall structure. This is a complicated issue and there are other benefits and assets (beyond electricity).”
The conclusion portion of the state audit states: “At its core, this remains a question of state tax system design. Any reform will have economic consequences that stretch beyond the balance sheet and geographic boundaries of the GRDA. Recovering the subsidy will alter the distribution of the tax burdens and benefits to citizens and should be evaluated against reasonable alternatives - including tax reforms that would accomplish the same objectives without significant change to the operating status of GRDA.”