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Ballot Measures

Provide That Any City Owning A Municipal Electric System May Acquire, Construct, Install And Equip Electric Generating, Transmission And Distribution Facilities & incur indebtedness or liability under agreements

November 2, 2010 Idaho General Election
Description:

Shall Article VIII, of the Constitution of the State of Idaho be amended by the addition of a New Section 3D to provide that any city owning a municipal electric system may:

(a) acquire, construct, install and equip electric generating, transmission and distribution facilities for the purpose of supplying electricity to customers located within the service area of each system established by law and for the purpose of paying the cost thereof, may issue revenue bonds with the assent of a majority of the qualified electors voting at an election held as provided by law; and

(b) incur indebtedness or liability under agreements to purchase, share, exchange or transmit wholesale electricity for the use and benefit of customers located within such service area;

provided that any revenue bonds, indebtedness or liability shall be payable solely from the rates, charges or revenues derived from the municipal electric system and shall not be secured by the full faith and credit or the taxing power of the city, the state or any political subdivision?"

Meaning, Purpose and Result to Be Accomplished

This proposed amendment has two parts. The first part will allow any city owning a municipal electric system to acquire, construct, install and equip electrical generating, transmission and distribution facilities for the purpose of supplying electricity to customers within its service area. The city will be authorized to issue revenue bonds to pay for such facilities, with the assent of a majority of the qualified voters, provided that these bonds are paid for by the electrical system rates and charges, or revenues derived from the municipal electric system, and not with tax dollars.

The second part of this proposed amendment will allow any city owning a municipal electric system to enter into agreements to purchase, share, exchange or transmit wholesale electricity to customers within its service area, without voter approval. Any indebtedness or liability from these agreements will be paid for by the electrical system rates and charges, or revenues derived from the municipal electric system, and not with tax dollars.

Statements FOR the Proposed Amendment

1. This amendment will clarify that a city owning a municipal electric system may enter into contracts or agreements for the purchase of wholesale electricity, helping to ensure that its citizens have low-cost and stable electric utility rates.

2. This amendment will allow a city owning a municipal electric system to responsibly upgrade and modernize electricity-related facilities and help to stabilize electric rates. Such cities will be allowed to issue revenue bonds, with the assent of a majority of voters, in order to finance investment in electric generation, transmission and distribution infrastructure.

3. This amendment provides that voter-approved revenue bonds and other indebtedness or liability shall be payable solely from the revenues derived from the municipal electric system. The amendment specifically provides that the revenue bonds and other indebtedness or liability shall not be secured by the taxing power of the city, state or any political subdivision.

Statements AGAINST the Proposed Amendment

1. The existing Idaho constitutional requirement mandating a two-thirds assent of the voters before a city owning a municipal electric system can enter into agreements resulting in debt is an important safeguard for all Idaho citizens.

2. Currently, the Constitution requires two-thirds assent of the voters of a city to approve the issuance of revenue bonds by a city owning a municipal electric system. If adopted, the proposed amendment will require only a majority of the voters to approve the issuance of revenue bonds by the city to finance electric generating, transmission and distribution facilities.

3. Changes to the Constitution should be made only for major issues of interest to the entire state or in the event of a constitutional crisis.

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