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PG&E’s bid to amend constitution to guarantee higher power costs

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POSTED February 26, 2010 2:27 a.m.
Editor’s note: The following is testimony Thursday at the State Capitol before the Joint Information Hearing of the Senate Energy, Utilities, and Communications Committee as well as the Assembly Utilities and Commerce Committee focusing on Proposition 16 – the PG&E-authored and financed measure to require a two-thirds vote for local public electric providers.

My name is Jeffrey Shields, I am the General Manager of the South San Joaquin Irrigation District (SSJID). I will focus my comments on two messages; first that PG&E’s Proposition 16 calls for yet another election while in fact, SSJID was formed by an election of the voters in our service area with over 80 percent of the electorate voting in the affirmative. Since that election the governing Board members have stood for election every four years. Each of the five current Board members have stood for elections in which PG&E aggressively supported opponents and despite PG&E funding, in some cases over $40,000 to unseat a director, the PG&E candidate was not elected.

PG&E attends every Board meeting of SSJID often taking video and tape recordings of our meetings, and they fund political consulting firms to campaign against our efforts and pepper us with Public Records Act requests. All of this according to PG&E is funded by shareholders.
So my first comment is that for over 100 years SSJID has stood before the electorate and has enjoyed the sunshine of public disclosure on our business. Never once has a voter in our service area had the opportunity to cast a vote to allow PG&E to provide service and never have our citizens been afforded an option to vote for a PG&E Board member or attend, let alone record, a PG&E meeting.

My second issue is the amendment of the Constitution of the State of California by foreign banks and institutional investors. I am a California veteran. I defended this constitution in uniform and I am appalled that PG&E has stated in no uncertain terms that their shareholders are paying to amend our Constitution.

If that is true, then it is important to examine who those shareholders are. One of the largest owners is Barclays Global Investors UK Holdings, Ltd. This UK bank owns 14,449,248 shares of PG&E or 3.90 percent of the outstanding shares of the corporation. It is reported that PG&E has contributed over $6.5 million to date on Proposition 16 and are prepared to spend $30 million. This means that Barclays UK is going to spend $1,170,000 in order to amend the California Constitution. Another major PG&E shareholder, KBC Groep NV is based in Brussels. KBC Groep NV is investing $12,000 to amend the California Constitution.

Perhaps less egregious but no less settling, JP Morgan Chase & Company owns 2.48 percent of PG&E’s outstanding shares. This Wall Street bank took a $25 billion US taxpayer bailout and paid the CEO tens of millions in bonuses throughout the bailout process. Now they are spending $744,000 to amend the California Constitution!

If these foreign banks and Wall Street institutional investors are truly at will to manipulate the California Constitution and this legislature has no ability to prevent that. God help us all, for the greed that, motivates PG&E’s Proposition 16 is only the first thread to be pulled from the fabric that binds our society.
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