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Troy Moody
Editor’s note: Candidates were asked to answer in no more than 650 words total for all three questions. For instance, they can use 300 words on one question, 200 for another and 150 for another question or other combinations, not to exceed 650 words total.
Question: What would you do to ensure the long-term fiscal viability of the PUD considering anticipated increases in power demands, as well as increases in operational and regulatory costs?
Answer: Let’s first put a definition to the word “viability,” defined as “the ability to work as intended or succeed.
There are some things we must be sure to guard and maintain.
1. We must keep and maintain the quality work force that we are blessed to have, and if possible, increase the quality of skills in our work force.
Work terms, conditions, and wages are critical for this.
2. We must stay up on our technology and keep our equipment current.
That will not be possible if we eliminate our cash on hand, which will force the bond market to deem us a “high risk” investment and subsequently cost our rare payers a much higher percentage when we must use long term bonds for funding projects.
Question: Should the PUD continue to use some of its cash reserves to keep from raising electric rates to balance the budget, as it did last year? Won’t that lead to larger rate increases in the future? Why or why not?
Answer: A hypothetical situation never deserves an absolute black or white answer. For example, if we say, “yes,” and we continue on that path then eventually we run out of cash on hand. Like I said in the previous answer, that makes our interest rate skyrocket. However, if we say, “no”, and attempt to continue on that course, then when we have no ability to fill in a financial gap if it unexpectedly appears.
The reality is that we must always keep that as an option, but I do not believe that we should plan to create a policy demanding that we do that.
Unless we see an actual reduction in the direction of inflation in the country, it is safe to assume that prices will continue to rise, wages, construction products, fuel, taxes, transformers, wire, steel electronics, and more will be steadily more costly in the future. In my opinion, another area of massive cost increase is coming at us via DEI(diversity/ equity/inclusion). We see it through things such as The Climate Control Act, commonly referred to as Carbon Tax.
Question: Which is preferable, funding capital projects by selling bonds or using the cash reserves? Why?
Again, this is not a, “pick one or the other,” answer. In order to be a “viable” PUD, we need a balance of both. We should be fortifying our PUD for our children and grandchildren. My opponent wants us to use up a large amount, if not almost all of the “cash on hand.” I think maybe by doing that it’ll make those who stand around us slap us on the back and like us. But the other thing that will happen is that when we need money, we’ll need to borrow more at a higher rate from the bond market and that will saddle our kids with even more debt, therefore higher rates. He says, $100 million dollars is too much to have on hand, did you know that just one generator turbine at box canyon costs about $100,000,000? You wouldn’t drain your family savings account, and we shouldn’t drain our children’s PUD account either. It’s not good business practice. Even an average businessman knows this.
If rates must go up, it must be as little as possible and in small increments based on competent analysis.
I find it interesting that my opponent is only focusing on this topic after 5-1/2 years of being commissioner and has an election to win.
