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12.19.03 Wise Management: Let the M.U.D. Board plan for the future
without state interference The squabble over whether M.U.D. should be permitted to lay natural gas pipeline from its Omaha service area to a transfer station near Springfield is trivial in its specifics but significant in its implications. It will take the court to clarify the Omaha area utility's independence, or a lack thereof, from state second-guessers. The gas transfer station near 84th Street and West Center Road, once on the fringes of the city, has been engulfed by urban development. The natural gas piped to this station, owned by Northern Natural Gas Co. and used by Metropolitan Utilities District, was not "odorized" -- that is, it didn't have the characteristic scent added to make odorless natural gas detectable, and it was highly pressurized. The citified location, while not necessarily dangerous, encouraged M.U.D. to begin planning for a new facility in the 1980s. Aquila Inc., the private provider of natural gas in the metropolitan area and M.U.D.'s only competitor, objected to the pipeline M.U.D. needed to extend to the new station. While the territory is not exclusively Aquila's (the Nebraska Legislature has not set service areas for private companies), Aquila apparently believed that the pipeline would allow M.U.D. to attract more Sarpy customers. The state Public Service Commission agreed with Aquila that M.U.D.'s action was predatory and stopped the pipeline. M.U.D. has filed an appeal in both Sarpy and Lancaster County courts. Attorneys will argue this issue on the details. To us, it is a larger question. M.U.D. is a publicly owned utility. Its board of directors is elected by voters who are also its customers and who pay its rates. These directors have in the past exhibited considerable wisdom and foresight in planning M.U.D.'s future while at the same time facilitating the growth of the metropolitan Omaha area. M.U.D.'s directors and attorneys argue that the PSC shouldn't be meddling in M.U.D. business -- that the state agency does not have proper jurisdiction in this instance. The courts will make that call. In general, however, we believe that the locally elected board of M.U.D. knows its business and its community and should be free to guide the utility without a state overseer. Its directors are solid, knowledgeable business people and managers, not politicians. They are specialists in gas and water. Their election by local ratepayers is particularly important. While PSC commissioners face election, their constituencies are large, and they routinely deal with many issues. From what we have seen, M.U.D.'s proposed pipeline and the new transfer station seem reasonable and defensible. While the change isn't an emergency (pressure at the station at 84th and West Center has been lowered and the gas is being odorized before it gets there), the addition would facilitate future development in M.U.D.'s existing service area and will be needed eventually. That looks to us like good management on the part of M.U.D.'s directors. We hope the courts tell the PSC to let them do the job right. |
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