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Council divided on Austin Energy oversight

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Austin Energy's future is again stirring debate among city council members.

Debated Thursday was when—and if—the city should create an independent board to oversee its biggest asset.

But City Council remains divided on the issue. Council Member Laura Morrison said she wants to see a comprehensive report on how cities across the country manage their own power companies before voting to overhaul Austin Energy.

"I feel like I have a responsibility to make sure I'm making the best decision," she said. “I still need to see why it's called for."

Mayor Lee Leffingwell says the reasons are clear, referencing a settlement with the Public Utility Commission which gave Austin Energy customers outside city limits lower rates than customers in Austin.

"We not only got an appeal to the PUC, we painted a target on our back at the state legislature,” Leffingwell said. "We've got to correct the situation we are in right now, and we have got to do it on a timely basis."

Council Member Mike Martinez said the council's actions are being closely watched by the state lawmakers working just ten blocks north of City Hall. He says any major decision needs to be especially well thought-through.

"We have a bill to change the annexation agreement over Circuit of The Americas. We have a bill to preclude us from adopting economic incentive policies with a wage floor," Martinez said.

But Martinez says the council is caught in a vice, pulled between making good decisions and making them quickly.

City Manager Marc Ott admits reorganization will be just as difficult as recent rate hikes.

"It was going to be messy, and it was going to be challenging,” Ott said. “At the end of the day, the ship was righted."

Evidenced, Ott said, by better bond ratings for the utility and a healthier financial outlook.

City Council will vote Thursday if it wants the City Manager to move forward with a comprehensive study regarding Austin Energy’s governance. If so, the report would be brought back before the Council on May 23.

Mayor Leffingwell wants to have an independent board in place by the end of the year.

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