City managers express disappointment

Rejected settlement means no payments to offset Diablo’s closure

SAN LUIS OBISPO COUNTY — Last month state judge Peter Allen rejected a settlement made by the Coalition of Cities which asked for $10 million for economic development efforts to offset anticipated losses created by the future closure of the Diablo Canyon Power Plant. The money would have come from PG&E ratepayers.

Local cities, including Paso Robles and Atascadero, Arroyo Grande, Morro Bay, Pismo Beach and San Luis Obispo make up the Coalition of Cities. The coalition worked with San Luis Obispo County and the San Luis Obispo School District to negotiate the settlement agreement that was rejected due to a lack of statutory basis for ratepayer funding of this type of settlement.

The coalition’s goal was to manage the economic fallout in the wake of PG&E’s plans to close the power plant. The proposed funding would have provided for economic development efforts to support job creation and business development in local communities after the closing of the plant.

“This is a tremendous setback,” Atascadero City Manager Rachelle Rickard said at a recent City Council meeting. “I forget the number of local jobs here in Atascadero, but it was a tremendous amount,” she said, adding that the judge’s decision will make a “significant adverse impacts on education and public safety and emergency services.”

“These were funds that were targeted, from a city standpoint, trying to work toward bringing jobs to the area,” Rickard said.

“We worked to reach an equitable agreement to help our communities manage the loss of Diablo Canyon,” said Derek Johnson, City of San Luis Obispo City Manager and spokesperson for the Coalition of Cities in a press release. “The agreement we reached with PG&E is founded in fundamental fairness and sound legal and policy considerations.”

Johnson added that it is appropriate for ratepayers to share in funding the economic mitigations. “For nearly 30 years our communities supported and incurred the risks of a nuclear power plant operation that benefitted users throughout the state. Those users will also benefit from the storage of nuclear waste in our community for the foreseeable future. It is only fair to ask those same users to participate in the impact mitigation costs of the operation's closure,” he said, pointing out the potential funding impact on individual ratepayers is negligible, while the cost to the local communities is potentially devastating. “Diablo Canyon represents $1 billion in annual economic impact,” Johnson said. “That kind of loss cannot be borne solely by our residents.”

You may contact Reporter Beth Giuffre at [email protected] for questions and/or feedback.

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