Court rejects South San Joaquin Irrigation District's power bid

By JOHN HOLLAND
jholland@modbee.com

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SACRAMENTO -- A state appellate court has rejected one of the arguments put forth by the South San Joaquin Irrigation District in its bid to become a retail supplier of electricity.

The 3rd District Court of Appeal in Sacramento ruled unanimously Tuesday that the San Joaquin Local Agency Formation Commission acted legally when it voted in 2006 against the district's proposed purchase of the Pacific Gas & Electric Co. distribution system in and around Ripon, Escalon and Manteca.

SSJID had argued that LAFCO, which reviews the boundaries and duties of public agencies in San Joaquin County, did not have authority to decide whether the district could get into the retail power business.

SSJID has long sold wholesale electric-ity from its Tri-Dam system on the Stanislaus River. It aims to buy power lines and other parts of the distribution system from PG&E, claiming that it could reduce rates by about 15 percent. PG&E opposes the effort.

The ruling said LAFCO permission is required under state law because retail power "is a different class of service" from wholesale.

"There would be no point in establishing a detailed, timely and costly procedure for LAFCO approval if a disappointed applicant could simply disregard the decision of LAFCO and proceed with its plan," said the ruling. written by Judge Fred Morrison.

It upheld a decision by Judge Elizabeth Humphreys in San Joaquin County Superior Court on a lawsuit filed by SSJID.

The district board plans to meet in closed session Tuesday to consider appealing to the California Supreme Court, General Manager Jeff Shields said. The other options include proceeding with the remaining issues in the lawsuit, including the grounds cited by LAFCO in its rejection, or dismissing it completely.

PG&E welcomed the appellate ruling, said Nancy McFadden, senior vice president of public affairs, in a news release.

"Before any special district can take over a service as important as a community's electric power, it ought to be able to make a good case, and prove the public benefit to the region, by winning approval at LAFCO," she said.

Bee staff writer John Holland can be reached at jholland@modbee.com or 578-2385.