New state bill allows county-owned electric utility to issue bonds

Gov. Ben Cayetano has signed into law a bill that allows an electric utility companies that is owned by the county, or operated by the county, to issue revenue bonds.

The governor signed the new state law last week.

Mayor Maryanne Kusaka, who is in favor of having the county-created power authority take over and run Kaua’i Electric, said the new bill will be beneficial to the county if such an effort moves ahead.

“The Act signed by the governor is consistent with the power authority model that we’ve forwarded to the council in the form of a resolution for a charter amendment,” Kusaka said.

“We thank the Governor for signing this bill so that the power authority alternative, if pursued, can be as effective and beneficial to the ratepayers as possible,” she said.

The Mayor said a power authority has never existed since the State of Hawai’i was formed in 1959.

The bill was written so that it applies only to counties with a resident population under 100,000. Kaua’i County had about 58,500 residents as of April, 2000, according to U.S. Census counts.

The bill also limits how funds generated by such a power authority could be directed. It states that none of the revenues of the power authority can be redirected to the county’s general fund, unless needed to pay taxes.

The bill expires on June 30, 2004.

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