On April 11, Austin City Council approved 6-0 the first reading of an ordinance that would establish an independent governing board for Austin Energy. Councilwoman Kathie Tovo did not attend the meeting because she was in China on council business.

"I think it is a good thing we're only looking at this on first reading and not any more readings than that," Councilman Bill Spelman said. "I would like to believe we could come to closure on this sooner rather than later, but it may take longer than a couple of weeks for us to come to closure, and I think we have a lot of people we need to talk with and a lot of discussions we need to have, and it's going to be done when it's going to be done. But in the meantime, I think we need to take the first step."

Currently, AE is governed by City Council. After some significant amendments proposed by Councilwoman Laura Morrison, the ordinance would distribute certain duties and powers to the newly created Electric Utility Board while the council retains all other authorities. The original language of the ordinance had the council giving all of its authority to the new board except for certain powers, including approval of rates adopted by the board and final authorization for debt issuance, lease of property and use of eminent domain.

"What I'm very very concerned about is the fact that we, as elected officials, have an enormous impact on balancing all of the things we have to balance when we are making decisions about Austin Energy," Morrison said. "It's because we're elected officials and because it's our job to take into account all those different values that we're the ones that really have to be making a lot of the decisions."

Mayor Lee Leffingwell did not support the switch in the language, saying that it undermined the original intention of the ordinance.

"The overall principle was to transfer authority and create an independent board," Leffingwell said. "This is, at the very best, a glorified Electric Utility Commission. It doesn't meet the primary objective of what we're trying to do."

The Electric Utility Commission is a board that reviews the policies and procedures of AE.

Austin resident David King spoke at the meeting, saying he understands the need for an independent board but hopes the council proceeds cautiously.

"I understand the benefits of having an independent advisory board," King said. "I think that's a good idea to have that professional board with expertise to help you and guide you and the city manager through the management of this utility. I'm just a little nervous in having elected people like you representing people like me and the citizens of Austin giving up control and authority."

Tom Smith, Texas director of Public Citizen—a nonprofit organization that focuses on promoting citizen interests in government—opposes the ordinance and said it is going to be one of the "most important and monumental" decisions the council members will make.

"Having elected officials set utility policy has made you an award-winning utility around the nation," Smith said. "We ask you to be very cognizant of that."

The authority that the EUB will ultimately possess has yet to be decided. Other details that still need to be finalized include an appeals process for board decisions and the council's role in selecting an independent examiner and consumer advocate, both of whom are involved in the comprehensive rate review process.

"I don't think our current ordinance is ready for prime time, and I look forward to improving it," Spelman said.