Don't micromanage CPS Energy

Our community is fortunate to have an exceptionally valuable asset in CPS Energy.

When San Antonio city leaders purchased the utility company for $34 million in 1942, they enabled San Antonio to chart its own course to adequately serve its energy needs for decades. As a result, San Antonio each year receives 14 percent of the annual gross revenue of CPS, which constitutes approximately 30 percent of the general revenues of the city. Yet even with 14 percent of its gross revenue going directly to the city, CPS has grown into a jewel for San Antonio.

By any standard, this municipally owned gas and electric utility is well-managed and successful, and it continues to get better. Electric service reliability is in the top 10 percent of all utilities in the nation, helping our community expand and attract new business. The company has a top-tier credit rating and was recognized last year by Bank of America Merrill Lynch as being the best of the best. And when compared on multiple measures to utilities across the nation, CPS Energy repeatedly ranks at the top of those national studies.

While CPS Energy excels in every category, the 14 percent of CPS Energy's revenue that goes into the budget of the city of San Antonio effectively enables those dollars to do double duty: helping to fund services delivered by the city to the ratepayers, and shielding those same ratepayers from higher taxes. It is also worth noting that even with the contemplated rate increase, CPS rates will remain the lowest among major cities in Texas and the lowest among the 20 largest cities in the country.

CPS Energy should not be evaluated by any comparisons with other city services or utilities. The City Council should recognize that CPS, by any standard, is a very substantial corporate entity that is on a par with and competes effectively with major privately held utilities for talent and financing.

CPS Energy should not be micromanaged by our city's leaders. The council should allow the CPS Energy independent board of trustees and management team to continue to run their business effectively. Evaluate and hold CPS Energy accountable on the basis of its overall performance, and let it compete in its marketplace. Otherwise, we seriously risk diminishing its ability to continue to excel.

We should appreciate the wisdom of the people who made the decision to establish CPS Energy with an independent board of trustees, and we should allow CPS to continue to excel.

J. Russell Davis practices transactional law, predominantly in commercial real estate development, and is a founding shareholder of Davis, Cedillo & Mendoza Inc.