We're Number One
In bankruptcies, that is. A recent Fortune magazine article about
bankruptcy focused on Memphis since we're so damn good at it, with the highest
filing rate in the country, a solid 1.4 percentage points ahead of the nearest
competitor and almost four times the national average.
"A visitor soon concludes that this boomtown has a culture of bankruptcy,"
the article says. "The city itself went bankrupt in 1879, and so have
many of its leading citizens, from the founder of the Piggly Wiggly grocery
chain to rock-and-roll legend Jerry Lee Lewis."
The reasons why, Memphis ranks as "No. 1 deadbeat," according
to Fortune? The article names quite a few -- including overborrowing,
state debt-collection laws, and the already-mentioned "culture of bankruptcy"
-- but the most ominous is what it calls "an apparent propensity for
personal misfortune."
Origin of Presleys Revisited
In response to last week's discussion here about the origins of the Presley
clan in Scotland, a reader sent us an article from the Turkish Daily
News with the headline, "Lincoln and Elvis were Turks, says Virginia
University deputy rector." According to the research of Brent Kennedy,
the deputy rector in question, the Meluncans, a group of Mediterranean peoples
brought to Roanoke by Sir Francis Drake by way of Brazil, originated in
Turkey before they were taken to South America by the Portugese. "It
is possible to meet some world-famous names within the list of Meluncans,"
the News item continues. "Abraham Lincoln, the United States'
16th president who struggled to abolish slavery, and Elvis Presley, one
of the most significant singers in the world, were also Meluncans."
Verbatim
We're not sure what to make of this snippet from "Women of Sex: A Man's
View," a commentary/manifesto from our new favorite publication, Memphis
Dateline.
"Quite contrary to what the `religious right' would like for you to
believe, dancers and models are not freelance sex junkies," writes
the unnamed author. "Factually, it's more difficult to have sex with
a dancer or model than it is to have sex with a woman not in the world of
sex."
We don't know why that is, and to tell you the truth, we don't even want
to touch it. Not even with a brass pole.
Fan Mail
We got a vague and anonymous e-mail recently with "Fly Guy" as
the subject, so we assume it belongs here.
"You are almost preposterously twee," writes this loyal fan. "Go
read a good book or learn memory tricks or something."
Well, thank you very much. Most humor-watchers agree that twee is shaping
up to be next year's black, after all. But what's with the "almost"?
MLGW Customers Will Pay For TVA's Nuclear Debt
by Debbie Gilbert
ctober is usually
a halcyon time for utility customers -- a month when neither air conditioning
nor heating is necessary. So you might feel disconcerted when your October
bill seems higher than it should be. But get used to it; the increase is
permanent. And don't bother calling Memphis Light, Gas & Water to complain.
The Tennessee Valley Authority, sole supplier of power to MLGW, voted August
5th to raise its wholesale rates by 5.5 percent, and MLGW has no alternative
but to pass the cost on to you.
TVA's
decision, after a decade-long rate freeze, came as no surprise to those
in the industry. Back in September 1995, John McCullough, MLGW's manager
of budget, plant, and rates, prophetically told the Flyer: "I
don't see any way they can go past October 1997 without raising rates significantly."
No one questions the need for a rate hike, but some are unhappy about the reason behind it. Economic inflation wasn't a factor, nor has there been a change in the actual cost of producing electricity. Every penny of the rate increase will go toward paying off TVA's $27.6 billion debt -- a burden so enormous that TVA spends one-third of its annual $5.7 billion in revenues just to pay interest on the debt. TVA estimates that the rate hike, combined with internal cost-cutting measures, will cut the debt in half by 2007.
But how did the debt grow so huge in the first place? About $17 billion of it was incurred between 1980 and 1994, when 44 percent of TVA's capital budget was spent building nuclear power plants. Plagued by shoddy construction, management problems, and safety issues, these plants took years to complete, accumulating massive costs along the way. Case in point: The Watts Bar Unit 1 reactor, near Knoxville, was under construction for 22 years before being brought on-line in 1996.
But at least Watts Bar is now producing revenue. Three of TVA's nine nuclear units were mothballed before completion and will never be used; TVA spent $6.3 billion on those white elephants. In December 1994, TVA Chairman Craven Crowell announced that the agency, in order to stop "piling up debt," would no longer be in the business of building nuclear power plants.
According to TVA spokesman Frank Cason, the reactors were financed through government bonds, which he likens to taking out a loan in order to buy a house. "By ending the nuclear program," he says, "we dramatically reduced capital costs and ended the borrowing." TVA's capital budget -- which covers construction of new facilities as well as improvements or additions to existing structures -- was about $1.87 billion in 1995; it's projected to drop to $821 million this year.
But although TVA has stopped the fiscal hemorrhaging, it still must pay back what it owes -- and that's where you come in. Starting October 1st, TVA's 8 million residential customers will pay an average of $3.39 extra per month. And because MLGW is the largest of TVA's 160 distributors, purchasing more than 10 percent of the electricity TVA generates, Memphians will be disproportionately affected.
"That is a serious concern," says Herman Morris, who was just sworn in last week as the new president and CEO of MLGW. "It is unfortunate that our customers -- who have not benefited from the nuclear program -- are being asked to help pay for this debt."
However, MLGW doesn't plan to make a bad situation worse. "We don't anticipate any upward [rate] adjustment for MLGW before the year 2000," Morris says. "So we hope this will make the increase by TVA more palatable to our customers."
Some activists claim that the rate increase unfairly targets residential consumers. "TVA is giving rebates and growth credits to big industries to offset the rate hike," says Michelle Neal of the Knoxville-based Tennessee Valley Energy Reform Coalition. "I think TVA is primarily looking out for the interests of large industrial consumers."