The Pros of Privatizing Power

Rep. Bob Franks, R-N.J., going against the grain of several colleagues' interpretations, Wednesday contended a new GAO report actually confirms both the feasibility and desirability of selling off federal power marketing administrations.

The report concludes "that there are no insurmountable obstacles to privatizing" the PMAs, according to a statement from Franks' office.

"GAO reiterated its findings from a previous report that the PMAs cost taxpayers at least $300 million per year. In addition, the government auditors highlighted the fact that taxpayers could receive a far greater return on investment if the government sold its power at market rates rather than below the cost of production," the statement said.

Franks and Rep. Martin Meehan, D-Mass., who co-chair the Northeast-Midwest Congressional Coalition, intend to introduce legislation to sell off the PMAs and force market rate sales of public power. Earlier this week, Rep. John Spratt, D-S.C., who had requested the study, said the report suggests that relying on the sale of PMAs to raise revenue for closing the deficit would be unwise.

The PMAs are prevalent in the Southeast, Southwest, Northwest and Alaska.