PROJECT ADMINISTRATION

The CCA draft plan calls for the creation of a new government entity which must be at least partially staffed prior to the beginning of any operations.

On a societal sense, this staff will essentially perform a duplication of the similar functions that will still be performed by PG&E for it's remaining customers.

Accordingly, the CCA calls for an initial $15,800,000 for start-up operations. These initial funds would be paid back by setting the initial CCA rates at a level somewhat greater than those of PG&E.

Although there may be those who will argue about the relative efficiency of private vs. government operations doing the same function, there does not seem to be any significant reason to believe that the staffing costs would be any greater than if PG&E performed the same administrative functions. However, the societal costs will be greater because of the duplication of the function for CCA users and PG&E users. Very probably the decrease in PG&E staffing due to loss of clients to the CCA would not equal the increase in staff caused by the creation of the CCA.