By Jennifer Grimes

Triplicate staff writer

The buyout of PacifiCorp by Nor-Cal seemed all but certain yesterday, as the two groups reached a tentative agreement.

If ratified by California Public Utilities Commission sometime next year, residents of Del Norte, Siskiyou and Modoc counties will be part of a public power cooperative and will benefit by seeing long-term, stable power rates. Ultimately, when the debt is paid, they may see rates go down.

Nor-Cal doesnt pay federal or state income tax and doesnt pay dividends to stockholders. The debt comes off much like a mortgage and optimistically in less than 20 years, the public will own the system outright. Rates will significantly drop off, said Del Norte Counsel Bob Black, a central figure in forming the Nor-Cal deal and governance structure for the past few years.

The two groups did not announce a purchase price for PacifiCorps Northern California holdings, but said that price will be announced when a final deal is struck.

Right now ratepayers spend 6.1 cents per kilowatt/hour. PacifiCorp plans to raise electricity rates 30 percent soon to 9.1 cents per kilowatt/hour. But under Nor-Cal, if the deal goes through, bills will increase by just 13 percent, according to Black, and will remain relatively constant for at least 10 years.

To get Nor-Cal up and running, it will be governed by a temporary commission of seven elected officials appointed by the member counties.

Del Norte County will have two seats on the commission, Modoc County will have one seat and Siskiyou County, which has the largest population, will have four seats.

After 120 days under this transitional board, all Nor-Cal members will be elected.

So far, Crescent City has not yet agreed to participate.

City Manager Dave Wells said the city probably wont join until everything in the deal is resolved and the structure of the operating board is finalized.

Its hard to make a decision to be involved in something until you know what that something is, Wells said.

Black said he hopes to have the 4,000-page application for Nor-Cal to buy PacifiCorp to the PUC by mid-January.

That means, getting all cities signed on, and formalizing financing information in the next three months.

None of the cities have opposed it and I think the economic case to be made is compelling, Black said.

If all goes according to plan, Black said local residents will be seeing Nor-Cal electric bills instead of Pacific Power bills by September 2002.

Several local benefits should be seen after switching to the smaller publicly owned company, according to Black and Reese.

One thing that impresses me is I wont have to call Portland to get in touch with a human being like if a tree falls on the line behind my house I can call the local office, Reese said.

Also Nor-Cal will have 110 local employees, where PacifiCorp has 47. Black said local banks and other service providers will have the chance to bid for Nor-Cals business.

After about four years and $514,000 of Del Norte County time and money, Reese said he is happy with this outcome.

We are extremely pleased with the outcome of this long negotiation process. With this improved purchase agreement, we have developed a transaction which is clearly in the public benefit, he said.

Black said all the money invested in Nor-Cal by the county over the last several years will come back to the county when the deal closes.

He estimates that with the bill for his staff time, that could amount to $750,000.

Under Nor-Cal, more money would be invested for capital improvements than is planned with PacifiCorp.

All local PacifiCorp employees have been offered jobs with the fledgling public utility at the same rate of pay.

Black and PacifiCorp officials met with the union officials yesterday.