2008: Will Buffett help fix environmental issues at PacifiCorp?

AUDIENCE MEMBER: (Inaudible). My name is Chu Chu (Inaudible), and I come here from the Klamath River, and I come here with a heavy heart.

And I know this is a pretty light-hearted event, but I came here last year with a heavy heart, too. And I fasted for ten days driving over here to speak with you.

And, you know, we really were disrespected last year, because one of your subsidiaries, PacifiCorp, has dams on the Klamath River that are creating toxic algae blooms, along with multiple other things. I won’t go into it too far.

But I just come here today with a principle agreement between you and I, that you will sit down at the table and help us figure this out, help us make PacifiCorp accountable.

And being that I’m an indigenous American, and you’re a guest in my home as a European American, that you would do that in front of all your shareholders today in good faith, that you care, you know, as a philanthropist and you care about, you know, helping, you know, third-world countries, you know, fight poverty, disease, when you’re helping create it right here in the United States.

WARREN BUFFETT: You may not — you may not — last year we read the order under which we acquired PacifiCorp.

And, actually, as you may know, I’m prohibited from actually making decisions in that — in the area of PacifiCorp. That was part of the public utility commission ruling when we bought it.

But we have Dave Sokol here who can speak to that. I think the first dam was built in 1907, and we bought PacifiCorp a couple of years ago.

But David — if Dave could go to a microphone, I think that — I think he could address the issues that you brought up. I don’t think we meant in any way to be disrespectful last year.

Those of you who were here last year, we may have a difference of opinion on this, and incidentally there are strong differences of opinion, as I understand it, in your area about what should be done.

And — well, I think I should have Dave make the explanation on it. Dave? Somebody want to put a spotlight on the —

DAVE SOKOL: Thanks, Warren. As you stated first, it would be inappropriate for Mr. Buffett to respond in any detail on this issue, because it’s part of the acquisition in 2006 of PacifiCorp.

He specifically agreed in writing not to interfere with any decisions of our regulated assets within PacifiCorp. So having said that, these four dams that we operate on the Klamath River were built over the last 100 years.

There are a whole series of issues in the Federal Energy Regulatory Commission relicensing process as to what should occur.

These decisions, through that regulatory process, have been ongoing for eight years, and they won’t culminate for probably another six.

Having said that, there are 28 various parties from federal, state, and local agencies, Native Americans, fishery folks, local landowners, that are party to a discussion as to what should or should not happen with these assets — and I left out the irrigators.

Of those 28 parties, other than PacifiCorp, there are at least four different directions in which people think this process should go.

From our perspective, we will be pleased to find a resolution when the 28 parties agree as to how that resolution should go forward, how it would be funded, et cetera.

Fundamentally, it’s up to the Federal Energy Regulatory Commission, state and federal regulators, in addition to them, and then our specific regulators in each of the six states that PacifiCorp operates in.

So if public policy moves in a direction of dam removal, fish ladders, or maintaining the existing status quo, that would be the process in which we would go forward.

We are working constructively with each of the various parties. We’ve met numerous times with each of the four tribes. And it’s a complicated situation and one that hopefully, over time, a cooperative resolution can be met. (Applause.)