Arizona to L.A.: Lights out!

NEW YORK (CNNMoney.com) -- Arizona responded to the Los Angeles city council boycott with a suggestion of its own: cutting power to the nation's second-largest city.

The Arizona Corporation Commission, the overseer for the state's electric and water utilities, has offered to pull the plug on Los Angeles, noting that Arizona's power plants supply electricity to 25% of the city.

"If an economic boycott is truly what you desire, I will be happy to encourage Arizona utilities to renegotiate your power agreements so Los Angeles no longer receives power from Arizona-based generation," wrote Arizona Corporation Commissioner Gary Pierce to Los Angeles Mayor Antonio R. Villaraigosa, in a May 18 letter.

"I am confident that Arizona's utilities would be happy to take those electrons off your hands," he wrote.

The letter is in response to the Los Angeles city council decision on May 12 to boycott the state of Arizona and Arizona-based businesses to protest the state's controversial new immigration law, which will take effect in July. Estimates of the economic impact range from $10 million to $56 million.

John LeSueur, spokesman for Pierce, downplayed the threatening nature of the letter, emphasizing that the commission itself does not have the authority to cut power to Los Angeles.

"It's not a threat," he told CNNMoney.com. "It's just pointing out the ramification of what L.A.'s threat would be on the boycott. If they carry out their threat to boycott Arizona, that includes 25% of their power."

LeSueur pointed out that Los Angeles has partial ownership in two of the Arizona power plants, including a 5.7% stake in the Palo Verde nuclear power plant, and a 21% stake in the Navajo Generation Station on a Navajo reservation.

The Arizona law requires enforcement agents to "determine the immigration status" of anyone under "reasonable suspicion" of being an illegal alien. In other words, the law provides state police with the power and responsibility that is normally accorded to federal immigration authorities.

The bill's proponents are concerned about the federal government's failure to crack down on illegal immigration and the growing sense of lawlessness in the border region with Mexico, where an American rancher was murdered in March.

The law's opponents are concerned that the bill endorses racial profiling. Gerry Miller, chief legislative analyst for Los Angeles, said in a May 11 analysis of the boycott that the Arizona law will "promote racial profiling, discrimination and harassment."

President Obama, in a meeting with Mexican President Felipe Calderon at the White House on Wednesday, called Arizona's law a "misdirected expression of frustration."

But it's not clear how much power Los Angeles actually has in boycotting Arizona.

Paul Senseman, a spokesman for Arizona Gov. Janice Brewer, told CNNMoney.com on May 13 that the Constitution "specifically prohibits economic blockades by a state or city against another."

Officials in Los Angeles spoke in support of the boycott, including Mayor Antonio Villaraigosa and Austin Beutner, general manager of the Los Angeles Department of Water and Power.

Beutner said he doubted that Arizona had the ability to turn off the lights, because L.A. was part owner of two of the power plants.

"As such, nothing in the city's resolution is inconsistent with our continuing to receive power from those LADWP-owned assets," he said.

Beutner added, "As the city's job czar, I would welcome any conventions or meetings that were going to be held in Arizona to come to Los Angeles. We have fantastic facilities and incomparable weather and we'd welcome them to the City of Angels."