Cook potatoes in boiling water to cover and 1 teaspoon salt 15 to 20 minutes or until tender; drain. Plunge into ice water to stop the cooking process; drain. Peel potatoes, and cut in half.
Place potato, bell pepper, and next 3 ingredients in a large bowl.
Process remaining 1 teaspoon salt, vinegar, pepper, and sugar in a blender until smooth. Turn blender on high; add oil in a slow, steady stream.