Clean Energy In the News

Friday, January 25, 2008

By Timothy C. Barmann Journal Staff Writer

Governor Carcieri has proposed shrinking the Public Utilities Commission to three members from five.

Assuming the General Assembly goes along with the proposal, it shouldn’t be hard to implement.

That’s because the PUC never had five members, even though state law has required it for the past four years.

In 2004, a new law expanded the number of commissioners to five from three. Supporters, including Rep. Brian Kennedy, D-Westerly, have said that having more commissioners would bring about more diverse discussions of utility issues, ultimately to the benefit of ratepayers.

The law required the governor to appoint two new commissioners, with the advice and consent of the Senate, by Jan. 30, 2004. It never happened.

The budgets approved by the governor and the General Assembly did not include financing for the new positions. “The governor has long believed that two additional commissioners are unnecessary to the mission of the PUC,” said Jeff Neal, a spokesman for Carcieri. “In addition, those additional positions have never been funded. In light of the state’s budget crisis, it is not clear that funding will be available next year either.”

The governor’s lack of action rankled community activists, who argued that the current three-member commission was not sensitive to the plight of low-income customers. And it prompted Attorney General Patrick Lynch to write to the governor in December 2006 and in May 2007, urging him to follow the mandate of the law.

Lynch told The Journal that if the governor didn’t like the law, he should try to change it rather than ignore it. That’s apparently what Carcieri is now trying to do. The supplemental budget proposal that the governor released this week removes the language added by the 2004 law, bringing the number of commissioners back to three. (Since the positions were never filled, the change won’t result in any new savings.)

The House Finance Committee is scheduled to take up the governor’s proposal today. Curiously, Carcieri also proposed removing language that established a waiting period before a utility company employee or executive could become a state regulator.

The law now says: “At least three of the five commissioners shall not be, nor shall have been within the previous five years, an employee, officer, or director of any business whose activities are subject to regulation by the commission.”

Matt Auten, a spokesman for Environment Rhode Island, a nonprofit environmental lobbying organization, said removal of that language would not serve the public interest. “It’s important, from a public policy perspective, that you have some separation, a firewall, or they call it a revolving-door provision,” Auten said. Otherwise, he said, there is little separation between those who write the rules and those who are required to follow them.

Neal, the governor’s spokesman, said it appears that the revolving-door language was eliminated unintentionally. “It was not the governor’s intention to completely remove the enumerated restrictions on who can serve as a commissioner,” Neal said. “As a result, the governor would be open to retaining those restrictions for some number of the remaining three commissioners.”

The current commissioners are: Elia Germani, chairman; Mary Bray; and Robert Holbrook. All three have either been appointed or reappointed by Carcieri.

The governor’s office has said that making the PUC smaller would save money. But the costs of running the PUC are paid by customers of utility companies, rather than taxpayers. Assessments are made through utility bills as Gross Earnings Tax and the money is put aside in a restricted state account to pay for PUC and Division of Public Utilities and Carriers operations.

A commissioner’s base salary during the current fiscal year is $81,089, according to the DPUC. With benefits, that brings the total to about $126,000 a year. Two additional commissioners would add about $252,000 a year to the annual budget of the PUC and the DPUC, which is $6.9 million this fiscal year.

To add two commissioners would cost a typical customer about 40 cents a year, or a little more than 3 cents a month, according to calculations by The Journal.

Germani, the PUC chairman, said he doesn’t think a commission with five members would necessarily be better than one with three members. “The number of commissioners is not terribly relevant,” Germani said. “It’s the quality of the people that is much more important. I don’t think you gain anything from going from three to five.”

tbarmann@projo.com