Thursday, September 23, 2010

State's Revolving Door Law Has No Teeth

The hiring of the top lawyer for the Indiana Utility Regulatory Commission by Duke Energy is Exhibit A for demonstrating Indiana's revolving door law has no teeth. The Star's John Russell has a story on the state ethics commission giving a green light to Duke Energy to hire Scott Storms, the IURC's general counsel:

Indiana's largest electric supplier, Duke Energy, has hired the top lawyer away from the state commission that approves utility rates, a move that raised ethical howls from several consumer-watchdog groups.

Scott R. Storms will begin his new job Monday as a lawyer in Duke Energy's regulatory division, just days after leaving his job as general counsel of the Indiana Utility Regulatory Commission . . .

While working for the state, Storms helped manage the regulatory process over Duke Energy, including oversight of its controversial Edwardsport power plant in southwestern Indiana.

The plant, which is still under construction, has seen its construction costs climb sharply, which will result in higher electrical rates for customers. Storms also acted as an administrative law judge in the case, taking testimony and evidence and overseeing numerous proceedings about the Edwardsport plant . . .

State ethics law forbids certain state employees from taking a job with a company the state regulates for at least a year. But the panel said the prohibition didn't apply to Storms, because he never made a regulatory or licensing decision on behalf of the state affecting Duke. Nor did he negotiate or administer a contract with Duke, the ethics panel said.

"This provision would not be triggered by Mr. Storms' work at the IURC as he was neither a commissioner nor a voting member of the regulatory body that may have made license or permit decisions regarding Duke," the panel wrote in a decision issued this month.

However, the ethics panel added that Storms would be prohibited from representing or assisting Duke on any matter in which he was "personally or substantially involved as a regulator." Those include several cases involving the Edwardsport plant and Duke's "smart grid." . . .

"An administrative law judge is extremely involved in handling all the legal evidence, procedures and details in a utility case, maybe even more so than a commissioner," said Julia Vaughn, policy director of Common Cause Indiana, a nonpartisan government watchdog group. "He or she is really the person who does the hard, hands-on day-to-day work."

She said that allowing a utility to hire a state regulator without an extended "cooling-off" period could give the impression that the corporate job was a gift offered in exchange for favorable regulatory treatment.

It's bad enough the revolving door law is only applicable to a one-year cooling off period after a person leaves their governmental job. The law becomes completely useless when the state ethics commission issues opinions which grant exceptions that completely consume the rule.

1 comment:

interestedparty said...

Why no comments? This is an egregious breach of trust and a transgression against all - or almost all - of us, no matter the "legalities".