More Bad News For Daniels Administration On IURC Ethics Flap

A new report by the Star's John Russell suggests Daniels' own office knew more about the controversial hiring of former IURC general counsel Scott Storms by Duke Energy a bit sooner than had earlier been claimed. Russell writes:

More than a month before a state ethics panel gave a green light to the top lawyer at the Indiana Utility Regulatory Commission to take a job with a major utility, Gov. Mitch Daniels' chief of staff seemed to be raising doubts that such a move would clear ethical hurdles, according to e-mails obtained by The Indianapolis Star.


By early September, those hurdles disappeared.

In a series of back-and-forth messages in August, two key players involved in the revolving-door case discussed the doubts and how to handle them.

The messages concerned whether Scott Storms, then general counsel and administrative law judge at the regulatory commission, would face ethical issues by seeking a job at Duke Energy Corp., over whose cases he had presided for several years. Storms had played a key role in administering one of Duke's biggest ongoing cases before the commission, construction of the utility's massive $2.9 billion coal-gasification plant in Edwardsport.

Mike Reed, then president of Duke Energy's Indiana division, wrote an e-mail on Aug. 1 to David Lott Hardy, the chairman of the regulatory commission. Reed said he had recently played golf with "EAG," presumed to be Daniels' chief of staff, Earl A. Goode, and the subject of Storms had come up.

"EAG told me during golf he will be surprised if IG [inspector general] OK's SS to join us. Reason: Eport," Reed wrote to Hardy, using shorthand to refer to the Edwardsport plant.

A few minutes later, Hardy shot back his answer: "What a crock."

But Reed had an idea. "Now we know the challenge," he wrote to Hardy. "Let's not give up. Focus may need to be how to convince that we can wall him off."

He told Hardy that the commission's ethics officer, Loraine L. Seyfried, "must clearly spell out how (Storms) would be walled off from Edwardsport, and therefore meet the test."

A few weeks later, on Aug. 25, Seyfried sent a three-page memo to Storms, stating her opinion that his prospective employment with Duke would not violate the state ethics code, as he had not negotiated or administered a contract with Duke while with the IURC. She stated that Storms had screened himself from pending Duke cases after submitting his resume to Duke, and the cases were reassigned to other administrative law judges.

So who told Seyfried what she had to write to make Storm's hiring look kosher? And why is the Governor's chief of staff playing golf with Duke's president and discussing the hiring of IURCs top attorney by the utility? It all sounds a little too cozy to me.