The PSC’s conflicts of interest

October 1, 2019

5:00 AM

David Michael Miller

The Public Service Commission is in a huff. They are protesting very much.

Last week two groups filed a motion with the commission demanding that commission chair Rebecca Valcq and commissioner Mike Huebsch recuse themselves from participating in a decision about whether to build a massive power line through the Driftless region of southwest Wisconsin.

As expected the commission rejected the motion and went on to approve the Cardinal-Hickory Creek line with its 17-story tall towers cutting through some of the most picturesque and sensitive landscapes in the state. The line was strongly supported by the state’s utilities and by at least one nonprofit group that supports wind and solar energy in the hopes that the line will bring in wind energy from western turbines. It was bitterly opposed by conservation groups and residents of the area. Hundreds of comments were filed, nearly all in opposition.

Lawyers for the Driftless Area Land Conservancy and the Wisconsin Wildlife Federation argued that Valcq had a conflict because she had spent a career as a utility regulation lawyer for WE Energies. That company owns 60 percent of the American Transmission Company, which is building and profiting from the nearly half-billion dollar line. They also argued that Huebsch had a conflict because he represents the PSC with the Midcontinent Independent System Operator, an organization that works on the power grid. MISO actually intervened in this case before the PSC arguing in favor of the line.

Moreover, the Environmental Law & Policy Center lawyers representing DALC and WWF laid out a convincing argument that case law indicates that the commissioners don’t have to have a direct conflict in order to be bound to recuse themselves, only that their “impartiality might reasonably be questioned.”

At their meeting last Thursday Valcq, Huebsch and the third commissioner who was not charged with a conflict all blasted the motion. Valcq said she is bound by ethical codes as an attorney and as a public servant. “To suggest otherwise is a false attack on my integrity, as an attorney, as a regulator, and as a ratepayer myself,” she said.

But actually let’s assume that these are all people of high integrity. In fact, I have no reason to think they’re not. We can still make a strong case for why Huebsch should not have participated in this case and for why Valcq should not be on the commission at all.

Let’s start with the fact that Valcq is, in fact, following the law to the letter. She is recusing herself from 28 cases (but not this ATC case) in which she had had a direct role for WE and she may recuse herself from more cases as they come up. But that means that Evers’ appointee will have to potentially sit out some three dozen cases. Assuming that a Democratic governor’s appointment would take a generally more progressive view, why would Evers appoint someone with so many conflicts that she can’t say a word in so many cases? That’s not on Valcq. That’s on Evers.

Next, there’s the other shoe test. A good way to test whether an argument holds up is to reverse it. So, what do you think the utilities’ reaction would have been if, instead of putting a utility lawyer on the PSC, Evers had appointed a person who had worked for the Citizens Utility Board? They would have gone crazy. What do you think the utility reaction would have been if instead of a commissioner cooperating with MISO there was one working with the Driftless Conservancy? Ditto. This isn’t about Valcq’s or Huebsch’s personal integrity. It’s about the perception of a lack of objectivity.

Then there’s the question of unconscious bias, a concept that gets a lot of attention in the area of race relations these days, but one that is worth considering in virtually any situation. Valcq has spent a career looking at things from the utilities’ point of view. Huebsch is steeped in MISO’s thinking whether or not he ever discussed this specific case in that venue. How easy is it for either of them to be truly unbiased even if they try?

Finally, there’s the revolving door. It’s not uncommon for commissioners to leave the PSC and join a utility. That’s true of any commissioner at any time, not just Valcq or Huebsch, but in Valcq’s case the problem is especially acute since she’s only in her 40s and has done virtually nothing but utility work in her previous legal career. Those of us who aren’t independently wealthy understandably keep an eye out for our next job and that’s particularly true for political appointees who know that they will eventually be gone after a change of administrations. Again, this doesn’t go to the personal integrity of specific commissioners. But it’s a systemic problem that the Legislature should find a way to address.

It’s possible to be both honest and wrong. I’m not saying that Valcq lacks personal integrity. I’m saying that Tony Evers should have never put her in this position to begin with. Her decisions will always be justifiably questioned just because of her career background. And I’m not saying that Huebsch lacks integrity either. But he should have recused himself in this case. The idea that he doesn’t have a bias simply because he didn’t discuss the specific Cardinal-Hickory line with MISO just doesn’t hold up.

Strong cases have been made on both sides of the power line issue itself. Personally, I’m more convinced by the opponents of the line, but I could more easily accept the PSC’s ultimate decision if there weren’t these obvious and nagging issues of bias.

I think governors would do well to look to judges for their appointments to the PSC. Judges wouldn’t have any conflicts and they would bring skill sets that are relevant since the job is about evaluating and weighing evidence against law and policy. In fact, one of the mostly widely respected commissioners ever was Ness Flores, a judge and incidentally the first Hispanic person on the commission, who was appointed commission chair (the same position now occupied by Valcq) by Gov. Tony Earl in 1983.

Opponents of the Cardinal-Hickory Creek line are well within bounds to question the objectivity of this PSC. There was no reason for the overly defensive reaction of the commissioners.

Comments (2)

Comment Feed

PSC's Conflicts article

The conflicts are real. For many years PSC Commissioners have gone on to very-well-paying jobs after their PSC stint. (Some research on the history of post-PSC employment might provide basis for a next article.)

There's a rumor around that one of the PSC commissioners has boasted about a $500,000 per year doing PR work for ATC. That would be a lot of motivation to approve whatever ATC wants.

Mr. Huebsch has stated that we'd better get used to transmission lines because there are going to be a lot more of them; pretty clear bias for approving whatever ATC & partners want.

Ms. Valcq has no doubt already considered the second half of her career, the first half having been for the benefit of CE. "Valcq said she is bound by ethical codes as an attorney and as a public servant. 'To suggest otherwise is a false attack on my integrity, as an attorney, as a regulator, and as a ratepayer myself,'.” So, attorneys are inherently ethical? And the couple bucks that her light bill might go up would prevent her making a biased decision to further her career? (Did anyone miss the subtle sarcasm?)

If we needed more energy or if the line would actually carry much wind power, one might overlook a little bias. But electric use is flat, and the line would carry much less energy from wind than from coal (based on Energy Information Administration figures). Moreover, a line that will last 50+ years bringing coal power to Wisconsin would prevent Gov Evers' goal of 100% renewables by 2050. This is a high-profit project for ATC & partners. ATC has boasted to its shareholders (including Valcq's WE) that their dividends have gone up every year since ATC was founded, and it probably wants to keep that pattern going, thus more lines. The commissioners even went against their own professional staff, who testified that the need for a line had not been proven, and at the very least the matter should be put on hold a couple years to see if a need materializes.

Huebsch and Valcq have conflicts, and the revolving door is wide open. But why is Nowak being defensive too? Apparently ELPC's Motion hit a touchy nerve for any PSC Commissioner.

Mark Mittelstadt more than 5 years ago

Do the Commissioners know what Wisconsin is losing? Is the PSC out of touch?

The recent Isthmus features an excellent article about the lower Wisconsin River. Unfortunately, the stunning cover photograph would be dramatically altered if projects like the Cardinal Hickory Creek transmission line continue to be approved. Last week, the Public Service Commission approved the unnecessary line that would mar Wisconsin’s scenic beauty. I recently canoed the river with my husband and children. We paddled from Sauk City to Ferry’s Bluff and ended with a hike. My husband, a lifetime Madisonian, has floated this river many times. Forty years ago, he noticed shacks and trash along the river, which is cleaner now. It’s reassuring to see this happen in a time of environmental uncertainty. One of the highlights of the float for my family was turtle spotting. We stopped after we counted three hundred! These corridors are critical for the ecosystem. They need to be protected from transmission lines, cell towers and other high-profile infrastructure. If we don’t, it’s just a matter of time before groups like the American Transmission Company push through projects under the guise of promoting renewable energy. I would hate to see our panoramic views ruined. Wisconsin is a special place. Let’s keep it that way.

Lianne Stephenson more than 5 years ago