Panel acts to oust PSC members

Vote in Senate a rebuke to Ehrlich

House moves to give Assembly veto power over utility merger

General Assembly

March 28, 2006|By KELLY BREWINGTON AND ANDREW A. GREEN | KELLY BREWINGTON AND ANDREW A. GREEN,SUN REPORTERS

A Senate committee approved yesterday a bill that would effectively fire the five current members of the Public Service Commission, which has been under intense criticism for not doing enough to protect Baltimore Gas and Electric Co. ratepayers from an impending 72 percent increase in electric bills.

The move -- supported by Republican and Democratic lawmakers on the Senate Finance Committee -- is a rebuke to Gov. Robert L. Ehrlich Jr., who appointed four of the commission's five members and has spoken of trying to make the body more helpful to business.

Senators said they want a regulatory agency that will side with consumers in negotiations over the rate increases and in a pending merger between BGE's parent company and FPL Group Inc. of Florida.

"The customers have to feel, however the rates are being set, that they are getting a fair shot and have confidence in the people who are setting the rates," said Sen. Paula C. Hollinger, a Baltimore County Democrat who sponsored the bill.

The House of Delegates took aggressive action of its own yesterday, passing a bill that would give the legislature veto power over the merger and create a special counsel to investigate whether the deal is good for Maryland consumers.

Although the House and Senate approaches could be combined into one proposal to tackle utility issues, leaders in each chamber expressed skepticism yesterday about the other chamber's plan.

The legislation emerged on another day of intense negotiation and political jockeying among leaders in Annapolis, where concern over the rate increase is dominating the final days of the session.

Time for a solution is running short. The session is set to end in less than two weeks, and the Assembly has limited recourse if the governor vetoes bills passed after Friday. But the prospects for the Senate's restructuring plan -- or for any of the other dozen or more electricity bills under consideration -- are unclear as the House, Senate and governor appear to be pursuing different courses of action.

The PSC bill appears poised for passage in the full Senate. The only dissenting committee vote was cast by Sen. J. Robert Hooper, a Harford County Republican, who worried that new commissioners would not have enough experience to deal with the rate increase and merger.

The commission is an independent agency under the executive branch of state government, with five full-time member appointed by the governor and more than 100 employees. Under the Senate bill, two commissioners would be named by the Senate, two by the House and one by the governor next month.

The Senate panel acted hours after the House voted 111-25 to grant the Assembly authority to quash a proposed $11.4 billion merger between Constellation Energy Group and Florida's FPL Group. One more Republican voted for the measure than voted against it, and the bill passed by a veto-proof majority.

Senate President Thomas V. Mike Miller said yesterday that he worries that the House is rushing to judgment on the merger.

"I salute the House because they're working on the issue, but I'm not certain of the long-range consequences," Miller said, noting the utility's concerns that a break-up of the deal could lead to bankruptcy for BGE.

House Speaker Michael E. Busch said creating an independent arbiter outside the Public Service Commission is the only way to win the public's trust for whatever solution lawmakers adopt.

"I'm glad the Senate is moving in the direction of trying to find a solution, but I think we just need to look outside of the Public Service Commission," Busch said.

In recent days, several prominent politicians have called for the ouster of PSC Chairman Kenneth D. Schisler. The commission angered lawmakers and BGE customers when it announced a rate-mitigation plan that would charge customers interest.

Recent revelations of e-mail between Schisler and a utility company lobbyist have drawn the ire of lawmakers who accuse the independent board of having a pro-industry agenda.

As the Senate begins negotiating final legislation, talks will be led by Edward J. Kasemeyer, a Howard County Democrat who is married to Pamela Metz Kasemeyer, a lobbyist for Constellation who was paid $25,000 plus expenses by the utility company last year.

Kasemeyer said he knew of his wife's representation of the company but that as a rule they don't discuss issues before the legislature.

Ehrlich derided the Senate bill as partisanship. He would not say whether he would veto the House's merger bill if the Senate passes it, saying that he is focused on negotiations between the administration and work groups from the House and Senate.

He said talks are proceeding well and promised to find a way to produce a rate increase that is "light years away" from 72 percent. He would not estimate how small an increase consumers might expect.

Ehrlich said he was working on a plan that was a "comprehensive package to get to yes," but he suggested that the House and Senate are at odds, hindering a solution.

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