Rate deferral is law

Legislature overrides Ehrlich veto, easing electricity cost increase

June 24, 2006|By ANDREW A. GREEN | ANDREW A. GREEN,SUN REPORTER

The General Assembly overrode Gov. Robert L. Ehrlich Jr.'s veto of a BGE rates bill yesterday, capping this summer's increase in electricity bills at 15 percent and firing the members of the Public Service Commission.

But the vote might not bring an end to the issue that has dominated Maryland politics and sparked anger and confusion among BGE's more than 1 million residential customers.

Ehrlich has questioned the legality of the Democratic-controlled Assembly firing all five PSC commissioners and said yesterday that he will encourage a lawsuit by the regulatory agency's chairman, Kenneth D. Schisler, a former Republican delegate appointed by the governor.

"We'll see 'em in court," Ehrlich said.

PSC spokeswoman Christine E. Nizer said the commission is still considering its legal options. Earlier this year, Schisler filed a suit - along the lines of what Ehrlich suggested - when legislators passed a similar law, which died when Ehrlich vetoed it in April.

New provisions in the bill that was enacted yesterday make legal action more difficult - Schisler could not again use public funds to pay for his lawsuit and could not file again in his hometown courthouse in Easton - but Ehrlich said a suit is necessary.

"Absolutely," he said. "The court here is really the last resort for the people."

The new law calls for House Speaker Michael E. Busch and Senate President Thomas V. Mike Miller to designate by July 1 three nominees for Ehrlich to consider for PSC chairman and 10 names for the other four seats. If the governor doesn't choose by July 15, the legislators get to do so. Ehrlich said yesterday that he's inclined to let them pick.

BGE rates were due to rise by 72 percent July 1 because of the expiration of limits instituted when Maryland deregulated the electric industry in 1999. In the past four months, the increase has been the biggest topic in the governor's race, and Ehrlich showed yesterday that he does not plan to let the issue go away.

Besides raising the specter of a legal challenge, Ehrlich succeeded yesterday in getting several of his fellow Republicans to switch sides and support his veto.

The plan initially passed with significant bipartisan support. Nearly all Republicans in Anne Arundel and Baltimore counties - key jurisdictions in the coming election - sided with the Democrats in supporting the plan. Yesterday, only one Republican voted to override.

Ehrlich said Republicans will ride the issue to victory in November.

"I am not pleased with this result, but you couldn't have a more stark contrast up and down the ballot," he said. "[Democratic leaders] Mike Miller and Mike Busch will be on the ballot in every race across the state of Maryland."

The state Senate convened for less than 10 minutes and overrode the governor with no discussion. The override there passed 34-10 on a mostly party-line vote.

"It's time to move on," said Sen. Thomas M. Middleton, the chairman of the Senate Finance Committee. "We have a good bill."

The House of Delegates discussed the measure for about a half-hour and voted 87-37 to override the veto, just two votes more than the requisite supermajority.

The vote was close both because of vote-changing among Republicans and because several Democrats were unable to attend the voting session, which came less than 24 hours after Ehrlich's veto.

Republicans said during the debate and afterward that they had learned more about the bill since their initial votes in last week's brief special session. Some said they were swayed by the opinions of people in their districts.

Ehrlich also held a hearing at which witnesses critical of the Assembly bill outnumbered those in favor by about 3 to 1. The governor said the bill wasn't friendly enough to consumers, but Democrats said it provided more relief than an earlier measure negotiated by the governor with BGE's parent company, Constellation Energy Group. They also said the savings in their plan were not tied, in part, to a merger between Constellation and a Florida utility company.

"I don't think any of us had the chance to really solicit public opinion during the special session because it was midnight" when the legislature voted on the plan, said Del. Terry R. Gilleland Jr., an Anne Arundel Republican who initially supported the bill but opposed the override. "There's just been a huge outcry of opposition in my district."

The plan caps rates at 15 percent above their present levels for 11 months. Customers will pay a monthly fee expected to average $2.19 for 10 years to make up the difference.

After the initial rate freeze, consumers will have the choice to go to market rates or enroll in another deferral plan, which would likely add to the monthly fee. In the meantime, the new PSC would investigate BGE rates to see whether other savings can be passed on to consumers and whether the 72 percent increase was justified.

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