Wider Bge Probe Sought

2 Senators Question How Constellation Accounts For Its Executives' Compensation

August 15, 2009|By Eileen Ambrose | Eileen Ambrose,eileen.ambrose@baltsun.com

Two state senators are requesting that Maryland's attorney general broaden his inquiry into the compensation of Constellation Energy Group's chief executive, Mayo A. Shattuck III.

In a letter dated Aug. 10 to Attorney General Douglas F. Gansler, Democratic state Sens. Jamie Raskin of Montgomery County and James Brochin of Baltimore County said that about 30 percent of Constellation's executive compensation costs, not including salary, is allocated to Baltimore Gas and Electric Co. The senators said they are concerned that future compensation costs, including potentially tens of millions of dollars if Shattuck is terminated in connection with a change in control at the company, will be borne by BGE and its ratepayers.

Last month, Raskin and Brochin requested that Gansler launch an investigation into Constellation's executive pay and whether state officials or the General Assembly can restrict Shattuck's pay.

In their latest letter, the senators wrote: "We would request that you increase the scope of your current inquiry to determine whether, how and most importantly why these costs are being allocated directly to BGE. Is this a lawful allocation and does it bear on the questions we raised about whether corporate waste has occurred and whether the General Assembly may act to deal with it."

The senators also asked Gansler for an update on his investigation. Spokeswoman Raquel Guillory said the attorney general's office received the letter Thursday and had no comment yet.

Constellation spokesman Rob Gould says the Public Service Commission must give its approval before any executive compensation costs are part of the electric distribution rates paid by BGE customers. The last time that happened was in 1993, long before Shattuck joined the company, Gould said, so "it is indisputable that no part of his compensation is incorporated in BGE's electric distribution rates."

Constellation is cooperating with the attorney general's inquiry, Gould said.

"In the final analysis, the ratepayers pay for everything," Raskin said in an interview Friday. "We think there is a strong public interest at work here."

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