Gov. Charlie Crist must appoint – or reappoint – two utility regulators to the Public Service Commission before the panel votes on a pending $1.3 billion Florida Power & Light Co. rate hike.

Crist said this morning he has been paying close attention to the scandal-plagued panel and will move forward with his picks, due to the Senate by the end of the week.

PSC Chairman Matthew Carter pushed back the FPL vote to Jan. 11 – ten days after his term and the term of Commissioner Katrina McMurrian ends.

“Intriguing, wasn’t it?” Crist said when asked about Carter’s decision, adding that it won’t impact the appointment process. “We still have the opportunity to make these selections. I still get to make the choice on behalf of the people of Florida.”
(more…)

The Florida chapter of the nation’s largest civil rights organization is calling for a statewide panel to create a code of conduct for state officials, prompted by allegations of ethical improprieties at the Public Service Commission.

Florida NAACP president Adora Obi Nweze late yesterday evening asked state lawmakers, Attorney General Bill McCollum and Gov. Charlie Crist to convene an “Ethics and Transparency Task Force” to restore the public’s trust in government officials. Read Obi Nweze’s letter here.

The request comes after accusations of wrongdoing at the maligned PSC even as it is in the midst of considering nearly $2 billion in utility rate increases, including a proposed $1.3 billion Florida Power & Light Co. rate hike.

FPL officials last week told PSC Chairman Matthew Carter they would begin charging the first $900 million of the rate hike on Jan. 4 without the panel’s approval, as allowed by state law. They also promised to refund any difference in the rates after the panel’s vote on Jan. 11, also required by state law.
(more…)

Chief Financial Officer Alex Sink weighed in on Florida Power & Light Co.’s plan to implement a $900 million base rate hike before state regulators vote on the proposed increase.

“I’m opposed to the FPL rate increase. And FPL’s attempt to implement the rate increase before the Public Service Commission makes a decision is simply unnecessary and outrageous,” Sink, a Democrat who is leaving office after one term to run for governor next year, told The Palm Beach Post today.

A lawyer for the state’s largest utility told PSC Chairman Matthew Carter last week that FPL would impose the rate hike on Jan. 4, as permitted by state law. The Juno Beach-based company would have to refund any difference in the rates after the PSC makes its final vote on the issue, scheduled for Jan. 11.

The decision comes after the terms of two commissioners – Carter and Katrina McMurrian – end. Gov. Charlie Crist threatened not to reappoint them if they vote in favor of the rate hike, raising fears in the investment community about a shift in Florida’s previously utility-friendly regulatory environment.

FPL’s rate hearing has dragged on far beyond its originally slated two weeks. The hearing, its first base rate request in more than two decades, has been bogged down in staff firings and suspensions, revelations about coziness between the regulators and the utilities they oversee and secret messages exchanged between PSC staff and FPL lawyer Natalie Smith.

Critics have also attacked FPL for proposing to use some of the $1.3 billion-a-year rate increase to purchase new planes for its air fleet now comprised of three fixed-wing aircraft and two helicopters.

And FPL is now fighting in court an order from the panel to make the salaries of its highest-paid executives and engineers public. FPL officials agreed to give the data to the panel but wanted it kept secret from the public.

FPL maintains that customers’ bills will go down $9 per month even with the rate hike because fuel charges will go down.

Company officials had this response to Sink’s comments:

“Floridians should not allow political grandstanding to create further uncertainty for customers and for FPL projects that will bring a lot of value to Floridians, now and in the future. Because of the delay that politics have caused, there are two paths forward here: a knee-jerk, short-sighted political response, which puts at risk thousands of construction jobs, hundreds of millions of dollars in new revenue for Florida communities and billions of dollars in capital investment at a time when all of this desperately needed; or a prudent, responsible and timely deliberation based on the facts and the merits of the case and its long-term impact,” FPL said in a statement.
(more…)

Florida Power & Light Co. plans to raise rates by more than $900 million beginning Jan. 4 without waiting for the Public Service Commission’s decision on whether to grant the requested increase, according to a letter from an FPL executive sent to the panel today.

Florida law allows the utility to implement the rate hike without the regulatory panel’s approval, but FPL would have to refund the difference to customers if the PSC authorizes a smaller increase. The regulatory board’s final decision is now scheduled for Jan. 11 because the rate case has run into overtime.

PSC Chairman Matthew Carter today refused to grant FPL’s requests from earlier this week to make a decision by Dec. 4.

Instead, the PSC will keep its schedule of finishing its hearing Oct. 21-23, voting Dec. 21 on the total amount FPL can collect and voting Jan. 11 on how that increase will affect different types of customers, such as homeowners and businesses.

(more…)

Florida Power & Light Co. appealed in state court today to keep the salaries of employees earning more than $165,000 a year confidential.

The Public Service Commission ordered the Juno Beach-based utility to provide the compensation information as part of its proposed $1.3 billion rate hike. FPL gave the regulatory panel the data but asked that it be kept secret. The PSC ruled that it should be available for anyone to see.

“The Commission has historically had no problem exercising its responsibilities without publicly releasing specific salary data for individual employees so the only reason for this information to be publicly disclosed now is to distract from the important issues in the case that matter to our customers,” FPL spokesman Mayco Villafana said in a statement released late this evening.

The appeal was filed on behalf of 15 FPL employees at the First District Court of Appeals in Tallahassee. Barry Richard and former Florida Supreme Court Chief Justice Arthur England represent the workers.

Florida Power & Light’s proposed $1.3 billion rate hike 13-hour marathon hearing yesterday concluded with one head-injured FPL lawyer, an order for an independent audit of the utility’s corporate jet spending and yet another delay to hear yet more testimony next month.

Public Service Commissioner Nathan Skop demanded the audit to check into the Juno Beach-based utility’s fuzzy accounting for VIPs, their wives and guests who flew, some at customers’ expense, to far-flung destinations including Europe, Martha’s Vineyard and Louisville during the Kentucky Derby.

FPL will have spent at least $32.5 million between 2006 and 2009 on the corporate aircraft travel alone, its records show.

“It’s very important to me that the rate payers of FPL are not being allocated costs that are not prudently incurred,” Skop said.

The discussion of the executive’s flights revealed that FPL Chief Financial Officer Armando Pimentel flew to Tallahassee on the corporate jet, earning a rebuke from Jon Moyle, a lawyer for the Florida Industrial Power Users Group that opposes the rate increase.

(more…)

Florida Power & Light Co.’s proposed $1.3 billion rate hike hearing fizzled out at 10:55 p.m. this evening after a 13-hour marathon of testimony from FPL CFO Armando Pimentel.

Public Service Commissioner Nancy Argenziano, attending the hearing by telephone, spoke up before the panel was set to take a five-minute respite.

“I really think this is wrong. 10:44 at night is not a good time for people” to be asking important questions,” Argenziano said. “I’m sure everybody there wants to go home.
That’s just not the way to do this. I have strong feelings that we may have pushed it too far or too late.”

PSC Chairman Matthew Carter, who’s had two back surgeries earlier this year, was in such pain late this evening that he went home after being helped out of the room by an aide.

Commissioner Lisa Edgar had already vacated hours earlier.

That left Commissioners Katrina McMurrian, acting as chairwoman, Nathan Skop and Argenziano to decide.

Argenziano won out in the end over FPL’s objections. Pimentel wanted to finish up because he did not want to have to return for the next round of hearings in late October, his lawyer said.

“We all want to get done. We’ve been at it more than 13 hours today,” said Sheffel Wright, an attorney representing the Florida Retail Federation that opposes the hike.

“I tend to agree with a lot of what’s been said. I think we are at that stage and we are getting a little overly tired and anxious,” McMurrian said, stumbling over her words. “I can’t even string a sentence together.”

She adjourned the meeting. The panel will reconvene on Oct. 21.

Florida Power & Light Co. spokesman Mayco Villafana didn’t like a comparison of FPL Chief Financial Officer Armando Pimentel to the Big Three CEO’s.

Pimentel traveled to Tallahassee to support FPL’s proposed $1.3 billion rate hike on one of the utility’s corporate aircraft that have been the subject of criticism for the past two days.

Rate increase opponent Jon Moyle, who represents the Florida Industrial Power Users Group, questioned Pimentel about the impression the jet travel to the hearing seeking the increase might leave with consumers.

The situation is nothing like the CEOs of the nation’s big three auto makers who traveled to Washington D.C. to ask for a $25 billion bailout, Villafana said in an e-mail.

“This is what you need to know:
OUR customer bills are the lowest in Florida.The bill will go down further in 2010 if our proposal is approved.
Reliability is high. Clean energy. Creating thousands of jobs. And millions in taxes for local communities. How is it exactly like auto executives?” he wrote.

Villafana then pointed out that Moyle’s client is a “special interest” group that represents some of the state’s worst pollutors, including mining, phosphate and cement companies.

And FIPUG complains that FPL – which has tried to keep information like executives’ salaries private – “has ‘too much secrecy’ yet refused to identify its own members,” Villafana wrote.

Florida Power & Light Group Chief Financial Officer Armando Pimentel flew to Tallahassee on the corporate jet to appear before a panel considering the utility’s proposed $1.3 billion rate hike.

Pimentel spent the day being grilled about the Juno Beach-based company’s request and about its corporate jets. Commissioners and opponents of the rate hike demanded answers about why ratepayers should foot the bill for FPL executives, their wives and their guests to jetset to places like Martha’s Vineyard, Las Vegas and the Louisville during the Kentucky Derby.

After nearly 10 hours of testimony, attorney Jon Moyle, who represents the Florida Industrial Power Users Group, asked the CFO about traveling to Tallahassee on the corporate plane.

“Did you have a concern when you decided to take the corporate aircraft up to provide your testimony that that might send a bad signal or a bad message to fly on the corporate aircraft up here to provide testimony to support a $1.5 billion rate increase?” Moyle wanted to know.

Pimentel wasn’t flustered.

(more…)

Public Service Commissioner Nancy Argenziano’s former aide Larry Harris is back at work at the utility regulatory agency in the general counsel’s office.

Argenziano fired Harris earlier this month for giving his secret BlackBerry personal identification number (PIN) to Florida Power & Light Co. attorney Natalie Smith.

The PINs allow BlackBerry users to exchange messages that can be impossible to trace.

Two other commissioners – including Chairman Matthew Carter – put their aides, who make at least $84,000 a year, on paid leave until investigations into the messaging mystery are resolved.

Carter also banned the use of the PINs or other types of communication that don’t leave a public record.

Harris was reassigned to the general counsel’s office as a senior attorney where he now earns $60,000 a year. The PSC’s general counsel Booter Imhof resigned Friday. He gave two weeks’ notice and said he is going back to work for the House of Representatives.

The PSC’s lobbyist Ryder Rudd resigned earlier this month after it was revealed that he attended a Kentucky Derby party at the Palm Beach Gardens home of FPL VP Ed Tancer. An internal investigation could not prove whether Rudd, who oversaw staff handling several FPL rate requests, broke state law or rules by going to the fete.

The musical chairs at the PSC takes place during a $1.3 billion proposed FPL rate hike hearing. Progress Energy Florida is also seeking a $500 million rate increase. That case is scheduled to resume next week.

Florida Power & Light Co.’s $1.3 billion rate hike request hearing is temporarily halted – again – because of an injury to one of the utility’s lawyers.

FPL attorney John Butler got hit in the head by a door leaving the hearing room. The door-slinger was Jon Moyle, a 6’4″ lawyer on the other side who was once an offensive lineman for the University of Florida and now represents the Florida Industrial Power Users Group.

Butler, a good six inches shorter than Moyle, has a lump on his forehead and a white butterfly bandage covering a cut near the center of his face. No word yet whether any lawsuits will be filed on the injury.

The already-into-overtime Florida Power & Light Co. $1.3 billion proposed rate hike hearing won’t finish up today as previously scheduled.

The hearing, slated to last 10 days but now on day 13, will go on for three more days next month – Oct. 21-23.

And the panel won’t vote on how much of the requested increase will be granted until Dec. 21. Then, on Jan. 11, the panel will vote on the specific rates and charges.

So how much will FPL customers’ rates go up?

They won’t. Because of lower fuel costs, electric bills will go down. The question is how much.

Customers would pay even less if the panel rejects the base rate increase.

The PSC usually grants a portion of requested rate increases. But FPL’s $1.3 billion rate hike increase – the largest ever requested in Florida and anywhere in the nation – is not the typical base rate case.

Gov. Charlie Crist threatened not to reappoint two commissioners if they vote for the rate hike.

An FPL financial consultant said yesterday that the shifting political climate under Crist could bring the state’s largest utility to its knees by damaging its ability to borrow.

PSC Chairman Matthew Carter announced the new schedule before breaking for lunch. Today’s hearing, like yesterday’s, is set to go for another 12-hour marathon run.

Gov. Charlie Crist’s recent threats not to reappoint two Public Service Commissioners if they vote for a proposed $1.3 billion Florida Power & Light Co. rate hike could scare investors away from investing in the utility, an expert testified today.

Bill Avera, a financial analyst hired by FPL, said that the regulatory climate in Florida had changed under Crist and that credit rating agencies, including Moody’s and Fitch, were paying attention.

“The governor cautioned this commission to regard carefully the outcome of this case and even suggested that the tenure of the reappointment of some of the commissioners might be in question based on the outcome of this case. That is unusual. That is the kind of political change that rating agencies are very concerned about,” Avera told the panel during a marathon hearing slated to last 12 hours today.

Opponents of the rate hike grilled Avera throughout the day but those comments temporarily quieted attorney Sheffel Wright.

“Surely you don’t think that Gov. Crist wants the commission to do anything that would render FPL unable to cover its debt service?” Wright asked after a long pause.

“It doesn’t matter what I think,” replied Avera. What matters is what the credit rating agencies believe, he said.

“I think investors see this as a change in posture in Florida. The long tradition in Florida is one where the commission has been free to exercise its expertise in making decisions that it thinks serve the customers long term. When the political leaders insert their judgment, that’s the kind of thing that scares investors,” Avera said.
.

Florida Power & Light Co. officials tried but failed to keep secret the names of some of those who flew on their corporate jets during a rate hike hearing today.

Public Service Commission Chairman Matthew Carter ordered the Juno Beach-based utility to provide the names of everyone who flew on its private jet over the objections of FPL lawyer John Butler.

The 1,500-page volume of flight logs going back to 2006 revealed that the company spent about $52 million on operation and maintenance for corporate jet flights over the past four years. That includes what they project they will spend for the next three months.

At least two GOP Florida elected officials traveled with FPL executives on the jet, the flight logs showed.

U.S. Sen. Mel Martinez, who retired last month, and U.S. Rep. Connie Mack, flew on the plane on separate occasions in 2006.

Taking away charges the company made to its affiliates for the jet travel, FPL still spent between $6.7 million and $9.5 million a year over the past four years, the records show.

FPL officials say the planes are necessary for the corporation to conduct its business.

“All the redacted names were those of NextEra/FPL Energy employees whose travel costs were paid for by their company, not Florida Power & Light,” FPL spokesman Mark Bubriski said in an e-mailed statement.

“NextEra/FPL Energy flight data, in addition to not being paid by FPL, is competitively sensitive, and that is why it is redacted. The only information that has been redacted is: 1) phone numbers, for privacy reasons; and 2) competitively sensitive NextEra/FPL Energy-specific information that does not relate to the cost of the travel,” Bubriski wrote.

Aircraft play a vital role in the safe and reliable operations of our 35-county electric infrastructure. We adhere to policies and procedures that prevent unnecessary use and keep costs as low as possible.

The more nearly $2 billion hanging in the balance of two utility rate hearings is contributing to the cloud of suspicion engulfing the regulatory panel that will rule on the cases, Public Service Commission Chairman Matthew Carter said today.

Before hearing on Florida Power & Light Co.’s requested $1.3 billion rate hike resumed after lunch, Carter offered the following statement on the goings-on.

“I think it’s no accident that all these shenanigans and sideshows are happening because we have these two rate cases,” Carter told The Palm Beach Post.

The panel is also considering a $500 million rate increase proposed by Progress Energy Florida.

“Some groups benefit if the rate case is denied. Some group benefits if the rate case is granted. But we’re going to make a decision. As for me, I will not be intimidated,” Carter added.

(more…)

Public Service Commissioner Katrina McMurrian’s absence at the onset of this morning’s Florida Power & Light Co. rate hearing wasn’t a mystery after all.

McMurrian said she was about an hour late to the meeting because her response to a motion asking her to be removed from the panel for the rate increase vote wasn’t yet ready.

McMurrian, who refused to recuse herself, didn’t want to attend the meeting until her formal response had been filed, she said.

(more…)

The Florida Power & Light Co. $1.3 billion rate hike hearing is droning on this morning as opponents to the increase grilled the utility’s expert witness Bill Avera on projected earnings and credit issues.

FPL reps sit in the audience, as they have each day of the hearing now more than a week into overtime above its planned one-week schedule.

But noticeably absent from the FPL pack is what until today had been their constant companions: BlackBerries.

Not only are their communication devices tucked away, their ever-present laptops sit idly inside their cases.

The change is likely due to the firestorm of controversy over secret messages called PINs exchanged between FPL attorney Natalie Smith and several of the commissioners aides. Critics fear Smith may have communicated with the aides during the hearings about the rate case under discussion.

FPL spokesman Mayco Villafana had this to say on the issue in an e-mail:

“Regarding pin communications what I can tell you is that Natalie Smith has never communicated via PIN with Commissioner Edgar or any other commissioner. With respect to PIN communications in general, these Blackberry-based text messages are not unusual nor any different than any other form of communication that isn’t paper-based such as a telephone call. In addition to those individuals you have cited, Natalie also has a PIN, for example, for Commissioner Argenziano’s chief advisor and had one for Commissioner Skop’s former chief advisor. Communication with staff members is a normal and appropriate part of the regulatory process in which all parties to any proceeding or issue regularly engage.”

Nancy Argenziano fired her aide Larry Williams for giving his PIN number to Smith. PSC Chairman Matthew Carter banned the commissioners and staff from using PINs or other types of messaging that don’t leave a public record.
He and Commissioner Lisa Edgar put their aides on paid leave indefinitely until a review of the PINs is complete. The panel is now considering requiring all communications between the PSC and the utilities be in writing.

Commissioner Katrina McMurrian’s response to have her recused from the case is now online.

This morning’s Florida Power & Light Co. $1.3 billion rate hike hearing got off to a murky start despite Public Service Commission Chairman Matthew Carter’s insistence yesterday that the regulatory panel wants to conduct its business in the sunshine.

Commissioner Katrina McMurrian, who was asked by an intervenor on the case on Monday to disqualify herself from the case, was a no-show when the hearing began at 9:30 a.m.

PSC staff were unable to say where McMurrian was or whether she planned to attend the hearing.

About an hour later, McMurrian showed up with no discussion of the motion to have her step away from the case.

McMurrian sat on the panel for about 20 minutes before a copy of her motion denying the request to have her removed was available. It was only available by request and was not on the PSC’s website.

Stephen Stewart objected that McMurrian couldn’t be objective because she had was a panelist at a New York conference at which financing and credit issues related to the FPL rate case were discussed. Utility representatives had attended the conference but no consumer advocates were present, Stewart argued, so McMurrian could not be impartial in her vote on the rate hike.

But McMurrian said Stewart’s logic would put commissioners in a bind: they are supposed to be technical experts but wouldn’t be able to use any information that wasn’t purely objective to learn more about the issues.

That’s a paradox, she wrote.

“The media, both broadcast and print, continuously feature discussions about the general effects of economic conditions on businesses and consumers,” McMurrian wrote. “Even if I recused myself…I would still be the recipient of an unending flow of information concerning these issues, none of which can be realistically expected to be perfectly objective.

“Accordingly, I believe that the paradox presented by the motion is better resolved with more information, rather than less,” she wrote.

This story appeared Wednesday on page 1A of the Sept. 16 Palm Beach Post.

A unique, eight-character code buried inside every BlackBerry device is at the center of the latest intersection of technology and politics in Florida.

State lawmakers hand these codes, known as a personal identification numbers, or PINs, to lobbyists so they can exchange messages during hearings. Gov. Charlie Crist’s staff regularly trades PIN messages to stay in touch.

“It’s a faster form of communication,” Florida House Majority Leader Adam Hasner, R-Boca Raton, said of the messages that for years have fallen outside of the state’s public records laws.

Hasner has traded PIN messages from the House floor with lobbyists. He said the messages are usually brief and meaningless: “Need to talk” or “Where can I find you?”

“The idea that things are intentionally being done in secret is overblown,” said Hasner, a devoted BlackBerry user who has an old, worn-out model mounted in his Capitol office. “But I think the issue is worthy of further conversation and potentially addressing it with new policies.”

On Tuesday – just days after Florida Power & Light Co.’s $1.3 billion rate hearing was nearly derailed when state regulators discovered their staff exchanging PIN messages with FPL officials – Attorney General Bill McCollum said the state should seal the cracks in its open government laws.

More here.

Public Service Commissioner Nancy Argenziano summed up her view of the public’s view of the regulatory panel mired in controversy while considering a proposed $1.3 billion Florida Power & Light Co. rate hike.

“The perception of people out there – they think we suck,” said Argenziano, a former state senator who is asking for a grand jury investigation into possible misconduct in the regulatory agency.

“Is that a technical term?” asked PSC Chairman Matthew Carter.

“That’s my technical term,” retorted Argenziano.

Argenziano participated by telephone in the panel’s discussion about how to handle what they called a “spaghetti bowl” of ethical questions about the regulators’ relationships with the utilities they oversee.

Commissioner Nathan Skop offered an unlikely solution: move the agency out from beneath the governor, who now appoints the five-member panel.
(more…)