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.

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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.

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.

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.

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.
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There’s a job opening at the Public Service Commission since general counsel Booter Imhof quit on Friday while the regulatory panel is mired in controversy.

Commissioner Lisa Edgar proposed two well-known Democratic politicians to step in for Imhof: former Attorney General Bob Butterworth, who also served as Department of Children and Families chief under Gov. Charlie Crist, and former state Sen. Rod Smith, who ran a losing battle in the Democratic primary for governor in 2006.

“It’s time to untangle the spaghetti bowl in which we find ourselves,” said Edgar.

“The question is why would they want to come into the spaghetti bowl?” questioned Commissioner Nathan Skop.

Commissioner Nancy Argenziano suggested former statewide prosecutor Melanie Hines.

Whoever the commission picks, Chairman Matthew Carter repeatedly laid down the law in one regard.
“I want them to agree not to come before us for at least five years in any capacity representing any party. I can’t go for that,” said Carter.

Carter said he’d prefer to have the prospective general counsel promise to never come before the panel, but backed away from that.

“If we’re dealing with a perception problem, then certainly we need to make sure we don’t add to it. The best thing to do when you’re in a hole is to stop digging,” he said.

The Public Service Commission tomorrow will discuss a proposal to require all communications between the regulatory panel and the utilities it oversees in writing.

The discussion comes amid a firestorm of criticism about commissioners’ aides swapping secret Blackberry codes with a Florida Power & Light Co. attorney that would allow them to communicate without creating a public record, even during hearings.

Commissioner Nancy Argenziano fired her aide for giving his Blackberry personal identification number – PIN – to FPL lawyer Natalie Smith and two other commissioners, including Chairman Matthew Carter, suspended theirs with pay for doing the same thing.

Commissioner Katrina McMurrian, who is not involved in the secret message melee, late Friday issued a proposal “to restore the public trust” as controversies involving the agency continue to make daily headlines.

Discussion of her proposal was added late this evening to the panel’s internal affairs agenda slated for tomorrow.

McMurrian is the target of a different conflict-of-interest criticism. An intervenor in FPL’s proposed $1.3 billion base rate hike case asked that she be disqualified from voting because she had hobnobbed with FPL executives during a conference in New York earlier this year.

The future of two utility regulators depends upon their vote in a proposed $1.3 billion Florida Power & Light Co. rate hike, Gov. Charlie Crist said this morning.

Crist has until Oct. 1 to reappoint two commissioners – Chairman Matthew Carter and Katrina McMurrian – whose terms expire Jan. 1.

Crist said he wants them to just say no to the Juno Beach-based utility.

“Let’s see what the commissioners want to do. Then I can have a better handle on who to appoint or reappoint,” Crist told reporters this morning.

A reporter asked Crist if he heard the governor correctly – that the commissioners’ vote would affect their appointments.

“You did,” Crist answered. “I think it would be nice to reject the increase. I’m trying to appoint members that would be sympathetic to the people and the economic challenge that they’re facing. So that’s a factor.”

Sen. Mike Fasano on Friday asked Carter, appointed to the panel by Gov. Jeb Bush, to indefinitely delay the FPL hearing and a $500 million Progress Energy Florida rate case until a storm of controversies surrounding the regulatory panel clears.

Crist disagreed.

“I don’t know why we should postpone it,” he said.

Carter said this morning that he hadn’t seen Fasano’s letter because he was on bed rest Friday recuperating from two back surgeries earlier this year.

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Public Service Commissioner Nancy Argenziano snapped back at state Rep. Carlos Lopez-Cantera for criticizing her critique of his questions of Public Service Commission Chairman Matthew Carter.

Argenziano, a former lawmaker who served in both the House and the Senate, sent a heated letter to Lopez-Cantera late this evening in which she expounds on her repeated complaints that lawmakers with too close of ties to utilities have too much influence over the regulatory panel on which she sits.

Lopez-Cantera sits on the council that selects nominees for the governor to appoint to the regulatory agency. He wasn’t happy with the answers Carter gave at the Sept. 1 nominating council meeting although Carter did make the list of six finalists for Gov. Charlie Crist to consider.

Her letter is a response to one Lopez-Cantera sent to her yesterday criticizing her reaction to his dissatisfaction with the PSC’s unanimous decision to force Florida Power & Light officials to release the salaries of all its employees that earn more than $165,000 per year. He advised Argenziano she could have found the information in the Juno Beach-based corporation’s federal filings as he and his office staff did in less than an hour.

“This same information would have saved the PSC time and taxpayer money,” Lopez-Cantera, R-Miami, wrote in a letter sent yesterday.

The federal information does not include bonuses and other perks that boost some of the salaries by up to 500 percent, Argenziano responded tonight.

“Your apparently gullible acceptance, Representative Cantera, as the FERC document reflects, that the salary of FPL’s Executive Vice President is $23,000, is flabbergasting. The ‘less than an hour’ which you and your office spent producing this useless information is perhaps the true waste of time and taxpayer money,” Argenziano wrote.

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Florida Power & Light Co. officials had this to say about a top GOP senator’s request to halt utility rate hearings until investigations into what could be too cozy connections between regulators and utilities.

“We believe it is in our customers’ best interest for the PSC to proceed with its evaluation of our request – on its merits and the facts – so that it can make a timely decision that will allow us to move forward with investments in the electrical infrastructure that benefit our customers and the communities we serve,” FPL spokesman Mark Bubriski said in an e-mail.

Sen. Mike Fasano asked Public Service Commission Chairman Matthew Carter to postpone rate hearings currently underway – including a $1.3 billion rate hike sought by FPL scheduled to resume Wednesday – indefinitely.

Fasano wants several current investigations wrapped up before the hearings continue. He also wants them suspended until the Senate confirms Gov. Charlie Crist’s two nominations for the panel. Crist received a list of six finalists – including two current commissioners – earlier this month and has until Oct. 2 to make his picks.

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Public Service Commission Chairman Matthew Carter today banned the use of all communication or messaging by the utility regulators and their staff other than e-mail until an internal investigation is complete.

One PSC aide was fired and two others, including Carter’s, were placed on administrative leave after it was revealed that the aides gave their Blackberry personal identification numbers (PINs) to a Florida Power & Light Co. lawyer.

PINs are messages that can be exchanged between Blackberry users without creating a public record.

The communication controversy is taking place against the backdrop of two hearings that involve FPL: a proposed $1.3 billion rate hike and a proposed $63 million increase to cover the costs of nuclear power plant enhancements not yet built.

“We are all aware of the controversy which has arisen regarding use of communications technologies within the Commission.  While we are currently conducting a review of these technologies and how they relate to maintaining public records, I am directing that pending the outcome of this review the Commission should disable all communications or messaging capabilities that are not captured through our existing e-mail system,” Carter wrote to the PSC commissioners in an e-mail sent today. 
 
Commissioner Lisa Edgar, who put her aide Roberta Bass on leave after it was reported that Bass gave her own and Edgar’s PINs to an FPL exec, requested the IT review. (more…)

Public Service Commission staffer Ryder Rudd resigned this morning after an internal investigation found that he may have broken the regulatory agency’s ethics rules.

Rudd, who earned $92,000 a year, attended a Kentucky Derby party at the Palm Beach Gardens home of Florida Power & Light Co. vice president Ed Tancer although Rudd was involved in at least two of the utility’s rate filings.

Knowledge of Rudd’s attendance at Tancer’s gala was the first in a string of events, the latest including two PSC staff resignations and two commissioners’ aides being place on administrative leave.

Also today, Sen. Mike Fasano asked for a Senate Ethics and Elections Committee hearing into whether the regulators and their staff are too cozy with the utilities they oversee.

“After reading and hearing of what’s happening over at the Public Service Commission, it sounds to me like they’re ready to implode over there,” Fasano, R-New Port Richey, said.

In the meantime, the Florida Department of Law Enforcement is also conducting an informal investigation into the same possible problem.

Two sitting PSC commissioners – Chairman Matthew Carter and Commissioner Katrina McMurrian – were included in the list of six nominees given to Gov. Charlie Crist last week. Fasano asked Crist to hold off on the appointments until the panel votes on a proposed $1.3 billion FPL rate hike.

Carter’s aide Bill Garner and Commissioner Lisa Edgar’s aide Roberta Bass were put on leave today after the Times/Herald reported that the aides had given secret Blackberry PIN numbers to an FPL attorney. Commissioner Nancy Argenziano fired her aide, Larry Harris, who is seeking reemployment elsewhere within the agency.

The panel that regulates utilities seems like “it’s about to implode,” Sen. Mike Fasano said today.

Fasano, who chairs the Senate Transportation and Economic Development Appropriations Committee, asked Senate President Jeff Atwater to order an ethics investigation into whether the Public Service Commission and its staff are too cozy with the industry it regulates.

“You have a regulatory body that can’t even regulate themselves let alone regulate a multi-billion dollar utility company that’s asking for a 30 percent rate increase,” Fasano, R-New Port Richey said.

Attorney General Bill McCollum earlier today said his office is “looking into” problems at the regulatory agency and the Florida Department of Law Enforcement is currently conducting an informal investigation.

The PSC is considering rate hikes for both Florida Power & Light Co. and Progress Energy and a proposed FPL natural gas pipeline that would altogether raise customers’ rates by more than $3 billion.

PSC staffer Ryder Rudd was pulled off all FPL cases after it was learned that he attended a Kentucky Derby party at the Palm Beach Gardens home of FPL VP Ed Tancer. An internal investigation found that he may have broken the agency’s ethics rules but could not prove it.

This weekend, The Miami Herald reported that other PSC aides had given secret Blackberry PIN numbers to an FPL attorney, prompting Commissioner Nancy Argenziano to fire her aide and Commissioner Lisa Edgar to put hers on leave.

‘From the Commission’s chief lobbyist attending a party with executives from Florida Power & Light, to the sharing of Blackberry PINs between commissioners, staff and utility executives, the appearance of impropriety has become impropriety itself.

‘If you throw into the mix the fact that two of the five sitting commissioners are up for possible reappointment in the midst of the rate case it becomes evident that disaster is in the making. I have publically asked the governor to not reappoint the two sitting commissioners until the rate cases have been disposed of,” Fasano wrote to Atwater asking for the Senate Ethics and Elections Committee investigation. The committee has to confirm Gov. Charlie Crist’s nominations for the commission.

PSC Chairman Matthew Carter last week denied the regulators were too close to the utilities.

Read Fasano’s entire letter to Atwater after the jump.

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A Public Service Commission staffer used “poor judgment” but an internal investigation did not conclude that he broke the law by attending a Kentucky Derby party at the home of a utility company executive.

But at least one PSC commissioner, Nathan Skop, demanded that PSC Office of Strategic Analysis and Government Affairs Ryder Rudd resign anyway.

Rudd went to a party at the Palm Beach Gardens home of Florida Power & Light Co. general counsel and VP Ed Tancer. Rudd oversees a staff of 28, some of whom are working on two FPL cases – a proposed rate hike and a natural gas pipeline.

The panel learned on the first day of the rate hearing last Monday of Rudd’s attendance at the party. Rudd had called several members of the panel over the weekend. He was removed from the FPL cases while the agency’s inspector general conducted an investigation, the results of which were released today.

Meanwhile, Florida Department of Law Enforcement officials are looking into a complaint, spokeswoman Heather Smith said. But she said the agency was not conducting a formal investigation.
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