Headline:Behind closed doors
Citizens must have confidence that independent state regulatory agencies are, in fact, independent.

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PublishDate:Tuesday, 4/10/2007
Sections:Editorial
Editions:Third Edition
Page:B6
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Body Text:On Sept. 11, 2006, a group of heavyweights gathered in Gov. Matt Blunt's Capitol office. The group included Steven R. Sullivan, general counsel for AmerenUE; Ed Martin, the governor's chief of staff; Tony Feather, a GOP strategist and lobbyist then working for the utility, and Jeff Davis, chairman of the Missouri Public Service Commission.

At the time, AmerenUE had a $360 million-a-year rate hike request pending before the PSC. Ameren also was facing the possibility of criminal charges related to the 2005 collapse of its Taum Sauk reservoir.

Mr. Martin says that Ameren's rate case was not discussed during the meeting, but the 2005 collapse of Ameren's Taum Sauk reservoir was.

"My vague recollection is that it was more of a meet-and-greet," Mr. Davis said recently. "It was more of trying to help these people (AmerenUE officials and the governor's staff) get to know each other so they could have conversations at a later date."

What troubles us about this meeting is Mr. Davis's presence. It is questionable, at the very least, for a PSC commissioner to meet privately with one side in a pending rate case, lest his impartiality be compromised. Whether or not the rate case was discussed per se, or what hat Mr. Davis says he was wearing at the time, the issue of rates and the dam collapse are entwined.

As PSC chairman, Mr. Davis presided over three weeks of courtroom-style hearings on the rate hike that ended last month. PSC commissioners act as administrative law judges in rate cases. Past PSC commissioners have taken their impartiality so seriously that they have refused to meet with legislative committees to discuss matters before the commission. State law was changed in 2003 so that PSC commissioners could testify before lawmakers. The law permits commissioners to meet privately with one party in a pending case only if the meeting is disclosed and its substance summarized for the other parties to review.

The meeting only came to light on March 29, when Mr. Davis disclosed a letter from Mr. Martin that mentioned the meeting. At the time of the meeting, AmerenUE was in talks with the state Department of Natural Resources to settle damage claims stemming from the dam collapse. Mr. Sullivan, the utility's lawyer, apparently told Mr. Martin that he did not get along with the attorney negotiating for the state, Kurt Schaefer, general counsel for the Department of Natural Resources. Mr. Martin subsequently took control of those negotiations.

Less than three weeks after the meeting, Ameren revised its rate request to the PSC to include $10 million in costs associated with the dam collapse. The company subsequently withdrew that part of its request, saying that it had been added in error. Even without that part of the request, it's difficult to untangle the costs of the Taum Sauk collapse from the utility's overall finances that are the basis of its rate increase request.

Whether or not the September meeting was legal, it bears further public scrutiny. The public has a right to know who was there, what went on and why. Was Ameren's rate case discussed? Did the utility or the governor's office try to persuade Mr. Davis to be more be sympathetic toward a rate increase in light of the huge costs associated with the dam failure? Was the meeting part of an effort to head off criminal charges or legal action that could affect the rate case? Should Mr. Davis now disqualify himself from voting on the rate case?

The Senate should launch an investigation into the probity - and legality - of the meeting. Mr. Davis, especially, must be called upon to explain why he was in a private meeting with an Ameren lobbyist and attorney.

Citizens must have confidence that independent state regulatory agencies are, in fact, independent. When state regulators make themselves available for closed-door meetings with the industries they regulate, the public interest too easily can get locked out.

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