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House proposes overhaul of PSC, with more legislative control

BY MARY ELLEN KLAS

TALLAHASSEE — Florida's Public Service Commission would undergo a complete face lift under a draft House proposal released Tuesday that moves the commission's regulatory staff into a separate entity that answers to the Legislature and tightens qualifications for commissioners.

The plan by the House Energy and Utility Policy Committee attempts to build a new firewall between regulators and the utilities and politicians that attempt to influence the PSC, said Rep. Stephen Precourt, R-Orlando, chairman of the committee.

It also aims to restore some legislative control over utility policy.

It would move the PSC's technical advisors to a newly-created Office of Regulatory Staff that would have the power to petition the PSC to take action, he said. The PSC would no longer have a policy role and could focus on acting "more like judges."

The measure also would ban all private communication between the commissioners and the parties that want to take a position on a case.

Under the current structure, the PSC establishes policy and regulates utilities, a system that Precourt believes has led to allegations that the Legislature is trying to influence commissioners.

"A lot of the conflict could be eliminated if you clarify the roles — that's where the undue influence was," he said.

Under the House plan, the new regulatory staff office would be housed in the Legislature like the Office of Public Counsel, which represents consumers in rate cases, and both would have equal standing in cases before the PSC.

Last fall, the PSC was rocked by allegations that staff and commissioners were too close to the utilities they regulate when it was revealed that staff members shared BlackBerry messaging codes and text messages with utility lobbyists. A PSC staff member also admitted to attending a Kentucky Derby party at the home of a Florida Power & Light official in the midst of a rate case.

Gov. Charlie Crist reacted by replacing two commissioners, and he opposed the rate increase request sought by FPL and Progress Energy of St. Petersburg.

Precourt said his goal is to create an "efficient regulatory environment'' and restore the confidence of bond markets.

The reforms are modeled after similar changes at the South Carolina Public Service Commission in 2004. Under the new structure, the Office of Regulatory Staff would petition the PSC when it determines regulatory action is needed. It would also have the job of carrying out the Legislature's utility policy.

The 72-page bill also requires future commissioners to have a college degree and 10 years experience in a related technical field, or an advanced degree and six years of experience. Commissioners would be appointed to six-year terms and subject to confirmation by the full Legislature after three years.

The plan would strip the PSC of hundreds of regulatory staff members, but the commission would retain a staff of technical and legal advisors.

The executive director of the regulatory agency would be appointed by a legislative committee for a six year term subject to the confirmation by a majority vote of both the House and Senate.

The proposal also embraces parts of the ethics reform bill passed by the Senate during the first week of session but does not include some of the most stringent changes.

Precourt said his staff has spent months studying similar utility regulatory systems in other states to come up with a plan that restructures the commission to deal with modern issues.

"This structure has been set up since the '70s for something that wasn't anywhere near as sophisticated as the arrangement that we have now," he said. "We decided there were structural problems at the PSC in addition to those that were more related to the people that you have there."

Precourt said Tuesday he expects resistance to the plan and admits it's "pushing the edge of palatable."

But, he said, that's because no one gets an advantage under this plan: "There's lots of parties that are going to be equally concerned about how this will play out."

House proposes overhaul of PSC, with more legislative control 03/16/10 [Last modified: Tuesday, March 16, 2010 9:34pm]
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