Checks & Balances Project Calls On Arizona Attorney General to Investigate Anti-Solar Push Poll

Checks & Balances Project Asks Arizona Attorney General for Investigation

Ariz. Attorney General Mark Brnovich

Today, the Checks and Balances Project sent a letter to Arizona Attorney General Mark Brnovich asking that he investigate whether or not Arizona Public Service (APS) is connected with efforts by the Virginia-based Taxpayers Protection Alliance to conduct a door-to-door push poll designed solely to discredit the residential solar industry in Arizona.

If APS is connected, we ask that the Attorney General determine the extent to which APS has used ratepayer funds to underwrite this effort to protect its status as a highly profitable, incumbent monopoly.

Our request for an investigation was sparked by an article in Friday’s Arizona Capitol Times titled, “Looking for Trouble in All the Solar Places” (subscription required). In the article, Virginia-based Taxpayer Protection Alliance President David Williams acknowledged he’s really after people’s negative experiences.

This takes places as Arizona Public Service Co. prepares a request for regulators that would increase monthly fees on solar companies, according to news reports.

Arizonans deserve to know whether or not APS hired the Taxpayers Protection Alliance directly or through the front group, American Encore. Formerly known as the Center to Protect Patient Rights, American Encore is run by Mr. Sean Noble who, during the 2013 net metering debate, APS acknowledged funneling money to in order to bolster APS’s position.

To read the full text of the letter, click here.

 

Scott Peterson

Executive Director

Checks and Balances Project

 

Letter to Arizona Attorney General Brnovich

March 23, 2015

 

The Honorable Mark Brnovich

Attorney General of Arizona

1275 West Washington Street

Phoenix, AZ 85007-2926

 

Dear Mr. Attorney General:

I am the Executive Director of the Checks and Balances Project, a government and industry watchdog. I am writing to you after reading about a push poll disclosed by the Arizona Capitol Times on Friday, March 20, 2015. The article is titled, “Looking for Trouble in All the Solar Places” (see attached). It quotes the owner of the push poll group as acknowledging that the effort is really to discover negative experiences with residential solar.

Given your investigation into the claims of a staff whistleblower about conduct of at least two members of the Arizona Corporation Commission in a dark money scheme, I am writing to request that you:

  • Investigate whether or not Arizona Public Service (APS) is connected with efforts by the Virginia-based Taxpayers Protection Alliance to conduct this door-to-door push poll, designed solely to discredit the residential solar industry in Arizona.
  • If APS is connected, determine the extent to which APS has used ratepayer funds to underwrite this effort to protect its status as a highly profitable, incumbent monopoly.
  • Determine which specific executives at APS approved the funding for the push poll.
  • Provide an opinion on this as a proper use of APS ratepayers’ money without their consent.

Arizonans deserves to know whether or not APS hired the Taxpayers Protection Alliance directly or through the front group, American Encore. Formerly known as the Center to Protect Patient Rights, American Encore is run by Mr. Sean Noble who, during the 2013 net metering debate, APS acknowledged funneling money to in order to bolster APS’s position.

I appreciate that APS spent a large amount of money advocating for your candidacy for Arizona Attorney General. However, I trust your office will conduct a thorough and impartial investigation.

Thank you for considering my request. Please contact me if you have any questions.

Regards,

 

Scott Peterson

Executive Director

Checks and Balances Project

Washington Post: Utilities wage campaign against rooftop solar

This article by Joby Warrick was originally posted by the Washington Post on Sunday, March 7, 2015.

Excerpt:

“The utilities are fighting tooth and nail,” said Scott Peterson, director of the Checks and Balances Project, a Virginia nonprofit that investigates lobbyists’ ties to regulatory agencies. Peterson, who has tracked the industry’s two-year legislative fight, said the pivot to public utility commissions moves the battle to friendlier terrain for utilities. The commissions, usually made up of political appointees, “have enormous power, and no one really watches them,” Peterson said.

Patterson Clark and Joby Warrick/The Washington Post.

Patterson Clark and Joby Warrick/The Washington Post.

 

Checks and Balances Project Launches Captured Regulators Initiative

Checks and Balances Project Launches Captured Regulators InitiativeInfluence pedaling in America is a $9 billion a year industry. It’s as big as Major League Baseball or NASA’s Mars spacecraft program, changing from direct meetings with lawmakers to a vertically integrated set of businesses that work every stage of government decision making – including the shaping of public opinion.

Many have charted the size, scope, and growth of the influence peddling industry. There’s the definitive, 25-part Washington Post series on the emergence of modern mega-lobbying firms. Ross and Amter’s definitive history of the chemical lobby The Polluters. Merchants of Doubt, by Oreskes and Conway, that laid bare the growth of the lobbyist-funded think tank industry. There are also definitive books by then-reporter Jeff Birnbaum’s, including The Money Men: The Real Story of Fund-raising’s Influence on Political Power in America – though Birnbaum later joined the influence business himself.

The point is that as a growth industry, influence peddling needs to find new ways to grow to accChecks and Balances Project Launches Captured Regulators Initiativeommodate the ever-expanding ranks for former staff and public officials who want to make big money after their public “service.”

So it was only a matter of time before previously sleepy public offices, such state assembly offices, state public utility commissions, and writers of obscure cost-benefit analyses became part of the influence peddling playbook. That’s particularly true now that the big shifts in the energy industry are under way. Rooftop solar on people’s homes has been declared a “mortal threat” by the lobbying arm of the utility industry, which has launched a very concerted effort to penalize their customers for buying less of their product.

Regulatory Capture in State Agencies

In many states, commissioners have been lured to ally themselves with the industries they are charged with regulating. There is a term for this, created by Nobel Prize winner Economist George J. Stigler over 50 years ago: “Regulatory capture.”

The financial crisis of 2007-2009 can be explained partly as a problem of regulatory capture. Regulators were so enamored by Wall Street’s risk prevention mechanisms and their way of life that they failed to recognize the enormous risks that were being taken right under their noses until it was too late.

In Virginia, the State Corporation Commission (SCC) is charged with regulating Dominion Resources, a monopoly utility and the Commonwealth’s most powerful corporation. Yet last October, two senior staff members of the SCC wrote a comment letter to the U.S. Environmental Protection Agency about the federal Clean Power Plan (CPP). The CPP is intended to reduce carbon pollution. Although it gives states wide latitude in cutting the pollution and independent studies show it will save money and create clean energy jobs, the staffers attacked the CPP as “arbitrary, capricious, unsupported, and unlawful.” They are thought to have taken Dominion’s 2013 Resource Plan as the basis for their frontal assault.

Death Spiral                                                                              

Utilities nationwide have captured Public Utility Commissions, in whole or in part, just like Dominion has enveloped its own in Virginia. This effort is seems to be encouraged by the Edison Electric Institute (EEI), the utility industry trade group based in Washington, DC.

In January, 2013, EEI released a man-the-battle-stations white paper that said solar panels on residential or commercial roofs that are not utility-owned or utility-purchased would lead to a death spiral for the utility industry. Since then, the effort to smother the solar baby in its cradle has been stepped up.

Checks and Balances Project Launches Captured Regulators InitiativeNew Captured Regulators Initiative

With renewable portfolio standards, net metering and the CPP, the next two years will decide how many clean energy jobs and energy efficiency savings Americans will see. The stakes are high.

The Checks and Balances Project has noticed that in a number of states, utility commissioners are acting almost as consultants to the utilities they are charged with overseeing. The range of favoritism is wide – from casual remarks to open assistance to help a regulated utility shop for a favorable state judge. There seems to be an emerging trend, which is why we are launching a systemic look to see what’s going on in state public utility and state corporation commissions. Where the influence is going, so should the oversight accountability.

We’re launching our Captured Regulators initiative by asking questions about these officials:

Are there public utility commissioners, public service commissioners or state corporation commissioners in your state that you think are captured by the utility industry? Or commissioners you have questions about like Audrey Zibelman of New York or Virginia’s Mark C. Christie?

If so, tell us more. Send us an email to capturedregulator@checksandbalancesproject.org.

 

Scott Peterson

Executive Director, Checks and Balances Project

Virginia Minority Leader Saslaw Again Declares His Opposition to Ethics Reform

Virginia Democratic Minority Leader Richard L. Saslaw (D-35) is a man of strong opinions when it comes to government ethics standards – basically, that we shouldn’t have any. That was clear (again) when I spoke on Jan. 10 at the Fairfax County Delegation’s Annual Public Meeting.

Saslaw-Peterson split screen 1.10.15Senator Saslaw presided. It was an opportunity for citizens of the state’s largest county, like me, to speak to their state senators and delegates before the legislature convened in Richmond on Jan. 14. It happened one week after the historic sentencing of former Governor Bob McDonnell for two years for corruption and bribery. This sad episode showed convincingly that Virginia operates largely on the honors system when it comes to ethics and that the honors system doesn’t work anymore.

I thought it would be a great chance to raise the issue of ethics reform with the most powerful Democrat in the Virginia legislature. The results were revealing.

I was speaker number 43. Each speaker was allocated three minutes and generally received a simple “Thank you,” from Senator Saslaw. I began with a quick explanation of the founding of Checks and Balances in 2009 by people who were concerned about how investigative journalism had shrunk while a tidal wave of lobbying money from the fossil fuel industry undermined the growth of clean energy. (See the entire video here.)

I noticed I had not gotten Saslaw’s attention, as he was talking with others on the panel. But I went on, saying that I wanted to talk about the sad state of ethics in the Commonwealth.

Corruption Risk Scorecard

I pointed out that according to the State Integrity Investigation’s Corruption Risk Scorecard, Virginia ranks 47th out of the 50 states with an overall grade of F.

I seemed, by that point, to have gotten the Minority Leader’s attention. I know I had the attention of Sen. Chap Petersen (D-34), whose ethics reform bills would limit campaign contributions and gifts. Sitting near him was Delegate Marcus Simon (D-53), who was planning on introducing a bill to limit what campaign contributions could be spent on. Simon was quoted in the Fairfax Times as saying:

“If you can go and spend leftover campaign funds on whatever you want, it’s not really any different than taking a bribe.”

Other members of the legislature have ethics reform bills. The Republican leadership has proposed reforms, as has Democratic Governor Terry McAuliffe.

None of those proposals went far enough, I asserted. “There’s simply too much coziness allowed with corporations. The General Assembly should pass a law that restricts members from accepting any political contributions from corporations with legislation pending before the legislature.

“Last year, North Carolina installed 13 times the solar photovoltaic capacity as Virginia has in its entire history,” I said. Yet two days before, “the Winchester Star reported that a 20-megawatt solar array—capable of powering 20,000 homes—was scuttled in Clark County. The developer blamed Dominion Virginia and other utilities for their lack of interest in buying the electricity.”

I pointed out that last year, Dominion was the largest donor to state-level politicians with over $1.3 million in campaign contributions.* “No wonder Dominion Virginia gets its way when it comes to energy in Virginia,” I stated.

I had Senator Saslaw’s attention now. In fact, he appeared to be glaring at me.

“Senator Saslaw,” I said. “Last year you were quoted as saying, ‘You can’t legislate ethics…”

“That is correct,” Saslaw interjected.

“… either you’re dishonest or not, OK?’ End quote. I hope you have reconsidered that position…”

“I have not,” the Minority Leader responded.

“…The time to get working on improving Virginia’s “F” grade is now.”

Sen. Saslaw, who said he generally did not comment after speakers, declared that in the 38 years he’d been in office, there had been six or seven episodes that had made the newspapers and “none of them involved lobbyists or a campaign contribution.”

I paused, wondering foolishly if his reform-minded colleagues might come to my aide. “May I respond to that?”

“Nope,” he declared.

Not certain I had heard him correctly, I asked, “No? Or Yes?” The Minority Leader repeated that he would not give me permission to respond.

Missing the Point

Sen. Saslaw clearly missed the point. When it came to “effective monitoring of lobbying disclosure requirements,” “ethics enforcement,” or “legislative accountability,” Virginia got straight F grades. No wonder there have been no scandals involving lobbyists or campaign contributions that had made the papers.

I returned to my seat, but before I could sit down, Senator Saslaw bounded up the aisle toward me. He walked up and leaned in within inches of my face. He told me that he had been interviewed by the FBI who told him that the way he handled campaign contributions was not corrupt.

“Senator, from everything I have learned, you are one of Dominion’s biggest apologists,” I said.

He seemed not to understand, so I repeated the word “apologist.” He then explained how he had gotten Virginia Dominion President Robert Blue and a solar chieftain together to try and work out their differences. I countered with the fact that the Sierra Club’s climate and energy scorecard had given Senator Saslaw an overall grade of D, while three Republican delegates received B’s.

“Well,” Senator Saslaw huffed. “Everyone knows they’re crazy!” He invited me to visit him in Richmond, then walked off.

Who is That Guy?

Later, a teenager sat down next to me who was also attending the meeting. He told me he was a Boy Scout, working on his Eagle Scout rank.

“I thought that was really rude how that guy cut you off,” he said. “Who is he?” I explained that he was the Democratic leader in the Virginia state senate. He looked incredulous, shook his head, and walked away.

 

Scott Peterson is executive director of the Checks and Balances Project, a Virginia-based watchdog that seeks to hold government officials, lobbyists and corporate management accountable to the public.

(* Note:  I should have said “largest corporate donor in 2013.” A report of Dominion’s contributions to state politicians in the second half of 2014 was submitted to the State Board of Elections on January 15. Totals for 2014 are not yet available on the VPAP website. )

Will the American Energy Scorecard Ask Lawmakers to Reject All Subsidies?

The American Energy Alliance announced on Jan. 8 “the nation’s first and only free-market congressional energy accountability scorecard.” But how much of their new scorecard will be devoted to getting mature, highly profitable fossil fuel industries off corporate welfare?

ScorecardIn AEA’s announcement, it declares the new Scorecard will “educate lawmakers” and “empower the American people,” while holding our representatives accountable for their votes on important energy issues. The first issue that it demands lawmakers vote for is the Keystone XL pipeline.

Would an organization that believes so strongly in free markets and stands so firmly against subsidies for the wind industry also declare itself uniformly against subsidies for the oil, gas, and coal industries?

After all, that seems to be the principle of free markets as AEA defines them. If wind energy producers must “stand on their own two feet,” then shouldn’t fossil fuel producers, as well?

$18.5 Billion for Fossil Fuel Subsidies

According to an analysis by Oil Change International, the federal government’s subsidies for fossil fuel exploration and production have increased by 45% since 2009 to $18.5 billion per year.

tom_pyleAEA’s President Thomas Pyle declared in a statement published on its website on Dec. 17 that subsidies like the wind production tax credit (PTC) are like “taking money out of the pockets of hardworking Americans to stuff the stockings of foreign corporations and wealthy investors.” Pyle said we must “unwind this culture of cronyism.”

After more than a century of subsidies by the federal government to encourage the growth of oil, gas and coal, we have to wonder. Is Pyle serious about eliminating energy subsidies? Or is his demand of accountability just a bunch of wind?

I called the American Energy Alliance’s spokesperson Chris Warren and asked him if the scorecard would include lawmakers’ votes against fossil fuel subsidies.

No Straight Answer

“We’re going take these on a vote by vote basis,” said Warren. “I can’t give you a straight answer.”

I tried again. Would the AEA score votes on subsidies for the oil, gas, and coal industries?

“We’re against subsidies in general,” Warren declared. “We believe in free markets. Energy industries should be able to stand on their own two feet and compete.”

So, the American Energy Alliance is against all subsidies. Who knew? Maybe their scorecard might have some value after all.

 

Scott Peterson is executive director of the Checks and Balances Project, a Virginia-based watchdog that seeks to hold government officials, lobbyists and corporate management accountable to the public.

 

Op-Ed: Leniency for McDonnell would send wrong signal

This op-ed was originally posted by the Daily Progress of Charlottesville, Virginia, on Sunday, January 4, 2015.

by Scott Peterson

McDonnellIs this the time for leniency? Former Gov. Bob McDonnell is scheduled to be sentenced by U.S. District Judge James Spencer on Jan. 6. But with Virginia ranked 47th out of 50 states on the State Integrity Investigation’s Corruption Risk Score Card, the answer is “no.” To be blunt, McDonnell should serve time in prison.

Why? A signal needs to be sent that we’ve turned a corner and corruption will no longer be tolerated in the commonwealth. What better place to start than with McDonnell, convicted last September of 11 counts of corruption for accepting $120,000 in sweetheart loans, lavish vacations and golf outings from a Richmond businessman?

It’s not just that he is the first Virginia governor to be convicted of a crime. Let’s face it. The “Virginia Way” is in peril. For years, the Virginia Way referred to the commonwealth’s efficient and well-managed government. Virginia was different from other states like Louisiana, Illinois or Rhode Island.

But those states all convicted and sentenced corrupt former governors Edwin Edwards, George Ryan and Edward DiPrete to prison. Because of that and other reforms, they now all rank ahead of Virginia on the Corruption Risk Score Card.

The U.S. probation office recommends a minimum of 10 years and a month in prison. McDonnell’s lawyers are pleading for community service. It is hard to believe they are serious.

For anyone who cares about Virginia’s reputation for having a clean business environment, this signals a dangerous lack of accountability. This is an issue that is bigger than just one man.

Although former Gov. McDonnell tried to blame his actions on his wife, the members of the jury did not buy that line of defense. They rightly concluded that the governor’s wife didn’t make him use Star Scientific CEO Jonnie R. Williams’s plane to travel to a political event, listen to the CEO pitch his tobacco-based Anatabloc supplement product on the way back, then recommend it to Virginia’s secretary of health and human resources. He chose to do that. Those facts are getting lost in coverage of character letters and calls for leniency.

McDonnell rejected a deal offered by prosecutors to plead guilty to a single count of lying to a bank in exchange for a reduced sentence of up to three years in prison or probation. But he arrogantly refused the prosecutor’s demand that he sign a statement acknowledging his guilt.

Whose advice should the judge follow when he hands down former governor’s sentence?

How about the former governor himself? In 2011, McDonnell issued a public statement on the sentencing of former Del. Phil Hamilton, who had been convicted of corruption.

“Virginia has long been a state marked by honest, transparent and ethical governing by both parties. Today’s judgment is a reminder that no one is above the law. So too was the jury’s verdict after this trial, and so too should be this court’s sentence.”

Former Del. Hamilton is now serving a 9 1/2-year sentence in prison.

Scott Peterson is executive director of the Checks and Balances Project, a Virginia-based watchdog that seeks to hold government officials, lobbyists and corporate management accountable to the public.

Think Tanks

Virginia

Op-Ed: Corruption put “The Virginia Way” on life support

This op-ed originally appeared in the Virginian-Pilot and PilotOnline.com.

By Scott Peterson

© December 21, 2014

pilotpalone_400x400For years, Virginians had confidence that their state government was run efficiently and well – at least compared to other states. “The Virginia Way” set us apart from other states with seemingly incorrigible corruption in their capitols.

All that has changed recently with a series of events that is deeply shaking public confidence.

It is not just the dramatic corruption conviction of once-popular former Gov. Bob McDonnell, but a series of ugly disclosures that have changed how we think business is done in Richmond.

There was the CONSOL Energy scandal in which an assistant attorney general provided legal advice to help an out-of-state energy company to fight Virginia landowners who were owed millions for gas extraction. There was the federal probe into offers of jobs to then-Sen. Phil Puckett and his daughter if the senator resigned his seat – thus changing partisan control of the Senate.

The State Integrity Investigation ranked Virginia 47th out of 50 states on its Corruption Risk Report Card.

This month’s scandal is news that the Virginia Tobacco Commission gave $30 million to a partner of Dominion Resources Inc., to construct a natural gas pipeline to a new $1.3 billion natural gas-fired power plant Dominion is building in Brunswick County. The commission’s staff recommended $6.5 million. Dominion is listed as a beneficiary on the Tobacco Commission grant application and is co-signer of the contract.

How was the grant increased by $23.5 million to benefit Dominion – one of the richest and most politically well-connected corporations in Richmond?

According to a draft report by the state Inspector General’s office obtained by The Associated Press, Tobacco Commission staffers said there was pressure from McDonnell’s office to boost the award. But McDonnell’s lawyers said he did not lobby the Tobacco Commission. Dominion said it didn’t, either. Hmmm.

The Tobacco Indemnification and Community Revitalization Commission was established in 1998 when Virginia received its portion of a settlement with 46 states and the four largest tobacco companies. Forty percent went to the General Fund and 10 percent to reduce tobacco use and obesity. The rest of the money was put into a $1 billion endowment fund run by the Tobacco Commission to generate cash for community revitalization grants in Southwest and Southside Virginia.

The Tobacco Commission’s chair is Terry Kilgore, a powerful Republican delegate from Virginia’s far southwestern corner. With $122,000 in campaign contributions from Dominion, Kilgore received more money from Dominion than any member of the House of Delegates. Terry’s twin brother, Jerry Kilgore, a former Virginia attorney general and GOP nominee for governor, is a partner with Dominion’s Richmond law firm, McGuireWoods.

So far this year, Dominion is the largest donor to state-level politicians, operating three different accounts, with over $1.3 million in contributions. Dominion has donated more than $9 million over the years to Virginia Democrats and Republicans.

The Virginia Way was fundamentally a public trust that our elected officials would not behave like those in other states. Though that trust has been severely injured, we cannot give up trying to restore it. We can and should demand that steps be taken to make this situation right.

Dominion and its pipeline partner, Transco, a subsidiary of the Houston, Texas-based The Williams Companies, must give back the money. They don’t need what is essentially a welfare check to continue eroding public confidence.

The General Assembly should pass a law that restricts members from accepting any political contributions from organizations and corporations with legislation pending before the legislature. The $100 cap on gifts that Republicans and Democrats are proposing is not enough.

Senate Minority Leader Richard Saslaw – no stranger to money from Dominion – said last year, “You can’t legislate ethics… either you’re dishonest or you’re not, OK?” Saslaw is wrong that Virginia doesn’t need strong ethics laws, but in one sense he was right. Either Virginia is going to decide to be an honest place to govern, live and do business, or it’s not. It’s time for all of us to decide if The Virginia Way can be saved.

Scott Peterson is executive director of the Checks and Balances Project, a Virginia-based watchdog that holds government officials, lobbyists, and corporate management accountable to the public.

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