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Gov. Hogan's nominee to utility regulator faces Senate grilling over emails

Appointee of Hogan to the agency that regulates utility rates faces a grilling before a Senate committee.

An appointee of Gov. Larry Hogan to the independent agency that regulates Maryland utilities faces tough questioning before a Senate committee Monday over allegations he improperly communicated with administration officials.

Michael T. Richard, a former deputy chief of staff to the Republican governor, has been summoned to appear before the Senate Executive Nominations Committee to explain why he should be confirmed in the position he now holds on a tentative basis on the Public Service Commission.

A consumer advocacy group and clean-energy think tank are calling on senators to reject his nomination. Sen. Jamie Raskin, the Montgomery County Democrat who chairs the committee, said his confirmation may now be in doubt.

"We have tried to give all of the governor's appointees the benefit of the doubt, but new information has surfaced that directly questions this nominee's commitment to independence as a member of the Public Service Commission," Raskin said. "The commission's role calls for a quasi-judicial independence and objectivity of judgment."

Hogan spokesman Matthew A. Clark said Richard had done nothing improper and accused the Senate's majority Democrats of applying a double standard, saying they didn't object to former Gov. Martin O'Malley appointing members of his Democratic administration to the commission.

"It really feels to me this is partisan and perhaps spiteful," he said.

If Richard is rejected, he would become the fourth Hogan nominee to be unseated this year because of a Senate vote. Last week the Senate voted to reject three of the governor's nominees to the Baltimore city liquor board. Last year, the Senate declined to confirm Hogan's nomination for higher education secretary without taking a formal vote.

Richard did not respond to requests for comment.

The committee is expected to ask Richard about emails he sent to members of the governor's staff since he was appointed in January. Under Maryland law, commissioners can carry out all their duties while their nominations are pending.

If Richard is confirmed, he would keep his position on the five-member panel for a five-year term. In 2014, the most recent year for which information was available, commissioners were paid $136,600 a year.

Richard's emails were obtained by the consumer advocacy group Public Citizen under a public records request. That group and the Energy and Policy Institute, which works to counter what it deems "misinformation" from fossil fuel and utility interests, issued a joint statement urging senators to reject Richard's nomination.

Gabe Elsner, executive director of the institute, said Richard's emails informing Hogan staff members about Public Service Commission deliberations and asking for their guidance amount to ex parte communications — a legal term for talking directly to a judge or decision-maker without the other parties' knowledge.

Emails to and from Richard show that he kept up a steady correspondence with his former colleagues in the Hogan administration.

In February, for instance, Richard sent an email to Hogan policy director Adam Dubitsky seeking help in a rule-making process, a highly formal proceeding involving public hearings and the filing of legal briefs. The governor's administration can intervene, filing its own briefs.

The commission regulates utilities, setting rates and ensuring safe and reliable service for gas and electricity. It also regulates some transportation providers, such as taxicab operators, as well as telecommunications and railroad companies.

Richard sought an administration statement that would help him in internal negotiations with fellow commissioners on the size of a solar energy pilot program. Among other things, Richard disclosed his fellow commissioners' negotiating position and told Dubitsky he was trying to "steer the program" toward smaller projects.

"The commission will be sitting again next Monday, so let's discuss a possible statement via [the Maryland Energy Administration] that I can use to vigorously assert the governor's office position on this," Richard wrote.

Elsner said that Richard's disclosure of his fellow commissioners' position on a pending case is analogous to Supreme Court justice telling a lawyer on one side in a case the opinions of his colleagues as they deliberate.

"It's improper. It's not supposed to happen," he said.

In another email in February, Richard notified Mary Beth Tung, deputy secretary of the Maryland Department of the Environment, that a set of hearings on the EmPower program had been set for May. The energy efficiency program aims to reduce energy consumption by residents and businesses.

"This will begin our first potential opportunity to begin putting our imprint on this significant energy tax policy," Richard wrote. "There is time, but this will be a significant and very public PSC action, so early governor's office direction, planning and Executive Brand coordination on related policies will be important."

According to Elsner, that communication is a violation of Public Service Commission rules because the Hogan administration is a party to the case.

"He's acting as if he's still working for the governor and not acting as an impartial judge," Elsner said.

In another email, Richard informed Dubitsky in January that a certain company had submitted an application for an offshore wind renewable energy credit.

"This is NOT yet public information, but I wanted you to be aware," Richard wrote.

Clark said Richard did nothing wrong in communicating with the governor's office.

"There's certainly nothing inappropriate about PSC members seeking input and guidance from a variety of sources," Clark said. Asked whether it also would be appropriate for a commissioner to consult legislative leaders, Clark said: "Why not?"

Hogan's spokesman said the administration believes the Senate set a precedent allowing such communications in a 2012 debate over former O'Malley's nomination of two staff members to the Public Service Commission. Both were confirmed by the Democratic-controlled Senate.

Clark pointed to media coverage at the time showing that then-Sen. Brian E. Frosh — since elected Maryland's attorney general as a Democrat — defended one of O'Malley's appointees over criticism about her email exchanges with the commission.

In that case, the emails were sent when the nominee was still on the governor's staff. Then-Sen. E. J. Pipkin, an Eastern Shore Republican, said the correspondence showed the nominee couldn't be independent given the lobbying done on behalf of the administration before taking a seat on the commission.

The emails showed the nominee had been "actively coercing an independent agency to amend its forecasts to bolster the governor's agenda."

But Frosh defended the nominee at the time, saying the law allows the Public Service Commission to cooperate with the administration on legislative matters.

"In this case we agree with the attorney general that there's nothing at all inappropriate about members of the PSC communicating with the Governor's Office," Clark said.

Frosh declined to comment.

Raskin said the committee decided to call Richard in to ask further questions Monday night. He said the nominee's initial hearing went well. Richard previously worked for the Nuclear Energy Institute, in former Gov. Robert L. Ehrlich Jr.'s administration, at the U.S. Department of Energy and for Westinghouse Electric Co.

But, Raskin said, subsequent disclosures have alarmed lawmakers. "This set of emails shocked a lot of the senators," he said.

There is nothing new about a governor naming a staff member to the PSC, Raskin said. But once there, the senator said, the commissioner is expected to act independently.

"It's an independent regulatory commission," Raskin said. "It is not meant to be a political instrumentality of the governor."

Baltimore Sun reporters Erin Cox and Pamela Wood contributed to this article.

mdresser@baltsun.com

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