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PSC sues in effort to avert firing

THE BALTIMORE SUN

The Public Service Commission filed suit yesterday to stop a new law that fires its five members, saying the measure is an unconstitutional power grab by a Democratic-controlled legislature looking to weaken a Republican chief executive.

Two weeks ago, in an effort to soften this summer's rise in BGE bills, the General Assembly approved a rate-relief plan that also reconstituted the PSC, which has been under attack for months as being too friendly to the utility industry.

Gov. Robert L. Ehrlich Jr. vetoed the bill last week, saying that the regulators, four of whom he appointed, were not to blame for the rate increase. The Assembly overturned his veto, and PSC members are supposed to be fired Friday.

Although the suit is not designed to affect BGE customers' bills, it will prolong the political issue that has dominated Maryland for months.

Ehrlich and his appointees at the PSC have been at odds with Democratic lawmakers and the governor's political opponents since March, when Baltimore Gas and Electric Co. announced a 72 percent rate increase to take effect July 1 and Democrats began criticizing the commission's response.

The suit, filed in Baltimore Circuit Court by PSC Chairman Kenneth D. Schisler, seeks a preliminary injunction to block the provisions of the law that remove the commissioners from their jobs, which pay the chairman $117,000 a year and the other four members a little less than $100,000.

The bill "is nothing more than a politically motivated attempt by the General Assembly to circumvent the express provisions of the Maryland Constitution, which only permits the removal of the incumbent commissioners for cause by the governor," the suit says.

If those provisions of the bill are upheld, the suit says, "no civil officer will be safe from the political whims of the General Assembly," the suit says. "Agencies such as the Parole Commission, the Workers Compensation Commission, State Board of Contract Appeals and others, all of whom make quasi-judicial decisions, will lose the independence which allows them to function in a fair, unbiased manner."

Ehrlich spokesman Henry Fawell declined to comment on the suit. But Ehrlich said on Friday that he would "absolutely" encourage the PSC to file a suit. He said the courts are the people's last resort against the Democratic-controlled General Assembly.

Democratic Party Chairman Terry Lierman called Schisler a "legal loose cannon" yesterday and demanded that Ehrlich renounce the lawsuit.

"Ken Schisler sealed his fate when he got caught conspiring with special interests to manipulate legislation and trying to fool the public he was supposed to serve," Lierman said in a statement. "He and the rest of Ehrlich's appointees got caught doing what Ehrlich told them to do - backing up the special interests at every turn - when they should have been fighting for ratepayers."

Democrats and some Republicans in the General Assembly said the PSC has shown little regard for consumers in the BGE rates crisis. They say the public's confidence in the commission was shattered by revelations that Schisler exchanged e-mails with an industry lobbyist to cooperate on legislative action and that he arranged a hunting trip and other social outings with electric industry executives.

The Assembly also passed a bill to replace the PSC last spring, but the plan died after a gubernatorial veto. Schisler also sued then, winning a temporary restraining order blocking the bill. The Court of Special Appeals upheld the restraining order.

Criticism of the PSC reached its zenith in May when Baltimore successfully sued the commission in circuit court to force it to hold a new hearing on a rate increase deferral plan Ehrlich had negotiated. The judge ruled that the PSC had to consider a broader scope of testimony to determine whether so large a rate increase was necessary.

Judge Albert J. Matricciani Jr. ruled that the commission failed in its duty to hold a proper hearing and issued a "defective order."

A spokesman for Attorney General J. Joseph Curran Jr. said he has received a copy of the new suit and will defend the law. The spokesman, Kevin Enright, declined to comment further.

Curran's office called the law constitutional, and the attorney general has said that because the legislature created the PSC, it has the power to remake it.

One member of the commission, Harold D. Williams, said he does not wish to be a part of the suit. He said Schisler told him yesterday that he planned to sue and promised to show him a copy of the filing beforehand but did not. Williams said he was also included involuntarily in Schisler's original lawsuit in April.

"The General Assembly came up with this particular law, and I'm going to abide by it," said Williams, the only PSC member not appointed by Ehrlich. "I'm just tired of this whole thing."

Legislative leaders said when they were crafting the bill that they anticipated a lawsuit. They said they studied the arguments Schisler made in his initial lawsuit and included several provisions to make a second such case harder to win.

The law allows the House speaker and Senate president to compile a list of potential new PSC members, with the governor making the final selection.

In an unusual move, the Assembly included a backup plan in the law should the initial mechanism for firing the commissioners be found unconstitutional. Should that happen, the law says, the commissioners would become at-will employees of the attorney general, who could then keep or replace them as he saw fit.

Schisler's new suit argues that such a mechanism would also be unconstitutional. The attorney general frequently intervenes in cases before the PSC, so making the commissioners his employees would pose a conflict of interest, the suit says.

Schisler, a former Republican delegate from the Eastern Shore, filed his first case in his hometown courthouse in Easton. He used public funds to hire his former law firm.

There is one judge in Talbot County, Sidney Campen. Before joining the bench, he was represented in a civil suit by the attorney Schisler hired to argue his case, David R. Thompson.

At the time of the initial suit, a bill designed specifically to make Campen eligible for lucrative work as a retired judge was awaiting Ehrlich's signature or veto.

The new law is designed to prevent a repeat of what leading lawmakers saw as a blatant attempt by Schisler to shop for a friendly venue. It requires a challenge to the law to be filed in Baltimore Circuit Court and prohibits public funds from being used for such a challenge.

PSC spokeswoman Christine E. Nizer did not respond to a phone message last night asking who is paying for the current suit. Williams said Schisler did not tell him who would be paying.

Thompson, the Easton lawyer, is listed as a co-counsel in the case, but the lead attorney is Andrew Radding of the Baltimore firm Adelberg, Rudow, Dorf & Hendler.

When Schisler filed his initial suit, Radding questioned whether it was proper for a state agency to sue the state government.

"I'm very quizzical about how it can be successful," he told The Sun at the time. "It's almost equivalent to the Postal Service filing a suit against the U.S. government."

Radding said yesterday that he made that comment without a complete knowledge of the new law or of the PSC's case.

"I am no longer quizzical about it," Radding said. "I now understand the issue, and I don't have those reservations."

Radding lists two co-counsels from his office, Gregory M. Kline and H. Scott Jones. Kline is a Republican candidate for the House of Delegates in Anne Arundel County, and Jones is his campaign treasurer.

Dan Friedman, an attorney with the Saul Ewing firm who teaches constitutional law at the University of Maryland Law School, said Schisler has a strong case.

The legislature appears to have exceeded its authority, said Friedman.

Had the legislature reorganized the PSC by taking some action such as making members' positions elected or changing their terms from five years to one to make them more responsive to the public, its move would probably have been legal, he said, but firing them because lawmakers disagree with their regulatory actions probably isn't.

andy.green@baltsun.com

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