Lawmakers Challenge PSO Rate Increase
Before the Oklahoma Supreme Court can decide on the legal challenges of three state legislators to rate hikes approved by the Oklahoma Corporation Commission, it first must decide on a growing number of other issues in the challenges.
In recent weeks following the January filiing of a lawsuit by Rep. Tom Gann and two other legislators that a Public Service Company of Oklahoma rate hike should not have been allowed because Commissioner Todd Hiett was allegedly biased in favor of the utility, two developments have occurred.
Industry Group Defends the Commission
One involved the filing of support for the Commission’s rate approval by the Oklahoma Industrial Energy Consumers group.
“”This appeal should be dismissed as moot to the extent it is based on Gann’s allegations against Hiett,” argued Thomas Schroedter, attorney and executive director who filed the response for the OIEC. He also made the argument that Hiett was the subject of a “thorough investigation” and based on the probe, Gann’s original complaints were dismissed.
“In addition to the lack of any evidence in the record demonstrating that Hiett’s alleged impartiality resulted in an order that is arbitrary and unfair, Gann did not introduce any
competent evidence of the claimed misconduct on the part of Hiett and he has not cited to any such evidence in the record. Instead, Gann relies on hearsay comments and allegations. Gann’s
public comments are not evidence.”
Schroedter also maintained that Gann did not rely on any official reports or legislative actions “but relies on hearsay comments and anonymous statements.”
He concluded by arguing, “In the absence of any evidence that Hiett’s alleged impartiality resulted in a rate order that is arbitrary and unfair, this appeal is moot because the Ethics Commission exercised its jurisdiction and power to investigate Gann’s complaints against Hiett and, after this appeal was filed, the Ethics Commission dismissed Gann’s complaints as a result of that investigation.”
In addition to the OIEC joining the Corporation Commission in defense of the $119.5 million rate hike approved after PSO had originally asked for a $231.2 million rate, the Supreme Court must consider the efforts of two others to join Gann in the lawsuit.
One is longtime Oklahoma City CPA and former Oklahoma City council member David Greenwell, who was the subject of an effort last year by former Corporation Commissioner Bob Anthony to allow Greenwell to testify about what Anthony contended was a faulty audit of PSO and other utilities involved in the 2021 Winter Storm securitization that resulted in billons of dollars in bonds passed onto ratepayers of the utilities.
Greenwell seeks to join the challenge with an Amicus Curiae Brief and pointed out he was the individual responsible for the July 8, 2024 report entitled “Public Confusion over Audits is Unnecessary and Problematic” that appears in the record of Gann’s challenge. His report claimed the Oklahoma Corporation Commission was required to comply with the Accountancy Act in these cases and didn’t.
“As a CPA and the Bill and Twylah Horne Professor of Accounting at Oklahoma Baptist University, I have a professional interest in opposing attempts to misinterpret or undermine the Oklahoma Accountancy Act. I also have a personal interest in good government and the rule of law,” stated Greenwell in his filing.
“Per the standards of my profession, one way or another, the absence of the 74 O.S. § 9073 winter storm costs audits in the securitization cases must be rectified in order to conduct the bond audits required by 74 O.S. § 9078 in this and future
rate cases for utilities with outstanding ratepayer-backed bonds.
Fundamentally, my brief seeks to help avoid additional ill-advised violations of the Accountancy Act and the need for additional appeals before this Court.”
A second individual also wants to enter the case with a Amicus Curiae Brief and it is James M. Proctor who served as the director of the Public Utility Division at the Corporation Commissoin from 1990 to 1993 and later as an administrative aide to then-Commissioner Anthony. Now a resident of Lawrence, Kansas, he pointed to his more than 40 years of experience in utility regulation matters and said he has an interest in upholding the rule of law and certain baseline standards of state utility regulation.
Commission and PSO Push Back
“My brief seeks to inform the Court about facts regarding the staffing and activities of the OCC Public Utility Division during my tenure at the OCC. Specifically, I hope to correct any false
notions that allowing non-CPA PUD employees to conduct audits or to testify about audits they conducted without CPA supervision is somehow “the way it’s always been done” at the OCC PUD.”
Proctor, in asking to enter the case, said he wants to show that audits and other financial analyses by the PUD “used to be performed by licensed CPAs or under the close supervision of licensed CPAs.
However, the Corporation Commission and PSO are fighting the requests of Greenwell and Proctor. The OCC argued Greenwell failed to address in any manner “the Court’s directive to show extraordinary cause as to why he would be allowed to file outside the normal briefing cycle” and claimed Greenwell violated a rule of the court.
The commission made the identical objection to Proctor’s filing to enter the case.
Public Service Company offered the same objections to allow Greenwell and Proctor to enter the case and urged the Supreme Court to deny their requests.
“There is already a plethora of briefing in this case. Appellant Gann has already filed a 48-page Brief in Chief. Four Appellees have filed or are soon to file Answer briefs. And Appellant Gann may file a lengthy reply brief as well.”
Attorneys for the utility stated two more amicus briefs would likely be followed by requests for responses and potentially “more belated requests for other amicus briefs—will only unnecessarily expand the volume of briefing in this case and potentially delay its resolution.”
