In a scathing filing with the Oklahoma Supreme Court, two of the three legislators who have challenged the state’s use of bonds to allow utilities to pay for fuel costs during the 2021 Winter Storm Uri attacked Oklahoma Natural Gas Company, the Attorney General, Corporation Commissioner Todd Hiett, and former Commission Director of Administration Brandy Wreath.
Republican Reps. Tom Gann and Kevin West filed their allegations and claims in their challenge of the securitization bonds allowed Oklahoma Natural Gas. Both are customers of ONG and the third legislator, Rep. Rick West is not.
“ONG’s bond financing order and the PBRC rate cases’ houses of cards must fall. This matter is urgent. Having already paid more than $140 million in illegitimate rate increases and $300 million in illegitimate bond charges, ONG’s captive customers have suffered enough,” wrote Reps. Gann and Kevin West at the end of their 46-page Appellants’ Brief in Chief which summarizes their claims against the bonds allowed for ONG following the storm that paralyzed the state and saw historic natural gas prices.
“If this Court does not prohibit the fake audits and due process
violations tainting these cases, it will enable the coverup of the original 2021 Winter Storm “fleecing” to continue. It will also establish a precedent for using fake audits and conflicted
commissioners to cover up millions more in illegitimate utility charges for decades to come,” they further argued.
The two legislators told the Supreme Court that the legal issue in the case is simple—whether the Corporation Commission is bound by Oklahoma law, including Ethics Rules and the state’s Accountancy Act. They accused the commission of misapplying statutes and ignoring ethics rules.
“The effect of the OCC’s errors has been to cover up significant wrongdoing during and after the 2021 Winter Storm,¹ resulting in millions of Oklahoma utility customers each paying thousands of dollars in illegitimate charges on their monthly bills for decades. Those thousands add up to billions for a handful of special interests and are being borne on the backs of Oklahoma seniors, single mothers and others struggling daily just to keep warm,” charged Gann and West.
They quoted former Corporation Commissioner Bob Anthony who opposed the bonds and the payments and called it “the largest fleecing of the Oklahoma ratepayer in the history of the state.” The two asked the Court to reverse what they called an “OCC order tainted by the OCC’s clearly erroneous interpretation of laws.”
A number of allegations were made in the lengthy filing which included a history of the creation of a state law, (February 2021 Regulated Utility Consumer Protection Act) which allowed utilities to apply to the Corporation Commission for a financing order using ratepayer-backed bonds. In February 2022, the Commissioners voted to allow ONG to issue $1.36 billion in bonds which the agency estimated would cost customers $1.77 billion over the next 25 years.
The legislators point to a $1 billion cost overrun of the estimates for ONG, OG&E and PSO’s use of the ratepayer-backed bonds. They also noted how the underwriter for the ONB bond deal was paid $1.6 million more than it bid to do the work.
March 2021 emails alleged to show the OCC Public Utility Division (“PUD”) director and Commissioner Todd Hiett’s legal advisor colluding with an ONG employee to invent “mock bills” and massively inflate the estimates given to lawmakers of what the “average Oklahoma” natural gas customer would owe” from “Uri” were made public in November 2023,”they alleged.
The use of a one-page audit that was sent to the governor and legislative leaders is one of the main challenges by Reps. Gann and West, an audit denounced by then-Corporation Commissioner Bob Anthony who called it “ludicrous,” “pitiful,” “farcically inadequate” and “another attempt at whitewash and cover-up,” pointing out that it did not meet the criteria for an “audit” as defined by state statute.
As alleged by the legislators, “In sum, in the four challenged orders, the OCC approved bonds costing ONG’s customers more than $2.25 billion, plus another $98 million in PBRC rate increases, in spite of the facts that: no documents purporting to be audits pursuant to the Securitization Act were provided to anyone before the final votes; none of the OCC PUD’s witnesses were licensed CPAs; no nationally-recognized accounting standards were followed; and Hiett actively participated in all the PBRC cases despite multiple publicly-alleged Ethics Rules violations.”
Gann and West continued in their allegations, stating, “(1) The OCC has relied on false and inadmissible testimony about a jurisdictionally-prerequisite audit, failing to perform or provide it; and (2) the OCC has violated the due process rights of ONG’s captive customers by issuing an order as to which Commissioner Hiett should not have participated according to State Ethics Rules. 74 O.S., Ch. 62, App. I. The appealed final order is not just reversible; it is both fundamentally and jurisdictionally void and should be vacated.”
Some of the allegations surround Commissioner Todd Hiett following incidents of drunkenness and reported sexual assault of a male attorney during a convention in Minneapolis, Minnesota. The attorney, at the time, worked for ONE Gas Inc., the parent company of ONG.
“Not only is a utility company employee the alleged victim, but ONG is also represented in this case by in-house attorney Dustin Fredrick, himself allegedly an outcry witness to the sexual assault,” stated the filing which argued the alleged criminal conduct by Hiett was a violation of state Ethics Rule 4.7.
The Republican legislators contend the failure to perform a lawful audit “clearly culminated in unfair rates for customers” and “renders the final orders void.”
Gann and West also raised a new issue in contending the ONG order was never officially approved by a majority of OCC Commissioners.
“Despite two electronic signatures on the CY2023 final order (R.4553), the attested official minutes of the OCC’s Aug. 27, 2024 meeting37 (during peak public attention on Hiett’s sex scandals) accurately reflect that during the vote on ONG’s CY2023 PBRC final order, Commissioner David voted, “Aye,” Commissioner Anthony voted, “No,” and Commissioner Hiett “Concur[red] in the Result,” never actually casting a vote. (“Concurring in the result” is something a voter says when he/she is not voting in favor of a measure; if he/she does vote in favor, he/she simply “concurs.”) With only one vote for and one vote against, the 2024-10 final order was not approved by “the concurrence of the majority of said Commission” as required by Art. IX, § 18a(B).”
Attorney General Gentner Drummond’s operation did not escape the wrath of the commissioners who contend Drummond used AG opinions to “perpetuate OCC coverups.” Gann and West argue the opinions should be “disavowed” by the Supreme Court.
They point to 1997 OK AG 76 (97-76) which allowed Brandy Wreath and Commissioner Hiett to “ignore and outright deny Commissioner Anthony’s requests for records related to utilities that issued ratepayer-backed bonds.” By doing so, Anthony was told to use the Open Records Act to ask for the records.
A second Attorney General’s opinion, 2024 OK AG 16, was cited as prohibiting Commissioner Anthony’s own investigation of the cases. The legislators contend it was used to ” threaten, intimidate, obstruct, delay, hinder and ultimately shut down Commissioner Anthony’s Notice of Inquiry(GD 2024-000003) used to make public information from his investigation into the impact of Hiett’s alleged criminal conduct involving regulated companies on the integrity of OCC cases.”
A third attorney general’s opinion, 2025 OKAG 01, cited in the appeal allowed OCC staff to withhold from individual commissioners “any records that might be related to settlement discussions, whether past or potential, whether or not labeled as such, whether or not a settlement conference has actually been ordered. This opinion was used to retroactively absolve the OCC Director of Administration and Public Information Office4 of their 2.5-year policy denying Anthony access to utility case records, even after Anthony accused OCC staff of obstructing him in the performance of his official duties (21 O.S. § 540) and repeatedly called on the Attorney General for assistance.”
The fourth AG opinion, 2024 OK AG 17, was one that prohibits the Council on Judicial Complaints from investigating executive branch officials for violations of the Code of Judicial Conduct. As a result, said the legislators, it ” leaves no investigation or enforcement mechanism for executive branch officials (like Hiett and OCС ALJs) subject to the Code of Judicial Conduct who are accused of violating it.”
“Justice Demands the Multi-Billion-Dollar Wrongs Done to Ratepayers Be Remedied,” read the heading of one part of the challenge.
In their conclusion, the legislators told the Supreme Court it was an “urgent” matter that should be decided.
“Consequently, and for the sake of ratepayers’ straining budgets, Appellants request an expedited decision in this case (Art. IX, § 21), as well as findings and holdings by this Court that will discourage the ongoing behaviors giving rise to these ongoing issues, necessitating these appeals,” stated the filing.