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Mon March 12, 2012
A Conflict-of-Interest Challenge To Newly Appointed PUC Commissioner
Last week the Executive Council confirmed Michael Harrington’s appointment as one of three Public Utilities Commissioners.
Since 2007 Harrington, of Strafford, has served as a senior regulatory advisor to the Public Utilities Commission.
It is his previous job that troubles Jim and Sandy Dannis, of Dalton, who filed the disqualification motion.
Harrington worked for Northeast Utilities or its subsidiaries and he has a pension from Northeast Utilities.
Northeast Utilities is the parent company of Public Service of New Hampshire and the force behind the Northern Pass project.
The Dannis’ say their analysis indicates the pension plan is underfunded and its viability depends on how well Northeast Utilities does financially.
The Dannis’ argue that since actions by the PUC could affect Northeast Utilities profits and the pension fund under Harrington has an unacceptable conflict of interest.
They cited RSA 363:5 which says: No person who owns stock in, or is employed by or otherwise pecuniarily interested in any public utility in this state, or any affiliate thereof, shall be appointed upon said commission.
In a message relayed by an assistant Harrington, who was recommended by Gov. Lynch, declined to comment to NHPR, saying it would be inappropriate given the Dannis’ motion.
Harrington’s appointment was approved by the Executive Council on a 4 -1 vote.
Councilor Ray Burton, who represents the North Country, voted against Harrington.
He told the council there were “too many questions in my mind about his areas of conflict of interest.”
REAL is fighting the Northern Pass project being undertaken by Northeast Utilities.
The Northern Pass project is likely to come before the PUC.
After being contacted by REAL earlier this year Burton asked for an opinion from Attorney General Michael Delaney on whether there would be a conflict of interest for Harrington.
In a letter Delaney – who was appointed by Lynch - told Burton there was no problem with Harrington’s past relationship with Northeast Utilities.
Delaney said Harrington’s “future benefits have been determined and are not subject to change based upon the financial performance” of PSNH or Northeast Utilities.”
Delaney also said the pension plan “is not based on the financial performance of a public utility.”
That is at odds with the analysis of Jim and Sandy Dannis.
Delaney also noted that “it is not unusual in a state such as New Hampshire for nominees to administrative positions to have prior connections to entities that may appear before them.”
He wrote that former PUC commissioner Thomas Getz had worked for PSNH and had a “vested interest in a PSNH defined benefit ERISA pension from his prior employment with PSNH.”
But REAL counters that Delaney “misunderstands the financial realities” of Mr. Harrington’s pension and came to “an erroneous conclusion.”
In a series of e-mails REAL asked Delaney if he had information including pension’s funding status, whether the pension could be reduced if Northeast Utilities ran into financial problems, the amount of the payments and the identities of the company or companies that are obligated to contribute to the pension plan.
Without such basic information, REAL argued, it would be impossible to make a thoughtful decision about a potential conflict of interest.
In an e-mail to REAL Deputy Attorney General Ann Rice said the attorney general did not have that information.
She wrote the no-conflict decision was “based on information this office obtained from Mr. Harrington and public filings of PSNH.”
REAL also asked Burton if he could get that information from Harrington.
In an e-mail Harrington told Burton “I believe the legal issues associated with my pension from the time I worked at Seabrook Station were adequately addressed by the Attorney General.” He also said there was no obligation to reveal any pension information and he would not do so.
The motion by the Dannis' triggered a 10-day period during which comments will be accepted. Then the commission will make a decision.