Showdown at the PRC: Consumers win as PNM’s rate increase is slashed

By J. Daniel

By any standard, it was a stunning upset. PNM lost yesterday and New Mexico consumers won.

As the state’s largest electric utility, Public Service Company of New Mexico (PNM) had grown accustomed to having its way with the 5-member elected body charged with regulating it — the Public Regulation Commission. After two straight years of getting its rate increase requests granted, this year PNM and its army of lawyers and lobbyists decided to go for a three-peat in 2011 — initially asking for a whopping $165 million rate hike.

After months of hearings, including closed-door negotiations from which consumer advocates were excluded, that figure got bumped down to a base rate of $85 million. However, a number of  consumer charges were tacked on in addition to the base rate — masked as extra “riders” to the so-called “stipulated agreement.”

So with customary sign-off by the lawyers from the Attorney General’s office, it looked like smooth sailing for PNM’s third straight rate hike. Soon it would be sending out bills to its residential customers with a hefty new increase tacked on.

But Thursday was decision day, and despite all the behind the scenes machinations of the lawyers, PNM ran into a brick wall of unprecedented customer resistance leading up to the PRC hearing in Santa Fe.

“We received hundreds of calls,” was the refrain voiced by at least two of the Commissioners as they prepared to cast their deciding votes.

And then in quick succession, the PRC rejected three motions favored by PNM (one even failing for lack of a second on a motion by Patrick Lyons). It then voted 3 to 2 and passed a framework put together by Commissioner Jason Marks that granted PNM a $72 million rate increase.

Marks explained it this way:

“It’s important that the company only gets what’s fair for PNM and its customers… We can’t afford to give the company the benefit of the doubt. We’ve got to sharpen our pencils. We’ve got to make sure we’re not asking a ratepayer to pay a dollar more than the law requires.”

As a regulated utility monopoly, PNM has a statutory right from the our legislature to make a profit.  The Commission must adhere to that law.  The true question before the Commission was how much exactly to award.

A press release issued by Prosperity Works, a nonprofit consumer advocacy group, lauded the PRC’s decision:

“Today the Public Regulation Commission was presented with four options to address PNM’s rate increase request. While all four options included rate increases, the one that passed today will have the smallest impact on consumers,” said Carmela Starce, lead council for Prosperity Works.  “We wish to thank Commissioners (Jason) Marks, (Jerome) Block and (Theresa Becenti) Aguilar for their vote on behalf of New Mexico’s consumers.”

Starce pointed out, “Let me be clear, one of the commissioners who voted against the Marks plan did so – not because he was against a rate increase but because he favored the plan that would have cost New Mexicans the most money and put it right into PNM’s pocket.  Today, three commissioners did the best they could with what was before them.  They should be applauded for working on behalf of New Mexicans to make sure that PNM didn’t get a penny more that it could justify.”

Starce estimated that the PRC’s action today will save consumers at least $60 million over the next five years.

PNM has ten days in which to appeal the decision.

More Clearly NM coverage of the PNM rate hike fight here.

(Many thanks to Charlotte Chinana, who contributed to this report.)

Coalition rallies in Albuquerque to end oil and gas subsidies

By Matthew Reichbach

 

With government spending and the Congressional debate on raising the debt ceiling dominating headlines, a collection of New Mexico groups gathered outside an Internal Revenue Service building in Albuquerque to protest subsidies given to the oil industry.

The groups were aided by a report by Taxpayers for Common Sense called “Subsidy Gusher” which “outlined $78.1 billion in subsidies and specialized tax breaks to the oil and gas industry over the next five years.” The study also found that New Mexico taxpayers contribute $104 million per year in subsidies to the oil and gas industry — or $285,000 per day.

“Oil and gas companies are hauling in enormous profits,” Jill Lancelot of Taxpayers for Common Sense said at the rally.

“We think that oil and gas companies that are profitable ought to be to pay their fair share in taxes and they’re not doing that at this point,” Lancelot said. “It’s just wrong that these corporations make this amount of money and are unwilling to pay their fair share.”

“The oil and gas industry is alive and well and doing quite well here in New Mexico,” Matthew Garrington, the Deputy Director of the Checks & Balances Project said at the rally. “In fact, in June and July, the state of New Mexico just saw the two most lucrative months for leasing on record here in the state.”

Garrington also said that drilling activity is 40 percent above the 20 year average and that New Mexico is “about to hit a 20-year high in the number of oil and gas rigs that are on the ground, operating right now.”

The report states that “the oil and gas industry’s Congressional ties run deep.”

Not surprisingly, oil and gas companies have spent hundreds of millions of dollars over the past decade in an effort to lock in the preferential treatment they receive from Washington. Since the start o the 2002 election cycle, the oil and gas industry has donated $138.7 million to the campaigns of elected officials in Washington, according to the Center for Responsive Politics.

The coalition of groups, which also included Republicans for Environmental Protection, OLÉ, New Mexico Wildlife Federation, Backcountry Hunters and Anglers and the Alliance for Retired Americans, held a sign near the IRS pointing out the subsidies that New Mexicans paid for the oil industry.

Some supporters of the oil and gas industry have argued that if the industry is not given tax breaks the companies would move out of the state to other states that provide better tax incentives.

“[That’s] absolutely not true because oil and gas companies have to drill wherever dinosaurs died in the ground,” Garrington said. “They can’t pick up shop and move next door to Arizona for drilling because there’s no oil and gas there.”

“The simple fact of the matter is that they will drill as long as prices are high and they’ve got the technology to get at the resources,” Garrington said.

The oil and gas industry defended its role in New Mexico. The Associated Press reported:

According to the New Mexico Oil and Gas Association, the industry paid more than $1.5 billion in taxes, fees and royalties to the state during the 2010 fiscal year. It also paid an additional $141 million in local taxes.

From (His)story to Ourstory – Youth Lead Mural Art Project to Tell the Story of This Enchanted Land

By Anthony Fleg, Native Health Initiative

Albuquerque – Empowered youth, hot summer sun, paintbrushes and the north-facing wall of the Albuquerque Center for Peace and Justice. These are the ingredients of an ambitious mural art project that contrasts iconic images and struggles with their modern-day counterparts. The goal is to tell “ourstory”, the heroes, events, and cultures of New Mexico often forgotten in textbooks.

Liz Carrasco and Lillian Fernandez, two college-bound youth interns with the SouthWest Organizing Project (SWOP) came up with the idea of the project through conversations with fellow SWOP youth.

Taking a break from the mural work being done outside, I had the chance to sit down with both students on the first day that the project began.

We envision the art as a space to come together as a community and represent  who we are,” says Liz, a graduate of the South Valley Academy who is headed to UNM to study political science.

Lillian sees the project as an extension of her love for art. “I think that this project, led by youth activists and artists, shows the power art has to improve our world.” A graduate of Nuestros Valores High School, she will be attending La Sierra University in Riverside California, planning to become a veterinarian.

“The mural is going to have images that you would not normally see together – the Virgin de Guadelupe reaching down to help a mother in need, an Aztec dancer who is break dancing…we will have freedom fighters from the past such as Dolores Huerta, Jeanne Gauna, and Geronimo alongside our struggles of today, such as the Statue of Liberty and a family on their knees, both detained by immigration,” says Liz.

Curious to hear about how the project got started, I asked them to explain.

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Breathe Tradition, Not Addiction: Youth artists bring the message!

By Anthony Fleg, Native Health Initiative

3,500 youth will light their first cigarette today.

1,000 of these will become regular smokers.

350 of this group will eventually die from tobacco related illnesses.

But this article is not about that group, nor is it about more depressing statistics around the biggest preventable cause of death in our country.

Here, we want to introduce you to two youth champions who are working toward a world without smoking. This past week, Joel Ladon and Tychelle Herron from Ramah, NM travelled to present their Tar Wars posters in prestigious settings, at the New Mexico Academy of Family Physicians (NMAFP) annual seminar in Ruidoso, and at the national Tar Wars conference in Washington D.C., respectively.

Tar Wars, a national program to teach 4th and 5th grade students about the harms of smoking, holds a poster contest where youth create anti-smoking advertisements. In NM, a partnership called the Native Health Initiative (NHI) helps the NMAFP run the Tar Wars program and poster contest. NHI has added a twist to the program, incorporating the traditional/ceremonial/medicinal ways that tobaccos are used into an anti-smoking curriculum.

“When we hear educators talk about being tobacco-free, as Dine’ and as Indigenous people, we may be confused, since traditional tobaccos are so important to us as people,” comments Shannon Fleg (Dine’) who is a health educator with NHI who came up with the Breathe Tradition, Not Addiction campaign.

“We decided to take a big step this year and work on getting our poster winners to receive bigger recognition for their work,” says Andrew Goumas, an NHI Coordinator who helps coordinate the Tar Wars NM program.

Tychelle and her mother, Melinda Herron worked for months to fundraise to make the trip to D.C. possible, receiving donations from many in the Ramah community. “We received bundles of wood, leatherwork and lots of other donations that we used to fundraise for the trip,” says Melinda. “It was a chance for Tychelle to get on a plane for the first time, and to see our nation’s capitol, and we were going to do whatever it took to make it happen for her.”

Tychelle and her mother stand by Tychelle’s poster in the “Parade of Posters” at the national Tar Wars Conference in Washington D.C.

Tychelle represented New Mexico at the Tar Wars Conference, where one youth winner from each state was picked to attend. Her poster was titled, Breathe Tradition, Not Addiction and was the only one at the conference that incorporated traditional tobacco.

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ACLU files suit against SOS Duran over secretive investigation

By Matthew Reichbach

The American Civil Liberties Union of New Mexico filed suit against Secretary of State Dianna Duran and Duran’s records custodian Christiana Sanchez over the rejection of Inspection of Public Records Act requests from media outlets and other groups.

The IPRA requests came in relation to the Secretary of State’s claims that 37 foreign nationals illegally voted in New Mexico elections and an investigation where Duran’s office turned over 64,000 names to the New Mexico Department of Public Safety.

The ACLU of New Mexico says that turning the records over to the DPS were “in an effort to shield the data that she had collected from disclosure pursuant to IPRA.”

Duran was grilled by legislators last week over the secretive investigation into the voter rolls which Duran repeatedly said is not to find voter fraud but to ensure the accuracy of voter rolls.

Duran rejected the IPRA requests from a number of media outlets and groups including the ACLU of New Mexico in both cases. Duran used “executive privilege” to deny the requests.

“These sorts of hit-and-run allegations are reckless and irresponsible,” said ACLU-NM Executive Director Peter Simonson in a statement. “Without offering any proof, the Secretary of State has undermined the public’s confidence in our elections system while hiding the evidence for her claims behind the cloak of executive privilege.”

Director of the New Mexico Bureau of Elections Bobbi Shearer said in March, “There’s evidence that they’re in the foreign national database, that their name and date of birth matches, and their social security number in our data is not valid, and that they did cast votes.”

The next day, the ACLU filed an IPRA request where the group requested “All records pertaining to possible voter fraud and/or any irregularities noted in the master list of registered voters in New Mexico involving foreign nationals.”

The Secretary of State’s office claimed the records that were obtained from the Motor Vehicles Division were exempt from IPRA requests because of the Drivers Protection Privacy Act and the New Mexico Driver Protection Privacy Act.

Heath Haussamen of NMPolitics.net wrote about Duran’s refusal to release any records, even those that were public records, like voter registration forms. Haussamen spoke to Sarah Welsh, the executive director of the open government group New Mexico Foundation for Open Government.

For starters, she said, it “doesn’t make any sense” to say that a law that makes MVD records confidential “somehow makes voter registrations confidential.”

“They’re public records,” Welsh said. “Under any other circumstances they would be public records.”

Welsh also said it’s concerning any time a government agency claims executive privilege because it’s “a nebulous” claim. She said the redactions in e-mails provided to the ACLU and me “don’t seem to fit under FOG’s view of executive privilege.” She also said it “stands in contrast to” the executive order Gov. Susana Martinez issued detailing how her administration would and would not use executive privilege.

The lawsuit also says that the idea for checking the voter rolls came from Colorado elections director Judd Choate. Choate e-mailed Duran’s office in March.

The e-mail from Mr. Choate stated that on March 8, 2011, the Colorado Secretary of State would hold a news conference to discuss legislation under consideration in the Colorado House that would allow the Colorado Department of State to spot check and investigate voter registrations for the possibility that non-citizens are 1) currently registered to vote, 2) are being accidentally registered to vote, or 3) are willfully seeking to register in violation of both state and potentially federal law. In addition, simultaneous with this press conference, the Colorado Department of State planned to issue a report outlining the research they had undertaken to determine if there were persons currently registered to vote who may not be U.S. citizens. Mr. Choate concluded by stating that “I wanted to warn you that this report will be issued in case it becomes a national story requiring that you address the issue relative to your state.”

“It is disappointing that our Secretary of State would go to such extraordinary lengths to hide important public records from New Mexicans,” said ACLU-NM Staff Attorney Alexandra Freedman Smith in a statement. “Governor Martinez promised that her administration would usher in a new era of openness and transparency in New Mexico government. It’s a shame that Diana Duran does not share the governor’s commitment.”

Upon entering office, Susana Martinez signed an executive order limited the use of executive privilege in her office. Duran is not part of Martinez’s office and is not subject to the executive order.

Interim Watch: Unemployment Insurance Fund (In)Solvency

By Charlotte Chinana

The Legislative Finance Committee met in Socorro Thursday to hear not only the latest projections for state revenues, but also the status of the unemployment insurance fund in the wake of Governor Martinez’s partial veto earlier this year of legislation that would have fixed the problem. A panel presentation on the subject pretty much says it all:  “Unemployment Insurance – Where are we headed in 2012? Insolvency, Federal Loans and Employer Contribution Increases.”

Celina Bussey, Cabinet Secretary for the Workforce Solutions Department (WSD), gave a detailed presentation about the unemployment outlook for New Mexico.

According to her office, as of May, the state’s average unemployment rate was 6.9%, and it has been steadily declining over a three-month period.

However, while the overall certified unemployment insurance claims have decreased during that period (from approximately 66,000 to 36,000), the state isn’t seeing a similar overall decline in initial claims being filed on a weekly basis. Moreover, there is a gap between people who are unemployed, and people who are unemployed and collecting unemployment benefits.

Secretary Bussey stated that, since the state trends tend to mirror federal trends – with a lag – there’s a concern that we might see an uptick in the unemployment rate in New Mexico.

Officials from WSD highlighted the fact that unemployment compensation payments have more than doubled by fiscal quarter since 2009, and that during peak periods (over the past two years) daily payments have hit the $1 million dollar mark. While the state had projected to pay out approximately $16 million in benefits for the 2011 fiscal year, the actual figure was closer to $17.2 million.

To address this shortfall, the state is looking into various scenarios, including increasing employer contributions, and taking out a loan from the U.S. Department of Labor). In addition, changes are to the reporting system are being contemplated to identify potential instances of overpayment, while ensuring that work search requirements are being met.

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Legality of Actions Questioned: Duran grilled over voter file examination (UPDATED)

By Matthew Reichbach

Secretary of State Dianna Duran

Secretary of State Dianna Duran was grilled by lawmakers at an interim Courts, Corrections and Justice hearing Friday morning. The main topic of discussion was Duran’s decision to send tens of thousands of names that her office says are potentially fraudulent to the Department of Public Safety (DPS), or state police.

Duran repeatedly denied that she was looking for voter fraud throughout the hearing and said numerous times that she is merely trying to ensure “accuracy in the voter files.” Duran blamed the media for stoking the flames of people believing she is looking for voter fraud.

Rep. Gail Chasey, D-Albuquerque, questioned the legality of sending over 60,000 names on the voter file to the Department of Public Safety instead of referring it to the Attorney General or District Attorneys with jurisdiction in the area.

Chasey quoted section 1-2-1(3) of state election code which says the Secretary of State should “through the attorney general or the district attorney having jurisdiction, bring such actions as deemed necessary and proper for the enforcement of the provisions of the Election Code.”

Chasey also said, “It doesn’t appear to me that DPS should be allowed [under the law] to have social security numbers. That’s my issue on transparency and I don’t think that we want to invade people’s privacy.” Chasey cited 1-4-5(E) in the election code which says:

“It is unlawful for the qualified elector’s date of birth or any portion of the qualified elector’s social security number required on the certificate of registration to be copied, conveyed or used by anyone other than the person registering to vote, either before or after it is filed with the county clerk, and by elections administrators in their official capacity.”

Other legislators wondered why Duran did not send the information to county clerks. Duran said that it was a lot of information and that they are not yet at the step in the process where county clerks will be involved. “We are working closely with them,” Duran said, but added that the clerks will receive the information when the names have been categorized.

When asked, Bernalillo County Clerk Maggie Toulouse Oliver, who oversees the elections in the state’s most populous county, whether it would have been overly burdensome if the Secretary of State’s office had come to her before sending the information to the DPS, Toulouse Oliver told Clearly New Mexico, “Absolutely not.” Continue reading

Groups to take Martinez administration to court over building code rollback

By Matthew Reichbach

The New Mexico Environmental Law Center announced Monday that a group including small businesses and energy efficiency groups are challenging the rollback of energy conservation building codes.

The action comes a month after the State Construction Industries Commission voted 7-1 to roll back the energy efficiency building codes.

Clearly New Mexico reported on the June 10 vote to roll back the energy efficiency building codes to the levels that they were at in 2009, the lowest possible to still receive funding from the Department of Energy.

“The Construction Industries Commission and the Construction Industries Division appear to have taken this action despite the absence of evidence supporting repeal of the energy conservation codes” said NMELC attorney and Executive Director Douglas Meiklejohn in a statement Monday. “We hope that the Court of Appeals will determine that decisions such as these must be supported by evidence in the record.”

One bone of contention is the process used to vote on the building codes.

Shrayas Jatkar of the Sierra Club New Mexico said in the public comment portion of the Construction Industries Commission meeting last month that there was a “stark difference” between the process used to roll back the building codes and the process that led to the building codes changes in December of 2010.

“It took 14 months to develop the code last time around and there were open meetings,” Jatkar told Clearly New Mexico in a short interview. The decision to roll back the energy efficiency building codes happened six months after Susana Martinez took office and replaced members of the commission.

The appeals were, according to a press release by NMELC, filed by NMELC “for Environment New Mexico, Southwest Energy Efficiency Project, Sundancer Creations Custom Builders, LLC, eSolved, Inc., and several individuals who supported the adoption of the codes promulgated in 2010.”

The codes would reduce energy use by about 20 percent.

Martinez’s administration said the codes were too costly for builders to implement and that would be passed on to property owners. The lawsuit says there is no evidence supporting the action that the Construction Industries Commission took.

“The Construction Industries Commission and the Construction Industries Division appear to have taken this action despite the absence of evidence supporting repeal of the energy conservation codes” said Douglas Meiklejohn, NMELC attorney and Executive Director, in a statement. “We hope that the Court of Appeals will determine that decisions such as these must be supported by evidence in the record.”

Interim Leg Watch: Energy Industry Wants Less Regulations, More Incentives

By Charlotte Chinana

“You’re preaching to the choir…we need to put people back to work – we need to put people back in [the] uranium mines.”

~ Sen. David Ulibarri (D – Grants) commenting on (while simultaneously commending) presentations from representatives from the mining, oil and gas industries in NM.

The interim Economic and Rural Development Committee recently held their July meetings (in Tucumcari and Santa Rosa), and I had the opportunity to take a little “legislative road trip” to sit in on a couple of agenda items – namely the “Energy Panel: Update on Projects, Tax Incentives and Laws and Regulations That Are Helping or Hurting Industry,” and the “Oil and Gas Energy Report.”

During the committee hearing, industry panelists took a moment to mention what their companies have done and/or will do for New Mexico – with regards to the number of jobs created and payments made to the state (by way of taxes, fees and royalties); they also spent the bulk of their presentations outlining what the state can (additionally) do for industry – specifically related to relaxing (if not entirely eliminating) regulations, while providing more incentives to do business in the state.

The Energy Panel Updates

Representatives from two of the state’s utility providers, Xcel Energy (an electric and natural gas company that operates in eight states – including NM), and Tri-State Generation and Transmission Association (a wholesale electric power producer/supplier that serves 44 rural electric cooperatives and public power districts in four states – with 12 in NM), spoke extensively about the reliability of service provided by their companies, as well as the importance of cost containment measures.

While each highlighted the need to keep and utilize a diverse energy portfolio, it was stressed that the companies pretty much only added solar and wind, because they were mandated to do it.

Sonia Phillips, the NM State Affairs Manager from Xcel Energy, noted the cost difference in terms of solar production, using the example that it costs her company about 13 cents to generate a kilowatt of solar, vs. 2 or 3 cents to generate that same kilowatt – using coal. Phillips also said that some “basic, good incentives” would be nice which, according to a handout from her company, would include:

  • Expedited permitting;
  • Transmission cost recovery riders;
  • Clean energy improvement riders; and
  • Less regulatory lag (as regulatory lag increases investment risk)

Sen. Clinton Harden (R – Clovis) asked if NM’s current electricity demands were being met, to which Phillips replied “yes,” and elaborated that utility companies in the state are meeting the demand “92% of the time.”

Phillips then when on to mention that her company has “customers who want power when they want it” – as part of a pitch for an investment in infrastructure modifications to the power grid/s that the state uses (which were built in the 70s), and that “customers have been able to enjoy low rates for over 35 years” – related to possible, future rate increases.

Rhonda Mitchell, from Tri-State Generation and Transmission Association, added that her company was doing what it can to educate their co-op members about the rising cost of energy production and transmission (i.e. why customers can expect to pay more), though it was unclear as to whether or not said education equally emphasizes energy conservation.

As for the reliability factor, she added that:  “Sometimes, we do too good of a job in being reliable … people [can] take it for granted.”

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“Your Money or Lights”: PNM Rate Hike Plan Draws Grassroots Opposition

New Mexico electric utility giant Public Service Company of NM may have expected smooth sailing for its latest request for a major rate increase, but the proposal has encountered a fierce storm of protest from ratepayers and consumer groups.

After granting PNM two successive rate increases in the last two years, the state Public Regulation Commission is getting an earful from irate New Mexicans who are objecting to the idea of A third rate hike being rubber-stamped by that body later this month.

A recent op ed in the Las Cruces Sun News by Carmela Starace of Prosperity Works captured the essence of consumer outrage:

Ratepayers have seen their bills rise by about 21 percent in base rate increases between 2008 and now. But that 21 percent doesn’t reflect what the (Public Regulation Commission) hearing examiner called “The Big Picture”… Even she acknowledged that the stipulation’s impact goes far beyond the 10.8 percent rate base increase PNM has been reporting. According to the hearing examiner’s findings, “the cumulative revenue increase would be 21.57 percent from 2010 to 2013.”

Combine that with the rate increases from cases in 2008 and 2009 and the end result for ratepayers is approximately a 45 percent increase in the cost of electricity since their 2008 PNM bills. That 45 percent increase “end result” does not fall within a zone of “fair, just and reasonable” as demanded in the Public Utility Act and it is our duty as constituents to tell the Commissioners to finally hold PNM accountable.

The Center for Civic Policy (parent organization of the Clearly New Mexico blog) weighed into the issue with a radio spot.  You can listen to it here:

Radio spot – Your money or your lights