Indicates Matter Stricken
Indicates New Matter
The House assembled at 10:00 A.M.
Deliberations were opened with prayer by the Chaplain of the House of Representatives, the Rev. Dr. Alton C. Clark as follows:
O God our Father, we thank You for the gift of another day with its opportunities to serve within the hallowed Hall of our State Capitol, to serve both You and our fellowbeings. Grant that we might be to the highest good for our beloved State. When the hours seem long, work wearisome, problems perplexing, and decisions difficult, sustain us by Your presence and strengthen us with Your might. May we never trust an unknown future instead of an all knowing God.
Cause us to hear and to heed the assurance of our Heavenly Father: "I am the Lord, your God; fear not, for I am with You."
(Isaiah 43:3,5) Amen.
Pursuant to Rule 6.3, the House of Representatives was led in the Pledge of Allegiance to the Flag of the United States of America by the SPEAKER.
After corrections to the Journal of the proceedings of yesterday, the SPEAKER ordered it confirmed.
TO: The Clerk of the Senate
The Clerk of the House
FROM: Committee to Review Candidates for the
South Carolina Public Service Commission
DATE: February 22, 1994
In compliance with the provisions of Act No. 119, 1975 S.C. Acts 122, it is respectfully requested that the following information be printed in the Journals of the Senate and the House.
Donald H. Holland, Chairman
Pursuant to Act No. 181 of 1993, the Committee to Review Candidates for the South Carolina Public Service Commission (hereinafter "Committee") was organized to consider the qualifications of candidates for the six resident and one at-large commissioners of the South Carolina Public Service Commission (hereinafter "Commission"). The Committee's deliberations marked the first time that a joint public-legislative committee has considered the qualifications of candidates for the Commission. The General Assembly, in furtherance of addressing the concerns noted by the Joint Legislative Screening Committee in its report of 1993, chose to combine the public member process of the Merit Selection Panel with the legislative screening process. We find the combined process to be efficient and hope that our input on the qualifications of the candidates demonstrates the Committee's total commitment to finding "the best qualified people giving due consideration to their ability and integrity." 1
1 See S.C. Code of Laws § 58-3-26 (1993).
The Committee is unique among screening committees in that its membership includes public members and has a broad ambit of statutory authority to determine not only the legal qualifications of the candidates, but to also determine their suitability for public service. The Committee has determined that while its statutory mission does not include selecting the best person for service on the Commission, it does bear responsibility to supply the General Assembly with a detailed analysis of each candidate's capabilities, giving special attention to any issue or concern which might limit a commissioner's effectiveness.
The determination of legal qualifications is limited to a determination of the candidate's residence in the appropriate Public Service Commission district as established by Section 58-3-20 of the S.C. Code of Laws, the candidate's eligibility for election as determined by Section 58-3-24 of the S.C. Code of Laws, and the candidate's compliance with Constitutional provisions limiting election to those persons eligible to be electors of this state.
To fulfill its mandate that it determine fitness beyond mere legal qualifications, the Committee has sought to do an intensive review of each candidate's experience, temperament, sensitivity to legal and ethical constraints on public service, relative understanding of public policy issues, knowledge of Commission operations commensurate with the candidate's access to information, and commitment to a balance in the interests of consumers and industry in setting rates, granting permits, etc.
As the Committee's first report, some explanation of these various benchmarks which it used to adjudge the qualifications of candidates is appropriate.
By statutory mandate, this Committee is charged with considering the knowledge and experience of potential commissioners "in such varied fields as business, government, accounting, law, engineering, statistics, consumer affairs, and finance." 2 The Committee looks for persons who have excelled in these fields and those persons' capability to transfer this success and knowledge to the operations of the Commission.
2 See S.C. Code § 58-3-26 (1993). The Committee also considers previous service on the Commission as valuable experience.
The Commission is neither a court, an executive agency, nor a legislative body, but a blend of all three. The Committee seeks to determine if a candidate's sense of the role or roles he is to fill on the Commission is such that his work will be productive, proactive, and protective of the interests of all South Carolinians.
Every candidate for the Commission carries a wealth of life experiences and business and personal relationships when seeking election to the Commission. The Committee realizes that there is little possibility of ever selecting candidates with no pre-existing conflicts of interest. To do so would, in effect, be asking candidates to have totally disassociated themselves from the "real world" and a direct repudiation of this Committee's statutory mandate to find candidates with experience in business, law, etc. However, the Committee finds it to be an important standard that a candidate recognizes when he may have a conflict of interest between his existing responsibilities and/or business interests and his future duties as a Public Service commissioner. The Committee strongly feels that a candidate should not only readily recognize such conflicts of interest, but should pro-actively and willingly offer to divest or divorce himself from such conflicts of interest. The Committee believes that the reluctance of a candidate to readily recognize or willingly divest or divorce himself of such interests during the intense public scrutiny of these screening hearings is a likely indicator of that candidate's future unwillingness to avoid conflicts of interest when called upon to do so in a less public forum--Public Service deliberations.
Candidates should have empathy for the concerns and needs of all South Carolinians, not just those South Carolinians who have interests similar to those of the candidate. A candidate should understand and appreciate the broad spectrum of thought on such important issues as universal availability of public services, protection of the environment, and the affordability of basic utility services. The Committee sought to measure each candidate's intuitive ability to grasp public policy concerns. The Committee realizes that while the consumer advocate often represents the views of the mythical "average South Carolina consumer," responsibility for ensuring that the great diversity of the needs of South Carolinians ultimately rests with a responsible, empathetic Commission. Moreover, the Commission must ensure through the grant of fair rates of return to the state's public utilities that there is a ready and available source of water, power, and communications available to all South Carolinians. The grant of monopoly status is, in fact, a recognition of an extraordinary public need which can only be met through the grant of monopoly status and the oversight of a strong, visionary regulatory board. To this end, the Commission looks for candidates who can not only recognize the need for a balanced hand in determining fair rates of return, but who can also discern the necessary distinction between unregulated and regulated segments of the utility industry.
The Committee uses a sliding scale in judging the qualifications of each candidate in this area. It would be patently unfair to require challengers to have accumulated a wealth of knowledge about Commission operations, specifically, or regulated utilities, generally. Unlike incumbent commissioners, challengers have not had the benefit of a compensated opportunity to educate themselves in hearings or through conversations with staff. However, every candidate, either incumbent or challenger, must be required to demonstrate some basic understanding of the role of the Commission and adequately display thoughtful reflection on issues likely to come before the Commission. Candidates should also be generally aware of the time commitment necessary for productive service as a commissioner. Each candidate must provide adequate assurance to this Committee of his commitment to meet the demands of the office. From incumbent commissioners and others who have benefited from intimate involvement with the Commission's affairs, this Committee looks for a thorough knowledge of Commission operations, an informed opinion as to matters of important public policy pending before the Commission, and demonstrated leadership on these matters of public policy. The Committee does not seek to prompt commissioners to certain decisions on individual issues through its questioning or the questioning of its counsel, but seeks to determine each candidate's capabilities to explore the demands of public policy balanced against the mathematics of the financial requirements of the state's public utilities. As previously noted, the Committee expects and, therefore, justifiably demands that incumbents and others with substantial experience before the Commission be able to discuss these matters with a greater fluency than those persons who have to date committed themselves to other employment.
While candidates must show a marked commitment to ensuring that South Carolina's consumers are protected, they should also demonstrate an understanding of the simple business principle that only profitable business enterprises can survive to provide important public services. As aforementioned, the Committee places great emphasis on the ability of candidates to distinguish between the regulated and unregulated business activities of the state's public utilities. It is important that regulated activities not serve to subsidize unregulated activities and that consumers of South Carolina can depend upon the Commission to serve as a watch dog over utility holding companies having unregulated subsidiaries.
A transcript of the Committee's extensive examination of the thirty-six candidates on January 20, 21, and 24, 1994, is appended to this report as required by law. 3
3 Mr. George V. Atkison has applied for election to both the Fifth District and At-Large seats on the Public Service Commission. The Committee determined that there was no legal prohibition to Mr. Atkison seeking both seats. Subsequent to his screening, yet prior to the release of this report, Mr. James L. Felder withdrew his candidacy for the Second District seat. At the time of the release of this report, there were 34 candidates (including Mr. Atkison, who seeks the two aforementioned seats).
In consideration of these findings of fact, the Committee finds all candidates to be legally qualified for service as Public Service commissioners. The Committee makes the following findings of fitness and general qualifications for candidates for the Commission:
FIRST DISTRICT
Anne M. Bowen
The Committee finds Ms. Bowen to be an outstanding candidate for the Commission. Ms. Bowen's service as vice chairman of the Sea Pines Public Service District and her employment as a certified financial planner give her excellent experience that would be analogous to work on the Commission. The Committee also finds that she has an even temperament and an understanding of the legal and ethical constraints on public service. Ms. Bowen's experience lends her a thorough knowledge of the applicable public policy issues and the need to balance the interests of consumers and industry in rate making and other functions of the Commission. Ms. Bowen also has a good knowledge of the workings of the Commission, commensurate to someone with her level of access to information.
FINDING: Qualified
Mignon Letitia Clyburn
The Committee finds Ms. Clyburn's temperament and understanding of the legal and ethical issues involved in public service to be good. She also understands the need to balance the interests of consumers and industry. However, the Committee finds that Ms. Clyburn demonstrated a somewhat limited knowledge of Commission functions and operations commensurate to others with her level of access to information.
FINDING: Qualified
Eugene Novgorodoff
Mr. Novgorodoff has outstanding experience with a variety of diversified utilities. His work experience and involvement over the years lends him extensive knowledge of utilities, particularly with respect to design and engineering issues, and somewhat with respect to the components of rate base. Mr. Novgorodoff is especially well-prepared to face the coming technological revolution. The Committee also finds that he seems to have a good approach to ethical considerations and the need to fairly balance the interests of consumers and the industry.
FINDING: Qualified
Furman M. Reynolds, III
Mr. Reynolds is currently employed as the Director of Public Service for the town of Mount Pleasant. This position has enabled him to gain valuable experience. However, in his testimony before the Committee, Mr. Reynolds indicated that he intends to remain in his position as Director of Public Service for the town of Mount Pleasant even if elected to the Commission. The Committee is concerned that Mr. Reynolds fails to recognize the potential ethical and time conflicts involved in dual service for the town of Mount Pleasant and on the Commission. Mr. Reynolds may not be sensitive to certain ethical constraints on public service. Furthermore, Mr. Reynolds was not familiar with some of the issues important to service on the Commission and did not demonstrate a strong understanding of the functions and operations of the Commission commensurate with others with his level of access to information.
FINDING: Not Qualified
William Saunders
The Committee finds that Mr. Saunders has good experience and a firm grasp on the legal and public policy aspects of service on the Commission commensurate with others of his level of access to information. The Committee is concerned about a letter Mr. Saunders sent to all members of the General Assembly. In his letter, he made a "formal request to solicit... support" for his candidacy. Mr. Saunders testified that he was not aware of the ethics law at the time he sent the letter, but that he believes he did not violate the law because he was soliciting "support" instead of "votes."
FINDING: Qualified
Charles E. Schuster
Mr. Schuster demonstrated a good understanding of the functions and operations of the Commission in his testimony before the Committee. He was also familiar with some of the more important policy and technological issues that are, or will be, before the Commission. Mr. Schuster also demonstrated an even temperament and was sensitive to the legal and ethical constraints on public service. The Committee is aware of Mr. Schuster's wife's employment as a designer of electrical substations for Santee Cooper and finds no appearance of impropriety in her continued fulfillment of the job responsibilities outlined in Mr. Schuster's testimony.
FINDING: Qualified
Hubert Tyler
The Committee finds that Mr. Tyler has experience that would be helpful in service on the Commission. He has also been a public servant for many years and is sensitive to the legal and ethical constraints on public service. Mr. Tyler demonstrated knowledge of the policy and technological issues that are now, or will be, before the Commission and an understanding of the functions and procedures of the Commission commensurate to someone with his level of access to information. Mr. Tyler's background in the sciences and mathematics could serve him well as a Commissioner.
FINDING: Qualified
Flemister Lamarr Wiley
The Committee finds that Mr. Wiley is sensitive to the legal and ethical constraints on public service and the need to balance the interests of consumers and industry. Mr. Wiley demonstrated a somewhat limited knowledge of Commission operations commensurate to someone with his level of access to information. Mr. Wiley did not, however, demonstrate an understanding of some of the important policy and technological issues that are now, or will be, before the Commission.
FINDING: Qualified
Richard Ganaway
The Committee recognizes Mr. Ganaway's experience in managerial work and his emphasis on providing quality service to consumers on a least-cost basis. Mr. Ganaway demonstrated an understanding of Commission operations commensurate to someone with his level of access to information. He also appears to recognize the ethical constraints on public service.
FINDING: Qualified
SECOND DISTRICT
Robert Buford Dibble, Sr.
Mr. Dibble has been a public servant for many years and has an admirable desire to serve his state. He understands, and has experience with, the legal and ethical constraints on public service. Mr. Dibble also recognizes the issues involved in fairly balancing the interests of consumers and industry. The Committee finds, however, that Mr. Dibble has a limited understanding of the functions and operations of the Commission commensurate to others with his level of access to information. He is anxious to learn, but does not possess a current understanding of some of the more important matters before the Commission.
FINDING: Qualified
Carl F. McIntosh
The Committee finds Mr. McIntosh to be an outstanding candidate for the Commission. He has excellent experience and a thorough knowledge of the functions and operations of the Commission. He also has an even temperament and is sensitive to the legal and ethical constraints on public service. In his testimony before the Committee, he demonstrated a thorough understanding of the applicable public policy issues and of the issues involved in balancing the interests of consumers and the industry.
FINDING: Qualified
C. Robert Moseley
Mr. Moseley has business experience that could serve him well as a commissioner. He also has an even temperament and experience working with the public. Mr. Moseley demonstrated a fairly general knowledge of Commission functions and operations commensurate to others with his level of access to information. He also appears to have a fairly general understanding of some of the more important policy and technological issues that are, or will be, before the Commission.
FINDING: Qualified
Margaret B. Reese
Ms. Reese has excellent experience as a school teacher, and an commendable desire to serve. Ms. Reese also has an even temperament and is sensitive to the constraints on public service. However, Ms. Reese demonstrated a limited understanding of Commission functions or operations and some of the more basic aspects of utility regulation.
FINDING: Qualified
Charles Dukes Scott
The Committee finds Mr. Scott to be an outstanding candidate for the Commission. He is currently serving on the Commission staff as Deputy Executive Director. Mr. Scott has excellent experience and is extremely knowledgeable. Mr. Scott also has an even temperament, and is familiar with, and sensitive to, the constraints on public service. He thoroughly understands the functions and operations of the Commission and the issues involved in balancing the competing interests of consumers and industry.
FINDING: Qualified
THIRD DISTRICT
Guy Butler
Guy Butler has served as a member of the Commission for thirty-one years. During his tenure, he has served on multiple occasions as Chairman or Vice-chairman. During his interview, Mr. Butler indicated a sensitivity to the various demands placed on commissioners, noted his respect for the role of the Consumer Advocate, and offered insight as how to improve the deliberations of the Commission. The Committee was also impressed with Mr. Butler's studious preparation for these hearings and his balanced approach to the interests of the consumer and the utility industry.
FINDING: Qualified
Mary H. Derrick
Mrs. Derrick, a real estate broker residing in Johnston, expressed her desire to serve on the Commission as wanting "to make a contribution on the state where I live." Mrs. Derrick's previous public service as well as her commitment to make the Commission her full-time job impressed the Committee. Mrs. Derrick forthrightly dealt with the Committee's inquiries regarding conflicts of interest and the balancing of consumer and industry interests. However, the Committee does note its reservations as to Mrs. Derrick's general qualifications in that her interest in public service in public office appears to be a general one insofar as she was unable to identify any issues she would like to address in serving on the Commission. The Committee well realizes that challengers are not in the same position as incumbents to intimately familiarize themselves with Commission operations and emerging issues, but is concerned if a candidate has not considered the role of a commissioner on at least a minimal level.
FINDING: Qualified
Lewis E. Jordan
Mr. Jordan impressed the Committee with his distinguished military career and his desire to serve the people of South Carolina. His commitment to serve as a full-time commissioner is also viewed positively. Mr. Jordan displayed a working knowledge of the general responsibilities of the Commission and a determination that the Commission pro-actively consider the ramifications of deregulation and the radical changes coming in information technology. Mr. Jordan's graduate education and recent private business experience strongly argue that he would be a successful and productive member of the Commission.
FINDING: Qualified
John T. Nave
Mr. Nave has served as Mayor of the City of Greenwood for the past twelve years. Mr. Nave clearly demonstrated a working knowledge of the general responsibilities of the Commission, expressed his commitment to fairly balancing industry and consumer interests, and spoke convincingly of his desire to ensure fair hiring practices. Nave's understanding of the ethical restraints on his service also meets the Committee's expectations.
FINDING: Qualified
FOURTH DISTRICT
Philip Tibbs Bradley
Mr. Bradley demonstrated a knowledge and heightened level of awareness as to many issues likely to be addressed by the Commission. The Committee views Mr. Bradley's business experience as an asset as well. During the course of his screening, Mr. Bradley noted the need of the Commission to have ongoing communication with the legislative and executive branches of government so as to ensure a finely woven fabric of utility regulation. The Committee concurs in this goal and feels that the candidate's previous legislative service could aid this effort. Mr. Bradley's commitment to full-time service and his quick grasp of ethical concerns also argues for his being qualified for election to the Commission.
FINDING: Qualified
Robert G. Rowell
Mr. Rowell has served on the Commission for less than one year and forthrightly noted that it had been a learning process. He demonstrated a firm grasp of Commission operations, issues likely to be confronted by the Commission, and ethical constraints on public service. Mr. Rowell also expressed his continued commitment to thoughtful participation in the Commission's deliberations on a full-time basis.
FINDING: Qualified
Frank B. Stone
The Committee finds Mr. Stone to have basic business experience which may aid the Commission in its deliberations. While Mr. Stone's knowledge of Commission operations and awareness as to pending issues is somewhat limited, the Committee noted with approval Mr. Stone's well-reasoned responses to its inquiries regarding industry rates of return and consumer expectations of affordable utility products and services.
FINDING: Qualified
FIFTH DISTRICT
George V. Atkison
Mr. Atkison offers substantial, high-level corporate experience drawn from nearly half a century as a business manager and product director with several Fortune 500 companies. Mr. Atkison, now retired, would serve full time on the Commission and noted that he would set an agenda of encouraging "stability." Mr. Atkison noted a partial loss of hearing that might affect his service on the Commission. The Committee finds Mr. Atkison's overall knowledge of Commission operations and pending issues to be of a general nature, but found his grasp of the economics of the marketplace to be more advanced.
FINDING: Qualified
Cecil A. Bowers
Mr. Bowers has served on the Commission for twelve years. The Committee finds Mr. Bowers to have a strong commitment to serve the public interests and a general grasp of the many public policy issues likely to confront the Commission in the future. Mr. Bowers' failure to grasp certain details of Commission decisions must be balanced against his general testimony indicating a strong desire to properly allocate costs and to balance the interests of industry and consumer. Mr. Bowers' expression of a strong commitment to progressive employment practices at the Commission met with Committee approval.
FINDING: Qualified
Mary Gail Douglas
The Committee finds Mrs. Douglas to be a very civic-minded advocate for the rights of many South Carolinians, such as the elderly, who may find difficulty in voicing their own concerns. The Committee finds Mrs. Douglas' advocacy to be well-tempered and her overall approach to rate-setting, permitting, etc. to be one where the "economic issue would . . . be first and foremost." Mrs. Douglas has substantial budgeting, accounting, and personnel experience, and through her testimony, provided evidence of a hands-on, well-reasoned approach to ensuring fair hiring practices. The Committee finds Mrs. Douglas' knowledge of Commission operations and utility issues to be commensurate with her prior access to information.
FINDING: Qualified
Richard A. Hall
Mr. Hall's previous experience as an employee of a utility company and as a director of a local natural gas authority provides him with a base of experiences on which to draw should he be elected to the Commission. He demonstrated a working knowledge of Commission operations and of many issues likely to confront the Commission. The Committee expressed its concern over a family member's ownership of a local telephone company's stock, but was assured by Mr. Hall that he would divest himself of this stock if elected.
FINDING: Qualified
SIXTH DISTRICT
Warren D. Arthur, IV
The Committee is impressed by the diligence and seriousness with which Mr. Arthur has performed his past duties as a Commissioner. The Committee found Mr. Arthur to have a solid understanding of both technical and industry trends and appreciates his efforts to recognize consumer, as well as corporate, concerns. Mr. Arthur currently serves as the President of the Southeastern Association of Utility Commissioners.
FINDING: Qualified
McKinley Lee Blackburn
The Committee is likewise impressed with the level of technical understanding displayed by Mr. Blackburn and recognizes his past experience in the utility industry, as well as his past service to the Commission (appointed by the Governor to serve in a vacancy). The Committee is satisfied that, if chosen, Mr. Blackburn would execute his duties with diligence.
FINDING: Qualified
James Leon Cannon
The Committee notes Mr. Cannon's many years of past service to his community as a magistrate and appreciates his continued willingness to serve the public. The Committee is concerned, however, that Mr. Cannon's lack of experience in the area of public utilities may place him at a disadvantage in evaluating future avenues of development in the utility industries.
FINDING: Qualified
Maxine T. Dawes
The Committee commends Ms. Dawes for her continuing desire to dedicate herself to public service. Despite a lack of experience in the public utilities field per se, Ms. Dawes gave strong responses to the Committee's questions and possesses a general understanding of accounting and taxation principles. The Committee notes Ms. Dawes' overall emphasis on balancing competing concerns, such as environmental issues and utility and community prosperity.
FINDING: Qualified
Ervin E. Lambert
The Committee recognizes Dr. Lambert for his desire to protect and represent the interests of consumers in this state. The Committee seriously questions, however, Dr. Lambert's ability to adequately execute the duties of commissioner while maintaining his current responsibilities as a full-time employee of the U.S. Postal Service and as a minister. Dr. Lambert informed the Committee during questioning that he would be unwilling to relinquish his current positions.
FINDING: Not Qualified
Paul W. Smith, Jr.
The Committee appreciated Mr. Smith's interest in environmental issues and consumer protection. Mr. Smith has some experience with utility rate-making from his service as a city councilman, and emphasized his desire to evaluate the environmental impact of utility production on the surrounding community.
FINDING: Qualified
AT-LARGE
George V. Atkison
Mr. Atkison offers substantial, high-level corporate experience drawn from nearly half a century as a business manager and product director with several Fortune 500 companies. Mr. Atkison, now retired, would offer to serve full time on the Commission and noted that he would set an agenda of encouraging "stability." Mr. Atkison noted a partial loss of hearing that might affect his service on the Commission. The Committee finds Mr. Atkison's overall knowledge of Commission operations and pending issues to be of a general nature, but found his grasp of the economics of the marketplace to be more advanced.
FINDING: Qualified
Robert Walter Hundley
The Committee was impressed by Mr. Hundley's general understanding of the role of the Commission and his awareness of current industry trends and concerns. The Commission also wishes to note Mr. Hundley's past experience in the utility industry, his private business management experience, and his federal governmental service. Although the Committee was concerned about Mr. Hundley's current ownership of certain utility stock, he voluntarily expressed his willingness to divest himself of such should he be selected to serve on the Commission.
FINDING: Qualified
Clayton Baker Ingram
The Committee wishes to commend Mr. Ingram for his obvious study in the area of public utilities and regulation. The Committee was particularly impressed with his knowledge of and familiarity with concerns and trends facing the industries. Although Mr. Ingram does not possess any formal experience in the utility industry, he appears willing to dedicate the time and effort necessary to master this field.
FINDING: Qualified
Rudolph Mitchell
The Committee thanks Mr. Mitchell for his past service as a Commissioner and feels confident that he intends to continue performing his duties with integrity and fairness. The Committee noted with approval that Mr. Mitchell demonstrated an understanding of the importance of balancing advancing technology with consumer cost concerns.
FINDING: Qualified
APPEARANCES:
Senator Donald H. Holland, Chairman
213 Gressette Building
Columbia, South Carolina 29202
Senator C. Tyrone Courtney
604 Gressette Building
Columbia, South Carolina 29202
Senator Darrell Jackson
610 Gressette Building
Columbia, South Carolina 29202
Representative Thomas E. Huff
518A Blatt Building
Columbia, South Carolina 29202
Representative Kenneth Kennedy
328B Blatt Building
Columbia, South Carolina 29202
Representative Timothy C. Wilkes
422D Blatt Building
Columbia, South Carolina 29202
Representative Richard M. Quinn, Jr.,
420B Blatt Building
Columbia, South Carolina 29202
Doctor Barbara R. Hatton
President, S.C. State University
300 College Street
Orangeburg, South Carolina 29117
Mr. J. Steven Bilton
c/o Jim Bilton Ford
P.O. Box 98
St. George, South Carolina 29477-0098
ALSO IN ATTENDANCE:
Michael N. Couick, Director of Research and Attorney to the Senate Judiciary Committee (serving as Council to the Committee to Review Candidates for the South Carolina Public Service Commission).
Ms. Debra D. Hammond, Administrative Assistant
THE CHAIRMAN: This meeting was supposed to have started at 10:00 o'clock. I think if we're to accomplish what we intend to today and what's set for us in the next three days, we'd better move along.
I'm Donald Holland from Camden and I represent Kershaw and Chesterfield County in the Senate. Other members of the committee are Senator -- present at this time are Senator Jackson, Senator Courtney, At Large Mr. Bilton and, of course, two members of our staff here, Mrs. Hammond and Mike Couick, Representative Wilkes and Representative Kennedy are present from the House and are members of this particular committee.
In an effort to -- in view of the fact that this meeting is being taped and the press is present, I'm going to read a statement so there won't be any question about what I said.
Members of this committee, I'm going to call this meeting to order. This is a joint screening committee of candidates for the South Carolina Public Service Commission. This committee screens those candidates who apply for consideration by the General Assembly in election for seven positions of the Public Service Commission.
Our basic duties are set out by statute. Not only are we to inquire as to the legal qualifications of the candidates, but we're also required to determine their fitness to serve based upon their experience, knowledge of utility regulation and personal character.
This hearing will be basically conducted by the chief counsel for the Judiciary Committee which is Mr. Couick on my left here and members of the committee will ask questions they have of the candidates. I understand from Mr. Couick who is chief counsel for the Judiciary Committee that there are certain questions that must be discussed in Executive Session before this -- we start this meeting.
And for that reason, I'm going to -- I would entertain a motion at this time to go into Executive Session and let's clear any problems that we might have in the future conduct of these meetings. There is no objection. We'll now go in Executive Session. We hope to be brief and we'll have you back in here for the start of this process.
(Executive Session)
THE CHAIRMAN: I call the meeting back to order. At this time
the counsel for the committee has a statement to make in regard to the proposed conduct of this committee. Mr. Couick.
MR. COUICK: Mr. Chairman, as decided by the committee during this Executive Session over the last few minutes, the committee feels it's imperative that this process be a public process and that is the whole purpose of having these hearings today to ensure that the public has confidence in the proceedings going on before this committee. The press have free and unfettered access to the proceedings of this committee and the public feel that when this process was over that they had a full access to a fair process.
In addition, the committee feels that it's imperative that the process be fair, that it be a fair process to all concerned whether it be an incumbent or nonincumbent and for that reason while having it remain a public process, they would request that all candidates or anyone else affiliated with a candidate, please be sequestered during the proceedings unless they're with the candidates being actively questioned at that time.
To illustrate the reason for that, the questions are going to be asked of all candidates as to their knowledge of the functions of the Public Service Commission. It would be patently unfair for a candidate to sit through two and a half days of hearings and appear on Monday afternoon and have the benefit of not only hearing the questions, but hearing everyone else's answers.
So to some degree this is like the Miss America contest when they go into the glass booth, so we would ask for those persons who are not being actively questioned to please report to Room 201, make yourselves comfortable. We'll try to keep on a schedule between 30 and 45 minutes per candidate for questioning.
You're welcome to check back with Room 105, the office in the front of the Gressette Building, if you have any questions, and you're also welcome to check from time to time for messages there if you want to leave that number. Please make yourself comfortable.
We'll try to come find you if we get ahead of schedule, but please try to anticipate when we would call you back. We'll post lunch times on the door if the committee breaks for lunch or for any other reason. The press is welcome to stay. Members of the public are welcome to stay, but please interpret liberally the admonition of the committee that if you're affiliated with a candidate as well to please excuse yourself as well.
It's important not only for the candidates to excuse themselves, but if there is anyone here that's related by family or employment to a candidate, please excuse yourself as well.
Mr. Chairman, I ask on your behalf that we do that at this time.
THE CHAIRMAN: Do you have an order of candidates that are to appear before us?
MR. COUICK: Yes, Mr. Chairman, and the candidates have received copies of that. Mr. Chairman -- thank you, Mr. Wilkes. If you -- the families of candidates and fellow employees are welcome to come at the time the candidate is being screened himself. You're welcome to have your family come back or anyone here with you at the time you're being screened. Mr. Chairman, if we could take a few moments to allow folks to exit the committee room.
Mr. Chairman, Ms. Bowen would be the first candidate.
MS. BOWEN: Should I remain then?
MR. COUICK: Yes, ma'am. Ms. Bowen, if you would come up and take a seat at the hearing table over here on the left. I think the far seat might be the best one. Let's see if we can make sure if the court reporter can see you. There is a microphone there in front of you.
MS. BOWEN: I see that.
MR. COUICK: If you would pull up -- pull the button on the top towards you.
MS. BOWEN: All right. I believe it is.
MR. COUICK: All right, while you remain standing, I'm going to go ahead and swear you in if you will raise your right arm.
ANNE BOWEN, having been duly sworn, testified as follows:
MR. COUICK: Mr. Chairman, under Tab 4 are the materials for Ms. Anne Bowen. Please have a seat, Ms. Bowen. Ms. Bowen has asked, Mr. Chairman, to present a statement to the committee this morning. She submitted this as an affidavit as is required by our rules. That's the first document under Tab 4.
Ms. Bowen, would you like to submit the statement to the committee to be included in the record now with the consent of the committee or would you like to read the statement?
MS. BOWEN: I'm willing to just submit it.
MR. COUICK: Mr. Chairman, counsel would request that you allow that statement to be submitted for inclusion of the permanent record. It's a statement I believe mainly of her experiences and qualifications.
MR. CHAIRMAN: You want the statement admitted?
MR. COUICK: Yes, sir.
THE CHAIRMAN: The statement is admitted.
MS. BOWEN - EXAMINATION BY MR. COUICK:
Q. Ms. Bowen, you were presented with a copy of your Personal Data Questionnaire Summary this morning and given the opportunity to review it. I believe you had certain typographical corrections on it, namely the spelling of your name in one case and also designating that Hilton Head Island is a town.
Are there any other corrections or additions or deletions that you would like to have made to that questionnaire summary prior to its being entered as a part of the permanent record of these proceedings?
A. No, sir.
Q. Thank you. Would you please state for the committee your full name, Ms. Bowen?
A. Anne Marie Gwen Bowen.
Q. You're a resident of where?
A. Of Hilton Head Island.
Q. Ms. Bowen, I believe you received a letter earlier this week from me asking for you to bring evidence of your residency. Do you have a copy of your certificate -- voter registration or your driver's license with you?
A. I do have a driver's license. I did not receive such a letter, but, fortunately, I have my driver's license with me. Shall I present it to you?
Q. Yes.
Mr. Chairman, provisions of law require that a commissioner must be elected from the Congressional District in which he resides unless he's elected At Large. A letter went out I believe on Monday and perhaps some of the candidates haven't received it yet asking them to bring evidence of their residency.
Mr. Chairman, the driver's license Ms. Bowen indicates that she resides at 4 Nautilus Road in Hilton Head, South Carolina, 29928? Ms. Bowen, is that correct?
A. Yes, sir.
Q. Ms. Bowen, what prompted your interest in serving on the Public Service Commission?
A. I see this as a natural continuation of what I'm presently doing in my role as vice chairman of Sea Pines Public Service District. I also am keenly aware of what the future holds in terms of technological things that are coming down the line that I feel like this Commission, in particular, has the potential to really determine if those future enhancements and services will be available to all the people of South Carolina or perhaps just an elite view. And I'm very interested in being a part of that process.
Q. Ms. Bowen, your service on the Public Service Commission District there at Sea Pines is compensated. You receive $5,000 in salary a year from that service. How much time do you serve in that capacity on average on a weekly or monthly basis?
A. Well, historically, it is not designed to be as intensive as, in fact, it has been. You may be aware Hilton Head is facing many challenges in the water area and has been for several years. I would suspect that it's in excess of a full day a week at this point.
Q. And what are your responsibilities? What types of utilities do you oversee? What generally makes up your responsibilities?
A. Well, the Sea Pines Public Service District is a Public Service District of South Carolina. There is a water treatment plant. We are in the process now still of expanding sewer service to everyone in the district. We should be fully sewered by the year 2000.
My duties involve reviewing bids and contracts for construction on those services, determining which areas
-- which geographic areas to extend sewer service to.
I'm also vice chairman -- I'm sorry, chairman of the finance committee of that body and in that capacity, review regularly the debt of the commission. I also look at the depreciation reserve to determine that it's adequate to meet our future needs. Those are some of the duties.
We are wrestling with a future source of a supplemental water supply at this time, so conservation efforts are very important to us and receive a lot of focus. In fact, we've recently enacted a rate structure for our customers to encourage conservation and it's been very, very successful in that matter.
Q. Ms. Bowen, for those of us who are not familiar with the confines of that district, does it only serve the Sea Pines area or does it extend beyond the boundaries?
A. No, sir, it extends beyond the boundaries of Sea Pines Plantation. It also encompasses a portion of Shipyard Plantation, down Palmetto Bay Road and Point Comfort Plantation, a part of Pope Avenue as well.
Q. Is it supported solely by the revenues derived from the providing of -- provision of water?
A. And sewer, that's correct.
Q. Is an effort made by that district to provide water to folks that may not afford to live in one of those plantations or other areas? Is there any lower income neighborhoods that are provided water or sewer by this Public Service District?
A. Our district, you know, we're most -- we are charged to provide services within our district and within our boundaries. We really do not have any residents who would meet that criteria within our boundary.
However, I can tell you that we have entertained going forward -- again, in the situation on the island where there are residents on the north end who are not being served, we have entertained the idea of forming some type of a coalition with other utilities to attempt to see what can be done as far as giving service to those individuals.
Q. Are those areas contiguous to any area served now by your service district?
A. Not by Sea Pines, no, sir.
Q. Would you briefly state for the committee your educational background, if you would.
A. I graduated from Sea Pines Academy in 1980. And I graduated from the College of Financial Planning with a degree in 1992. That was a three-year course that I began in August of 1989. There are classes that are held with the course at the College of Charleston; however, I did not take any classes. I took it all on a home study basis. All of the examinations were held at the College of Charleston. They were proctored exams, but I was successful in completion of all of the examinations and completed the course in a timely fashion.
Q. Is that a baccalaureate program, Ms. Bowen?
A. It's an equivalent to a baccalaureate program, yes, sir.
Q. And in your occupation as financial planner, are you self-employed or --
A. I'm self-employed.
Q. Given that the duties of the Public Service Commission are extensive, what are your plans in terms of your self-employment as a financial planner should you be elected to this position?
A. If I'm successful in being elected to this position, the Public Service Commission would be my first professional priority. If I'm able to successfully discharge my duties in that capacity and in addition to maintain the clients that I have at this time that I think that if it's acceptable to whoever would determine if that's a acceptable procedure, then I would endeavor to do that. However, I do understand that the Public Service Commission would be the number one priority.
Q. In your capacity as a certified financial planner, what type of fees do you receive for your services?
A. I'm paid on an hourly basis by my clients.
Q. Do you receive --
A. Sometimes --
Q. I'm sorry. Go ahead.
A. That's okay. There is within my fee schedule the option to be paid on a percentage of assets basis for asset management. However, at this time I don't have any clients that are under that arrangement. Everyone is worked on an hourly or flat fee basis. I do not sell securities or insurance of any type.
Q. In terms of your financial planning, though, would you be called upon to create a portfolio of investments that may include regulated securities?
A. Yes. There is the potential for that.
Q. And would there be the potential that some of those securities maybe utility stocks?
A. Yes, there is a potential for that.
Q. What approach would you take for your service on the Public Service Commission and your dual employment sense that you're offering this financial advice? How would you avoid the appearance of impropriety of offering that advice as to investment in utility stocks?
A. Well, generally, the way that I handle my asset management is to only utilize no load mutual funds, so I'm not presently and do not anticipate becoming involved in the market place of buying individual stocks, or bonds, for that matter, of any nature.
So there -- I don't believe there would be a conflict since the portfolio managers of each of the mutual funds are the ones making the decisions to buy and hold those securities. I believe that would be adequately addressed by that.
Q. So the closest you would come to actively being involved in utility stocks would be perhaps suggesting a utility based or oriented --
A. To recommend a mutual fund that met those objectives.
Q. That was based or somewhat oriented toward utility stocks?
A. That's correct.
Q. Have you ever served as a lobbyist or a lobbyist principal, Ms. Bowen?
A. No, sir, I have not.
Q. Are you actively involved at any point in any political campaigns at this time?
A. No, sir.
Q. Have you contributed any funds to any person running for public office since your declaration of candidacy for this position?
A. No, sir.
Q. You indicate on your Personal Data Questionnaire that you've expended $49.30 in sending letters to all 170 members of the South Carolina House and Senate. Aside from travel expense, have you expended any other funds since your filing of this report?
A. No.
Q. Mr. Chairman, your staff has checked with the South Carolina Law Enforcement Division and also with the appropriate credit agencies and found that SLED have no reports of any judgments or criminal convictions on the part of Ms. Bowen.
In addition, her SLED report had no negative entries in the sense that there was nothing that was reported that would be an indication of any delay or failure to pay any of her obligations.
Moving on to talk a little bit, Ms. Bowen, about your preparation or experience that would help you serve on the Public Service Commission, if you had to name two or three hot topics that you would think that would be important to the Public Service Commission, it would be on the cutting edge in terms of being a successful commissioner, what would those topics be?
A. Probably number one would be the coming revelation in telecommunications. And I think that all of us hear on the news and read about it in the newspaper every day about the Information Highway and how -- how that's going to make things that today we only dream about happen for each of us in our homes.
Q. What would be the second thing?
A. Probably the second thing would be as it relates to water utilities. I think that the focus needs to be more on making the most of your resources that they have at hand.
Q. So that would be the demand supply?
A. I think it encourages conservation and efficient use of that supply.
Q. So demand side management for water utilities. As to the first revolution telecommunications, what responsibilities do you understand the Public Service Commission to have or authority do they have to impact on that revolution in ensuring that it is properly managed and it's fairly available to all South Carolinians?
A. Well, certainly, the Public Service Commission has had the regulation and supervisory authority to make sure that the rates that are charged --
Q. By whom?
A. -- are fair.
Q. By whom?
A. By the -- by those companies and those industries --
Q. Which companies --
A. -- operating within the telecommunications industry operating within the boundaries of this state. Those that are -- that are publicly available.
Q. Which companies? What type of company would that be, Ms. Bowen?
A. Well, for instance, the telephone company. Southern Bell, you know. MCI, perhaps. You know there are any number up that could be potential.
Q. Would cable television companies be something subject to regulation --
A. No, I don't believe that they are.
Q. What -- in what manner would they regulate the revolution or how would they ensure fairness?
A. Well, I think that the important consideration is that the services are available at a reasonable rate. Reasonable being defined by it is reasonable for the company to have a rate of return commiserate with the risk that they are taking and it was their investment.
However, the people of the state of South Carolina should have that service available to them for a reasonable rate, so there is a balance that has to be found there.
Q. My limited understanding of the telecommunications revolution is that everybody is going to kind of end up being vanilla, whether they're going to be in a cable company or a phone company, you're going to be a provider of all sorts of information through various means.
If phone companies are going to go into the cable television business that would be as you said unregulated I believe by the Public Service Commission; is that correct?
A. It's my understanding and, again, I -- I don't -- I've reviewed the practice and procedure and also the available legislation of the Public Service Commission and it's my understanding that the cable companies do not fall under their jurisdiction.
Q. They are federally regulated?
A. Right.
Q. And if a phone company is going to go into the cable business, they're going to have to have the fiberoptic cable to go into cable television. Would it be appropriate for the Public Service Commission to allow a phone company to include in its rate base to be charged to its telephone customers the development of a fiberoptic system to supply cable television?
A. I would have to review that in more detail in order to answer you adequately, sir.
Q. Are you familiar with a topic called cross subsidization or the ability of a company to take costs that would generate unregulated profits and put those costs in the regulated rate base?
A. I have been vaguely familiar with that, sir.
Q. What would you think the Public Service Commission would need to do to avoid that problem or is it a problem?
A. Well, I think that the -- potentially, it would be a problem because we would want to ensure that the customers that are paying for service are not subsidizing another service that that company can operate without regulation. And I think there that needs to be some attention to that matter. As far as --
Q. Are you aware of any utility that may have attempted or has done that in South Carolina to take an unregulated enterprise and attempt to include it in its rate base or at least benefit by some portion of the expense of that being included in its rate base?
A. I believe that I am a little familiar with that. I don't want to say who it is because I may be incorrect, but in --
Q. Would you talk generically about what type of operation was unregulated and what type of operation was regulated?
A. Perhaps a power company, for instance, that --
Q. What was the unregulated activity?
A. You know, perhaps the -- a nuclear power plant. That would come under the Nuclear Regulatory Commission, perhaps. I'm slightly aware of there was an instance, I believe, in regard to that.
Q. What role should the Public Service Commission staff play?
A. A very important role in terms of collecting the information that is necessary to review before the Public Service Commission makes decisions and administratively to make sure that the public is informed of the process and the proceeding.
Q. You mentioned earlier demand side management and you mentioned this twice, once in your opening when you talked about Sea Pines Public Service District and then you mentioned it a little while ago as one of your top issues.
This is, in fact, a concern to a number of environmental groups including the Sierra Club. What could the Public Service Commission do to encourage demand side controls as opposed to how they more or less now regulate from the supply side? What would you seek to do as a Public Service Commissioner?
A. Well, I think that you would have to really review carefully each individual circumstance. However, in the case, for instance, of a private utility who was seeking a rate increase based on an expansion into an additional water source, there may be encouragement -- there may need to be encouragement for certainty on the part of the commission to see that that utility has sufficiently explored all of their available options.
And one of those options would certainly be water conservation. Other sources that may be less costly to the customers. In fact, that's what I have in mind most particularly.
Q. Ms. Bowen, when those things approach the company providing service. Companies typically are in the business of making money. If you asked them to sell for less rather than more, most folks would see that as the ability to make less money and in this nation of free enterprise, how do you accomplish that goal of selling less and making more?
A. Are you talking about in terms of water conservation?
Q. Any type of demand supply management -- demand side management?
A. Well, I think that you can address that in your rate structure to some extent such as at Sea Pines Public Service District had done by having a base rate for the initial usage and then having an additional higher rate for the overusage, so that those individuals that do overuse the resource are paying a higher rate and that to some extent will address the revenue question.
At least that's been our experience locally, that our revenue has not suffered. Our usage has sufficiently been stable and declined, however, our revenue has been very steady.
Q. Ms. Bowen, does the Public Service Commission have any responsibilities as to environmental impact?
A. I think that we have the responsibility to make sure from my understanding that the utilities are in compliance with whatever DHEC and, in particular, the waste water area, they are in compliance with whatever regulation DHEC has imposed on them.
Q. Do you have any statutory responsibility independent of whatever DHEC may do?
A. I'm not aware of that, sir.
Q. Are you familiar with the concept called Wheeling, W-h-e-e-l-i-n-g?
A. No, sir.
Q. Wheeling?
A. I do not believe I am.
Q. How about gas cooling?
A. No, sir.
Q. Gas cooling? What authority or what responsibilities does the PSC have for the regulation of motor carriers?
A. Of motor carriers, I believe that the responsibility lies in the rate setting. I believe it has been changed in the area of -- recently in that regard. I'm not aware of what specific changes were made with regard to motor carriers, but I am aware there have been some changes in the commission's duty in that area.
Q. What is the proper role of the Consumer Advocate before the Public Service Commission?
A. My understanding is they are always there to ensure that the public is well served and in that capacity that the ability for the company or the utility before the commission to generate a profit is equitably balanced against the consumers' ability to access the service on a fair basis.
Q. And what is your role, vis-a-vis, the Public -- the Consumer Advocate? As a commissioner, what type of role do you have, vis-a-vis, the Consumer Advocate?
A. As a commissioner on the Public Service Commission?
Q. Right. It is a cooperative role?
A. I would say that you're representing the public. That you are there to make sure that their interests are served. I see that as the one of the very important duties as a commissioner.
Q. So would you say you would have a cooperative role with the Consumer Advocate --
A. Well --
Q. -- in terms of rate hearings and siting hearings, that sort of thing?
A. No, because I see the Public Service Commission as being the authority and having the -- having the charge, if you will, to make sure that they are effectively balancing the needs of the Consumer Advocate with the need of the utility to be a profitable venture.
Q. So is it more judicial in nature, do you think?
A. I would say that there -- there's an element in that because they've got to effectively balance both of those roles. That's my -- that's my impression.
Q. Are you familiar with the concept of generational mix --
A. I'm not.
Q. -- production of power?
A. No, I'm not.
Q. And, finally, do you have any recommendations for improving the current system of screening for election of candidates or commissioners to the Public Service Commission based upon what you've been through so far?
A. I think that it would probably be helpful to have more advance understanding of what you as a body are looking to determine from the individual candidates. I think that that would give a -- more feeling of being better prepared in these proceedings.
I must say I came in this room feeling very prepared. I read the legislation. I have read the public policy. I've studied the commission's records, but I leave it feeling a little bit less prepared.
Q. Mr. Chairman, that's all the questions your counsel has.
THE CHAIRMAN: Any members of the committee have any questions of this candidate?
SENATOR COURTNEY: Mr. Chairman?
THE CHAIRMAN: The Senator from Spartanburg.
EXAMINATION BY SENATOR COURTNEY:
Q. Ms. Bowen, I just want to ask you couple of questions about your service as a financial planner.
A. Yes, sir.
Q. Do any of your present or past clients own any utility stocks that are regulated by the Public Service Commission?
A. If they do, they only own it through a mutual fund.
Q. Nothing that you have recommended?
A. No, sir. Well, I recommend specific mutual funds. However, at this time I do not recommend individual utility securities.
Q. Are you willing to refrain from recommending any specific utility stocks to your clients if you are to serve on the --
A. Yes.
Q. -- Public Service Commission?
A. Yes, I certainly am.
Q. Do you have any association with any law firm or any attorney or anyone who appears before the Public Service Commission representing utility companies?
A. Not that I'm aware of. I work closely with many law firms on the island and in Beaufort. I'm not aware of any of their activities in that regard. But I work mostly in Family Court type matters.
Q. Thank you. Thank you, Mr. Chairman.
SENATOR JACKSON: Mr. Chairman?
THE CHAIRMAN: Senator Jackson.
EXAMINATION BY SENATOR JACKSON:
Q. Ms. Bowen, I want to ask you a question about your previous employment as a marketing advertising executive.
A. Uh-huh.
Q. In that capacity, have you ever had an opportunity to represent a utility company or a company that was regulated by the Public Service Commission?
A. Only to solicit advertising from those companies. I was involved in that capacity. And I have since learned in my review of the voluminous materials that I have studied that the Public Service Commission takes out those advertising expenses in considering the rate process, which was interesting for me to find out.
Q. One follow-up, so you solicited advertising. Did you have one of the companies as a client and were you successful in representing?
A. There may have been occasions over my career where I was successful in soliciting advertising from a utility. I am not aware at this time of any specific instance, but it's quite possible that was the case.
Q. So you actually served as an advertising executive as opposed to Public Relations specialist? You did not represent them in trying to shape the public's perception of that company?
A. Well, that's -- it was closely tied to their advertising efforts and I would give advice to my clients with regard to how to frame their message and develop their advertising campaign. However, most of the larger utilities, if not all of them, employ advertising agencies to perform that function for them. And generally in those cases, I would serve as a go-between between the media and the advertising agency, so I would probably say that it was very rare if it ever happened that I would come directly to the utility.
Q. Thank you.
THE CHAIRMAN: Representative Wilkes.
EXAMINATION BY REPRESENTATIVE WILKES:
Q. Good morning, Ms. Bowen. First of all, I thank you for your wish to be a public servant and taking your time to come and talk with us and if I may put you at ease a little bit about the questions that we're asking, we don't expect any candidate to be able to answer every single technical question.
We're trying to determine your general knowledge of business and of law and accounting and what the Public Service Commission does, so I hope --
A. I understand.
Q. -- that puts you a little bit more at ease.
I'd like to ask you a question that just came to mind as you were talking. Recently, I read where the mayor of Hilton Head had taken a position against any further commercial or industrial development on the island. Given the fact that the PSC does play a role in -- a significant role in industrial development, if you have that same parochial attitude maybe that your mayor does, could you divorce yourself from that attitude and look at that economic development or industrial development on a statewide basis?
A. Well, I can assure you that I do not share the views of our present mayor and I recognize the responsibility that I would have as a commissioner to put aside whatever personal feelings that I had on any issue and to only rely on the facts of the particular circumstances and statutes that I'm bound by.
Q. You mentioned a word a little while ago that is very important to me in assessment of candidates and that is balance. Today, we're faced with so many issues that are controversial and where you have advocates and adversaries and whether it's industrial development versus environmental protection or big business versus small business or urban development versus rural development, can you give us some idea of how you approach problem solving and decision making given the often time diverse views on issues like I just mentioned?
A. Well, I can probably give you a personal example of a process that I went through as a result of my coming over to Sea Pines Public Service District. And at that time the water issue -- the future source of water on Hilton Head had been agreed upon and determined to be the Savannah River and based on everything -- all the knowledge that I had of the situation and following that, I have to state honestly that my personal feeling coming on to that commission is that had probably been a very good decision.
Once I had the opportunity, however, to fully review all of the relevant matters that I had not been aware of and to study the financial side of the equation, however, I found myself first of all, having to remove my personal feelings as I made that evaluation having come to the process with an idea in my mind as to how I felt. And I feel like I was successfully able to do that and, in fact, really have changed my mind about the entire issue based on the financial analysis and the additional facts that have -- have come to light and, in fact, that has -- that opinion has spread and -- and there are other utilities on the island now who have also turned away from that solution, so I think that's one instance where I have employed that process.
Q. Thank you. One other quick question. On the matter of the cross subsidization that you were talking about a few minutes ago, I'm going to ask you maybe a bit more of a specific question than Mr. Couick asked you.
If, for instance, a real estate company were -- I mean the utility company were to have a real estate subsidiary, say, a wholly owned subsidiary in timber management, let's say, and I for accounting purposes was allowed to make certain journal entries that would shift profits and losses and expenses and depreciation, et cetera, from one company to the other --
A. Uh-huh.
Q. Would you think it important to ferret out all of this from the county standpoint before you made a decision in a rate making case, for instance?
A. I think that it needs to be clear to me what all of -- you know, what all the numbers represent in that case. And I think in determining, you know, what elements, for instance, of the asset base may be unrelated assets or income or liabilities, I think it's clear to have that understanding and then to be bound by whatever statutes are in place to act with that knowledge. I would think that that --
Q. In other words you would require full disclosure on all of the activities of that utility?
A. Well, if it is relevant to the rate making case, then certainly, I would -- would pursue that.
Q. Thank you.
A. It may not be bound by the statute.
Q. Thank you very much.
THE CHAIRMAN: Any other questions? Yes, ma'am.
EXAMINATION BY DOCTOR HATTON:
Q. Ms. Bowen, who could help you to inform you what the public policy issues are to be resolved if the Sea Pines Public Service District were to reach out to those people who don't have services and try to serve them? What public policy issues are involved in your making that kind of decision?
A. Well, I think that for a long time it has been apparent to us as a commission -- and we are not the only commission, let me clarify that. There has been discussion of forming a coalition of either of the other utilities with the town to address the inequity.
I think there is a number of policy issues that have to be resolved before that can take place. One of those, of course, is that the present customers being served by that utility have paid for their service. They have -- they paid for their service. They have -- they've paid for their portion of the treatment plant and I can understand or anticipate that they perhaps might be unwilling to subsidize those that don't have service, but I'm also aware that there is a precedent in other areas for doing so.
I'm aware of, you know, the electric companies that help people who can't pay their bills and, in fact, this commission has some interest in that regard in making sure that those that are financially disadvantaged have those services.
They're not luxuries. They're necessities to people. And I think that because of that distinction that it's not a luxury that those are the necessities, that we all have an obligation to make sure that those are available to everybody. So I feel like that there -- there are valid concerns, but I think that they can be addressed effectively.
Q. Thank you very much.
THE CHAIRMAN: Representative Kennedy, any questions?
REPRESENTATIVE KENNEDY: No.
RE-EXAMINATION BY MR. COUICK:
Q. Ms. Bowen, I had failed to ask you. You indicated that you had no security interest that you would see the conflicting out (phonetic) from service on the commission. Do you have any utility stock?
A. No, I do not.
Q. Does your husband own any utility stock?
A. No. I own I believe some shares in British Petroleum Oil Company.
Q. Thank you.
A. And several mutual funds which may own utility stocks in those mutual funds.
THE CHAIRMAN: Ms. Bowen, on behalf of the committee, I want to thank you for offering as a candidate for the Public Service Commission. First, a person with your background and knowledge, it's commendable that you're seeking a public job.
I find in recent years it's difficult to get some people to reach out and serve the public because of the criticism they take. The effort we're going through here this morning is brought about largely because of the fact that we're heard this said all the time, the public wants to know, the public has got to know.
As a result of that, we're here trying to do what we think that the public has demanded of us. You are a commendable candidate and I thank you for coming. The next candidate.
MR. COUICK: Mr. Chairman, Ms. Clyburn is on her way.
A. May I ask a question?
MR. COUICK: Yes, Ms. Bowen.
A. Would it be possible now that I've been through the process for me to sit in on some of the other candidates? Has that been --
SENATOR COURTNEY: Mr. Chairman, the only problem I would see with that is potential for follow-up questions later if something comes up that.
THE CHAIRMAN: Our policy would be that once you're sequestered, you're sequestered, Ms. Bowen, if you are a candidate. We could discuss with you the implications of it, but --
A. That's all right. So are you requesting that I leave now?
THE CHAIRMAN: We would prefer that you did.
MR. COUICK: Ms. Bowen, and I will repeat this for the other candidates, the screening policy, are you familiar with it in terms of soliciting for pledges and the fact that your release to seek pledges does not start until the screening report is issued.
A. Yes, I understand that completely. Do you anticipate that that will be -- do you have a time frame in mind for the process?
THE CHAIRMAN: It's hard for us to give you a time frame because what we're going to do, of course, is go through the process you've just gone through and then the staff is going to transcribe the record and have staff to review that. Any noticeable defects of anyone will we brought back to us, then we'll discuss each candidate individually, so we don't know. It depends on how many stay in the candidacy.
MR. COUICK: Mr. Chairman, to protect the candidate's interest, we will formally notify you of the release. You'll have a clear time to move forward.
A. All right. Thank you.
1. Ms. Anne M. Bowen
Home Address: Business Address:
4 Nautilus Road 19 Pope Avenue
Hilton Head, SC 29928 Executive Park
Hilton Head, SC 29928
2. She was born in Augusta, Georgia on August 14, 1962.
Social Security number: ***-**-****.
3. S.C. Driver's License Number: *******.
S.C. Voter's Registration Number: 4 400 472.
4. She was married to John H. Bowen on June 22, 1985.
She has two children: R. Rushton Bowen, age 6; M. Eden Bowen, age 10 months.
6. She graduated from the College for Financial Planning, (Denver, Colorado) as a Certified Financial Planner in 1992.
7. Appointed to Sea Pines Public Service District in June 1990 and presently serves as Vice - Chairman.
9. She worked for Gannet Newspaper Corporation as a sales executive from 1980 to 1987; sales executive for the Island Packet Newspaper from 1987 to 1989; Self employed in Financial Services since 1989.
10. She serves as Principal of Anne M. Bowen, Certified Financial Planner.
22. She has spent $49.30 on letters to all 170 members of the legislature.
26. Professional Organizations: Hilton Head Island Council of Estate and Financial Advisors; SC Society of Institute of Certified Financial Planners; The Institute of Certified Financial Planners (National); The Institute of Certified Financial Planners, registered practitioner, (National).
27. Civic, charitable, etc. organizations: Sea Pines Public Service District, Vice Chairman; Commissioner, Town of Hilton Head Island Water Commission; Hilton Head Island Chamber of Commerce, Executive Exchange; Hilton Head Speaker's Bureau; Board Member, Leadership Hilton Head Forum; Women's Association of Hilton Head; First Baptist Church of Hilton Head.
29. Five letters of reference:
(a) Honorable John C. West
Former Governor of SC
P.O. Drawer 3
Hilton Head, SC 29938
(803) 785-2171
(b) Honorable Thomas C. Taylor
Chairman, Beaufort County Council
P.O. Drawer 5280
Hilton Head, SC 29938
(803) 785-7606
(c) Paula Harper Bethea
P.O. Drawer 3
Hilton Head, SC 29938
(803) 785-2171
(d) C.W. Garnett
Vice President, The National Bank of South Carolina
P.O. Box 1567
Greenville, SC 29602-1567
(803) 241-7903
(e) Sara Johnson Borton
Publisher, The Island Packet Newspaper
P.O. Box 5727
Hilton Head, SC 29938
(803) 785-4293
30. First District
MR. COUICK: Mr. Chairman, that's all. Ms. Clyburn, I believe is present. Mr. Chairman, the next candidate is Ms. Mignon Clyburn. Ms. Clyburn, if you would come forward.
MS. CLYBURN: Is this forward?
MR. COUICK: Yes, ma'am. Ms. Clyburn, while you're standing, if you would raise your right hand and swear.
MIGNON CLYBURN, having been duly sworn, testified as follows:
MS. CLYBURN - EXAMINATION BY MR. COUICK:
Q. Ms. Clyburn, please make yourself comfortable. I'm not sure if you received a letter that I sent out earlier this week requesting you to bring evidence of your residency. Do you have a voter registration certificate or a driver's license?
A. Yes.
Q. If you would share that with Ms. Pendavaris. Mr. Chairman, I have Ms. Clyburn's voter registration card showing that she lives at 16 Darlington Avenue, Charleston, South Carolina, 29403. Ms. Clyburn, is that your correct, current address?
A. It is.
Q. Thank you. Would you please state for the record your full name?
A. Mignon Letitia Clyburn.
Q. Ms. Clyburn, you were supplied with a copy of your Personal Data Questionnaire Summary earlier today. Did you have an opportunity to review it and do you know of anything that needs to be corrected with that?
A. Yes, I did. Everything seems to be in order.
Q. Did you have -- would you object to that being a part of the permanent record of this hearing?
A. No, I will not.
Q. Thank you. Ms. Clyburn, what prompted your interest in service on the Public Service Commission?
A. I have an interest in my state and in public service and
-- may I read this statement? Would it be -- or did you
-- would you -- I'm trying to answer that.
Q. Mr. Chairman, staff had notified each of the candidates if they wished to read a statement into the record, they needed to supply us an affidavit. To the extent, you can perhaps incorporate that into your response to the question would certainly be okay.
A. For the past ten years, I have been manager of a weekly newspaper here in South Carolina.
THE CHAIRMAN: Ma'am, let me ask you this, is this the statement you want to submit to the committee?
A. I'm going to --
THE CHAIRMAN: You're just going to --
A. Right. I'm paraphrasing it. I have -- and I believe that that -- that newspaper, The Coastal Times Weekly newspaper, exposed me to a lot of people and their interests and because of that, I have been volunteering for many years, for over ten years, as well in terms of my background. So public service has been always important to me and the Public Service Commission in its duty to the citizens of South Carolina is one that I consider a big challenge and an interest to me because of the nature of utilities and the need for them to be regulated by another outside body.
Q. Ms. Clyburn, do you own any utility stocks?
A. I have one stock in SCE&G.
Q. What would be your plans --
A. One share. I'm sorry.
Q. What would be your plans for your investment in utility stocks should you be elected to the Public Service Commission?
A. If the rules stated that I needed to dis--- to not -- disinvest, I believe is the word --
Q. So --
A. -- then I would do so. But, again, it's just one share.
Q. You would sell that stock?
A. I would sell it.
Q. Ms. Clyburn, what improvements would you make at the commission if you were elected or what changes would you make?
A. Coming from a newspaper standpoint, I really think that the public is not aware of the duties -- of the vast amount of duties that the commission has. I really think that just talking to some people about this, they really did not know what it meant.
I really think that from a public educational standpoint, which is where my forte or where my interest has been for the past ten years, I think that there should be a more working, an ongoing relationship with the Public Service Commission because I really don't think that the public has a good picture or the sensitivity that -- people complain about rates, but they don't know what all of the variables that to go into it.
So as far as that's concerned even though it's not day to day specific in reference to the operation of PSC, I think --
Q. That would be your overall theme would be try to bring the commission closer to the public concern?
A. To the public, right. Again, I think that there is a big line of ignorance.
Q. What part of that would you do as a commissioner and what part of that would be assigned to staff to do?
A. Again, I have a background in newspapers, so I would want to be more hands on. I know there is -- just looking at the structure of the agency, there is a person who is responsible for press releases and all of that, but I -- at each site or at each location where we would travel, I would be willing to, if it's permitted, use the relationships that I've developed over the past several years with several other media sources to, you know, let them know what's going on and hopefully sometimes when they see someone they're more familiar with, they would be more prone to either run or disperse the information that you may be distributing.
But they don't consider it worthy because they don't have an ongoing relationship with you, but if it is somebody in media with a background that they're accustomed to seeing at meetings once a year, they might be more prone to be more open and receptive to information that you might be disseminating.
Q. Ms. Clyburn, in this role as a commissioner, you certainly bring a new focus to the role of commissioner and a commendable one in terms of bringing it closer to the public, but do you see any tension there between your service as a commissioner who in essence is a judge on rate cases and also being a -- to some degree an activist in the sense of taking the opportunity to go out and make contact directly with the public about an ongoing case?
A. I don't think I need to be case specific. I think that would again be pushing things a little bit too far, but there are some basic things that I believe our community is just simply unaware of and, again, I think that dimension would be an asset.
Q. You mention that you now own and, I guess, or you're an associate publisher of The Coastal Times newspaper?
A. Sometimes that's synonymous. Chief cook and bottle washer.
Q. Do you have plans to continue your involvement with the newspaper should you be elected?
A. No, I do not.
Q. Do you have an ownership interest in the newspaper?
A. Yes, I do.
Q. Would you continue your ownership in the newspaper?
A. That is being discussed. I've had several people who are interested if I am elected to taking over that concern.
Q. If you retained your interest in the newspaper, what ethical concerns would be heightened for you serving on the commission and owning a newspaper at the same time? What would you have to be careful of?
A. I would not -- if -- if elected, I would not have anything to do with the day to day operations. I would strictly be as an advisor. Most publishers, if you note, are real hands off in terms of the day to day workings. They have nothing to do with the editorial staff.
While they want their publication to be a viable one in terms of bottom line making money, they don't have anything to do again with the day to day operations, so the possible conflict in terms of -- I don't know if you're thinking about divulging certain information, that wouldn't come into play since --
Q. And that was one. And one -- the other one is the bottom line in terms of money. If all of a sudden, with an ownership interest, you notice SCE&G's advertising went up 1500 percent after your election, what do you need to do?
A. That is something that I would have -- I would really have to evaluate whether or not I could accept in good faith any utility monies. I would really have to look at that from SCE&G or any of the regulatories because I didn't want -- wouldn't want -- would not want the appearance of any conflict or any favoritism.
So there are some publications who don't accept cigarette ads or liquor ads and I feel that again, if I maintained ownership and if elected, then if need be, I would make that decision.
Q. Mr. Chairman, for the committee's benefit staff has had SLED do a check of judgments and any criminal convictions upon Ms. Clyburn and that check was negative. There were no entries there. The credit report was also a positive credit report in that there were no negative entries on that.
Just generally talking a little bit the role of the Public Service Commission, I'd like to throw out some terms to you, Ms. Clyburn, and see if you're somewhat familiar with them and I'm not expecting anybody to know all of this. I certainly am not familiar with all these concepts. Just to get an idea of your familiarity.
Generational mix, use of fuels to have a cleaner burn in terms of an environmental purposes, what authority does the Public Service Commission have in that area?
A. I'm afraid I can't remember that --
Q. And that's certainly fine. That's certainly fine. How about wheeling? Have you heard of wheeling?
A. Excuse me?
Q. W-h-e-e-l-i-n-g, wheeling of utility resources?
A. No, sir, I'm afraid not.
Q. How about demand side management? Demand side management?
A. If I am not mistaken, I'm thinking that it has something to do with the fluctuation that may occur during peak or low periods. Say, right now we would on a high demand side.
Q. Exactly.
A. And during, say, March or April, we're on a low demand side, so that there needs to be a balance with -- in terms of rates, so that it wouldn't have the peak and low
-- even though you're going to see fluctuations in your -- unfortunately when I open my bill, I'm going to see fluctuations, so that the fluctuations wouldn't be as varied.
Q. And you bring up --
A. You need to keep that in consideration when thinking of the whole rate structure for six months or a year.
Q. And a lot of environmental groups would like to see conservation caused by demand side management and the feeling they express is exactly the opposite of what you just expressed. What they would like to see is that during high peak times, energy costs more rather than less. From a public policy perspective, analyze that for me or as a reporter, what are the concerns you have on either side? I mean --
A. You're saying --
Q. -- from charging more for --
A. You're saying more at peak time? I really am as a consumer more in line with averaging out, spreading that out as opposed to hitting somebody at a certain time of year because of variances and the weather conditions, so I think I would be more of an advocate of, you know, looking at the past trends even though this past -- past couple of days has been kind of defiant of all of those in terms of the lows that we are experiencing in the country.
But if you could take the 30-year averages or whatever we're looking at and see where they are and attempt to make it more -- spread it over -- over the course of the six months to a year, I really think that that would be better for the consumer.
Q. And you would do that even though you won't be more like to have conservation increased if you charge more?
A. Excuse me? You said I would do that --
Q. You would be more --
A. -- even though I would --
Q. You would rather do that even though higher rates may make folks conserve a little bit more?
A. That is a tough one because I can see both sides. At this point, I would stick with that, but maybe that does need to be evaluated because again I recognize that I need -- the need not be wasteful because there are no supplies that limitless. You know, we've got limits on all things, but there are so many other types of measures including media sponsor -- and then again that's my -- that's where I've been for the past ten years that's why I keep bringing it up.
That are other types of ways I think to get people's minds thinking more in terms of conservation other than strictly price specific ones.
Q. Could you please tell the committee what your understanding is of the types of utilities regulated by the Public Service Commission?
A. Telephone and telegraph type facilities meaning Southern Bell. I say Southern Bell because that's what I use. The electric utilities, motor vehicle, transit motor vehicle type entities. These are the ones that I can think of right now.
Q. That's fine. And, Ms. Clyburn, what role should the PSC staff play?
A. Judging by some of my responses today, I think more of a support role. There is some phraseology and some specifics that -- of course, I'm not an attorney. I haven't been working with a co-op or a utility for years, so there are some things I'm going to be quite weak on.
I don't think I'm the dumbest person in the world, but by the same token, I don't know a lot of specifics. So in terms of staff, strictly support and their expertise in those areas and, you know, working as a collective, everybody benefits.
Q. The committee certainly is not looking for anyone that has an absolute knowledge of all these concepts. I'm really just trying to plumb and find out basically your experience level. But I think that from indications of previous question what they're looking for is a firm understanding of how you make decisions, what's important to you and what grounds those decisions as a matter of public policy. And I hope that makes you more comfortable because you certainly have done well when you expressed those things.
What else would you want to tell the committee as a matter of things of public policy that are important to you and that you would take not necessarily as an agenda into your service at the Public Service Commission, but what makes things fair, what makes things right for you? What are you looking for to accomplish? What do you want to be the epitaph if one has to write it for you when you're through with your service?
A. As a business owner for nearly ten years, I recognize that there is a need to make a profit. You cannot live -- you cannot get motivated without one and in terms of utilities, because we're dealing with either monopolies or oligopolies, businesses that really don't -- aren't subjected to the same type of market, of course, as a newspaper would be, there is a need for this body, the Public Service Commission, to act as a governing body or a buffer so to speak between -- the voice between the overall masses of the community and the monopoly or oligopoly.
I think that fairness is the one word that comes to mind. Fairness to stockholders and fairness to persons who -- who are serviced -- who are users of services. Hundreds of thousands of people in our state who are the users of the services, they are entitled to the lowest rate possible.
By the same token, they -- in their pursuits in terms of business as well as working, they know that they can't get a paycheck without the entity making any money. So by the same token these utilities must have a reasonable rate of return in order for expansion to be more efficient, in order to finance plant and facility, again, expansions that would make services hopefully in the long haul more economical and more efficient.
Q. Yes, ma'am.
A. So an attempt to strike that balance I think would be a must. But fairness -- I mean fairness to everyone involved that, you know, you and I and everybody in this room cannot sufficiently or adequately run any utility. I mean we really can't and most -- we've got to recognize that economies of scale come into play and when they do again there needs to be a buffer. But there needs to be a fairness on both ends.
Q. Yes, ma'am. And the final couple of questions, you indicate on your Personal Data Questionnaire that you had expended a little in excess, I believe, of $150?
A. Well, $100 and $50 yet because I was waiting to see.
Q. The follow up more?
A. Right.
Q. Have you expended any more monies since that time?
A. No. I did not bring a copy of the phone call, but, no, I just called everyone to say, not to ask for anything else except to express interest in this because I know it's premature to ask for anything else.
Q. Yes, ma'am.
A. I do know that.
Q. And finally, do you have any recommendations for this committee to improve its process to make it fairer or to bring more folks to the table?
A. I really think that if we -- if the commission were to do more of a PR, and, again, I don't mean to harp on any one thing, this is my background, more of a better relationship with some of the media entities, more people would know about the commission, its function and what's going on.
People -- in degree people that I'm with just simply -- I've had to state do you know about and they're like I think I have, so there is a real across the board ignorance factor, I don't know how else to put it, about the interworkings of this particular entity.
Q. You're talking about the commission?
A. And I think -- yes.
Q. How about this committee? What can this committee do better, the selection committee, the screening committee?
A. I feel a little uneasy about it. I don't know. I might want to sleep on it. I really don't know. It's my first time and I'm real nervous, so I'm not sure and there is nothing you can do about that, but I'm not sure what else -- you've been most cooperative in terms of, you know, getting information out on a timely basis. Right now, I cannot off the --
Q. Thank you, Ms. Clyburn. Mr. Chairman, that's it.
THE CHAIRMAN: Any questions from any members of the committee?
SENATOR COURTNEY: Mr. Chairman? Senator.
EXAMINATION BY SENATOR COURTNEY:
Q. Ms. Clyburn, I want to agree with you when you say you're not the dumbest person in the world. You're obviously a very bright and articulate young woman and I admire you that you have the initiative to own and operate your own business. And I want to say, too, that you don't have to apologize for not being an attorney. These days you can brag about that.
I guess I have just a couple of questions, one is a philosophical type question. What do you see the role of the Public Service Commission to be? And I'm asking you is it an agency that's there to regulate industry to see that it makes a profit, a fair profit, or is it an agency there to protect consumers?
A. There is -- both. There is a balance again that must be maintained. If I can make a parallel from my own publication, there is an ongoing struggle, but a must to make a profit, to be able to pay for people that work for me, to be able to pay my printer today when I go back. So there is an ongoing struggle for that.
But by the same token, there is a duty that I have to serve that segment of the community or that niche which I've carved out for myself and that balance, there is no one variable that's any more significant than the other.
Now right now when I go home, I need to go home and pay my printer. Right now what I consider more important is bottom line, but I can't escape the fact that if I do not adequately serve my readers, if I do -- am not fair in my assessment or in my deliverance of information that I'm going to have a problem ultimately. The whole enterprise fails, so what I'm saying is there has to be an equal balance there recognizing that.
The monopoly or oligopoly has to -- is the one best in line to deliver that service, but again the consumer, you and I, everyone in this state, is entitled to the lowest rate possible. They know they're going to have to pay something, but the lowest rate possible.
Again, that balance has to be maintained. No one over the other and some people might argue with that, but there has got to be a balance struck there.
Q. Let me ask you also a question that Mr. Couick touched on, that is, the advertising in your newspaper, have you in the past accepted advertising from utility companies through the paper?
A. Yes, I have.
Q. And I don't have any problem with that. How would you handle that in the future if you did see an increase? You spoke a little bit about it, but I didn't really get a clear answer.
A. Right. It would really depend -- I went in two different directions. That's probably why you were not sure what I said. Again, if we were to sell the enterprise, then I don't have a problem. If I were to maintain ownership control, I would probably feel more comfortable in not accepting monies from Southern Bell, BEC or SCE&G. Those are the only three entities that I'm familiar with down in my area that I would be concerned with.
Again, we have refused certain types of advertising and other people have before, so I -- and we're really not talking about a whole lot. It's, you know -- you know, by -- they can't do an excessive amount of advertising and be responsible, so we're not talking about damaging the enterprise as a whole. And I would really be in a comfortable enough position to refuse those if ownership is kept.
Q. Thank you. Mr. Chairman?
THE CHAIRMAN: Representative Huff.
EXAMINATION BY REPRESENTATIVE HUFF:
Q. Ms. Clyburn, you sounded almost like a lawyer when you can go two different ways at the same time, but what do you perceive to be one of the most controversial topics just from your general familiarity with the PSC or issues that you've read about? What would you perceive to be the most controversial issue that the PSC may have to involve itself in, say, within the next four to five years?
A. I think this Information Highway issue that we're reading a lot about is going to be something that -- it's interesting to me from the outside looking in, from a person who is running a business who almost went to banking and finance, probably would not have a job right now, but, anyway, from a straight line business standpoint that flexibility and diversity seems exciting and I know I see that Southern Bell has filed something here.
But again I think we need to be real careful in terms of the regulatory aspect of it to make sure that there is no shifting in terms of dollars from one area that may be more either experimental or a little more risk -- less risk at first. I can't think of my word right now, but a more risk taking venture as opposed to your basic services to make sure that a holding company is possibly just kind of looking.
You'd have a holding company there and the entity that if I'm using my telephone that the cable service that might be provided does not effect the rate of my phone service. So that is going to be a big challenge and I can't speculate on what's going to happen, but there are going to be some changes made in order for local enterprises to be more competitive because it's happening everywhere else.
Q. Do you think there is going to be a lot of pressure there to -- particularly in the issues of monopolies as opposed to assuming another competitor came in that can offer the same services as the Informational Highway as we call it versus Southern Bell? I notice that you mention monopolies and oligopolies. Are you familiar at all with any of the issues that have been raised in territorial assignments and how they interplay between SCE&G and the Cooperatives of this state?
A. Oh, we had a big argument down in the low county.
Q. I thought you did. I was just curious as to --
A. I was kind of scared to go down on Bonita (phonetic) Road anyway.
Q. Yes.
A. Yeah, I'm kind of uneasy with it. There are some questions, in just kind of reviewing some of the things, you know, I learned a lot, too, about in terms of, again, what jurisdiction the PSC has and not.
There are going to be some ongoing conflicts I think as we annex -- and being from Charleston we just annexed with Daniel Island. And as cities attempt to grow and get -- expand their tax base, that's definitely going to -- and co-ops, some of the smaller entities and municipal run utilities.
There's going to be an ongoing -- it's not going to get any easier. It's going to get really ugly in terms of territory and we're just going to have to make the -- look at the consumer. That's the time we're going to have to really look at the consumer and see if it's within the parameters of the PSC to make that decision, who best can supply that service.
Q. I have no further questions, Mr. Chairman.
THE CHAIRMAN: Representative Wilkes.
EXAMINATION BY REPRESENTATIVE WILKES:
Q. Good morning, Ms. Clyburn.
A. Good morning.
Q. I'm Representative Wilkes from Fairfield County. It's nice to see you. I, too, find you very intelligent and articulate and --
A. And nervous.
Q. -- and nervous and that's understandable. You mentioned something and I would like to know maybe a little more about your philosophy. Just out of interest, you mentioned things could get ugly?
A. Yes.
Q. Could get ugly?
A. Uh-huh.
Q. And so --
A. It got ugly in Charleston.
Q. Yes, and so if you were in a position -- in a decision making position when things get ugly, would you consider yourself an emotionally driven person or a logically driven person?
A. I have been told by my -- I hate to say this -- my ex says I'm very logical. Ex-boyfriend, not husband. You know, very, very logical about being able to look at the bottom line. And I'm not saying that I don't get angry and I'm not saying that I don't empathize with persons, but I really think, you know, after you go outside and blow smoke and come back in it and look at what is the best for the consumer.
Q. Reason over emotion?
A. Right.
Q. How about urban oriented versus rural oriented?
A. There are some definite differences. I'm trying to -- can you be more specific?
Q. For instance, if you're talking about territorial disputes and you've got co-ops versus maybe a big utility or you're interested in economic development in urban areas where sometimes it's more difficult or more expensive to get infrastructure, you know, if there -- the reason I ask this question is as I have been -- as a member of the General Assembly, I have seen a division among the members from the urban areas versus the rural areas?
A. Right.
Q. Even since the last census, and I'm just wondering, are you more urban, more rural or pretty objective, you know, about --
A. I think I'm pretty objective. My mother is from Moncks Corner and that's almost urban now. And my family has roots -- farm roots in Bishopville, Camden, so I do empathize. But I think as long as there's not an duplication or an overlapping of services, I'm not sure if that's where you're getting at, and that was one of the questions down on Johns Island that, you know, there is overlapping that just does not make basic economic sense.
So I don't think I have -- we've got to weigh things because you don't want any one entity to suffer because of the other and usually some of the rural persons are a little more sensitive because they see these sprawling urban districts and things kind of remain constant in the outskirts, though some people might not see it that way. There is a need for economic diversity and a viability in the rural areas. By the same token, we need to be careful with the balance. I don't want to say --
Q. I understand.
A. -- maintain because sometimes maintain is a negative.
Q. Balance is a very good word. Thank you very much.
THE CHAIRMAN: Any other questions? Senator Jackson.
EXAMINATION BY SENATOR JACKSON:
Q. Thank you, Mr. Chairman. Ms. Clyburn, welcome, and I want to congratulate you for having an interest in being a public servant. I want to ask you one question as it relates to the Office of the Consumer Advocate. Are you familiar with the Office of Consumer Advocate?
A. Is that Mr. Hamm?
Q. Yes.
A. Okay.
Q. How do you think that office relates to the Public Service Commission and how do you see the role of the Consumer Advocate with the individual Public Service Commission?
A. With individual Public Service Commissioners?
Q. First of all, the role of the Office of the Consumer Advocate with the Public Service Commission and second the role of the relationship of the Consumer Advocate with individual Public Service Commissioners?
A. I think that it's significant and important for there to be someone there acting as the ears and eyes of those members of the community, someone who is more tangible. A Consumer Advocate, there is no question what that means, that hopefully in an ideal sense that people would go in with their concerns, people who may be illequipped in terms of eloquent or financially go to say Mr. Ham and say, you know, we're having a problem out on Johns Island, that this ruling or what have you is adversely effecting this segment of the population, can you help us?
So there is a need to have a Consumer Advocate expounding or expressing or vocalizing the concerns of persons because even though we might be all well intentioned, no one really will positively effect everyone. Someone is going to fall through the cracks, so a consumer advocate can say, yeah, 90 percent of our population will benefit from X, but there is ten percent over here who is really suffering, so we need have an amendment or something into place.
And someone walking up the street may not -- may just complain about it and may not feel comfortable enough, you know, to articulate that, but 34Steve Hamm, who I think is an attorney, but I'm not sure, and I don't mean that as a negative, is in a position to articulate that and put that into place and put that into motion for them and come before this commission.
Now, if I understand correctly, in terms of individual -- I know he's come before the commission before. In terms of individual -- one on one relationships?
Q. Yes.
A. Is that what you mean?
Q. I think you've answered the question. I guess the second part was that you referred to that you see him more as an advocate of the people?
A. Right.
Q. And not as someone who is a colleague of the commissioners, but basically an advocate of the people?
A. I don't see him that way. That's not how I --
THE CHAIRMAN: Any further questions from the committee? Thank you, Ms. Clyburn.
A. Thank you, sir.
THE CHAIRMAN: I appreciate your offering for the candidate and I find that you've been real articulate.
A. Thank you.
THE CHAIRMAN: Answered questions well. Sorry you had to get nervous. I think you've probably got some heredity traits.
A. Being nervous. Thank you.
MR. COUICK: You're welcome to come up to the witness stand at this time. While you're standing if you will take an oath by raising your hand.
1. Ms. Mignon L. Clyburn
Home Address: Business Address:
16 Darlington Avenue 2106 Mt. Pleasant Street
Charleston, SC 29403 Charleston, SC 29403
2. She was born in Charleston, South Carolina on March 22, 1962.
Social Security Number: ***-**-****.
3. S.C. Driver's License Number: *******;
S.C. Voter's Registration Number: 2544691.
4. She is single, no children.
6. She graduated from W. J. Keenan High School in 1980, and earned a B.S. in Business Administration from the University of South Carolina in 1984.
9. She was a C&S bank teller in the summers of 1979 through 1983, a page in the Lt. Governor's Office from 1982 to 1984, and worked with the Coastal Times newspaper from 1984 to present.
10. She is an associate publisher at the Coastal Times.
22. She has spent approximately $100 on telephone calls and anticipates issuing a follow-up mailing at a cost of approximately $50.
26. Professional organizations: South Carolina Association of Black Journalists, treasurer, 1992 to present; United Way Allocations Board, 1991-93; Charleston Area Arts Council, 1992-93; Board of Adjustment, Site and Design, City of Chas., 1991-93; and Black Women Entrepreneurs, president 1993 to present.
27. Civic, charitable, etc. organizations: Network of Charleston; CASES; Charleston County Young Democrats; Charleston County Coalition for Black Voter Participation; Charleston Affordable Housing; Wagener Terrace Neighborhood Assoc.; NAACP; YWCA; and Democratic Women.
29. Five letters of reference:
(a) Sandra Fowler
2415 Middle Street
Sullivan's Island, SC 29482
(803) 883-9000
(b) H. Ronald Stanley
P.O. Box 7722
Columbia, SC 29202
(803) 799-4700
(c) Daryl Milligan, Sr.
200 Meeting Street
Charleston, SC 29401
(803) 723-6867
(d) James White
500 Thurmond Mall Suite 324
Columbia, SC 29201
(803) 779-0752
(e) Henry Williams
701 East Bay Street, Suite 532
Charleston, SC 29403
(803) 577-0052
30. First District.
EUGENE NOVGORODOFF, having been duly sworn, testified as follows:
MR. NOVGORODOFF - EXAMINATION BY MR. COUICK:
Q. I had sent out a letter earlier this week that asked for you to bring evidence of your residency, a driver's license or certificate of voter registration. Did you receive that letter and if you didn't, maybe you have your driver's license with you?
A. Yes.
Q. If you could share that with Ms. Hammond. You indicate your address on your driver's license to be 9120 Delancey Circle in Charleston, South Carolina, 29418. Does that continue to be your correct address?
A. That is.
Q. Would you please state for the record your full name please?
A. Eugene Novgorodoff.
Q. Thank you. And I apologize if I tend to mispronounce it from time to time. I've suffered all my life from the same affliction you've had in terms of a name that is somewhat hard to pronounce, but I will do my best.
A. Couick is very simple.
Q. It's -- you have an interesting history in terms of your employment and your education. Would you like to share that with the committee briefly in terms of your place of birth and your employment over the years and mainly the international flavor it has.
A. Yes. I was born in transit in Harbin, Manchuria while my parents were fleeing from the Communists in -- from Moscow. They were both residents of Moscow. And they didn't appreciate the bourgeoisie, so off with their heads. Rather to have -- they were trying to preserve their heads and ran east. Many of the emigres ran west and finally -- eventually ended up in the United States. We ended up in China and particularly in Shanghai where I lived most of the time. It was my home for almost 25 years.
I was fortunate enough to have an international upbringing at the Public School for Boys which started off as a private school, but then it became a public. And in becoming public, they admitted people from many nationalities and, of course, was truly an international school. As a matter of fact, the badge that they had in the school which I wore on my hat was 12 nations, the flags of 12 nations, which was a very diverse and very interesting experience for me.
In Shanghai, I joined the Shanghai Telephone Company and served an apprenticeship there. It was very intensive. We worked around 14 or 15 hours a day for three years. And then eventually I was assigned to -- but the war broke out, the first world war. But prior to World War II breaking out, the Chinese and the Japanese had tremendous conflict in 1937 to 1939, so the city was disrupted all the time.
During that time also I joined the Shanghai Volunteers Corps which was a uniformed service to protect the city. It was a very uniquely interesting organization. In 1950 after a year's occupation by the Chinese Communists in Shanghai, I managed to be one of the first Europeans to leave the city and I lived -- I went to Japan and lived in Japan for about two years and then I migrated to Brazil where I registered for employment for being able to work as a native there. You had to have a work card before you managed to get a job. And I was fortunate enough to get a what they call a carte del trabajo (phonetic) and, which was a work permit and worked for the Brazilian telephone company which was an extremely diversified rural and broad -- broadly based education for me in the field of telecommunications.
I applied -- I was going to apply for Brazilian citizenship when a visa from the United States was made available to me and I emigrated immediately leaving my family behind in Rio De Janeiro. Anyway, I eventually got into the United States.
Q. And that was, I believe, in the late fifties; is that correct?
A. That is correct.
Q. And from that time forward -- from 1959, I believe, on, you have worked for such diversified utilities as GTE, New York Central Railroad, ITT, MITRE Company?
A. MITRE company.
Q. MITRE?
A. MITRE Corporation.
Q. Which works with fiberoptic network?
A. That's right.
Q. And with Bechtel, the large construction and engineering company?
A. That is correct.
Q. In each of those applications, you were working with telephone or data switching technology of some sort; is that correct?
A. Exactly right. We were the first -- first ones in -- in New York Central Railroad, we were the first ones to develop a quote unquote computerized data system which used what had -- what are known as floppy disks about 10,000 times the size of what they are today. They were huge monsters, but we did manage to get the first technology and the first ideas developed. And it was I think a great contribution to what followed.
I was also with General Electric where we developed the first satellite earth stations. It was to overcome the lack of broad bank communications for interorganization communication.
Q. In working with those companies, you are now retired from all employment with private corporations; is that correct?
A. That is correct.
Q. Do you receive any type of pension from any of those companies?
A. No. Oh, except the Ticrip (phonetic). I receive a pension from Ticrip which I obtained during my employment with the MITRE Corporation.
Q. And the MITRE Corporation is the one that works with fiberoptic networking and other developmental digitized switching; is that correct?
A. Right.
Q. And they are not a regulated utility company? They are not a public utility that supplies gas or electricity?
A. No.
Q. Do you own any utility stocks?
A. Only in General Electric.
Q. Do you own any public utility stocks that are -- offer services to consumers in South Carolina? SCE&G, Duke Power?
A. No.
Q. CP&L?
A. No.
Q. If you had to name one or two important issues before the Public Service Commission at this time or you would feel would be important, what would those be?
A. Well, one of the issues I think are an old credo that I sort of grew into and that is to provide the consumer. After all, you're providing a service.
You've got to serve the consumer and the Public Utilities (sic) Commission usually tries to improve the goal of providing the best service at the least cost to the consumer and I think that's a very -- in my opinion, a very important credo to follow.
We are serving the public and I think that if we follow this concept, we can't go far wrong.
Q. What other topic or goal would you have if you were to serve on the Public Service Commission? What other problems would you address?
A. Well, health issues like the supply of water and a good clean supply of water. When I lived in -- when I lived in China, I worked for a year with the Public Works Department which sort of ran the roads and sewer pipes and the -- and the sewer plants and the water distribution and we had quite an experience in providing this water to the public and -- but at a very, very low cost.
But I was trying to think of the term as accurately as I could. That the purpose of the service was to provide good water to the public at a very, very low cost.
Q. Mr. Chairman, for the benefit of the committee, we have done a check of -- with SLED and it was negative. There were no entries. In addition, your credit report would have no negative entries. It was positive.
What other things occupy your time now, Mr. Novgorodoff, that would prevent you from devoting your time to the Public Service Commission? Are there any limitations on your time availability?
A. No, I have no -- none except that I help my wife grow roses whenever I have the free time, but I do read a lot and I keep up -- I try to keep up to date with what's going on.
Q. So if we have a bad case of mites or something like that, that would be the only thing that would keep you from coming to Columbia?
A. That's right.
Q. You have heard or have -- we have asked other persons applying or being candidates a little bit about the activities of the Public Service Commission in trying to determine your level of familiarity with their operations. As a -- before I ask that question, is it fair for me to summarize your past experience with utilities or with companies that you worked with to being one of design and engineering?
A. Yes, mostly.
Q. And you have not been involved on the side that would work with the accounting aspects, with the management of the rate base, those types of activities?
A. Well, with GTE, I did go into the rate base and how costs are formed, how costs are sort of dreamed up, how to finance would take place, what charges would be equitable in applying the rates.
In other words, if you're going to charge a customer for a service, it's got to be based on something. And the -- that something is the cost of producing that service and I did go into that very extensively with GTE.
Q. Was that a regulated utility at the time?
A. GTE, yes.
Q. And who regulated? What -- was it a state regulator and what state were you located in?
A. That was in -- in Iowa and it was the State Regulatory Commission. But we had more problems with AT&T and the cost sharing than we did with --
Q. You mentioned earlier the role of the PSC should certainly be geared toward public service or service of the consuming public. There are a number of areas where there is tension between a fair rate of return to the industry and the needs of the public for reasonable inexpensive service.
There is also a tension between the environ