Consumer watchdog on Ohio utility's leash?

3/24/2004

COLUMBUS - Ohio's consumer watchdog golfed and dined with utility representatives and destroyed a report that undermined FirstEnergy's ultimately successful plan to pass on billions in costs to its customers, a state investigator charged yesterday.

Consumers' Counsel Robert Tongren resigned in November after it was revealed he ordered the destruction of a consultant's report that cost taxpayers $579,000, despite the fact that newspapers repeatedly filed public records requests for its release.

"The acceptance of gifts and gratuities, coupled with his predilection for attending political events, demonstrates a pattern of activity beyond what one could expect as necessary to further consumer interests," reads a report issued by Inspector General Tom Charles.

"In our view, this crossed the line and was self-serving," it reads. "Moreover, we believe it affected his ability to serve as an effective advocate on behalf of residential utility customers."

The findings have been referred to the Ohio Ethics Commission and the Joint Legislative Ethics Committee for further review and possible referral for prosecution.

In a written statement, Mr. Tongren denied wrongdoing, saying he was following a records-retention plan approved by the state Department of Administrative Services.

"The inspector general's re-

port on meals and gifts is not the whole picture," he wrote. "There was no finding that any meal or gift exerted any undue influence on (me). ...

"As the report notes, (I) sought consensus over litigation," he wrote. "That approach contributed to more than $1.7 billion in consumer savings over the last 10 years."

The consultant's report, completed by LaCapra and Associates of Boston, was commissioned in 1999 as a starting point in negotiations with FirstEnergy. The dispute was over how much the parent company of Toledo Edison could recoup from ratepayers for nuclear power plants and other investments it made before Ohio opened the supply of electricity to competition.

The report was never released, and Mr. Tongren, one of about 20 interested parties at the table, ultimately signed onto a settlement that largely accepted FirstEnergy's figure of up to $8.8 billion through 2005. The LaCapra report indicated the figure should have been $2.2 billion to $4 billion.

"We, the ratepayers, spend $9 million a year to fund the Office of Consumers' Counsel to serve as an advocate for us in rate cases," said Shari Weir, Cleveland director of Ohio Citizen Action. "We couldn't trust Rob Tongren because he was playing golf and dining with utilities and shredding reports that should have been made available to the public."

In February, 2003, despite requests for release of the report, Mr. Tongren enacted a new records-retention policy that called for destruction of case records a year after the completion of the case. The LaCapra report was destroyed last August.

The inspector general's report concedes Mr. Tongren succeeded in winning concessions from FirstEnergy, including a freeze on distribution rates through 2007.

But it pointed to a series of e-mails that seem to suggest that counsel staff was seeking to have LaCapra destroy its records as well.

"In our view, [the office's actions] were either an orchestrated attempt to conceal records or a gross error in judgment on the part of Tongren and others in senior management within OCC," the inspector general said.

The investigation also revealed that Mr. Tongren accepted meals, refreshments, or golf outings from utility representatives on 71 occasions, with a total value of $2,000.

Most of these were under the $100-per-day threshold requiring disclosure to the Ohio Ethics Commission. But records subpoenaed from the utilities indicated that Mr. Tongren had not disclosed that he had accepted meals, country club golf tee time, and even a gift ham delivered to his home above that threshold from Sprint, Cinergy, AEP, and Columbia Gas between 2000 and 2002.

Janine Migden-Ostrander, who will begin work as the new consumers' counsel next month, said she plans a thorough review of the current records-retention policy as well as creation of a new code of conduct.

"Everybody pays his own way," she said. "There are no ambiguities in that."

- JIM PROVANCE