Sandra Hochstetter took her leave from the state Public Service Commission very abruptly Wednesday but it was not a day too soon. Her departure seemed to be hastened by a telephone call from Gov. Beebe, who smelled an ethical crisis even if she did not.
Hochstetter, who was appointed to the utility commission by former Gov. Mike Huckabee, announced early in the week that she would resign from the commission in “a month or so” to take a job as vice president of Arkansas Electric Cooperatives Corp. She seemed to faintly recognize a potential conflict of interest because in two days she was about to sit in judgment on a request from a partner of the cooperatives to build a giant coal-fired generating plant in Hempstead County. She said that her future employer’s keen interest in the issue would not influence her in the least and that she expected to participate unless any of the disputing parties to the case objected.
They did — within minutes. So she recused from the coal-plant hearings, which began Thursday, and Gov. Beebe promptly appointed a former Supreme Court justice as a special arbiter to sit with the other two commissioners. Thank goodness for that.
But what could Ms. Hochstetter have been thinking? It is enough that the public must see the old revolving door between utilities and the regulatory commission swing once again, as it has so often in this ethically challenged state. Regulators do their public work and then take lucrative jobs with the utilities that they have been regulating. Sometimes, as in Ms. Hochstetter’s case, the governor goes to the utilities in the first place to get someone to regulate them. That is routine in the government of George W. Bush, but it is it is rare in state government. Hochstetter had been an attorney for Arkla Gas, later gobbled up by Centerpoint Energy, when Huckabee tapped her for the commission. A righteous state senator, Jim Argue of Little Rock, objected, so the governor had her sit for a while as a commission staffer, who did not have to be confirmed by the Senate, before elevating her to the commission. She was in her second six-year term on the commission.
Her impending employment by one of the largest utilities cast a shadow on all the impending cases involving the cooperatives and their competitors and upon those cases on which she has already sat, including preliminary decisions on the coal plant, which Southwestern Electric Power Co. is already building in anticipation of the PSC’s approval. The cooperatives expect to contract for a portion of the plant’s output. Attorney General Dustin McDaniel said she should resign immediately, not in “a month or so.” Beebe said so, too, and his view counts. He telephoned her Wednesday and she ruminated a few minutes before resigning.
The state has one small caveat about revolving doors. For one year, Hochstetter will not be able to represent the cooperatives — in person —before the commission and her former employees.
