April 20, 2023

PRC defends discussions, decision to request the NM Supreme Court send utility merger case back commission

The New Mexico Public Regulation Commission defended its past closed session discussions about a proposed utility merger and its decision to ask the state Supreme Court to send the case back to the commission during its Wednesday meeting.

This came after nearly two dozen New Mexicans criticized the commission’s actions.

A total of 25 people signed up for public comment during Wednesday’s PRC meeting, though not all of them spoke.

The outrage started in March when the PRC joined the Public Service Company of New Mexico and Avangrid in filing a motion before the New Mexico Supreme Court asking the court to remand a merger application case to the commission.

Merger opponents saw this as a “behind-closed-doors” decision that could have broad reaching consequences. They further saw it as an attempt by the newly-appointed commissioners to undo a decision made by the previous commission, which was made up of elected officials.

“This decision is important to the lives of all New Mexicans, therefore should not be taken in the dark,” Walter Gerstle, who identified himself as a professional engineer, said.

Bernalillo County resident Carl Peterson said the new members of the PRC are attempting to overturn a legitimate decision by the preceding regulatory body. He said the past PRC members decided that the merger was not in the public’s best interest.

“This decision was not arbitrary. It was based on evidence,” he said.

PRC counsel Michael Smith said there has been a misunderstanding about what the December 2021 order in the merger case actually did. He said it has been presented as a final decision rejecting the proposed merger, but that is not the case. Instead, he said it “addressed and rejected a stipulation that was proposed as the basis on which to approve the merger.” 

Smith said the 2021 decision “did not conclude the case.”

PNM and Avangrid had options after the decision and chose to pursue an appeal to the New Mexico Supreme Court.

This placed the case in New Mexico Supreme Court jurisdiction and the PRC is unable to reopen the case and hear additional arguments in it unless the court remands it.

The PRC changed from an elected body to an appointed body in January after New Mexico voters approved the move through a constitutional amendment.

Commissioner Gabriel Aguilera said that in mid-January utility officials approached the PRC counsel about asking the state Supreme Court to remand the case back to the PRC.

Following that, Aguilera said that he and Commissioner James Ellison met with counsel in a series of closed sessions. Commissioner Pat O’Connell recused himself from the case. 

Aguilera described these closed sessions as partially needed to educate both him and Ellison about what had happened in the past, including the past decision to reject the stipulation. He said they also discussed whether to join the motion to remand the case back to the PRC.

Aguilera said that the order issued on Dec. 8, 2021 that led to the appeal provided the opportunity to request further PRC proceedings. He said even if the order did not explicitly offer further PRC proceedings, there is nothing that bars Avangrid and PNM from bringing the case back to the commission. That could involve filing a new application, which could be done even without the state Supreme Court remanding the case.

Aguilera said he prefers to hear the merger case in the existing docket because “it is better to build upon the existing record than start over completely.”

At the same time, Aguilera acknowledged that there were some errors in the March 8 filing that requested the case be remanded. For example, the filing cited the commission’s rehearing rule, but too much time has lapsed for that rule to be in effect.

The commission will amend the filing to specify that it is calling for the court to allow the PRC to reconsider the case should PNM and Avangrid file a motion to reopen the case. 

Smith said that the PRC does not have the jurisdiction to reopen the merger case within its original docket unless the state Supreme Court remands it to the commission.

But neither the Supreme Court remanding the case nor an application to reopen it would require the PRC to reconsider the proposed merger.

“Quite a lot of time has passed,” Ellison said. “New information is undoubtedly available. New analysis undoubtedly needs to be performed.”

He said the commission’s intent was never to do a “very quick review” of the evidence.

Aguilera said that if the commission considers the merger proposal, whether in the current docket or in a future one, the proceeding “will take as long as it needs to take.” 

He said if the court chooses to remand the case to the commission, there will be “a fair opportunity for comments, protests and new evidence.”

He said that artificial deadlines, such as the ones in agreements between PNM and Avangrid, will not pressure the PRC.

“If PNM and Avangrid feel that too much time has lapsed and their deal is no longer viable, they have the ability to withdraw their filings,” he said.

Many of the people who spoke said they were concerned about the PRC’s conduct in making that decision. They criticized the PRC’s past closed sessions to discuss the case. The Open Meetings Act does have a provision for discussions to occur in closed session to discuss a matter of attorney-client privilege. This is often used by government entities to discuss how to proceed with court cases.

Smith said that case law has upheld that public entities can make litigation decisions, including entering into settlements, in closed session without having to conduct a confirming vote in open session.

Ellison explained that government bodies would be at a competitive disadvantage if they were required to have discussions related to court cases in open session.

“Since we’re representing the public interest, the public interest would be at a competitive disadvantage,” he said.