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Home / Articles / News / News /  Controversial PUC appointee got money from Xcel
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Thursday, January 23,2014

Controversial PUC appointee got money from Xcel

Potential conflict of interest for Glenn Vaad

By Jefferson Dodge and Bob Berwyn
PUC appointee Glenn Vaad

Campaign finance reports show that Gov. John Hickenlooper’s controversial appointee to the Public Utilities Commission has received money from an Xcel Energy political action committee and others in industries that he is now involved in regulating.

 

Glenn Vaad, a former Weld County commissioner who served as a state representative from 2007 to 2013, has been under fire because of his leadership role in the right-wing American Legislative Exchange Council (ALEC). That group, which has campaigned to overturn renewable energy standards nationally, named him “state legislator of the year” in 2012, according to documents provided to the Center for Media and Democracy by a whistleblower.

Critics also point to Vaad’s possible conflicts of interest with Xcel Energy, which is regulated by the powerful three-member PUC and is battling the city of Boulder over its utility municipalization efforts. Vaad benefited from an ALEC “scholarship fund” to which former ALEC member Xcel contributed, according to whistleblower groups, and Xcel pays hundreds of thousands of dollars a year to the Edison Electric Institute, an industry group and ALEC member.

Vaad, who was sworn in on an interim basis Jan. 8, still must be confirmed by the Senate.

A BW inquiry into campaign finance reports filed by Vaad with the Colorado Secretary of State from 2006 through 2011 reveals even more possible conflicts of interest, including contributions that Vaad received directly from the Xcel Energy Western Political Action Committee (PAC) of Colorado. According to those records and Xcel officials, that PAC gave a total of $1,400 to Vaad during the six-year period: $200 in 2006, $400 in 2008, $400 in 2010 and $400 in 2011. (Mike Beasley, Xcel’s regional government affairs director, is also listed as giving Vaad a $13 in-kind donation for a fundraising luncheon.)

The PUC regulates several industries, including electricity, gas pipelines, natural gas, rail, telecommunications and elements of transportation, like towing carriers. Xcel, among other companies in these industries, is regulated by the PUC.

From 2006 through 2012, Vaad received at least $7,800 from the energy industry, including the Xcel contribution.

More than $6,400 of that amount came from individuals, companies and groups associated with the oil and gas industry.

BW found that during those same years Vaad received contributions from other industries that he is now involved in regulating: at least $1,700 from the telecommunications industry and more than $3,100 from the transportation industry (including trucking and rail interests). In addition, he got about $3,700 in contributions from pro-business groups.

Any financial links to regulated industries raise conflict of interest questions because Colorado law intends the PUC to be an independent panel giving “paramount consideration” to the public interest. The commissioners act both in a quasi-legislative role (in rule-making procedures), and in a quasi-judicial role, during litigated proceedings.

The PUC has its roots in the robber baron days of the early Colorado railroad wars, as rival companies sought to sabotage each other to gain advantage. After gangs of gunmen squared off at the roundhouse in Pueblo during a dispute over a lucrative rail contract to the mines at Leadville, political support for regulation grew at the state and federal levels.

The Colorado Legislature created a contested railroad commission in 1910, which became part of the newly created Public Utilities Commission in 1913.

The other members of the PUC are Chairman Joshua Epel and Pamela Patton. Epel previously served as chair of the Colorado Oil and Gas Conservation Commission and has worked on regional air quality issues. Patton served on the La Plata Electric Association board of directors for 12 years.

When asked about Vaad’s possible conflicts of interest, Colorado Ethics Watch Director Luis Toro told BW, “Businesses spend money on politics for a reason: They look at political spending as an investment that will pay off with favorable government policies. Anything else would violate management’s responsibility to shareholders.”

But Toro adds that his organization has learned not to read too much into any individual legislator’s receipt of energy industry money.

“It could be hard to find a former legislator that doesn’t have these types of contributions in their reports,” he says. “That doesn’t mean there is no reason for concern. It’s legitimate to ask questions about Vaad’s relationship with these donors.”

While the amounts of money involved are relatively small, Toro acknowledges that sometimes it’s the relationships that matter.

“He should explain fully why he should be trusted to deal fairly with those who come before the PUC when he has preexisting relationships with some of the regulated community from his days in the legislature,” he says.

Some of the contributions might be explained by the committees Vaad served on at the Capitol. As a state legislator in 2011-12, he chaired the House Transportation Committee and sat on the House Agriculture, Livestock and Natural Resources Committee. In 2009-10 he served on the Transportation and Energy Committee, among others. (Most of his professional career was spent working for the Colorado Department of Transportation.)

Vaad did not respond to requests for comment.

Some renewable energy advocates are concerned that, because of his financial ties, Vaad might favor Xcel’s pending request on net-metering for solar-generated electricity.

Xcel says customers who don’t generate their own solar power subsidize the cost of transmitting it for those who do. The company says it wants to make the rate structure more equitable, but the proposed changes could mean higher rates for people who do produce their own power — a disincentive that could slow the transition to renewable energy in Colorado, according to Eric Westerhoff, a Breckenridge-based solar energy expert.

Westerhoff says Xcel rate calculations should include the benefits of solar power generation. The huge growth of solar has enabled the company to defer the capital costs of building new power plants and transmission capacity, he says.

“If we had no solar, we’d be buying electricity generated at the Craig power plant ... and the utility company would pay for the transmission losses in any case,” he explained. “Solar customers don’t get enough credit for contributing energy, which lessens the demand for new power sources and transmission capacity.”

When asked about the contributions to Vaad, Xcel spokesperson Michelle Aguayo says the employee-funded PAC gives money to lots of legislators, and looking at the per-year average, Vaad got less than Rep. Matt Jones, D-Louisville, who got $800 from Xcel over two years, and Rep. Max Tyler, D-Lakewood, who got $1,200 over three years.

“The reason you’re wanting to tie our money to him is because you want to say he’s in our back pocket, and nothing could be further from the truth,” she told BW, adding that Vaad has voted in favor of renewable energy standards in the past. “This guy’s been vilified that he’s anti-green energy, that he’s anti-this and anti-that. It’s very clear that people, especially the solar industry, want to paint him in one way. And in all honesty, what I read in all the different publications is that those industries have all of you reporters wrapped around their little fingers.”

Aguayo adds that courting lawmakers is par for the course.

“You know that the solar industry has their folks that are working with legislators too,” she says. “It’s the course of business. If you’re going to rake Xcel Energy over the coals for the course of business, then you’ve got to talk about who the solar industry has hired, and what they’ve got going at the legislature, and what they’re proposing.”

When asked for a response to the latest revelations about Vaad’s possible ties to the industries he is helping regulate, Hickenlooper spokesperson Eric Brown said via email: “We discussed Glenn’s full record and found him to be a person of integrity and thoughtfulness.”

As of press time Vaad’s confirmation still had not been referred to a Senate committee for a hearing, which must occur before it is sent to the full Senate for a vote. After being notified of Vaad’s additional possible ties to entities that answer to the PUC, Senate President Morgan Carroll told BW via email that the appointment has proven controversial and that the Senate is treating it carefully.

“It’s fair to say this is an important and divisive appointment, so at this time the Senate is doing its due diligence in investigating Mr. Vaad’s qualifications and experience in this field,” she wrote.

Nearly 1,000 people have signed a change.org petition urging the Senate to reject Vaad’s confirmation.

Respond: letters@boulderweekly.com

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