OP-ED | ‘Derbygate’ A Fine Example Of ‘Quasi-Public’ Arrogance
If you’re a public official involved in questionable behavior, the last thing you want to hear is someone in the media attaching a Nixonian suffix to your dubious doings. But that’s exactly what’s happened in Norwich, where ratepayers are outraged at an annual Kentucky Derby junket for board members that has over the last four years cost the local utility more than $1 million.
The resulting scandal has earned the moniker Derbygate.
The attendees had most of their expenses covered by the Connecticut Municipal Electric Energy Cooperative (CMEEC). The excursions were spun by officials as a “qualitative investment” and “strategic retreats” for dozens of board members, municipal officials, and guests associated with the six-town energy cooperative. Guests and family members of the officials went on the trip in order, CMEEC’s director said, to “maximize participation” among CMEEC decision makers. I guess so. According to the Bulletin, of the trip’s 44 attendees, 32 were not directly involved with CMEEC or any of its member utilities.
The annual trips to the Kentucky Derby were planned for dozens of guests, including not only CMEEC board members, but municipal officials such as Norwich Public Utilities General Manager John Bilda and Norwich Mayor Deb Hinchey. The latest trip cost the CMEEC $342,300 for the 44 guests who came along for the ride.
CMEEC was created by the General Assembly in 1976. It’s a public power entity held by the municipally-owned utilities in Norwich, Groton, Jewett City, and portions of Norwalk. CMEEC is useful to those municipalities because it can negotiate wholesale energy purchase prices that allow ratepayers in cities with their own utilities to pay lower rates than those charged by the private-sector utilities that serve most of us in the state — companies such as Eversource and United Illuminating.
So make no mistake about it. CMEEC’s business is the public’s business. That’s why it’s laughable that CMEEC officials are insisting that no ratepayer funds were used to pay for the fancy four-day excursions. They say the trips were instead paid for by revenues from selling electricity and services to nonmembers of CMEEC. Those monies go into a separate account called the “Margin Fund,” which raises the question of why they don’t just level with us and call it the “Slush Fund?”
It stands to reason that $1 million in revenues coming from the outside could be better used to lower rates for customers within the system or put into a capital account for infrastructure improvements. So even if the funds for Derbygate were not derived from CMEEC’s ratepayers, the frivolous spending affects the company’s bottom line, which invariably has an adverse impact on the municipalities and taxpayers that own CMEEC.
Besides, where I come from, “strategic retreat” is a euphemism for a big party financed with someone else’s money. And “maximizing participation” means the more the merrier. Does anyone think that’s what a taxpayer-owned utility ought to be doing?
Worse yet, when public officials began asking CMEEC questions about the waste of money, answers were scarce. When confronted with queries at a public meeting last month from the Jewett City Department of Public Utilities, CMEEC officials offered little more than bromides and hid behind technical jargon. Jewett City officials were so frustrated that department members voted to extend the meeting into the new year.
The situation was ripe for a lawmaker looking for a good issue. Enter state Sen. Cathy Osten, D-Sprague. Her bill, co-sponsored with two other legislators from southeastern Connecticut, would require more transparency on finances and meetings on the part of organizations such as CMEEC. It would also mandate that retreats to be approved at formal board meetings, that they be held in Connecticut, and “that they conduct the business of the utility at hand.” Good for her. Osten and her colleagues are to be commended for taking on CMEEC and its ilk.
The CMEEC imbroglio is really emblematic of a larger problem. It’s part of that gray area of government — those quasi-public agencies that seem to operate with limited transparency and accountability compared to their public- or private-sector counterparts. Remember the scandal-plagued Connecticut Resources Recovery Authority?
When asked by The Day of New London for details of the Margin Fund, CMEEC Executive Director Drew Rankin initially submitted a one-page sheet to the newspaper with nearly every line item blacked out. To the Jewett City officials, he would not acknowledge any impropriety in the junkets and insisted they were merely a problem of “public perception.”
In the same breath, Rankin said he and his staff would do “whatever is humanly possible to restore public trust.” CMEEC officials could start by cancelling future Derby trips and opening their books and meetings to the full scrutiny of the public whose trust they seek.
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