TRANSCRIPT OF THE LOUISIANA PUBLIC SERVICE COMMISSION BUSINESS AND EXECUTIVE OPEN SESSION HELD ON NOVEMBER 17, 2017 IN BATON ROUGE, LOUISIANA. PRESENT WERE: CHAIRMAN ERIC SKRMETTA, COMMISSIONER LAMBERT BOISSIERE, COMMISSIONER FOSTER CAMPBELL, COMMISSIONER MIKE FRANCIS, AND COMMISSIONER CRAIG GREENE. Exhibit Docket Page Description 1-14 1 Announcements 2 Undocketed Discussion and possible vote to elect Louisiana Public Service Commission representative to the Regional State Committee of the Southwest Power Pool. Undocketed Discussion and possible vote to approve amended and restated site-specific contract between Cleco Power, LLC and Plastipak Packaging and Tabb Realty, LLC. T-34241 Dynamic Environmental Services, LLC vs. Steve Kent Trucking, Inc. and Kent & Smith Holdings, LLC 5 U-32159 AccessCom, Inc. vs. BellSouth Telecommunications, LLC dba BellSouth Telecommunications aka AT&T Louisiana (‘AT&T Louisiana). 6 U-34658 (RFP 17-14) Concordia Electric Cooperative, Inc. 3 4 14 39-41 96-127 41-65 65-66 i LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 7 R-34661 (RFP 17-15) Louisiana Public Service Commission, ex parte. 66 8 S-34607 Community Utilities of Louisiana, Inc., ex parte. PASSED 9 S-34608 Community Utilities of Louisiana, Inc., ex parte. PASSED 10 S-34624 Cleco Power LLC, ex parte. 11 S-34646 Northeast Louisiana Power Cooperative Inc., ex parte 68-69 12 Docket TBD Claiborne Electric Cooperative, Inc.’s Fiber-to-theHome project. 69-71 1) Reports 2) Resolutions 3) Discussions 4) ERSC/OMS business 5) Directives 13 14 X-34674 Louisiana Public Service Commission, ex parte. 15 X- Louisiana Public Service Commission, ex parte. 66-68 71-91 91 92 ii LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 16 U-34206 14-38 Community Utilities of Louisiana, Inc., ex parte. 17 Directive to Staff related to the Texas HartburgSabine MEP Transmission Project currently under review as part of the MISO MTEP17 process. 18 Directive regarding Cleco. 93-96 96 1 iii LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 1 TRANSCRIPT OF THE LOUISIANA PUBLIC SERVICE COMMISSION 2 BUSINESS AND EXECUTIVE OPEN SESSION HELD ON NOVEMBER 3 17, 2017 IN BATON ROUGE, LOUISIANA. 4 CHAIRMAN 5 BOISSIERE, COMMISSIONER FOSTER CAMPBELL, COMMISSIONER 6 MIKE FRANCIS, AND COMMISSIONER CRAIG GREENE. 7 CHAIRMAN ERIC SKRMETTA: Please stand. Commissioner Francis will 8 do the prayer and Commissioner Greene will do the Pledge of Allegiance for us. 9 [COMMISSIONER MIKE FRANCIS LEADS PRAYER] 10 [COMMISSIONER CRAIG GREENE LEADS PLEDGE] 11 CHAIRMAN SKRMETTA: Good morning, everyone. Before we begin, I'd 12 like to take the obvious first step and welcome our newest Commissioner, Dr. 13 Craig Greene, and I ask y’all to the join me in a round of applause. And even 14 though it’s his birthday, he didn't bring cake. So you can all wish him happy 15 birthday on the way out. As we move in--let’s move into announcements, and I 16 have one person who is here to give testimony on a non-docketed item, we’ll hear 17 that during the announcements. 18 MR. FREY: Okay. Good morning, Commissioners. We've got quite a few, 19 we’re moving some items around. So, first off, Exhibits 8 and 9 are being passed, 20 so 8 and 9 will be passed. 21 CHAIRMAN SKRMETTA: Hang on. Which one is that, Foster? What’s the 22 other one, Brandon? ERIC SKRMETTA, PRESENT WERE: COMMISSIONER LAMBERT LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 1 1 MR. FREY: Okay. This is under announcements. Commissioner Campbell's 2 directive, which is the first directive on your briefing sheet, we’re going to pass 3 that as well. 4 CHAIRMAN SKRMETTA: In reports, you mean? 5 MR. FREY: It’s under directives, under Exhibit 13, reports, resolutions. 6 CHAIRMAN SKRMETTA: Oh, okay. 7 MR. FREY: It’s the very first one regarding transmission rulemaking. We’re 8 going to pass that. 9 CHAIRMAN SKRMETTA: Okay. Got it. 10 MR. FREY: And then we’re going to move a few items. We’re moving 4 to the 11 end of the agenda, and then we’re going to take up 16 after Exhibit 2. So we’ll do 12 2 next, and we’ll take up 16. 13 CHAIRMAN SKRMETTA: Okay. Commissioner Campbell has--needs the 14 microphone. Go ahead, sir. 15 COMMISSIONER FOSTER CAMPBELL: I have something to talk to you 16 about a little bit, several things. First of all, we’re glad to see you come up to 17 Natchitoches next week--next month. Natchitoches is the oldest town in the 18 Louisiana Purchase. It’s absolutely older than New Orleans. I don't know if you 19 know that, but it is, a few years. And it’s beautiful in December. They have a lot 20 of lights, a nice bunch of people up there. I’m very fond of Natchitoches. I went 21 to school there, and we’re glad to see you come. The next thing I want to talk to 22 you about. I was on a hunting trip last week in Kansas. I go up there quite 23 frequently, and I’m a bird hunter. And I don't know if you know this or not, but LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 2 1 you just picture this. I’m going to tell you a little story. It happened to me. Bird 2 dogs hunt all the time. They’re consistently just moving and they hunt. And you 3 have to have them in good shape because they finally give out, but you can hunt 4 them a couple of hours. So we were bird hunting, and I heard my dogs. Bird 5 dogs don’t bark, they point. Hounds bark at things but dogs--they point. So I 6 heard these dogs. I have a Irish Setter and English Pointer at this particular time 7 out. And I heard them barking down in a ditch. So I went out to see what they 8 were barking at, and it was a giant--we call them coons, but you might--they’re 9 raccoons, but in Louisiana, they’re coons. Okay. Big--big raccoon. He’s in a 10 ditch and both dogs have jumped on him, and it was a hell of a fight. Man, they 11 were fighting and hollering, and a raccoon is very fierce. So anyway, I couldn’t-- 12 I went out and to try to get my dogs. But anyway, the raccoon got out of that 13 situation. He swam out in the lake. Raccoons are notorious, the dogs--my Irish 14 Setter went out in the lake after the dog--after the coon. As long as a dog can 15 walk around, it was a pretty good fight. But the coon went on out where he was 16 swimming, and the dog went out there. It was a fatal mistake almost. The coon-- 17 now, they do this every time. He swim around got on the back of that dog’s head 18 and was going to drown him. I mean, he had him--it was on his back and he had 19 that dog’s head like, you know, pushing it down. So I had to go out and wade out 20 and get the dog. And I--it was a hell of a mess. I had a coon over here. I was up 21 to my belly in water and the dog over here, man. You talking about a tough 22 situation. But had I not got that dog away from that coon, that coon would have 23 drowned that dog, and it would have happened just like that. They do it all the LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 3 1 time. Anyway, I thought you might like that. And another thing I want to talk to 2 you about today is something that we all--I’m sure are--we’ll say--I understand 3 Ms. Gonzalez is not going to be our executive secretary after the first of the year. 4 And, look, I’m going to ‘fess up. I’ve give--I’ve give Eve hell a lot of times, but 5 she’s been very, very good and very efficient and very smart, and she’s done a 6 good job. And I’m--I’m glad I voted for her. We voted for her the first time. Mr. 7 Fields was really the one that orchestrated Eve, and I helped and Lambert helped. 8 We helped and got it done. And we’re glad we did that because she’s been very 9 good. We all voted for her. I say that to say this. Now, that that we’re going to 10 have secretary slot open, I would like to do a national search for someone to be 11 our executive secretary. I really would. I think this is an important Commission. 12 You’re dealing with four million people, the bills they pay every month, and I 13 would like to do that. No--no criticism against anybody on Staff or anything like 14 that. And I would go further to say I would like to see whoever is going to be 15 interim secretary not be a candidate to be the secretary. I think if you’re a 16 candidate for secretary and you are the exec--appointed secretary, you got a leg 17 up. And I would like to see somebody on Staff that is not going to be a candidate 18 for the secretary of the Public Service Commission, I don't know, y’all know who 19 been here a long time and doesn’t want to be secretary, I would like to see them 20 handle a job until we interview everybody, anybody who wants to be interviewed. 21 That’s not to say now if anybody’s on Staff you can’t be interviewed and you 22 dern sure can get the job. But I don’t think we ought to have a interim secretary LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 4 1 that’s applying for the job, because that gives them a leg up. That’s the way I 2 feel. So I don't know how y’all feel. 3 CHAIRMAN SKRMETTA: Is that a directive? 4 COMMISSIONER CAMPBELL: That’s just what I think. 5 CHAIRMAN SKRMETTA: Okay. Just to counter with you. We’re in a 6 position of incredible technical issues right now that the interim secretary, who 7 will--the interim secretary has been acting now during now during Ms. 8 Gonzalez’s health issues, and he’s no longer the interim secretary. He’s back to 9 executive counsel. And I would oppose using somebody from Staff and 10 excluding them for consideration. They have the right to consideration like 11 everybody else. 12 everybody stands in equal shoes. And, you know, we’d certainly like to see that 13 begin, but without any restrictions on any participants. 14 COMMISSIONER CAMPBELL: Well, I--you’re talking about Mr. Frey? 15 CHAIRMAN SKRMETTA: Yes. 16 COMMISSIONER CAMPBELL: And that’s fine. I want Mr. Frey to apply. 17 He very well might get the job. But I don’t want Mr. Frey to be the executive 18 secretary and apply because he’s got a leg up as a acting executive secretary. I 19 think, just like Mr. Greene didn’t--when he ran, he didn’t want to be appointed to 20 the Public Service Commission and run. He said let me run. So I’d like to see it 21 all equal and have a national search and have someone on this Staff who’s not 22 going to apply be the interim secretary. That’s just the way I feel. Certainly no problem with doing a national search, but LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 5 1 CHAIRMAN SKRMETTA: May I suggest that we take Mr. Tobler and let him 2 be interim secretary during the search? 3 COMMISSIONER CAMPBELL: I tell you what we-- 4 CHAIRMAN SKRMETTA: Because he certainly doesn’t want it in any way, 5 shape, or form. He does have a heart condition, but I’m not really concerned. 6 COMMISSIONER CAMPBELL: Well, anyway, if y’all want to-- 7 CHAIRMAN SKRMETTA: That will be the problem is, you know-- 8 COMMISSIONER CAMPBELL: I’ll bring this up in sign of a motion in 9 Natchitoches if that’s all right. 10 SECRETARY EVE GONZALEZ: Yeah. In Natchitoches, I was planning on 11 having an item on the agenda to discuss this in executive session. 12 COMMISSIONER CAMPBELL: That--that’ll will be fine. 13 SECRETARY GONZALEZ: And then have a vote. 14 CHAIRMAN SKRMETTA: Yeah, great. Go from there. And certainly my 15 consideration is everybody--everybody ought to have a shot at it. That’s all. 16 Commissioner Greene, go ahead. 17 COMMISSIONER GREENE: I would just like to point out that being the 18 interim doesn’t necessarily mean that you win. 19 CHAIRMAN SKRMETTA: Yeah, exactly. All right. Thank you very much. 20 That’s why Mr. Tobler could be the interim. It’d be a short journey anyway. We 21 still anticipate migration from him in the not too distant future. Before we move 22 forward, is there--Commissioner Boissiere, go ahead. LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 6 1 COMMISSIONER LAMBERT BOISSIERE: Well, obviously we’re starting 2 off with everybody in agreement so far and it’s another meeting. And--and since 3 we’re just saying what we’d like to see, that gives us a couple of days to sit 4 around and work it out amongst ourselves. And Mr. Greene apparently comes in 5 with great wisdom already, and is able to settle these issues very quickly with a 6 comment. So I’m looking forward to working with the rest of the Commissioners 7 to resolve how we move forward, who is interim or not, and what our process 8 might look like and just ask for everybody’s support in getting a really good 9 quality, qualified secretary. That will be important for this whole process. That 10 means a lot to everybody here and all of the public out there. So I think the 11 Commissioners are very excited about this as always and I look forward to a very 12 lively process. Let’s--I ask my Commissioners to really come together and let’s 13 work out all--as many of the details as possible on the front end and be ready for 14 next month’s meeting. 15 CHAIRMAN SKRMETTA: Okay. Thank you, Commissioner Boissiere. Any 16 other announcements? 17 MR. FREY: We--we do have a couple other announcements. Just to-- 18 CHAIRMAN SKRMETTA: Sure, go ahead. 19 MR. FREY: --on the B&E, it’s on the 20th in Natchitoches at the Event Center. 20 Which, those of you who have been there before, it’s the same place where we’ve 21 had the B&Es before. 22 CHAIRMAN SKRMETTA: Same place as last time. Okay. LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 7 1 MR. FREY: And also the--the public utilities section of the bar is having its 2 annual CLE on December 1st here in Baton Rouge at the Hilton. I know Melissa 3 Watson is out today, but Jamie Watts is here so you can check with her if you 4 need further information on how to register. 5 CHAIRMAN SKRMETTA: 6 announcements? 7 MR. FREY: Other than the one-- 8 CHAIRMAN SKRMETTA: Commissioner Greene, go ahead. 9 COMMISSIONER GREENE: Yeah, I would like to honor and appreciate our 10 executive assistant Susan Benoit. She was with now three Commissioners, three 11 personalities, actually maybe five personalities among three Commissioners. And 12 super intelligent, a huge servant’s heart, and none of us would be here without 13 you. So we just want to say thank you, and we have a little something for you. 14 So thank you very much, a huge round of applause. 15 MS. SUSAN BENOIT: Chairman, if I could have a moment. 16 CHAIRMAN SKRMETTA: Absolutely. Take--take Mike’s microphone. Take 17 Craig’s microphone, please, sorry. 18 SECRETARY EVE GONZALEZ: Or the mic--yeah, that’s fine. I was going 19 to say the mics up here are also. 20 MS. BENOIT: 21 Commissioners, you are the heart and soul of the Commission. And with your 22 assistance, I’ve learned so much. You are the people’s voice. Commissioner 23 Greene, congratulations on your big primary victory. You will do great things Okay. Okay. Thank you very much. Any other Just one minute to thank the--first of all, the LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 8 1 here at the Commission. I’d like to thank Eve and Staff and special counsel, with 2 your hard work and dedication, you--Eve, you’re a strong ethical, great role 3 model. 4 utilities and their representatives. With your great spirit of cooperation, we have 5 some of the lowest rates in the country. And finally, I would like to thank 6 Commissioner and now Director Scott Angelle. He was a blessing to my family 7 and when he reached out to me and said, if you can put up with me, I need you, 8 let’s get to work. And so I will be forever grateful. Thank you very much and 9 God bless. Congratulations on your retirement. I’d like to thank the regulated 10 COMMISSIONER GREENE: With that, too, I’d like to introduce my new 11 executive assistance, Mr. Bo Staples and my technical assistant, Ms. Gabrielle 12 Walker, if y’all could stand up. 13 CHAIRMAN SKRMETTA: 14 Commissioner Greene? Okay. Commissioner Francis? 15 COMMISSIONER FRANCIS: Along with my first assistant, Joan Finley, I’ve 16 got one of my key staff player from out of the Lake Charles area, Janice Perkins. 17 Would you stand up, Janice? 18 CHAIRMAN SKRMETTA: Thank you, Commissioner. And obviously--I’m 19 not too sure I was remiss, but I think I introduced you, Donna, at the meeting in 20 Buras, but I’d like you to stand. And this is Donna Dardar, she is my new 21 technical assistant. For those of you who weren’t there. Thank you very much. 22 Okay. As far as announcements, we have Vincent--is it Deliberto? 23 MR. VINCENT DELIBERTO: Yes. Okay. And Commissioner--are you finished, LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 9 1 CHAIRMAN SKRMETTA: Yeah. Come on up, Mr. Deliberto. Mr. Deliberto 2 is a former councilman from the city of Killian, and he has some issues he wanted 3 to bring to the attention of the Commission. So I have your card, you’re already 4 sworn in by that. So please have a seat and say your name for the record and tell 5 us what is on your mind, sir. 6 MR. DELIBERTO: Okay. First, I’d like to thank the Commissioner for letting 7 me speak. My name is Vincent Deliberto. I’m retired. I live in Livingston 8 Parish, the town of Killian, and that’s in District 1. 9 Livingston Parish. And I would like to address the council not only for me, but 10 for the 135 customers in the town of Killian who are connected to Mo-Dad 11 Utilities sewer system. I would like to address the issue of Mo-Dad who was 12 found out of compliance and fined $20,000 at a treasury department, then in 13 return donated 50,000 to the Pontchartrain Basin Foundation. 14 Commissioner granted Mo-Dad another rate increase of 27 percent, from 28 to 15 35.56 per month for just--just the sewer then was caught out of compliance by the 16 DEQ. Came before the Public Service Commission and was granted 42 percent 17 increase for the year 2017, 10 percent for the year 2018, and 12 percent for 2019 18 rate increase so they could borrow $17 million for upgrades--which they called 19 upgrades which in reality are general maintenance. This was unknown until the 20 customers received a bill and a letter the same day. Killian is the only town 21 which Mo-Dad operates in the city limits or township. There are 139 combined 22 customers in Mo-Dad representative and Terry Harvey in Riverside Ridge. The 23 rest of the town residents have their own septic tanks which in turn all empty into It’s the lower half of In 2015, the LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 10 1 the Tickfaw River. As you know, we are mandated by the state of Louisiana to be 2 connected to this system. We have no choice. All I ask is to have a choice. I 3 have a choice for everything but this. When will the rate increase end? Some 4 people run the--the same people run the company who’ll be doing the same thing 5 with the same results. It does--does not work out. I started first when I received 6 increase on my water bill--on the sewer bill trying to contact District 1. Finally, 7 had to file two complaints, faxed info with no reply. Have contacted everyone 8 from my town mayor, which was helpful, state representative, state senator, parish 9 president, everybody, zero help. I would like in turn to ask--ask the 10 Commissioner who represents the people? People in--the Commissioner people 11 in Baton Rouge were very helpful in telling me who to send the information to 12 and who not to. In return, since Mo-Dad is in the town of Killian, they have to 13 pay a franchise fee which they signed in 2008 of three percent. They paid it all 14 the way up to the year 2011. In which all they charge was 66 cents per customer. 15 From 2011 to 2017 when they were caught, they had not paid the franchise fee to 16 the town of Killian, but yet they--they collected the fee from the people. In 17 return, they are not collecting the correct amount of three percent because it 18 should be off your base bill minus the franchise fee and your DEQ fee. Now, if 19 you take somebody’s money and you designate it to go someplace and it doesn’t, 20 to me, that’s illegal. And we just now are getting them to--they sent us the check 21 for $5,400, the town they sent, but in return they had no memo for how many 22 customers, what rate it was, or anything. All I ask the Commission is--I--I think 23 the people should have some type of voice in this, and this--this company LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 11 1 continues to do the same thing over and over with the same results. If you would 2 even just go look at the oxidation ponds they got, they are a disgrace. Their lift 3 station is the same way. They changed out a control panel. What do they do with 4 the control panel? Threw it in the ditch. You know, I mean, it’s--we--we have-- 5 we have no choice. It’s mandated, and how high will this go? We’re going to be 6 paying $100 a month and we got to pay it or how we going do for the sewer? 7 You know, I just ask the Commission to--whatever you can do, I’d appreciate it. I 8 know the people would appreciate it. 9 CHAIRMAN SKRMETTA: Well, thank you very much. We have been 10 engaged in a dialogue through my staff with you and also with the current mayor 11 and council of Killian on this matter. Who is the Staff counsel who was handling 12 Mo-Dad issues? Was that you, Lauren? 13 MS. LAUREN TEMENTO: This is Lauren. It was actually Adrienne, but I’ve 14 taken over from her once she left. 15 CHAIRMAN SKRMETTA: Okay. Lauren, I would like you to get contact 16 details from Mr. Deliberto, correct? 17 MR. DELIBERTO: Yeah. 18 CHAIRMAN SKRMETTA: And arrange to do two things. One is to review if 19 we have a Staff or a contract engineer on this issue. Which I think we-- 20 MS. TEMENTO: We do. 21 CHAIRMAN SKRMETTA: --have Lambert Engineering. 22 MS. TEMENTO: Mr. Lambert, correct. LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 12 1 CHAIRMAN SKRMETTA: Have them go and ensure that this is not 2 maintenance and they’re actually doing what they’re supposed to be doing under 3 their rate increase. And two, please engage in a dialogue with the city of Killian 4 to find out, you know, where they are on this, and I hope that leads this matter 5 into a review from the Commission on this issue. And that we will bring it up if it 6 appears to be any issue that we can deal with on our part of it. Understanding that 7 anything to do with franchise fees is going to be strictly limited to the 8 municipality. 9 MR. DELIBERTO: No, no, I understand that part. 10 CHAIRMAN SKRMETTA: Okay. 11 MR. DELIBERTO: My part is the increase that y’all continue to receive, you 12 know-- 13 CHAIRMAN SKRMETTA: Well, and unfortunately, the Commission receives 14 the request from increase due to regulations from DEQ and DHH on water and on 15 sewer, opposite of each other. So it comes to us under a state mandate. It is not 16 funded by the state and it comes to us find a way to pay for it, unfortunately. We 17 do not make the rules that make the price go up. We just try to find a way to 18 make it work and make it work in a financial sense. But what we will find out is 19 if they are taking money under the rate increase and not doing the job, there will 20 be credits and dealt with in a very direct manner. So you have our commitment 21 on that. 22 MR. DELIBERTO: Yeah, and I mean and according to the beginning, they 23 were supposed to put on their website the upgrades as--as they go. LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 13 1 CHAIRMAN SKRMETTA: We will--we will review that. 2 MR. DELIBERTO: I went on there and it wasn’t--there were no upgrades on 3 there. 4 CHAIRMAN SKRMETTA: 5 details with her and Mr. Tobler will monitor it from my staff and we will bring 6 the matter forward for you. Okay? 7 MR. DELIBERTO: Okay. I appreciate--appreciate your time. 8 CHAIRMAN SKRMETTA: Thank you very much, Mr. Deliberto. 9 MR. DELIBERTO: Thank you, gentlemen. Okay. Well, Ms. Temento, please exchange 10 CHAIRMAN SKRMETTA: Next item, please, Brandon? 11 MR. FREY: Exhibit 2 is discussion and possible vote to elect Louisiana Public 12 Service Commission representative to the regional state committee of the 13 Southwest Power Pool. 14 CHAIRMAN SKRMETTA: Chair nominates Commissioner Campbell to serve 15 as the Commission representative to the Southwest Power Pool. Any seconds? 16 COMMISSIONER FRANCIS: Seconded. 17 CHAIRMAN SKRMETTA: 18 opposition? [NONE HEARD] Hearing none, the matter is ordered. 19 MR. FREY: Okay. Then as we announced, we’re going to move to Exhibit 16 20 now. This is Docket U-34206 and U-34287. U-34206 is Community Utilities of 21 Louisiana, ex parte. 22 adjustment of retail rates and the reservation of rights to request interim rates for 23 the Density Systems and in Docket U-34287, Community Utilities Louisiana, ex Seconded by Commissioner Francis. Any In re: Request--in re: Application for increase in the LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 14 1 parte, in re: Application for an increase adjustment and retail rates and reservation 2 of rights to request interim rates of the WTSO systems. Discussion and possible 3 vote on a global settlement pursuant to Rule 57, so we’ll need two votes. One to 4 take it up, first. If y’all want to do it. 5 CHAIRMAN SKRMETTA: Any motions? 6 COMMISSIONER FRANCIS: 7 primary jurisdiction under Rule 57 to consider the global settlement. 8 CHAIRMAN SKRMETTA: Okay. Any seconds? 9 COMMISSIONER CAMPBELL: I’ll second. The Commission exercise its original and 10 CHAIRMAN SKRMETTA: Seconded by--motion by Commissioner Francis, 11 seconded Commissioner Campbell. Opposition roll call vote, please. 12 MR. FREY: This is on the Rule 57? 13 CHAIRMAN SKRMETTA: Yes. 14 MR. FREY: Commissioner Boissiere? 15 COMMISSIONER BOISSIERE: Yes. 16 MR. FREY: Commissioner Campbell? 17 COMMISSIONER CAMPBELL: Yes. 18 MR. FREY: Commissioner Francis? 19 COMMISSIONER FRANCIS: Yes. 20 MR. FREY: Commissioner Greene? 21 COMMISSIONER GREENE: Yes. 22 MR. FREY: And Chairman Skrmetta? LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 15 1 CHAIRMAN SKRMETTA: No. For reasons that I would like to state now 2 which is my concerns that there has not been a merger of these small companies 3 which would in fact result in a lower rate than are currently being sought, and my 4 concerns are that it’s been over three years for this merger to take place. And 5 we’ll address the issue as we move through the process, but the Rule 57 is 6 approved. Next, and please read the in re. 7 MR. FREY: 8 pending before the Commission, Docket U-34206 and U-34287. In August of 9 2016, CULI filed a request for rate increase for its Density assets requesting a 10 10.95 ROE and a capital structure of 65 percent equity and 35 percent debt which 11 would result in an overall rate for wastewater service of 98.15. 12 recommended in that docket a rate for wastewater service of 97.40. 13 November 1, 2016, CULI filed a request for rate increase for its WTSO assets, 14 requesting a 10.95 ROE and a capital structure of 65 percent equity and 35 15 percent debt which resulted in a overall rate for water service of 75.85 and a 16 overall rate of wastewater services of 70.65. The recommended rate by Staff in 17 that docket was 72.65 for water and 70.50 for wastewater. In an effort to resolve 18 all outstanding issues between Commission Staff and CULI, the parties have 19 entered into a global settlement agreement filed into the record of both dockets on 20 November 16, 2017. The global settlement agreement provides that CULI will 21 immediately consolidate its assets for Density and WTSO and begin charging a 22 uniform interim rate. The interim rate would be 57.68 for wastewater and 45 for 23 water. Prior to implementing these rates, CULI will post a protective bond of Okay. This global settlement resolves two contested dockets Staff had On LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 16 1 security and provide proof of such bond to the Commission. CULI Utilities, Inc. 2 will file a statewide consolidation no later than January 31, 2018 in order to 3 achieve economies of scale for the companies and its customers seeking the 4 implementation of a formula rate plan to establish consolidated rates. CULI will 5 provide notice to its customer prior to implementation of rates established in the 6 statewide consolidated filing by virtue of bill inserts and town hall meetings 7 where necessary. And within 18 months of a Commission order being issued in 8 the statewide consolidated filing, all water customers of UIL must be metered. 9 Staff and CULI and UIL both agree this settlement is in the best interest for all 10 parties given that statewide consolidation will occur immediately versus at an 11 unknown point in the future. Furthermore, once in place, implementation of a 12 formula rate plan will provide stability and predictability for both the company 13 and its ratepayers. Not moving forward with the settlement will allow CULI and 14 UIL to continue to operate as two separate companies with different rates and rate 15 structures for the various systems. The recommendation, Staff recommends the 16 Commission exercise its original and primary jurisdiction under Rule 57 and 17 further recommends the Commission vote to approve the global settlement 18 entered into by Commission Staff and CULI and Utilities Inc. on October 30, 19 2017 and filed into the record of both dockets on November 16, 2017 requiring an 20 immediate consolidation of CULI’s systems with a subsequent statewide 21 consolidation of CULI and Utility Inc. systems to be filed no later than January 22 31, 2018. As part of Staff’s recommendation to approve the global settlement, 23 Staff recommends the Commission also authorize CULI to begin charging the LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 17 1 following interim rates subject to refund and applicable bonding requirements 2 until a final order is issued in a statewide consolidated docket of the CULI and 3 Utilities, Inc. systems. For residential water customers, an interim rate of 45, for 4 residential wastewater customers an interim rate of 57.68, for residential 5 apartment wastewater customers, an interim rate of $1,411.34 and for commercial 6 wastewater customers, an interim rate range of 57.68 to 749.79. 7 concludes the recommendation. 8 CHAIRMAN SKRMETTA: There’s a motion from Commissioner Francis. 9 COMMISSIONER FRANCIS: I move to approve the global settlement which 10 resolves both dockets and allows CULI to begin charging an interim rate subject 11 to refund and applicable bonding requirements until a final order is issued in the 12 statewide consolidation docket of CULI and UIL. And, of course, Mr. Brandon 13 has already given us these numbers, but I will repeat. For residential water 14 customers, an interim rate of $45. For residential wastewater customers, an 15 interim rate of 57.68. For residential apartment wastewater customers, an interim 16 rate of 1,411.34. For commercial wastewater customers, an interim rate range of 17 57.68 to 749.79. And further, I move that CULI be allowed to charge these 18 interim rates subject to the conditions below: CULI be required to file proof of 19 the application bond requirements with the cust--with the Commission. CULI is 20 required to file an update tariff indicating the interim rate and its terms with the 21 utilities division within 30 days of the order approving such and CULI cannot 22 begin charging the interim rate until one and two are completely and approved-- 23 completed and approved by the Staff. And that LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 18 1 CHAIRMAN SKRMETTA: Thank you. Any seconds? 2 COMMISSIONER CAMPBELL: I’ll second. 3 CHAIRMAN SKRMETTA: Seconded by Commissioner Campbell. There is 4 opposition on this, and we have our yellow card for Mr. Don Suddith and I guess, 5 Ms. Kantrow, you’re going to be coming up, too? Okay. 6 MR. FREY: And we also have representatives of DEQ. I think it’s necessary on 7 this one. 8 CHAIRMAN SKRMETTA: Sure. They can come up as well. That’s why we 9 moved it up. Thank you very much. Y’all pull up a seat. Actually, I got a couple 10 of quick questions if you don’t mind. 11 MS. KARA KANTROW: Sure. 12 CHAIRMAN SKRMETTA: 13 wastewater of $1,411.43, is that for a single master meter regardless of the size of 14 the--of the facility? 15 MR. DON SUDDITH: There’s just one--that’s an apartment, the residential 16 apartment. There’s just one apartment customer, and it’s one--it’s for all the units 17 in that apartment complex. 18 CHAIRMAN SKRMETTA: So what if there’s another apartment building gets 19 built? 20 MR. SUDDITH: If another apartment--first of all, they’d have to come to us to 21 connect to the system, and then we would come to the Commission and--and ask 22 for an applicable tariff for that because it may not be the same. In other words-- Could you explain to me on the residential LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 19 1 CHAIRMAN SKRMETTA: There’s no doubt it won’t be the same. That’s why 2 I’m wondering-- 3 MR. SUDDITH: Right. Unless it was exactly the same number of customers 4 and the exactly the same amount of flow, so we only have one customer for that. 5 That’s why we included it in the tariff. 6 CHAIRMAN SKRMETTA: And there’s no--this is--is this the last apartment 7 structure that has a master meter agreement? 8 MR. SUDDITH: Yeah, I think so. Yeah. 9 CHAIRMAN SKRMETTA: Okay. Is the movement to go away from master 10 meters? Go ahead, Commissioner. 11 COMMISSIONER CAMPBELL: How many people in this apartment? 12 MR. SUDDITH: I don't know off the top of my head. Do you? It’s maybe--I 13 don’t remember. 14 CHAIRMAN SKRMETTA: Does anybody know? 15 COMMISSIONER CAMPBELL: I mean is it ten? 16 CHAIRMAN SKRMETTA: Is it five people? 17 MR. SUDDITH: No, it’s--I think it’s somewhere between 40 and 50. 18 COMMISSIONER CAMPBELL: Fifteen people? 19 MR. SUDDITH: Fifty, 40 to 50. 20 CHAIRMAN SKRMETTA: Five zero? 21 MR. SUDDITH: Yeah, five zero. 22 COMMISSIONER CAMPBELL: Fifty people in this apartment, $1,400. 23 MR. SUDDITH: Right. LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 20 1 COMMISSIONER CAMPBELL: You need to say that. That helps a little bit. 2 CHAIRMAN SKRMETTA: Yeah, it makes a--makes a slight difference. 3 MR. SUDDITH: Okay. I’d love to have the exact number. I don’t have it in 4 front of me. 5 COMMISSIONER CAMPBELL: I understand. That settles my question. 6 CHAIRMAN SKRMETTA: Yeah. Okay. Thank you. Yeah, my concerns are 7 it’s a little bit broad and undetermined on that particular issue. And that--let the 8 record reflect that this apartment complex--and who’s handling from Staff on 9 this? Kathryn? 10 MS. KATHRYN BOWMAN: Kathryn Bowman, yes. 11 CHAIRMAN SKRMETTA: Kathryn, I need you to follow-up with this within 12 30 days to determine the exact number of folks that are in this apartment 13 structure. And I want a equative value per unit on what each one of those ones 14 will be paying and that it will be subject to review if it’s anything less than 50 15 units. Okay? That also creates--if it’s at 50, it’s $28 a unit which is half the price 16 of what the regular residential wastewater folks are doing, so you’re creating a 17 different class on this. So I’m sort of inherently opposed that kind of thing. The 18 other question I have for you is, you know, when you first came to Louisiana, you 19 said that you were going to take all these underperforming groups and you’ve 20 done that. But you said you were going to merge these companies together to 21 [INAUDIBLE] before the most, you know, economies of scale, the lowest 22 potential price and my initial inquiry with Staff over the last few weeks has 23 determined that if you were to do a merger, the rates requested would be lower LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 21 1 than what you’re requesting now. And that you’ve done this subject to credit 2 back to the ratepayers, correct? 3 consolidation structure, are you anticipating that your rates will go down? 4 MR. SUDDITH: It’s possible the rates could go down. We, I mean, it--it would 5 require looking at the financials for utili--I’m sorry. Don Suddith, Community 6 Utilities of Louisiana. 7 CHAIRMAN SKRMETTA: I got your card. 8 MR. SUDDITH: 9 financials. I mean, there’s a net book value, there’s a rate base for--for UIL and 10 there’s a rate base for Community Utilities of Louisiana. You put those together-- 11 CHAIRMAN SKRMETTA: Would you be surprised if your--I told you your 12 attorney told me that they anticipated rate structure would go down? 13 MR. SUDDITH: No, I wouldn’t be surprised. 14 CHAIRMAN SKRMETTA: 15 individually stated that if there was a merger that had taken place, these rates 16 would have gone down or rates will go down? 17 MR. SUDDITH: No, I wouldn’t be surprised at that. It’s very, very possible 18 because we feed the attorney. 19 CHAIRMAN SKRMETTA: My question is, so how long you’ve been here 20 now, three years, four years? 21 MR. SUDDITH: We’ve been here over 30 years. 22 CHAIRMAN SKRMETTA: No, but I mean in the--in the--under the was it-- 23 MR. SUDDITH: Community Utilities? Okay. If you get a lower rate after you do your It would--it would--it’s going to depend on the If I told you that our Staff attorneys had LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 22 1 CHAIRMAN SKRMETTA: Yeah, Community Utilities. 2 MR. SUDDITH: We acquired Density Utilities out of bankruptcy January of 3 2015. 4 CHAIRMAN SKRMETTA: Okay. 5 MR. SUDDITH: And we acquired WTSO out of--not out of bankruptcy, just 6 before the Commission in August of ’15. 7 CHAIRMAN SKRMETTA: Okay. So basically two years. 8 MR. SUDDITH: So two years [INAUDIBLE], yeah. 9 CHAIRMAN SKRMETTA: So my problem is is for two years you’ve had a 10 mechanism in which you could have reduced rates and you didn’t do it by not 11 merging the companies. And so I’m going to offer a substitute motion. 12 MR. SUDDITH: May I--may I just interject? 13 CHAIRMAN SKRMETTA: No. I’m in the middle of something. I’m going to 14 offer a substitute motion that I’m willing to agree with, which is every statement 15 that Mr. Frey has made and Commissioner Francis has made subject to the 16 requirement that if the Staff determines that the rate structure will go down by a 17 merger of these units, that you will complete a merger of all assets and companies 18 within 12 months of this date. Okay. And so that’s my substitute motion. And 19 would anybody consider seconding it? 20 COMMISSIONER BOISSIERE: I have one or two questions. 21 CHAIRMAN SKRMETTA: Go ahead--go ahead, Commissioner. LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 23 1 COMMISSIONER BOISSIERE: To--to basically understand what’s happening 2 in your discussion just now is to say that if these companies were merged, that the 3 ratepayers would get a lower price. 4 CHAIRMAN SKRMETTA: Correct. 5 COMMISSIONER BOISSIERE: Has that been determined? 6 CHAIRMAN SKRMETTA: 7 attorney I’ve come into contact with on this whether they’re state attorneys or 8 private counsel. 9 COMMISSIONER BOISSIERE: And I ask the company, what--what is your-- That has been told to me by virtually every 10 MS. KANTROW: I guess I’m, I mean-- 11 MR. SUDDITH: I got to say at least one thing. With respect to being able to 12 file, we were--the orders for Density Utilities did not allow us to file for two 13 years--at least two years. So we could not do anything with rates for two years. 14 So we invested capital for that two years. 15 CHAIRMAN SKRMETTA: Commission orders or-- 16 MR. SUDDITH: I’m sorry? 17 CHAIRMAN SKRMETTA: --or Federal Bankruptcy Court orders? 18 MR. SUDDITH: Commission orders. 19 MS. KANTROW: Commission orders. 20 MR. SUDDITH: Commission order. We agreed to that actually as part of that. 21 We would not-- 22 CHAIRMAN SKRMETTA: Not to seek an increase. LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 24 1 MR. SUDDITH: We would not try to raise rates. We would actually make 2 improvements-- 3 CHAIRMAN SKRMETTA: But if your rates would have gone down, you 4 could have filed. 5 MR. SUDDITH: Well, they wouldn’t have gone down. They would always 6 have went up because we were investing capital. So in other words the rates that 7 were in place when we acquired would have always went up from-- 8 CHAIRMAN SKRMETTA: But if you merged, the rates would have gone 9 down, right? 10 MS. KANTROW: No. Part of the agreement when they bought the system, the 11 systems were in disrepair, complete disrepair. 12 SECRETARY GONZALEZ: Kara, identify yourself, please. 13 MS. KANTROW: Kara Kantrow--Kara Kantrow on behalf of the company. 14 The systems when they were purchased were completely deplorable. You had 15 raw sewage coming up in people’s houses. 16 CHAIRMAN SKRMETTA: Completely understanding of that. 17 MS. KANTROW: Exactly. So any type of-- 18 CHAIRMAN SKRMETTA: We’re talking about finance. 19 MS. KANTROW: I know. 20 CHAIRMAN SKRMETTA: And financial-- 21 MS. KANTROW: Any type of filing that would have been done on behalf of the 22 company would have increased rates because the systems needed an improvement 23 to infrastructure. The company has poured in, between the two systems, roughly LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 25 1 $8 million, so any type of filing done by the company would have resulted in an 2 increase. As per the agreements that the company made with the Staff when they 3 acquired the systems, both Density and WTSO, was that the company would not 4 raise rates and would not do any filing with the Public Service Commission until 5 the proper infrastructure was made to the systems. So nothing--any filing that 6 would have been done with the Commission would have resulted in an increase. 7 It would have been impossible to file anything with the Commission regarding 8 rates without resulting in an increase because the company has been pouring 9 money into the systems. Anything they would have said would have resulted in 10 an increase. The company on the Density assets is making--or not making at a 11 negative 10.3 ROE. 12 CHAIRMAN SKRMETTA: Commissioner Campbell has a question for you. 13 COMMISSIONER CAMPBELL: 14 bringing it all back. How much have you put in this--these bad systems? 15 MR. SUDDITH: We’ve put--for Density Utilities, the ones out of bankruptcy, 16 we put about $5 million in today, a little less than $5 million. I think it’s 4.9. 17 We’ve got some stuff in progress that’s going to push it up to around 6. And then 18 with WTSO, we’ve put about 2 million in. 19 COMMISSIONER CAMPBELL: I’m not saying thank you, but thank you 20 because we had a terrible system up in Monroe. These people took it over. They 21 spent a hell of a lot of money up there. It’s not involved in this rate increase but 22 when it comes up, I’m going to have ask y’all to help me because that system was 23 in terrible repair, not anybody wanted it. And so I appreciate what you did in I’m sort of familiar with--I’m--you’re LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 26 1 Monroe. I don't know about down here, but in Monroe, you really helped because 2 we had a terrible system. And guy--well it was some--a fellow went to jail and all 3 that stuff. It was terrible. You took it over, and it’s still not the best in the world, 4 but it’s a lot better because of what you’ve done. I don't know about down here. 5 I’m just saying in Monroe, you helped. 6 MS. KANTROW: Thank you. This company prides itself on actually doing the 7 infrastructure and doing the improvements, and that’s what you see in Density 8 and WTSO. 9 eliminating the customer concerns. And as far as consolidation goes, part of the 10 stipulation that the company is willing to enter into with the--with Commission 11 Staff is an immediate consolidation of WTSO and Density so that is checking that 12 box. 13 CHAIRMAN SKRMETTA: What’s immediate? 14 MS. KANTROW: Right now. As far as today. If we--today. 15 CHAIRMAN SKRMETTA: So it’s just a consolidation issue, not a merger? 16 MS. KANTROW: It’s a consolidation of--so you have UIL and you have CULI 17 and if this is successful today, CULI which is--has the WTSO assets as well as the 18 Density assets will be immediately consolidated. So those assets and those rates 19 will be consolidated today if this is--if this global settlement is agreed upon and 20 then also part of the global settlement the company has agreed upon filing by 21 January 31, 2018-- 22 CHAIRMAN SKRMETTA: Right. 23 MS. KANTROW: --a statewide consolidation. They’ve taken deplorable systems and making them work and LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 27 1 CHAIRMAN SKRMETTA: Commissioner Francis has a question for you. 2 COMMISSIONER FRANCIS: Mr. Suddith, go back to the apartments rate a 3 minute. You say it’s about 50 units? 4 MR. SUDDITH: I’m--Don Suddith, Community Utilities. I’m estimating 50. 5 COMMISSIONER FRANCIS: 6 occupancy rate? 7 MR. SUDDITH: It’s pretty high, but we do have some move in, move out. We 8 continuously have to try to figure out from the apartment landlord who’s there. 9 You know, it would be great, I mean, if--I know the question is coming up for a 10 reason. It would be great if we could charge each customer individually there. 11 There’s just no--there’s a master connection, so there’s no way to cut people off if 12 they choose not to pay. So right now, the landlord pays the--the bill and pays it 13 out of the--I’m sure out of the rent that folks get so that’s--that’s the way it was 14 set up. And we just didn’t change it. 15 COMMISSIONER FRANCIS: On full occupancy is like $28 a month, you 16 know. And when you look at these other rates, they’re almost double that. It’s-- 17 one of the things we like--we’re trying to do here is when you get--you get more 18 volume everybody gets a little better price. 19 MR. SUDDITH: Right. 20 COMMISSIONER FRANCIS: 21 apartment, you’re saving more money than a household outside. Is there any way 22 you could equalize that for-- 23 MR. SUDDITH: Equalize it for the apartments? Do you know what the utilization is, the And it looks like if you’re living in an LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 28 1 COMMISSIONER FRANCIS: Well, equalize it for the--the other homeowners 2 that are not apartments. 3 MR. SUDDITH: I mean, the--the $57.68 rate covers our O&M and a negative 2 4 percent return on our investment. So, can we equalize rates? We’re sort of trying 5 to do that. I’d--I’d love to have the actual--if we could get the--if we could text 6 somebody and ask the count, we can probably find out the count of the customers 7 in that complex. I’m not sure it’s 50. It may--I know there’s two different 8 buildings or three different buildings, so I want to make sure we have the count 9 right so we can do the math. 10 CHAIRMAN SKRMETTA: I mean, if you’re asking for the rate, you might 11 want to know the facts, that’s the only thing, you know. 12 MS. KANTROW: And Mr. Suddith raises a good point. The--the rates that 13 we’re requesting today puts the company at a negative 2.2 ROE. The company is 14 not here today asking this Commission for rates for some type of windfall. The 15 company has put in the investment, in the infrastructure, has supplied the 16 customers with high quality of service and is willing to absorb a negative 2.2 17 ROE and to be put on a formula rate plan and a rate stabilization clause. 18 CHAIRMAN SKRMETTA: Well, Commissioner Francis is still not finished. 19 COMMISSIONER FRANCIS: My point is if I’m living in an apartment, my 20 bill is $28. If I've got home out, you know, in town it’s $57. So the company’s 21 just breaking even on 57 or losing a few dollars, well, they’re really getting beat 22 up on this apartment because they're only receiving $28. And why is the rate at LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 29 1 the apartments so cheap compared to the--the other homeowners was my 2 question. 3 MR. SUDDITH: I don't think it is. But we've got to get--I just texted to try to 4 get the actual count because the rates before were higher. I mean, they were, say, 5 37.25 is what the rate was for a residential customer in all of Density, and I 6 believe--I want to say the apartments were closer to 35. And I know they went up 7 with this rate increase. But let’s see here. 8 MR. AARON ACCARDO: This is Aaron Accardo, vice president of operations. 9 The other thing I would add to this is that this particular master meter account and 10 that financial arrangement, it’s carryover from the previous Density tariff. I think 11 we’re all interested in going one way or the other, meaning, creating--creating 12 these master meter accounts or not. There's pros and cons to doing it both ways. 13 We've got another, Oak Lane apartments, I think was one of the apartment 14 complexes that was having a lot of issues. 15 CHAIRMAN SKRMETTA: One second. 16 MR. ACCARDO: Yes, sir. 17 CHAIRMAN SKRMETTA: Eve, are master meter account holders prohibited 18 from doing anything other than a strict division for application of the--of the 19 costs? They can't resell this service at any increase, correct? 20 MR. FREY: Correct. It would be--it would be the prohibited ratio billing or 21 submetering that would [INAUDIBLE] rules. LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 30 1 CHAIRMAN SKRMETTA: So what I’d like Staff to do is work with this 2 landlord to make the determination that they’re not charging anything more for 3 these services than the meter will allow for. 4 MR. SUDDITH: The feedback that we just received is 96 units, don’t know 5 about occupancy rate. 6 CHAIRMAN SKRMETTA: Ninety-six units, so now it’s--now it’s $14. 7 COMMISSIONER FRANCIS: See that’s-- 8 CHAIRMAN SKRMETTA: That’s interesting. 9 COMMISSIONER FRANCIS: That’s not a way to run a business. 10 CHAIRMAN SKRMETTA: Yeah. 11 COMMISSIONER FRANCIS: 12 apartments, and you’re--you’re really beating up the folks that are not in the 13 apartment if you look at the rates. We want you to be a profitable business. 14 You’re losing money on the apartments. 15 MR. ACCARDO: Absolutely. And we would--there’s a lot of advantages on 16 our end to actually doing away with the master meter agreement so. I just wanted 17 to point out that it was carryover. 18 CHAIRMAN SKRMETTA: You can’t--you can’t do away with it if it’s been 19 there before. Commissioner Greene? 20 COMMISSIONER GREENE: 21 economies of scale would look like after the consolidation? 22 MS. BOWMAN: Kathryn Bowman on behalf of Staff. We have not run what 23 you would consider a true model on what these numbers would be. The--the You’re giving away your service at the Are there any models to show what the LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 31 1 problem that auditing Staff is having, and I’ll let them speak if I’m misstating 2 anything, we have three sets of financials for three separate companies at this 3 time. Some of those are metered, some of those are unmetered. It’s difficult to 4 take all three sets of those finances and those number of customers and the usage 5 of all three of those and put them together as one to populate one uniform rate 6 across. That’s--that would take some time and that’s what part of this global 7 settlement would do is we--the companies have agreed by January 31st of next 8 year, they will file for a merger of both the CULI company and the UIL company. 9 At that time, we will have up to date current financials of all three of those 10 companies, for all of their assets and auditing Staff would put that together and 11 we would create a formula rate plan across the board. And--and that’s where 12 we’re trying to get to. We’ve agreed to also have that done by October of 2018 13 so, Chairman Skrmetta, I believe that that answers your concern with your 14 substitute motion. 15 CHAIRMAN SKRMETTA: Is it--is it embedded in the--the document that it’ll 16 be done by October? 17 MS. BOWMAN: Yeah. 18 CHAIRMAN SKRMETTA: Ready for a vote by October? 19 MS. BOWMAN: Yes. 20 CHAIRMAN SKRMETTA: Okay. 21 MS. BOWMAN: You mean the consolidation, the merger of all three? Yes. 22 CHAIRMAN SKRMETTA: Consolidation and merger? 23 MS. BOWMAN: Yes. LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 32 1 CHAIRMAN SKRMETTA: There’s a difference. I mean, the general public 2 might not understand the difference, but the merger is the thing that I’m interested 3 in. And I’m also interested in an advanced element of whether or not it really is 4 going to provide for a lower rate. Because to be honest, I’ve been getting a little 5 bit of song and a lot of dance on what it’s going to be, but I’m very concerned 6 about the veracity of those statements. So my concerns are that as long as the--if 7 you’re saying that the--that this Staff investigation of the necessity for the merger 8 will be complete and ready for a vote by October, correct? 9 MS. BOWMAN: Yes. Correct. 10 CHAIRMAN SKRMETTA: Okay. Which means you should have it for review 11 by the Commissioners by the end of July, early--like mid August or something for 12 just in-office, in camera review. 13 MS. BOWMAN: Absolutely. 14 CHAIRMAN SKRMETTA: Okay. All right. Well I’ll withdraw my motion. 15 And any other comments from any other Commissioners? 16 Boissiere? Anything else from you, Craig? 17 COMMISSIONER BOISSIERE: 18 necessary and--and I thank Commissioner Skrmetta for raising the issue to begin 19 with to get clarity on the process going forward, but my question is still the same 20 about consolidation or merger as the company may move forward. I want to 21 thank Staff for chiming in to bring some clarity to the agreement that we may 22 have potentially missed in that. But at any rate, when you--once this has been 23 put--when all the companies are settled and brought back together, we will Commissioner First of all, this discussion has been LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 33 1 reexamine an audit for a new rate; is that correct? And of course we would--of 2 course as we always do look for the lowest rate possible. 3 SECRETARY GONZALEZ: 4 they’re-- 5 MS. KANTROW: 6 stipulation is that the company has agreed to be put on a formula rate plan. So 7 part of what Kathryn mentioned is come October, you guys will be voting on a 8 statewide consolidation. The rates that we’re voting on--that you guys are voting 9 on today are interim. Yes. Don’t--don’t nod, say yes. No, I mean, if So the--the point of the, you know, part of the 10 CHAIRMAN SKRMETTA: Is it a merger or is it a consolidation? 11 MS. BOWMAN: At the end, when this comes back up to vote in front of you 12 guys-- 13 CHAIRMAN SKRMETTA: Right, in October. 14 MS. BOWMAN: --it will be one company with all of the assets that are currently 15 owned by UIL and currently owned by CULI under one entity. 16 CHAIRMAN SKRMETTA: Now, is this rate--interim rate, is it subject to 17 credit? 18 MS. BOWMAN: Yes, sir. 19 CHAIRMAN SKRMETTA: Okay. All right. 20 COMMISSIONER BOISSIERE: And let me let you finish. Go ahead. 21 MS. KANTROW: No, no. And just to follow that up. So the interim rates, the 22 company is responsible for putting up a protective bond with the Commission so 23 that if anything lower is subject to a refund and when we come back before you in LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 34 1 October, it will be one entity. All the assets will be under that entity and we’ll be 2 voting on a rate--a formula rate plan. And so then every year the company will be 3 before the Commission for their formula rate plan annual filing to provide for 4 stability, for suitability, and Commission oversight. 5 COMMISSIONER BOISSIERE: Well, that’s--that’s good because this is an 6 issue, and these are some companies that have been problematic for years because 7 of the amount of investment they needed to bring them up to speed and for the 8 difficulty it takes to get investment in and at a reasonable rate. So I want to say I 9 appreciate the work being done because many people have come before you and 10 tried to do this, and they’re not--the reason you’re here is because they’re no 11 longer here. And this is a very daunting task. I’m glad to hear that not only the 12 Commissioners are paying attention to this case as I’m--I know they would, but 13 Staff seems to be working very closely with the company to make sure the 14 ratepayers are going to be protected as much as possible under our regulatory 15 authority. And if you don’t mind, I do want to back track just a little bit. The 16 discussion of master meter came up. I’m going to say right now, we had a few of 17 those in Orleans and in my district in different places and those are always 18 problematic. 19 complexes, but once development is in, it’s also nearly impossible--very difficult 20 to change. I did hear some discussion of differences in prices between maybe 21 private homes verse--private customers versus--I mean, individual private 22 customers versus apartment, but that’s always going to be the case on an economy 23 of scale type basis. My question would not be to say every ratepayer should They’re very difficult especially when you have apartment LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 35 1 necessarily have the same price, but I would like to see the best practices for 2 master meters or apartment buildings and compare where you are versus where all 3 other apartments are in relation--in the same type of relationship. Let’s do apples 4 to apples comparison. And I’m almost certain you would see that when apartment 5 buildings do consolidate or do a master meter, it may be if you divide it among 6 apartment dwellers, it’s probably a little bit cheaper than a homeowner but that’s 7 neither right or wrong or fair or unfair either. And I want to--before we start 8 dividing--the discussion is of classes, and we need to look at that. I don't know 9 that it’s creating a new class. These are difficult. That’s why no one does them 10 anymore. But we have to continue to live with what we have and do the best we 11 can. So I’ll work with you. I’ll work with Staff to make sure the master meter 12 system is right, and I’m sure our Commissioners will be very involved to see 13 where that goes. At the same time, we want to stay in a fair zone, meaning what’s 14 happening in the industry, what do we do in this state, what’s--how do we treat 15 our master meters, and make sure you’re in the right zone. And it matters because 16 all of them are ratepayers, all of them are Louisiana citizens. And all of these 17 apartment buildings are sometimes trying to build so housing cost are cheaper for 18 people to live, too. It’s just another way of doing business. And it’s true that 19 when there’s someone comes in a new development, you would have to 20 reexamine your process here, but until that day comes. So I just want to say that 21 not only for you guys to hear it--the company, but for my fellow Commissioners 22 to know that these are always problematic and difficult. As long as we’re LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 36 1 working to resolve in the most fair way possible, I’m with you. And that’s it. 2 End of my comments. 3 CHAIRMAN SKRMETTA: Thank you, Commissioner. 4 MS. KANTROW: Thank you. 5 CHAIRMAN SKRMETTA: I’d just like to add one thing before we move--I 6 guess we’ll be moving to a vote is my concerns are pretty straightforward. Is that 7 I am of a recollection of promises being made from the beginning and to me it’s 8 taking too long to get to this point which means that it’s possibly been 9 overearning. I understand they’ve put a lot of money in. I understand that. I 10 thank them for doing it. In fact, I know they’re sitting on a $90 million fund 11 through their investment portfolio out of Canada. I know they’ve got plenty of 12 money. This is not someone who’s like on the gap, but I understand that their 13 pension fund owners got to make money. Everybody’s got to make money in this 14 line, and I get that. My concerns were it is difficult for me as a Commissioner to 15 receive promises and overtures from companies that take so long to meet. And a 16 lot of times, that ends up being bad for ratepayers. And so my concerns of which 17 you would even admit, Ms. Kantrow, my concerns with this have not changed an 18 iota since the beginning of our conversations on this. 19 everybody’s had--say what they need to say and, Brandon, I’d ask for an 20 opposition roll call vote. 21 MR. FREY: 22 seconded by Commissioner Campbell. We’ll start on the other end this time. All right. Okay. So I think So this is on Commissioner Francis’ motion and LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 37 1 Commissioner Greene? This is on--a yes vote is in support of Commissioner 2 Francis’ motion. 3 COMMISSIONER GREENE: Yes. 4 MR. FREY: Commissioner Francis? 5 COMMISSIONER FRANCIS: Yes. 6 MR. FREY: Commissioner Campbell? 7 CHAIRMAN SKRMETTA: Vote yes or no to support the motion. 8 COMMISSIONER CAMPBELL: [No audible response] 9 MR. FREY: Yes. And Commissioner Boissiere? 10 COMMISSIONER BOISSIERE: And this is yes for the original motion? 11 SECRETARY GONZALEZ: Correct. 12 MR. FREY: Yes, yes. 13 CHAIRMAN SKRMETTA: I withdrew the other. 14 MR. FREY: Yes. 15 COMMISSIONER BOISSIERE: Yes, then. 16 MR. FREY: And Chairman Skrmetta? 17 CHAIRMAN SKRMETTA: No. 18 MR. FREY: It passes four to one. 19 CHAIRMAN SKRMETTA: Okay. Next item, please. Thank you, Kara. 20 MS. KANTROW: Thank you. 21 MR. FREY: We’ll go back to Exhibit 3 now. 22 CHAIRMAN SKRMETTA: By the way, is there--was there a specific reason 23 why we passed 9 and the other on these letters of non-opp? Is there any-- LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 38 1 MR. FREY: So it was 8 and 9. 2 CHAIRMAN SKRMETTA: Was there any particular issue? 3 MR. FREY: I think Commissioner Francis had asked we had passed those. 4 CHAIRMAN SKRMETTA: Okay. 5 MR. FREY: Eight, 9. 6 CHAIRMAN SKRMETTA: Is it unnecessary? 7 MR. FREY: Yeah. 8 MS. KANTROW: Till December-- 9 CHAIRMAN SKRMETTA: Okay. All right. Thank you very much. 10 MR. FREY: Okay. Exhibit 3 is undocketed. Discussion and possible vote to 11 approve site-specific contract between Cleco Power, LLC and Plastipak 12 Packaging and Tabb Realty, LLC. Cleco filed with the Commission a request for 13 approval of an amended and reinstated site-specific sales agreement between 14 Cleco and Plastipak Packaging and Tabb Realty. In recent years, Cleco has 15 entered into and the Commission has approved site-specific contracts containing 16 discounted rates for some of Cleco’s larger industrial customers. The discounts 17 have been provided to those customers in an attempt to bring new load and 18 employment to Cleco’s service territory, maintain existing industrial load and 19 employment at those facilities undergoing economic distress, retain tax revenues 20 and maintain load at those locations with competitive alternatives. 21 Commission has provided a mechanism to ensure adequate base revenue 22 contributions from all of Cleco’s site-specific customers, including Plastipak. 23 Order Number U-32779 provides that customers receiving discounts on base rates The LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 39 1 shall not share in refunds resulting from overearnings, pursuant to Section 2.4 of 2 the amended and restated formula rate plan. Cleco negotiated an amended and 3 restated site-specific contract--agreement of its electric service with Plastipak, 4 based on Plastipak’s plans to expand its operations. Before negotiating the new 5 rate, Plastipak had initially intended to locate the new manufacturing operation at 6 its Jackson Center, Ohio plant. 7 Plastipak and the amended site-specific contract will continue to generate a retail 8 benefit to Cleco customers. This is determined by conducting a ratepayer impact 9 measurement analysis. Staff reviewed the RIM calculations, which demonstrated 10 a retail benefit with the Plastipak contract as compared to without the contract. 11 The recommendation, therefore, Staff recommends approval of the amended and 12 restated site-specific contract between Cleco and Plastipak because the terms and 13 rates offered will facilitate continued operation for the foreseeable future, thereby 14 retaining the associated employment benefits. A ratepayer impact measurement, 15 or RIM analysis, showed a benefit to Cleco and other--to Cleco’s other ratepayers. 16 The base revenue contributions from Plastipak serve to mitigate the base rate 17 increases to other retail customers. Staff also recommends the following: Cleco 18 shall track on an annual basis revenues and electric consumption and make said 19 information available to the Staff, and 2) The Commission reserves the rights to 20 review any impact the site-specific contracts have on Cleco and Cleco’s 21 ratepayers. 22 CHAIRMAN SKRMETTA: 23 recommendation. Any seconds? The site-specific rate provides savings to Okay. Chair moves to accept Staff LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 40 1 COMMISSIONER FRANCIS: Second. 2 CHAIRMAN SKRMETTA: 3 opposition? [NONE HEARD] Hearing none, the matter is approved. Next item, 4 please. 5 MR. FREY: Okay. We said we’re--4 is moved to the back. So we’ll move to 6 Exhibit 5. 7 CHAIRMAN SKRMETTA: Okay. 8 MR. FREY: 9 Telecommunications, LLC formerly known as BellSouth Telecommunications 10 also known as AT&T Louisiana. Petition for arbitration pursuant to Section 252 11 of the Telecom Act of 1996. 12 recommendation. In 2006, the LPSC approved an interconnection agreement 13 between AccessCom and BellSouth, pursuant to which AccessCom leases 14 elements of AT&T’s telecom network. In recent years, AccessCom and AT&T 15 have engaged in the negotiation of a new interconnection agreement to replace the 16 2006 ICA. The parties have largely been successful with their negotiations of the 17 new agreement, but have reached an impasse regarding some of the terms. In this 18 proceeding, AccessCom seeks the Commission’s resolution of the terms and 19 conditions still in dispute. The ALJ issued a proposed recommendation on July 20 21, 2017. As no party filed an exception to the proposed recommendation, the 21 analysis and conclusions presented in the proposed recommendation were re- 22 formatted as a final recommendation issued by the ALJ on August 14, 2017. The 23 recommendation is follows: The joint disputed issues list filed by AccessCom Second by Commissioner Francis. Any Docket U-32159 - AccessCom, Inc. versus BellSouth Discussion and possible vote on the ALJ’s LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 41 1 and AT&T presented 21 issues for resolution by the Commission. In addition, 2 AccessCom requested the Commission correct errors or omissions in the FCC’s 3 regulations. The ALJ recommends the following conclusions: For preliminary 4 issue of does the PSC have authority in resolving disputed issues in this 5 proceeding to modify FCC regulations to correct perceived clerical or transcript 6 errors or omissions? The ALJ agreed with AT&T and Commission Staff that the 7 Commission does not have the authority to modify FCC regulations to correct 8 perceived clerical or transcript errors or omissions. Issue 1(a), what is the proper 9 definition of a UNE loop? The ALJ concluded the AT--AT&T’s proposed 10 language comports with the FCC regulations. Issues 2(a) and 2(b), which are the 11 proper definition of cross-connect and is AT&T required to provide cross- 12 connects beyond the scope of Section 251(c) of the Act? The ALJ found AT&T’s 13 definition of cross-connect tracks the FCC’s definition almost exactly and further 14 concluded a cross-connect is not properly characterized as an unbundled network 15 element or UNE. 16 agreement language include process details or point to online user guides that may 17 be updated to reflect current practices? The ALJ concluded from the arguments 18 presented that publication of conversion procedures in AT&T’s online ordering 19 guides as compared to the inclusion of the procedures in the ICA is the more 20 efficient method of organizing, maintaining, and publishing the up-to-date 21 information. Issue 2(e), can a cross-connect be the higher bandwidth circuit in a 22 commingled circuit? The ALJ previous determined under Issue 2(a) that AT&T’s 23 definition of cross-connect was accurate and further agreed with AT&T that a Issue 2(d), for conversions, should the interconnection LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 42 1 cross-connect is merely a simple connection scheme using patch cords or jumpers. 2 It’s not a circuit and cannot be considered the higher bandwidth facility. Issue 3 3(b), is AT&T obligated to provide DS0 as unbundled dedicated transport? The 4 ALJ concluded AT&T is not obligated to provide it. Issue 4(a), do the FCC’s 5 rules require AT&T to provide multiplexing or channelization as UNEs? The 6 ALJ concluded that AT&T is not required to provide multiplexing/channelization 7 as an unbundled network element. 8 multiplexing/channelization under the interconnection agreement with unbundled 9 dedicated transport, is AT&T allowed to decide which equipment to use? Also, 10 what rate element should apply? The ALJ concluded AccessCom has provided 11 insufficient support for its contention that multiplexing and channelization, when 12 provided with unbundled dedicated support, should be charged at different rates 13 depending on AT&T’s provision of that facility. Issue 4(c), is AT&T entitled to 14 recover a separate charge for central office channel interfaces regarding the type 15 of equipment--traditional multiplexer or digital cross-connect? 16 concluded that AT&T is entitled to recover a separate charge. AT&T is also 17 entitled to recover a separate charge COCIs regardless of whether traditional 18 multiplexer or digital cross-connect is used. Issue 4(d), is AT&T obligated under 19 federal law to provide AccessCom with access to digital cross-connect system 20 functionality? The ALJ concluded that AT&T is not obligated under federal law 21 to provide. Issue 4(e), 5(a), and 5(b) is AT&T obligated to provide unbundled 22 channelization and multiplexing? 23 respect to the other two, the ALJ concluded that AT&T’s proposed definition Issue 4(b), when AT&T provides The ALJ Issue 4(e) was resolved above. And with LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 43 1 correctly tracks the FCC definition of entrance facilities, that AT&T is not 2 obligated to provide AccessCom with access to entrance facilities as an 3 unbundled network element, and that the definition of entrance facility should be 4 included in the interconnection attachment rather than the UNE attachment. Issue 5 6(a), does the FCC’s unbundling of rules require AT&T to provide tandem 6 switching as a unbundled network element? 7 switching is not properly characterized as an unbundled network element. Issue 8 6(b), should the interconnection agreement include AccessCom’s proposed 9 sections 11.5.3 through 11.5.9 regarding tandem switching? The ALJ concluded 10 that the proposed language should be rejected. Issue 8(a), what is the proper 11 definition of unbundled network element dedicated transport dark fiber/dark fiber 12 transport? The ALJ concluded AT&T’s proposed definition is consistent with the 13 rule and that AccessCom’s definition is not. 14 unbundling rules require AT&T to provide dark fiber transport connection to a 15 remote site? The ALJ concluded AT&T is not obligated to provide such facilities. 16 Issue 9(a) and 9(b), do the FCC rules or orders require AT&T to provide high- 17 capacity channels, channelized interfaces, terminations, and the like at an STS- 18 level or OC-n level? And if the answer is yes, how should prices be determined? 19 The ALJ concluded the cross-connects should not be defined broadly to include 20 the newer technology and AT&T is not obligated to provide them. Finally, in 21 light of the conclusions, the issue of pricing is moot. Issue 11, is AT&T required 22 to engage in new construction for the provision of UNEs? The ALJ concluded 23 AT&T is not obligated to engage in new construction of unbundled network The ALJ concluded tandem Issue 8(b), does the FCC’s LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 44 1 elements at the request of AccessCom. And finally, Issue 12, should the 2 interconnection agreement include references to products or services that have no 3 associated terms or conditions? The ALJ concluded the proposed interconnection 4 agreement should not include pricing information for products and services that 5 have no associated terms or conditions in the agreement. 6 CHAIRMAN SKRMETTA: Okay. Mr. Giles and Mr. Hastings, we’re going to 7 put a motion on the floor, and then we’ll begin discussion. Any motions in this 8 matter? No motions to approve? 9 COMMISSIONER CAMPBELL: What do you say? 10 CHAIRMAN SKRMETTA: There’s a motion--is there any motion on this 11 particular agenda item? The motion to accept or a motion to-- 12 COMMISSIONER CAMPBELL: I want to hear these gentlemen speak. 13 CHAIRMAN SKRMETTA: Okay. We normally--we get a--we get a motion 14 on the floor and then discuss it, but that’s what you want to do, we’ll do it that 15 way. Mr. Giles, Mr. Hastings, just introduce yourself. I actually have your 16 yellow cards up here and the Staff will pick them up later. 17 MR. JEFF GILES: Jeff Giles, president of AccessCom and the--the founder. 18 MR. STEPHEN HASTINGS: Stephen Hastings, chief engineer, AccessCom, 19 based out of Houma, Louisiana. 20 CHAIRMAN SKRMETTA: On Staff, who handled the Staff’s position at the 21 hearing? 22 MS. TEMENTO: Lauren Temento on behalf of Staff. 23 CHAIRMAN SKRMETTA: Lauren, you handled this? LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 45 1 MS. TEMENTO: Yes, sir. 2 CHAIRMAN SKRMETTA: Okay. Please, the floor’s yours. 3 MR. GILES: This has been a long arduous journey. We’ve been before the 4 Public Service Commission in one shape or form on these issues for 10 years. As 5 have many CLECs across the United States have also made these similar 6 arguments. Your eyes glaze over at just the reading of these results. You can 7 only imagine the testimony. It’s--it’s ultra complex, and it literally will bore the 8 uninitiated to tears and cause you to pass out. So if you need to go to sleep, 9 Craig, this is a great opportunity, you know, you can snooze off with this type of 10 study. Most of you guys, y’all know me or have met me over the years, worked 11 with y’all and I’m not BS’ing. I’m just telling you what the facts are. We came 12 before the Commission with a hearing a few years back, the same issues, many-- 13 many of the same issues, and we presented this information to an ALJ. And the 14 ALJ asked great questions, was very involved in the--the courtroom proceeding. 15 Steve gave testimony. We presented our case, and that ALJ ruled in our favor on 16 the issues and we got a settlement out of AT&T. And we said look, we’re going 17 to revisit this in our interconnection agreement discussions, and we thought that 18 would proceed rather quickly. It didn’t. It drug on for several more years, and in 19 the interim period that we presented these facts and won an ALJ’s attention and-- 20 and concurrence, the Supreme Court of the United States had issued a ruling that 21 we became aware of and it completely exonerates--15 of our points are considered 22 in this Supreme Court ruling. LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 46 1 CHAIRMAN SKRMETTA: Hang on one second. Ms. Temento, are you 2 familiar with the Supreme Court decision he’s talking about? 3 MS. TEMENTO: He said that it was included in their rebuttal testimony so it 4 should be in the record. 5 CHAIRMAN SKRMETTA: Okay. It is in your rebuttal testimony about the 6 Supreme Court decision you’re talking about? 7 MR. GILES: We submitted in rebuttal testimony, yeah. 8 CHAIRMAN SKRMETTA: Okay. All right, thank you. 9 MR. GILES: But it’s not--it’s not talked about in the--in the final result. It’s not 10 even mentioned. There’s no ibid, op. cit., no nothing. 11 CHAIRMAN SKRMETTA: Are you familiar with it, Ms. Temento? 12 MS. TEMENTO: The hearing was a year and a half ago. 13 CHAIRMAN SKRMETTA: I’m sorry. I was just asking. 14 MS. TEMENTO: But I--I received it this morning. 15 CHAIRMAN SKRMETTA: Okay. All right, thank you. 16 MS. TEMENTO: Thank you. 17 MR. GILES: We--we decided that it was prudent to bring it to everyone’s 18 attention. 19 CHAIRMAN SKRMETTA: What did--what did the Supreme Court do? 20 MR. GILES: The Supreme Court ruled that entrance--I think I lost my mic. 21 CHAIRMAN SKRMETTA: Well, I think you’re okay. 22 MR. GILES: The Supreme Court ruled that entrance facilities that had been-- 23 CHAIRMAN SKRMETTA: I don’t have anything to do with it. LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 47 1 MR. GILES: Okay. All right, I’m sorry. 2 CHAIRMAN SKRMETTA: There we go. 3 MR. GILES: I’m sorry. The Supreme Court ruled that entrance facilities that 4 are being used for interconnection between the--the CLEC and the customers of-- 5 of AT&T--‘cause ultimately they’re providing the wire to the customer. 6 CHAIRMAN SKRMETTA: I just want to know what the--the ruling was. 7 MR. GILES: They ruled that those entrance facilities used for interconnection 8 were subject to TELRIC rates, the discount rates, and that’s what our whole 9 argument is. Our whole entire 21 points basically, except for 2 or 3 of them, are 10 all about rate structure that we’re being charged. We’re being charged an 11 excessive rate when in fact 15 of the 21 issues were dealt with by this Supreme 12 Court ruling. And so over the years of doing this, we found an inherent lack of 13 interest on the part of AT&T to resolve these obviously clear distinct problems 14 with the FCC ruling because it’s so complex. But we’ve invested huge amounts 15 of our time, energy and effort into understanding this. And I have to point out to 16 you guys when I started the business, I designed all of my interconnection 17 locations with the rules that were in place at the time. 18 thoughtful and--and practical way to build a business. Guys, this is a very 19 expensive business to be in. Competing against these billion dollar titans is--is 20 quite an undertaking for somebody who has less than $2 million worth of invested 21 capital, okay. But we did that. We were the first network in the country--one of 22 the first to have a MPLS, multi protocol label switch network. We were one of 23 the first companies to do aggregated high availability circuits where we merged And it was a very LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 48 1 T1s together. We were one of the first companies that deployed VoIP transport. 2 Way back, 1996, ’97, we were using it. We were innovators and that’s what the 3 spirit of the act in 1996 was. It was to create innovation which would create 4 comp--you know, competition creates innovation and lowers prices. We lowered 5 prices. We were a very tiny company, but we returned back to our customers $20 6 million of overcharge of what AT&T was charging them in our little region, 7 Houma, Thibodaux, and the bayou region, and little bit in New Orleans. We 8 were--we got our customers back cash that they were able to put into their 9 businesses. I think that is what we call winning. You know, that’s what the act 10 was supposed to do and we were one of those companies that was doing that until 11 AT&T said no, your disputes are not--don’t hold water. This is after the--the--it’s 12 actually concurrent with the Supreme Court ruling which they knew all about, 13 okay. We didn’t know about it because we were underrepresented. We were just 14 business guys trying to make a living, trying to save our customers money and 15 keep their circuits up, keep their businesses going. And then during this period of 16 time that I started this company until now, I had to convince my friends that they 17 needed an email address to the point where they threatened to kill my first born if 18 their email wasn’t up in the next hour, okay. 19 CHAIRMAN SKRMETTA: Perhaps you’re overstating that. 20 MR. GILES: No. I’m--I mean these guys take it seriously. 21 CHAIRMAN SKRMETTA: So there was a death threat? 22 MR. GILES: What’s that? 23 CHAIRMAN SKRMETTA: There was a death threat or you’re overstating-- LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 49 1 MR. GILES: I’m overstating it-- 2 CHAIRMAN SKRMETTA: Okay. 3 MR. GILES: --Commissioner. So--but what I’m saying is the internet changed 4 everything and everybody got to where this thing was the lifeblood of their 5 business. Y’all all know what I’m talking about. Everybody’s aware of what 6 happened, okay. And in that process, we played by the rules. And we saw 7 inadequacies and failures on the part of the regulatory bodies to do this correctly 8 and we pointed that out. At the same time that we did that, other companies did 9 the same thing. This was not--we’re not the champions here. We’re just part of a 10 group of people who brought forward this common sense understanding and some 11 of these people were much better funded than us and they brought this to the 12 district courts. They brought it to their PSC, where they lost there. They brought 13 it to their district courts, where they lost there. They brought it to the appellate 14 courts and ultimately, it wound up in the court of the highest court of the land, the 15 Supreme Court who ruled concurrent--I mean total completely in, what I say, our 16 favor. In other words, acknowledging our--the practicality of our argument that 17 interconnection facilities that--that are sold as no longer unbundled were actually 18 subject to the TELRIC rate. Now they didn’t go in there and change the--the 19 listing. They just said that you have to settle the TELRIC rate. Well, guys. 20 That’s what’s the whole deal is. 21 CHAIRMAN SKRMETTA: Let me--let me-- 22 MR. GILES: The whole deal is--is the rate. LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 50 1 CHAIRMAN SKRMETTA: Let me interrupt you for a minute. Commissioner 2 Campbell has a question. 3 MR. GILES: All right. 4 COMMISSIONER CAMPBELL: Basically are--to get to the bottom of this, 5 I’m--I’m trying to understand it. 6 CHAIRMAN SKRMETTA: You might need to use your microphone. 7 SECRETARY GONZALEZ: Commissioner, can you bring your mic--there. 8 COMMISSIONER CAMPBELL: Thank you. Yep, is it on? 9 SECRETARY GONZALEZ: Yes. 10 COMMISSIONER CAMPBELL: To get to the bottom of this, are you saying 11 that is information that you now have that we didn’t have-- 12 MR. GILES: 13 considered. There’s no record--there’s no reference to it in the--in the ruling and 14 it directly affects the ruling. 15 COMMISSIONER CAMPBELL: 16 through. 17 CHAIRMAN SKRMETTA: Yeah, go ahead. 18 COMMISSIONER CAMPBELL: Are you asking that you want this to be sent 19 back to the ALJ where you can present this evidence? 20 MR. GILES: I think it would be prudent for her to--to answer. 21 COMMISSIONER CAMPBELL: I’m just asking is that what you want? 22 MR. GILES: Yes, that’s what we’d like, yes. Well, no, we had it in our rebuttal testimony, it just wasn’t Well, are you asking--are--let me get LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 51 1 COMMISSIONER CAMPBELL: Okay. Let me ask you something. If you do 2 that and you don’t get what you want, then you’re through? 3 MR. GILES: Well, there’s a procedure where we would follow that all these 4 other people did the same thing. We have to go to district court, present the 5 Supreme Court ruling to them. 6 COMMISSIONER CAMPBELL: No, no. I’m just talk--I’m just saying here-- 7 here’s where you came here today. This has been a long going process, wouldn’t 8 you agree? 9 MR. GILES: Right. Yes, sir. 10 COMMISSIONER CAMPBELL: How many years? 11 MR. GILES: Over ten. 12 COMMISSIONER CAMPBELL: Ten years, okay. That’s a long time. Ten 13 years and you’re saying there’s one particular flaw in our ALJ’s--that you know 14 right off the bat is that you got information she didn’t use or wasn’t privy to or 15 whatever, right? 16 MR. GILES: Well, chose not to even discuss it in her-- 17 COMMISSIONER CAMPBELL: Okay. Well, whatever. Now, if you could 18 send this back to the ALJ with that information, would you feel like you got your 19 day in court? 20 MR. GILES: With you guys today, I would say yes. That’s what I’m asking for. 21 COMMISSIONER CAMPBELL: 22 know, how--I’m trying to find out how reasonable you are-- 23 MR. GILES: All right. Well then--then if--I’m just asking, you LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 52 1 COMMISSIONER CAMPBELL: --in my mind. 2 MR. GILES: Right. 3 COMMISSIONER CAMPBELL: ‘Cause I’m not your judge. If we send it 4 back to the ALJ and you present your case, would then--would you be satisfied if 5 she didn’t like it or-- 6 MR. GILES: I would be shocked and dismayed if she didn’t rule in our favor 7 after that. 8 COMMISSIONER CAMPBELL: Let me ask you this. When you went to the 9 ALJ, were you there to-- 10 MR. GILES: Nope. 11 COMMISSIONER CAMPBELL: Why didn’t you go? 12 MR. GILES: I have a personality type that tends to be somewhat aggressive and 13 overbearing. 14 COMMISSIONER CAMPBELL: I--I do too. I got one worse than you. But 15 let me just tell you this. This is my opinion. Mine’s worse than yours because I 16 get--I’m really--when I’m for something, I’m really for it. But when I’m really 17 for something and I knew there was going to be a hearing, I’m going to sit on the 18 front row ‘cause I want to be heard. 19 MR. GILES: I think I’m going to take your advice, Commissioner Campbell. 20 COMMISSIONER CAMPBELL: Yeah, well if I was you and I was really for 21 something, ain’t no way in the world I wouldn’t be in the courtroom where I 22 could voice my opinion because I couldn’t sleep at night till I got out what I 23 wanted to say. And then if I get beat, I can take the beating. I’ve been beaten LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 53 1 more times than I’ve won, but at least I know I have presented my case. So that-- 2 that troubles me that--don’t worry about your personality. I mean if you’re 3 aggressive, aggression is what made the United States what it is today. We’re a 4 aggressive country. But anyway, there’s a way to control that. I’m not saying 5 you go crazy, but it troubles me a little bit when you have this in court or you 6 have it before the ALJ, you don’t appear because if it means everything to you, 7 look like you would want to say everything you could say. 8 MR. GILES: Well, quite frankly, after we did such a conclusive job with the 9 first ALJ and she agreed with us totally on all of it. She said look, y’all made 10 your point great. We--we went in and said--we made the same points again and 11 then--with some additional stuff we were asking for and--and then we gave them 12 the--obviously it didn’t seem to be registering so Steve said well, look, I’ll just 13 pull out the big gun. Here’s the--here’s the Supreme Court ruling that supports 15 14 of the 21 points and I said, okay. You did your job, that’s good, you know, and I 15 thought the ALJ would rule. When we got this in August, I was--I was kind of 16 surprised actually. 17 COMMISSIONER CAMPBELL: Are we representing--you had legal-- 18 MR. GILES: By the way I got--I got--no, we never--we represented ourselves. 19 After the first round where we had to teach our attorneys everything, we figured 20 we’d just handle it ourselves. The--and we’re not lawyers, I’ve played one on 21 television once before, but I’m not one. The--the 21 points, when she ruled 22 against every single one of them, I haven’t been beaten that badly since our JV 23 team played the--the South Lafourche Tarpons, the future state champions and LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 54 1 whipped our behinds, okay. I hadn’t been beaten that bad since then and I was 2 just shocked that she didn’t even mention the Supreme Court ruling. And so-- 3 COMMISSIONER CAMPBELL: So-- 4 MR. GILES: --we’re here before you asking you to send it back to her and say 5 did you consider this, is this really what happened, that this is not even 6 mentioned. And a friend of mine who’s here who’s an attorney-- 7 COMMISSIONER CAMPBELL: Let me ask something to Eve. 8 SECRETARY GONZALEZ: Yes. 9 COMMISSIONER CAMPBELL: And I’m just speaking for me now ‘cause I 10 don’t know what the rest of these guys--I hadn’t talked to--I don't know what they 11 going to do. I’m just talk--I’m trying to get this for me. If we sent this back 12 ‘cause--to--to the ALJ-- 13 SECRETARY GONZALEZ: Uh-huh. ALJ. 14 COMMISSIONER CAMPBELL: And we gave her the information that he 15 now has, when could we get this back? How, I mean, if somebody’s got a guess 16 or something. 17 SECRETARY GONZALEZ: Yeah. Well, first of all, I do want to say that 18 because this case is in the record, we have to assume, and I would be--I would be 19 shocked and surprised that she did not consider it. The fact that she didn’t say it 20 or address it does not mean she didn’t consider it. However, obviously you are 21 free to--free to remand it to the ALJ. It would probably take a couple of months. 22 Now, the ALJ who reached this conclusion was Judge Meiners and she is actually 23 retiring at the end of the year, so it may end up with a new ALJ which could be LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 55 1 very difficult because she would have to review the entire record again. So they 2 do have obviously the right to appeal the Commission’s decision which it sounds 3 like if the ALJ looks at it and comes to the same conclusion, they’re going to do 4 anyway, so--so I just wanted to make that point. 5 COMMISSIONER CAMPBELL: There’s no way-- 6 SECRETARY GONZALEZ: I think it would be--I mean, excuse me. I can’t 7 speak for her, but if you gave her a directive to have it by the December B&E that 8 all you wanted was a--was a statement that she saw the case, concluded, you 9 know, and--and basically considered the case and keeps the same opinion, I guess 10 she could have it by December if we direct her to do that. 11 COMMISSIONER CAMPBELL: Well, let me ask that. I’m just asking now. 12 I’m seeking information. Is there any way that--I hear what the gentleman says. 13 And 30 days don’t break anybody back. 14 SECRETARY GONZALEZ: Uh-huh. 15 COMMISSIONER CAMPBELL: If there’s any way, can we send it back to the 16 ALJ and tell her to look at this and come up with something-- 17 CHAIRMAN SKRMETTA: Sure. 18 COMMISSIONER CAMPBELL: --by--by Natchitoches. And then, you know, 19 if she comes back and says I know all about what you did, I still rule the same 20 way, well that-- 21 SECRETARY GONZALEZ: She’ll have to--yeah. She can--just if you send it 22 back and you want a statement from her whether or not she considered it and if LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 56 1 she did, either way would--would her opinion remain the same. If she did 2 consider it, I’m sure she would have it back. If she didn’t consider it-- 3 CHAIRMAN SKRMETTA: And I think what--and I think Eve is--her salient 4 point is if you’re concerned that the ALJ didn’t consider the Supreme Court 5 ruling, did not take action-- 6 SECRETARY GONZALEZ: It was in the record. 7 CHAIRMAN SKRMETTA: To not take action today, I understand. For me, 8 there’s no way that the ALJ didn’t consider it. 9 SECRETARY GONZALEZ: No, it was in the record. 10 CHAIRMAN SKRMETTA: But she may have found it totally irrelevant. You 11 know, that could have been her-- 12 MR. GILES: But it’s the whole heart of the whole argument, Commissioner. 13 CHAIRMAN SKRMETTA: I understand that and like I said, you know, trust 14 me on this. I have--kind of like Commissioner Campbell, I’ve had my fair share 15 of contrary decisions from judges over my 30 something years of practicing law 16 and not understanding why I didn’t win, okay. But what my question is and what 17 Commissioner--excuse me, what Secretary Gonzalez is saying is that the only 18 action that may be relevant to your argument instead of burdening this into the 19 system again is to simply make a request to the ALJ and ask her if she considered 20 that case in her reason decision and then bring it back in the December meeting 21 and find out if she included that in her argument or her, excuse me, her reasoning 22 and if she did, then that--that answers the question whether she did or not and it 23 would be right for a vote. But the other option is, you know, I have to say that LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 57 1 everything in the record is considered, okay. Otherwise, it would be an arbitrary 2 decision, okay. 3 MR. GILES: Uh-huh. 4 CHAIRMAN SKRMETTA: 5 decision of the Commission is arbitrary because it didn’t consider this, well that’s 6 something for you to take to the 19th or to the state Supreme Court, all right. But 7 the record is in place, the record’s fulfilled and the--you know, I’m not prepared 8 to disrupt the universe and send it back into the ALJ system. The only thing I 9 would consider is having the secretary contact the judge and make a interrogatory And if you’re fundamentally saying that the 10 to her that--did you consider the case as part of the reason judgment, that’s it. 11 MR. GILES: Okay. Like-- 12 CHAIRMAN SKRMETTA: Well, hang on. 13 MR. GILES: We have people here who can testify to this right now. If we 14 submitted this in our rebuttal testimony and it’s the Supreme Court of the United 15 States of America, and it directly relates to this issue. It is the issue. It’s not a 16 relation. It is the issue. Should entrance facilities be charged at TELRIC rates? 17 If you’re--if the Staff didn’t even read it so that they could say they support the 18 position or against the position, how can you say that this is not an important 19 document that should be considered when it says it on there. 20 CHAIRMAN SKRMETTA: I’m not saying that. I’m not saying that at all. 21 MR. GILES: Oh. 22 CHAIRMAN SKRMETTA: All I’m saying is a judge will take a content of a 23 file and review and some things they will just not consider mentioning because if LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 58 1 they’re mentioning every single aspect of every single element of evidence, this 2 would be--instead of being 55 pages, it’d be 555 pages, okay. Arguments of 3 Supreme Court law on their own will take exactly how much this is, but you 4 know, her interpretation of it is what we rely on in the system, okay. But if what 5 you’re saying is that you believe that she failed to consider it, that’s--that’s a error 6 issue that can be dealt with later, but if what I’m getting from Eve is the element 7 of seeing if she even considered it, okay. 8 MR. GILES: I understand that’s a difficult [INAUDIBLE]. 9 CHAIRMAN SKRMETTA: And then on that basis, at least we’ll know that she 10 can--she can write back and say she considered it, she did what she wanted but 11 she felt like it was not on point and was unnecessary to include. That’s the only 12 answer I can perceive coming back because-- 13 SECRETARY GONZALEZ: Yeah, she’s not going to need to give reasons-- 14 CHAIRMAN SKRMETTA: No, she doesn’t need to give reasons. 15 SECRETARY GONZALEZ: But she--she-- 16 CHAIRMAN SKRMETTA: Just say if she, you know, she reviewed it and she 17 found it to be unnecessary to mention or she didn’t review it. It’s the only two 18 answers there are. Go ahead, Commissioner Boissiere. 19 COMMISSIONER BOISSIERE: Thank you. Well, Commissioner Skrmetta, I 20 actually really agree with your comments, of course. It’s that-- 21 CHAIRMAN SKRMETTA: Shock. 22 COMMISSIONER BOISSIERE: No, no, that’s not it. That’s not the point I 23 mean, what I mean is that I have to believe as well that if it’s in the record, the LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 59 1 judge probably considered it whether or not it was expressed in the reasoning at 2 the end. Whether or not it was properly considered or properly applied, only the 3 judge would know that herself if she didn’t leave it off, but it doesn’t mean that 4 she did or didn’t. It doesn’t mean she didn’t. So for that matter, I have to believe 5 the judge did but I understand the question. I understand the question, I really do 6 and at this point, I’m--I’m not ready. Let--let me consider an option here and I 7 say this not only to my Commissioners but to the parties sitting there, and really I 8 guess my question goes to our secretary, Ms. Gonzalez. Considering everything 9 like we--I both heard you and Commissioner Skrmetta say the judge probably 10 considered it even though it was not mentioned later. 11 SECRETARY GONZALEZ: And it should be assumed that she did. I believe 12 on an--on an appeal it would be assumed that she did. Now-- 13 COMMISSIONER BOISSIERE: Right. An appellate could find-- 14 SECRETARY GONZALEZ: --they could still find that her--they could still 15 find that her--her recommendation is incorrect. 16 COMMISSIONER BOISSIERE: 17 would be-- 18 SECRETARY GONZALEZ: Because what the--what the court does is looks at 19 the record and says is her recommendation reasonably supported by the record? 20 They look at the record. If it is, it is. If it isn’t, it isn’t. 21 COMMISSIONER BOISSIERE: Well, I’m asking a question and really, I’m 22 just looking for advice from maybe procedurally or in some way, could we just 23 ask the judge was it considered? Her reason--right. So my--my question LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 60 Commissioners, I’m sorry. Lauren Temento with Staff. It 1 MS. TEMENTO: 2 looks like she cites the Supreme Court case in her recommendation. 3 COMMISSIONER BOISSIERE: Where is that cited, please? 4 CHAIRMAN SKRMETTA: What page, please? 5 MS. TEMENTO: Page 4, footnote 4. 6 CHAIRMAN SKRMETTA: Hang on a minute. United States Supreme Court 7 Talk America versus Michigan Bell-- 8 MR. GILES: Yes. 9 CHAIRMAN SKRMETTA: That’s it? 10 MS. TEMENTO: Yes, sir. 11 CHAIRMAN SKRMETTA: Okay. It’s in the record. 12 COMMISSIONER BOISSIERE: There’s no need mentioning it. 13 CHAIRMAN SKRMETTA: 14 argument is the application of the rule of law in the Supreme Court case is on 15 page 4 in the body of the argument. Her interpretation and analysis of it is in 16 place there. 17 MS. TEMENTO: 18 recommendation which made it a final recommendation. 19 CHAIRMAN SKRMETTA: Okay. 20 SECRETARY GONZALEZ: 21 persuadably free to file exceptions and argue that that was not considered, 22 incorrectly considered, etcetera. So-- It’s footnoted on page 4 which means the And AccessCom did not file exceptions to the proposed Yes. They did. They were--they’re also LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 61 1 CHAIRMAN SKRMETTA: All right. Any--any other comments from 2 Commissioners? Mr. Demint, do you have any questions or statements you’d like 3 to make? If he needs to do a card, he can do one for you. 4 SECRETARY GONZALEZ: Yeah, he can fill it out afterwards. 5 CHAIRMAN SKRMETTA: Okay. 6 MR. RICK DEMINT: Rick Demint, director of regulatory affairs for AT&T 7 and I’d just like to make the comment, yes, it is a--a complex issue as you can tell 8 from Brandon’s reading. That’s why there are many rules that were in place in 9 the ’96 telecom act that govern these interconnection agreements. We have 10 thousands of these agreements with wholesale, CLEC, various types of 11 communications providers. It’s a pretty standard business and I did attend the 12 hearings. They were about a week long. This was reviewed very thoroughly, 13 much detail was discussed. The gentleman here, Mr. Hastings, with AccessCom 14 was present. There was lots of discussion for hours and hours, a lot of cross 15 examination, question back and forth. So in my opinion, the Commission has 16 spent enough time and resource on this. 17 Commission--the ALJ’s recommendation. I just don’t think there’s anything new 18 here. I appreciate the opportunity to address you on the matter. Thank you. 19 CHAIRMAN SKRMETTA: All right, thank you. Commissioner Campbell? 20 COMMISSIONER CAMPBELL: Did you hear him talk about the Supreme 21 Court in that--was that brought up? 22 MR. DEMINT: Yeah, I’m not an attorney, so I might not have tuned in to-- 23 CHAIRMAN SKRMETTA: You got to use the microphone. I would ask that you support the LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 62 1 SECRETARY GONZALEZ: Speak into the mic, please. 2 CHAIRMAN SKRMETTA: Sorry. 3 MR. DEMINT: I’m sorry. I’m not an attorney, so I didn’t maybe tune into that 4 particular piece of it, so I can’t recall, I’m sorry, but I’m sure it was mentioned. 5 SECRETARY GONZALEZ: But it is obvious--it is obvious that she did read 6 the case and consider it because it’s cited in her--in her opinion. 7 CHAIRMAN SKRMETTA: And it’s in the review. It’s on page 4 of the-- 8 SECRETARY GONZALEZ: Page 4. 9 CHAIRMAN SKRMETTA: --of the review. In the meantime-- 10 SECRETARY GONZALEZ: And what the ALJ does is of course, she presides 11 over the hearing and then they get a transcript and they get the transcript printed 12 and she reads through the entire transcript and all the exhibits and everything 13 that’s filed by all parties before she begins her recommendation. 14 CHAIRMAN SKRMETTA: You know, I’m going to go ahead and, you know, 15 I don’t take great pleasure in it, but I move to accept the Staff recommendation 16 and the ALJ ruling simply because the issue that you’ve brought up is clearly 17 exhibited that it was reviewed and used as part of the analysis and this action 18 would allow you to move to the 19th and do an immediate appeal and I think that, 19 you know, you can be on the track. Otherwise, this could be bogged down and to 20 be perfectly honest, I think the argument is potentially salient, but I think you’re 21 at the wrong place right now because your argument is over the Supreme Court 22 action that wasn’t considered and yet it is considered and it’s--it’s even footnoted 23 which means that she even tags the part that she read about it. So--but the chair-- LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 63 1 MR. GILES: It--it isn’t discussing the--the salient point of that ruling-- 2 CHAIRMAN SKRMETTA: That is-- 3 MR. GILES: --these facilities are to be charged the TELRIC rates. 4 CHAIRMAN SKRMETTA: Right. And--and-- 5 MR. GILES: It just says that-- 6 CHAIRMAN SKRMETTA: And I would tell you, Jeff, that I understand what 7 you’re saying. What this judge did was interpret what they saw to be the salient 8 points of that case. They did not interpret it, which you have, look, it’s court. If 9 they didn’t have two--two separate opinions, it’d be--you wouldn’t need a 10 courtroom, okay. There are different ways of reviewing this kind of stuff. And 11 look, I understand you’re not a lawyer and I understand all this and you’re a good 12 business guy, and look, all those things, but what we are focusing on there is 13 judicial interpretation, okay. And we rely on judicial interpretation of what goes 14 on because, I mean, we--look, I’m the lawyer up here and I’m looking at it and I 15 can only interpret what a judge did, okay. The judge reviewed the Supreme Court 16 case, footnoted it, and put it into their review. Whether or not they saw what you 17 saw in it, they saw what they saw in it and because of that, you know, the ruling is 18 fairly straightforward for me. So the chair moves to accept the ALJ ruling and is 19 there any second? 20 COMMISSIONER FRANCIS: Second. 21 CHAIRMAN SKRMETTA: Seconded by Commissioner Francis. We have 22 some further discussion on this. We’re not going to vote yet, okay. LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 64 1 Commissioner Campbell, you have any more questions, sir? Okay. No more 2 questions from Commissioner Campbell. Commissioner Francis? 3 COMMISSIONER FRANCIS: I move that we vote on this issue. 4 CHAIRMAN SKRMETTA: 5 opposition? [NONE HEARD] All right. Hearing no opposition, the matter is 6 done, but you have the right to appeal to the 19th Judicial District Court, and I 7 think that you may find exactly what you’re looking for there. Thank you. 8 MR. DEMINT: Thank you. 9 MR. FREY: Okay. We’ll move on to Exhibit 6 - Docket U-34658 - Concordia 10 Electric Cooperative, ex parte. In re: Application for approval of an updated 11 advanced metering system program. Discussion and possible vote to hire outside 12 consultant. Staff issued RFP 17-14 on October 16th seeking bids from outside 13 consultants. The following four proposals were received: Exeter Associates, 14 15,800 in fees, 1,200 in expenses for a total not to exceed budget of 17,000; J. 15 Kennedy & Associates, 17,900 in fees, 1,000 in expenses for a total not to exceed 16 of 18,900; Henderson Ridge Consulting, 21,750 in fees, 1,200 in expenses for a 17 total not to exceed of 22,950 and UtiliWorks Consulting, 49,725 in fees, 6,000 in 18 expenses for a total not to exceed of 55,725. As all bidders are qualified, Staff 19 makes no final--formal recommendation. 20 CHAIRMAN SKRMETTA: Chair--chair moves to accept the bid of Exeter 21 Associates for a total of $17,000. Any seconds? 22 COMMISSIONER FRANCIS: Second. Okay. We have a call for a vote and any LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 65 1 CHAIRMAN SKRMETTA: Seconded by Commissioner Francis. Any 2 opposition? [NONE HEARD] Hearing none, the matter’s approved. Next item. 3 MR. FREY: Exhibit 7 - Docket R-34661 - LPSC, ex parte, In re: Rulemaking 4 docket to determine the appropriate formula for charges to developers of 5 residential subdivisions for underground electric service pursuant to existing 6 applicable LPSC general orders. Discussion and possible vote to hire outside 7 consultant. Staff issued RFP 17-15 and received one qualifying proposal and 8 response. J. Kennedy & Associates, 38,200 in fees, 1,700 in expenses for a total 9 not to exceed of 39,900. 10 CHAIRMAN SKRMETTA: Chair moves to accept the sole bid of J. Kennedy 11 & Associates for a total of $39,900. Any seconds? 12 COMMISSIONER BOISSIERE: Second. 13 CHAIRMAN SKRMETTA: 14 opposition? [NONE HEARD] Hearing none, so--matter’s approved. Next item, 15 please. 16 MR. FREY: Eight and nine were both passed so we’ll move to ten. Docket S- 17 34624 - Cleco Power, LLC, ex parte. 18 authorization of new mortgage indenture. Discussion and possible vote of Staff’s 19 recommendation. Cleco filed an application with the Commission requesting the 20 Commission’s authorization to put in place a new mortgage indenture to replace 21 Cleco’s current mortgage indenture, which has been in place since 1950. 22 Specifically, Cleco is seeking authorization under the 1994 General Order to 23 replace the--this ’95--1950 indenture with the new indenture. The 1950 indenture Seconded by Commissioner Boissiere. In re: Any Application for Commission LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 66 1 is no longer viable in its current form. The company estimates the cost of fully 2 replacing the 1950 indenture with the proposed new indenture would be 3 approximately $250,000. Since these costs are debt issuance costs, they will be 4 reflected in the cost of debt for ratemaking purposes. Staff has reviewed the 5 explanation of potential benefits described in the company’s application and 6 discovery responses. Staff agrees that the expected potential benefits described 7 by the Company are reasonable and the plan to replace the 1950 indenture with 8 the proposed new indenture is the result of sound financial planning, is just and 9 reasonable, and will serve the public interest. Staff therefore recommends the 10 following: 1) The company should find the--I’m sorry, the Commission should 11 find the company’s request to replace the 1950 indenture with the proposed new 12 indenture serves the public interest as required by the 1994 General Order. 2) The 13 Commission should grant authority such that any future debt issuances under the 14 proposed new indenture will be considered for approval in conjunction with the 15 company’s current blanket financing order, Order Number S-333--I’m sorry-- 16 33218, which is in effect through the end of 2018. 3) The Commission should 17 grant pre-authorization that any unsecured debt issued pursuant to the blanket 18 financing order, whether currently issued or subsequently issued, and subject to 19 pari passu provisions, can be stepped-up to a secured basis if and when any debt is 20 issued pursuant to the proposed new indenture; and 4) The Commission should 21 replace that--should require that all costs associated with the termination of the 22 1950 indenture and replacement with the proposed new indenture, estimated to be 23 approximately 250,000, be deferred and amortized over 30 years. These deferred LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 67 1 costs should not be included in the company’s rate base, rather they should be 2 included as an issuance cost and included in the cost of debt the same as any other 3 upfront issuance fee. The amortization of these deferred costs should be included 4 as debt interest expense and included in the calculation of the cost of long-term 5 debt as part of the normal cost of capital calculation in any subsequent rate 6 determination proceedings. The Commission shall have the opportunity to review 7 the reasonableness of the level of actual costs incurred, deferred, and amortized in 8 future rate base proceedings. 9 CHAIRMAN SKRMETTA: Chair moves to accept Staff recommendation on 10 this. Any seconds? 11 COMMISSIONER FRANCIS: Second. 12 CHAIRMAN SKRMETTA: 13 opposition? [NONE HEARD] Hearing none, the matter’s approved. Next item, 14 please. 15 MR. FREY: 16 Cooperative, ex parte. 17 refinance. 18 Commission--the Commissioner moved-- 19 CHAIRMAN SKRMETTA: We got a--read it. 20 MR. FREY: --received a letter of non-opp to borrow 3.5 million from CoBank in 21 order to refinance Northeast’s current short term line of credit, also with CoBank. 22 Northeast is not seeking to incur any additional debt through the letter of non- 23 opposition, simply to refinance. After review of the company’s financials and Seconded by Commissioner Francis. Any Exhibit 11 - Docket S-34646 - Northeast Louisiana Power In re: Petition for approval of letter of non-opp to Discussion and possible vote on Staff’s Recommendation. The LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 68 1 financial ratio minimums as required by the rule of utility service, Staff 2 determined that Northeast’s times interest earned ratio or TIER is 1.78 and the 3 company’s debt service coverage ratio is 2.67 both of which are above the RUS’s 4 minimum requirements. Following Staff’s review of all documents provided as 5 well as the responses to the 18 factors, Staff filed its recommendation 6 recommending the Commission express its non-opp to the company’s requests 7 based on certain terms and conditions. Northeast filed correspondence into the 8 record indicating its acceptance of Staff’s report. Staff therefore recommends the 9 Commission accept Staff’s report and recommendation and issue its non- 10 opposition to Northeast’s request to borrow 3.5 million from CoBank in order to 11 refinance Northeast’s current short term line of credit with CoBank under the 12 following--following terms and conditions: 1) Northeast shall file into the record 13 of this docket, and submit a copy to the audit division, all finalized loan 14 agreements signed by both Northeast and representatives from CoBank setting out 15 all terms within 30 days of closing on the refinance and 2) The Commission 16 reserves its right to review the ratemaking treatment of this loan proposal in any 17 future rate proceeding. 18 CHAIRMAN SKRMETTA: Chair moves to accept Staff’s recommendation. 19 Any seconds? Seconded by Commissioner Campbell. Any opposition? [NONE 20 HEARD] Hearing none, the matter’s approved. Next item, please. 21 MR. FREY: Exhibit 12 is undocketed. This is Claiborne Electric’s fiber-to-the- 22 home project. 23 September B&E, Commissioner Campbell directed Staff to solicit bids for under Discussion and possible vote to hire outside consultant. At the LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 69 1 50 from qualified consultants to assist Staff in reviewing Claiborne’s proposed 2 broadband deployment. In accordance with the directive, Staff solicited bids from 3 consultants for under 50,000 to review the proposed broadband deployment 4 and/or any filings made by the company seeking Commission approval and/or 5 non-opposition. The following four proposals were received and there’s actually- 6 -the last two are--are switched under the total figure, so I’m going to read them as 7 they came in. The lowest bid is D’Onofrio & Associates, LLC, 24,000 in fees, 8 2,000 in expenses for a total not to exceed of 26,000. 9 Consulting, 28,500 in fees, 1,200 in expenses for a total not to exceed of 29,700. 10 J. Kennedy & Associates, 36,600 in fees, 600 in expenses for a total not to exceed 11 of 37,200, and Power System Engineering, 35,000 in fees, 2,000 in expenses for a 12 total not to exceed of 37,500. Staff makes no formal recommendation as all 13 bidders are qualified. 14 COMMISSIONER CAMPBELL: I’ve got a motion. 15 CHAIRMAN SKRMETTA: Commissioner Campbell. 16 COMMISSIONER CAMPBELL: I know all about this project. I am--y’all are 17 probably going to get all familiar with it. This is the co-ops want to get into the 18 broadband business. 19 SECRETARY GONZALEZ: Speak into the mic, please. 20 CHAIRMAN SKRMETTA: You need to use your microphone. 21 COMMISSIONER CAMPBELL: This is the first co-op to talk about getting in 22 the broadband business. But anyway, I was looking through these people that 23 proposed a bid. I’d like to accept number 3. It is $10,000 higher, but they have Henderson Ridge LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 70 1 the expertise to fill a noble voice wireless data fiber microwave systems and over 2 the past five years, have become expert for the clients. I’d like to use those 3 people. 4 MR. FREY: Power System, okay. 5 COMMISSIONER CAMPBELL: I think--I think we need that. 6 SECRETARY GONZALEZ: Power System Engineering? 7 CHAIRMAN SKRMETTA: Power System Engineering for $37,500. Motion 8 by Commissioner Campbell, seconded by the chair. Any opposition? [NONE 9 HEARD] Hearing none, the matter’s approved. Next item, please. 10 MR. FREY: Exhibit 13 is the reports, resolutions, discussion, ERSC, MISO 11 business. Directives, we’ve got quite a few. First, we’ve got a couple reports 12 from Staff and I think it’ll be the same group on both, so we’ll take--I’ll read them 13 both. First, the report from Staff regarding FERC Docket Number RM-18-1-000, 14 Grid reliability and resiliency pricing and the second will be a status report by 15 Commission Staff on Docket U-34631 - Entergy Louisiana, ex parte. In re: 16 Application for an extension and modification of formula rate plan pursuant to 17 directive of Chairman Skrmetta at the September B&E. 18 CHAIRMAN SKRMETTA: Okay. Mr. Zimmering, would you like to explain 19 where we are? 20 MR. PAUL ZIMMERING: 21 Zimmering, special counsel to the Commission with the Stone Pigman law firm. 22 My law partner, Noel Darce with me--is with me and Lane Sisung of United 23 Professionals is--is also here. Certainly. Thank you, Mr. Chairman. Paul This--we’ll start with FERC Docket Number LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 71 1 RM18-1. At the very end of September, the secretary of the department of 2 Energy issued a noticed of proposed rulemaking essentially ordering the FERC to 3 do a rulemaking. It’s a procedure I frankly was unfamiliar with. I’d never seen it 4 used--utilized before. The proposed rule would require regional transmission 5 organizations and ISO’s to advise their tariffs to require certain generating units 6 using only certain fuel types to recover 100 percent of their costs of service 7 including all operating and fuel expense, cost of capital, fair return on equity, plus 8 a premium for their reliability and resiliency. It is possible and likely that this 9 rule will apply to MISO. The only generating units eligible for special treatment 10 are those that have a 90 day fuel supply on site, are not subject to cost of service 11 rate regulation by any state or local regulatory authority, and are members of 12 RTOs with capacity markets. 13 unregulated coal and nuclear units the way we read it. None of the generator 14 units, including coal and nuclear units owned by Louisiana’s MISO investor 15 owned utilities, that is Entergy Louisiana or Cleco Power, would qualify. The 16 purported justification for the rule is that electric--electric grids resiliency is 17 threatened by the potential premature retirement of all the coal and nuclear power 18 plants that are supposedly able to withstand major fuel supply disruptions 19 particularly during storms. The DO--the DOE cited the 2014 polar vortex super-- 20 super storm Sandy and the three of 2017 hurricanes as justification. 21 Unfortunately, based on the research we’ve done and lots of other people have 22 done as well, there were over 1,400 comments filed in all. Effectively, the rule would just apply to LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 72 1 CHAIRMAN SKRMETTA: Paul, to interrupt, what are the usual number of 2 comments filed? 3 MR. ZIMMERING: Oh, go ahead, Noel. 4 MR. NOEL DARCE: I mean it depends how big it is, but this is a pretty big 5 deal. 6 CHAIRMAN SKRMETTA: Usually--I understand it’s somewhere around 450 7 comments and this is over 1000 additional comments? 8 MR. DARCE: Okay. Well, that--yeah, that--that sounds about right. 9 CHAIRMAN SKRMETTA: Okay. Thank you. 10 MR. ZIMMERING: Four hundred and fify would be a robust set of comments. 11 CHAIRMAN SKRMETTA: Four hundred and fifty would be robust so 1,450 12 would be somewhat larger. 13 MR. ZIMMERING: Yes, absolutely. 14 CHAIRMAN SKRMETTA: I understand that it actually caused the FERC 15 server to crash with the filing of comments. 16 MR. ZIMMERING: Anecdotally, I’ve heard the same thing, Mr. Chairman. 17 CHAIRMAN SKRMETTA: Okay. Thank you, sir. 18 MR. ZIMMERING: The facts don’t support the proposed justification by the 19 DOE for this NOPR. 20 COMMISSIONER CAMPBELL: Is this the DOE that-- 21 CHAIRMAN SKRMETTA: No, this is a proposed rulemaking. 22 COMMISSIONER CAMPBELL: Up there--the man from Texas? LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 73 1 MR. ZIMMERING: Yes. Secretary of Energy, Perry is the one who had the 2 DOE order the FERC to open this-- 3 COMMISSIONER CAMPBELL: He’s got the degree in agriculture, he’s the 4 one running the DOE? 5 SECRETARY GONZALEZ: 6 your mic, please. 7 COMMISSIONER CAMPBELL: He’s the guy that got a degree in agriculture 8 is running Department of Energy, right? 9 MR. ZIMMERING: I don't know if he has a degree-- Commissioner, remember your mic--speak in 10 COMMISSIONER CAMPBELL: That’s true. That’s--shake your head this 11 way. 12 MR. ZIMMERING: I’ll--I’ll take your word for it, Commissioner. 13 COMMISSIONER CAMPBELL: He went to Texas A&M, he’s got a degree in 14 agriculture, and he’s running Department of Energy. I just want to put the record 15 straight. That’s true, Paul. 16 MR. ZIMMERING: Okay. All right. I’ll agree with you. I’m not fighting with 17 you, Commissioner. Just--just preliminarily, and I won’t take very long here. 18 The FERC set a wholly unreasonable comment schedule. Initial comments were 19 due in two weeks, reply comments were due two weeks later, and the FERC is 20 talking about issuing at least an interim order by December 11th. One of the 21 major problems here is that Louisiana ratepayers are going to have to pay to 22 support aging coal units in remote areas of MISO that are unneeded to serve 23 Louisiana customers as well as paying for their own generation ‘cause LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 74 1 presumably the cost to--to keep these older coal and nuclear units are going to be 2 uplifted to everybody within MISO while we’re still going to have our ratepayers 3 paying for their own generation. All right. Briefly, we believe first the rule is 4 unnecessary. The evidence that we have is these units that are supposedly being 5 protected for resiliency are some of the units that-- 6 CHAIRMAN SKRMETTA: Can I stop you for a minute? 7 MR. ZIMMERING: Yes. 8 CHAIRMAN SKRMETTA: I’d like you to explain sort of the nebulous term of 9 resiliency ‘cause it’s a new term in the utility vernacular world. And it’s still 10 some argument over what it really means. I’ve been told it just means the ability 11 to bounce back at, you know, but I’m not even sure what that really means. 12 MR. ZIMMERING: I’m not certain what it means either. Normally, we would 13 use a term like reliability as opposed--as opposed to-- 14 CHAIRMAN SKRMETTA: So it’s a new unknown term at this time? 15 MR. ZIMMERING: It’s--I--I think what the DOE would tell you is it’s to 16 provide sort of some redundancy, some backbone, some extra protection. 17 CHAIRMAN SKRMETTA: So they don’t know either, pretty much? 18 MR. ZIMMERING: I can’t speak for the--the DOE. 19 CHAIRMAN SKRMETTA: Yeah, I understand, got it. 20 MR. ZIMMERING: There--there were-- 21 CHAIRMAN SKRMETTA: I didn’t bring my sock puppet today, but I’ll work 22 on it, you know, the testifying. LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 75 1 MR. ZIMMERING: Just--just referring to the outages that--that occurred during 2 the polar vortex. For example, some of these outages were caused by the fact that 3 coal units had their coal piles freeze or during the storms, the coal piles got so wet 4 that they couldn’t be delivered to the generating units. 5 indication that it was caused by--these outages were caused by non-delivery of 6 gas and as most everybody in the business knows, the vast majority of outages are 7 caused by problems to the distribution system year round and not by problems 8 associating with the generating units. Okay. Secondly, the rule--we believe it’s 9 discriminatory and violates the FERC’s pro competition in fuel neutrality 10 provisions. By definition, it only applies to--to old--old unregulated coal and 11 nuclear units and on its face, it violates the FERC’s stated fuel neutrality 12 provisions because it only applies to those units. Significantly, we believe it 13 intrudes upon state jurisdiction. The FERC repeatedly has affirmed that fuel 14 choices and choices regarding generation resources are traditionally and properly 15 decisions within the jurisdiction and the purview of the states. The states know 16 what fuels are available to it. They know what citing is like within their own 17 states. They make decisions along with their--their regulated utilities as to what 18 to bill-- 19 CHAIRMAN SKRMETTA: Let me interrupt you for a moment. 20 MR. ZIMMERING: Certainly. 21 CHAIRMAN SKRMETTA: One of the statements from the Department of 22 Energy is regarding the fact that winter is coming and the concerns are a shortage 23 of deliverable energy. At NARUC in Baltimore and actually it was the ERSC There’s very little LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 76 1 right before NARUC started, we had a presentation from MISO that shows that in 2 the MISO system we’re at about one and a half gigawatts of energy and we’re 3 consuming about one gigawatt of energy. We’re going to be long in energy as we 4 head into the winter so we will have surplus energy available for expert--export 5 during that timeframe. I think that’s a reasonable interpretation of the availability 6 of energy without needing to take the next step because my concerns are that 7 Secretary Pruitt of the EPA I thought made a very salient expression in the 8 modification of the clean power plan saying that, you know, we shouldn’t be 9 picking favorites. We should allow the market to make determination and that the 10 business of regulatory is to make business regular, not to make it complicated or 11 disruptive. My concerns are that I’ve been on the Commission for nine years, and 12 I think we’re still waiting for the FERC to rule on stuff before I got here. And for 13 a fast track from effectively September--late September, early October, 14 completion--actually, late October, but completion by Monday, a week ago on the 15 responsive comments, a vote in early December when it’s pretty much defined to 16 me by the FERC that most of their Staff are leaving on accumulated leave until 17 January for Thanksgiving shows me that this is not interpretative of the 18 comments. My understanding is 47 states have filed comments in opposition. 19 My understanding is that it would take significant resources and man hours of the 20 FERC to do a thoughtful and non-arbitrary interpretation of the comments and it 21 seems to be decidedly impossible to do by December 11th. For me, this is a case 22 of regulatory ready, fire, aim and I think my concerns are that. And I might--I 23 might have to talk to them about Jerry Clower’s coon hunting monkey ‘cause I’m LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 77 1 getting this story all over again. So, but anyway, see, it’s not even--so anyway, 2 would you concern--would you continue, Commissioner? 3 MR. ZIMMERING: Yes. Certainly. As I mentioned, a significant problem 4 from the Commission Staff’s point of view is having Louisiana ratepayers having 5 to pay some uplift charges or however they’re going to be charged for these older 6 units that would otherwise retire while they still got to pay rates to support their 7 own--to support their own generation. As far as we know, only three public 8 service commissions have supported the rule. I don't know how many total filed. 9 One of the three was West Virginia, but that makes sense. They’re a large 10 producer--a large producer of coal, and they have coal fire generation in their 11 own--in their own portfolios. As I said, MISO has filed comments to try to 12 convince the FERC that it should not be subject to the proposed rule. We would 13 ask them to continue to take that--that position. We could not take the chance that 14 that’s the way the FERC would rule so the Staff on behalf of the Commission 15 filed comments and reply comments. To some degree, we believe that this is a 16 solution looking for a problem, but in any event, we will keep you apprised and 17 certainly if anything happens. 18 CHAIRMAN SKRMETTA: I think that I speak for all the Commissioners 19 when I tell you that because this action is going to take place on December 11th 20 which is 10 days or 9 days before the B&E, that certain legal actions may have to 21 be taken to protect the rights of the citizens of the state of Louisiana and that I 22 would ask you to take whatever legal action is necessary to protect the rights of 23 the citizens and the Commission in anticipation of us having review of the matter LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 78 1 at the December 20 B&E in Natchitoches. And if you do take any legal action, I 2 would ask for you to put it on the agenda as a executive session item and work 3 with Staff counsel to do so. 4 MR. ZIMMERING: Certainly. We’ll work with executive counsel-- 5 CHAIRMAN SKRMETTA: Okay. 6 MR. ZIMMERING: --and the executive secretary. 7 CHAIRMAN SKRMETTA: I will point out to the Commission that last week 8 before the ERSC meeting and NARUC, I went and visited with the delegation of 9 the state in congress and I met with five out of the six of the congress people, both 10 senators, explained to them the issues associated with this matter. And all of them 11 that we met with have expressly agreed to assist the Public Service Commission 12 in whatever action we take in this matter, and I want to thank them very much for 13 their assistances. I actually believe before this is over, we will have the complete 14 delegation working with us to take action to support this and we will rely on these 15 actions to motivate MISO to take whatever actions necessary to work to exclude 16 the state of Louisiana from those issues. I would point out for Commissioner 17 Campbell and Commissioner Boissiere’s notes, that ERCOT is actually exempt 18 from this rule and so is most of California and so is, I forget who else is. 19 MR. DARCE: The SPP. 20 CHAIRMAN SKRMETTA: The SPP is. So we are--we are going to be faced 21 with an issue where, you know, we like the market, we like what we’re doing here 22 in Louisiana, but we need for our--our partners in this to work very aggressively 23 to help us continue on a--a very salient commercial path and that’ll provide for the LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 79 1 protections for the ratepayers of the state of Louisiana. So thank you for your 2 report. Any other questions? 3 COMMISSIONER FRANCIS: Yeah, I’ve got a-- 4 CHAIRMAN SKRMETTA: Commissioner Francis has a question. 5 COMMISSIONER FRANCIS: Paul, what--NRG up in New Roads, do they 6 have a 90 supply of coal there? 7 MR. DARCE: That I don't know. 8 MR. ZIMMERING: I don't know. 9 CHAIRMAN SKRMETTA: They’re--they’re not regulated so it’s hard to tell-- 10 COMMISSIONER FRANCIS: Coal fired, I just was curious. 11 CHAIRMAN SKRMETTA: We have the president of Point Coupee here. He 12 might have some side knowledge if he is interested in coming up. I won’t force 13 him to, but I think the issues of coal in the northern regions that were affected. 14 This is decidedly the impact is predominantly born by PJM which is a RTO to the 15 north and east of MISO and they’ve had the biggest impact of the clean power 16 plan on them. They’ve had the biggest impact in general because of the age of the 17 legacy units there and other issues that were dealt with, but they also had ice and 18 snow and I don’t think they had three or four feet of ice and snow in Point Coupee 19 to dig a hole. 20 COMMISSIONER FRANCIS: No. 21 CHAIRMAN SKRMETTA: So, you know, that’s the real issue and--and you 22 know three and a half thousand power plants in the United States that burn coal, LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 80 1 we need to be very cautious about, you know, how that impacts Louisiana 2 ratepayers so thank you very much. Any other questions, sir? 3 COMMISSIONER FRANCIS: No. 4 CHAIRMAN SKRMETTA: Okay. Thank you very much. You’re excused. 5 Next status report, Mr. Frey? 6 SECRETARY GONZALEZ: They also had the status report. 7 MR. FREY: They have the status report too. 8 CHAIRMAN SKRMETTA: They’ve got the status report. 9 MR. FREY: Same--same team. 10 CHAIRMAN SKRMETTA: Okay. Go ahead. 11 MR. ZIMMERING: This will be shorter. At the September 20th B&E, the Staff 12 was directed to provide the Commission in November a status report on the 13 ongoing discussions with Entergy Louisiana regarding its request for an extension 14 and modification of its formula rate plan which is pending in Docket Number U- 15 34631. There were several intervenors active intervenors in that case, Marathon 16 Petroleum, the Louisiana Energy Users Group, Occidental Chemical, the Alliance 17 for Affordable Energy, Bayou Steel, and the Department--U.S. Department of 18 Energy. Since outside consultants and counsel were retained in September, the 19 Staff has been reviewing and analyzing the company’s application. 20 prepared and served upon ELL three sets of data requests consisting of about 85 21 total requests. Marathon has served four sets of requests and the LEUG has 22 served two sets of comprehensive requests. The company has, I believe to date, 23 replied to all of these data requests. There have been two status conferences We’ve LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 81 1 before the ALJ assigned to the docket. The first was held October 3 rd, the second 2 on November 2nd. The purposes of these conferences was to report to the judge 3 on the status of discovery and negotiations. At the party’s request, because 4 negotiations were ongoing, no hearing schedule has been established so that we’re 5 not pressured by having it done by any specific date a week or two out. A third 6 status conference is scheduled to take place on December 5, 2017. Aside from 7 these formal status conferences, a technical conference was held in Baton Rouge 8 for several hours on October 13th at which all parties were invited to attend and 9 participate. The company gave introductory presentations regarding its 10 application and all parties were given the opportunity to ask and answer questions 11 regarding the issues they were concerned with. ELL has had additional meetings 12 and/or telephone conferences with the Staff and at least some of the intervenors. 13 Staff understands, excuse me, the company is continuing to meet with individual 14 stakeholders and the meeting is scheduled immediately after Thanksgiving with 15 all of the stakeholders in the docket. Discussions to date have been productive. 16 The Staff and the intervenors are attempting to analyze the information that’s 17 been provided by the company through formal discovery and through informal 18 discussions. The plan is for this to last for another three years so it’s a significant 19 step so it’s taken some time to go through these matters. It is Staff’s hope and 20 belief that additional discussions will continue to be productive and that the 21 parties are all working in good faith to determine if a compromise can be achieved 22 and we hope that will be in the very near future. And I’ll leave it to Mr. Sisung or 23 Mr. Darce. LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 82 1 CHAIRMAN SKRMETTA: Mr. Sisung? 2 MR. LANE SISUNG: Yes. Not much more to add to that. We’ve been working 3 very well with the company. 4 getting us data whenever we ask for it, and we look forward to trying to wrap it 5 up. 6 CHAIRMAN SKRMETTA: Thank you. And I want to thank Mr. Sisung for 7 letting me drag him through Washington to meet with our delegation because 8 even he will tell you that he was shocked by the--how we managed it in a day and 9 a half so thank you very much for your--for your help. So thank you, you They have been responding with phone calls, 10 gentlemen are excused. We move into the next items, Mr. Frey. 11 MR. ZIMMERING: Thank you, Commissioners. 12 MR. FREY: The next is the ERSC MISO business. We have a discussion and 13 possible vote to ratify the vote taken by Vice Chairman Boissiere acting as the 14 Commission’s representative on the board of directors of the OMS. Specifically, 15 this matter’s on the agenda for ratification of a vote taken on October 20, 2017 by 16 Vice Chairman Boissiere as the LPSC’s representative of the OMS. The OMS 17 sought approval to file comments in FERC Docket R--Rulemaking 18-1-000, 18 what you just heard about. Rulemaking proceeding initiated by the DOE for final 19 action by FERC. Rulemaking is proposing requirements for RTO markets to pay 20 cost of service rates to qualifying merchant owned garneting units. The OMS 21 Commerce urged that states have primary jurisdiction over resource adequacy, 22 that states have made decisions to properly value capacity, MISO and FERC 23 already have adequately addressed any resiliency issues and that MISO customers LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 83 1 should be held harmless from paying twice for resiliency they already have and 2 have paid for. The recommendation: Staff recommends the Commission ratify 3 Vice Chairman Boissiere’s vote taken October 20, 2017 as the LPSC’s 4 representative to the OMS board of directors. 5 CHAIRMAN SKRMETTA: Chair moves to ratify the vote of Commissioner 6 Boissiere and need a second. 7 COMMISSIONER FRANCIS: Second. 8 CHAIRMAN SKRMETTA: Seconded by Commissioner Francis. Need--do 9 we--I just need--Commissioner Boissiere, you’re excluded from this vote. 10 MR. FREY: Commissioner Boissiere is abstaining. 11 CHAIRMAN SKRMETTA: Any opposition? [NONE HEARD] Hearing none, 12 the matter is approved. Next item. 13 MR. FREY: Okay. Then we’ll move to directives. Commissioner Campbell’s 14 directive we said earlier is passed. 15 CHAIRMAN SKRMETTA: Correct. 16 MR. FREY: We have two additional directives. One is the directive to Staff to 17 institute the Phase I audits of the energy efficiency Quickstart program and to 18 insure that all program costs are considered in the audit at the request of Chairman 19 Skrmetta. 20 CHAIRMAN SKRMETTA: Yeah. That’s just--that’s the end of that phase of 21 the program and we need to, you know, go ahead and review the costs, etcetera. 22 So any opposition? Sure. Go ahead. LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 84 1 COMMISSIONER BOISSIERE: Is the Phase I ending because of time or 2 because we’re moving on to Phase II? 3 MR. FREY: I think--Melanie can answer, but I think that’s correct that y’all 4 voted to add that additional year to Phase I pending Phase II and I think-- 5 MS. MELANIE VERZWYVELT: I think we--we have the data right now in 6 the record that we could go ahead if the Commission wants to go ahead with the 7 audit so we can audit the first two years of the program which were the--the two 8 full years without any modifications of the Quickstart so I think that’s-- 9 COMMISSIONER BOISSIERE: I feel like the-- 10 MS. VERZWYVELT: I mean we have the consultant budget to go forward with 11 that right now. 12 COMMISSIONER BOISSIERE: And we still have one--we did continue a 13 year of Phase I. 14 MR. FREY: That--that’s correct. 15 MS. VERZWYVELT: That’s correct. 16 COMMISSIONER BOISSIERE: So would this also trigger another audit into 17 next year? 18 MS. VERZWYVELT: It would. That’s ongoing, so we would have to wait if 19 we were going to also do the third year. 20 COMMISSIONER BOISSIERE: We would have to wait? 21 MS. VERZWYVELT: Until the data from the full year. 22 COMMISSIONER BOISSIERE: 23 course. I just wanted to know whether because the fact that we did extend Phase All right. I would understand, yeah, of LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 85 1 I, would that also trigger another audit and should they be--should we have 2 multiple audits or just one at the end of Phase I? 3 MS. VERZWYVELT: I think that’s up to the Commission. I mean pursuant to 4 the rules, there was one audit anticipated, but it wasn’t necessarily anticipated that 5 there would be changes made in the third year so I think that does, you know, 6 present a complicating issuing. I would suggest that we do the audits for the first 7 two years and then if the Commission wants to do another audit, that that would 8 be up to the Commission. 9 COMMISSIONER BOISSIERE: Well, I guess my question was--would an 10 audit not be somewhat premature and I do expect some changes since we did 11 implement a new program recently in our energy efficiency phase I portion 12 CHAIRMAN SKRMETTA: Right. 13 COMMISSIONER BOISSIERE: So I do expect--I do expect some changes to- 14 -next year’s audit will look different from this one simply by the fact that we did 15 enhance our overall program. 16 CHAIRMAN SKRMETTA: Yeah. Commissioner, the reason for it is that 17 because we have sort of modified how the revenue would be shifted that it’s 18 appropriate to review the process up until the point that the revenue do shift to do 19 also government projects. So what I’m looking at is pre-government anticipated 20 projects backwards to the institution to the project which would provide for a 21 reasonable audit profile to understand what was done in that--in the parameters of 22 that without diluting it and looking at the government elements. I’d appreciate the 23 support for the directive. Iif you an opposition, I would request a vote. LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 86 1 COMMISSIONER BOISSIERE: And I may as well, but would this also incur 2 additional costs? 3 CHAIRMAN SKRMETTA: 4 already. 5 COMMISSIONER BOISSIERE: Yeah, but for sec--but we will for another 6 audit next year at the end of Phase I. That would--that would create a new audit. 7 CHAIRMAN SKRMETTA: Well, the diff--the secondary audit’s going to have 8 government aspects to it so it’s going to be a little different anyway, so they’re 9 going to have to look at bifurcating it anyway. So this is appropriate to do it at No, she just said there’s room in the budget 10 this time. So are you opposed to this? 11 COMMISSIONER BOISSIERE: Well, I’m not sure. I don’t know that I 12 would--the reason I’m not sure is because this is the first I’m hearing of it. So 13 it’s--I’m not -- I’m not opposed to having an audit, per se, but I want to make sure 14 the cost is not prohibitive. 15 Absolutely everything we do-- 16 CHAIRMAN SKRMETTA: Well-- 17 COMMISSIONER BOISSIERE: --gets borne on ratepayers, and I just want to 18 make sure we are prudent, not only in our ability to get data from the audit, but 19 also in just continuing to spend money for legal and professional services all the 20 time, especially since we’ve extended it. I think we’ve also created a new action. 21 I just think if you-- 22 CHAIRMAN SKRMETTA: I think--I think we’re covered. Because everything we do goes to ratepayers. LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 87 1 COMMISSIONER BOISSIERE: Well, okay. Well, what I’m saying is I would 2 probably like to get a little more discussion on it. Maybe you and I could sit 3 down with Staff to work it out and maybe consider this by next month. 4 CHAIRMAN SKRMETTA: To be perfectly frank with you, it was published in 5 the agenda. It’s pretty straightforward. We’re looking at the--from the beginning 6 of the program until the timeframe that it split off and to conclude a government 7 component of the program, so it’s a fairly narrow parameters of what we need to 8 look at. And we just need to understand the cost and how it--they’re recovered 9 and everything else. It’s just, you know, a traditional audit of what we do. So 10 I’m going to--if you’re opposed to it, I don’t mind calling for a vote. 11 COMMISSIONER BOISSIERE: Again, I’m not saying I’m opposed to it. I 12 think it raises far more questions than the--than the publishing answers, and that’s 13 why I’m asking now, and I haven’t got a direct answer on how much the audit 14 will cost, how much the future audit would cost, and what’s the difference in the 15 two, and what do we do with these audits while moving forward to Phase II. I 16 think it raises a number of questions that need to be a part of the audit. 17 CHAIRMAN SKRMETTA: 18 already money within the docket to provide for the audit. And as we look down 19 and understand when the Phase I aspect of the government aspect audit comes in, 20 then we’ll be able to address it at that time. But don’t anticipate this being a--this 21 would be a fairly narrow audit because it’s a--an audit of a program that the 22 companies will provide all the information. So I’m okay with it moving forward. Well, Ms.--Ms. Verzwyvelt said that there is LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 88 1 So if you would like to call for a vote on it, I’m ready to call for a vote. Your 2 choice. 3 COMMISSIONER BOISSIERE: I can move forward with it, but I do-- 4 CHAIRMAN SKRMETTA: Okay. 5 COMMISSIONER BOISSIERE: --my only concern is for next year. This will 6 create a new audit and I want to know the specifics on that. 7 CHAIRMAN SKRMETTA: I would like to just have you, at the next meeting, 8 provide for when you anticipate the completion of Phase I to where it comes 9 forward and is that going to be included down the road in any other elements, 10 secondary audits that we have to do because it would have to be more than one 11 audit. We can’t just wait until we’ve actually burned through all of the money 12 and then have an audit at the end and then find out -- 13 COMMISSIONER BOISSIERE: Exactly. 14 CHAIRMAN SKRMETTA: --surprise. So I’m going to go ahead and ask that 15 we allow the directive to go forward and we will--we will manage this issue as we 16 go forward. Obviously, we have a fiduciary responsibility in always, not just on 17 what we spend, but also on what was been spent. So I’d ask for your decision on 18 whether you want to oppose or cause a vote or are you okay with moving 19 forward? 20 COMMISSIONER BOISSIERE: And I’ll answer that. And I’ll answer that. I 21 will--I will agree to it, but I will say that I have questions and I--about the cost 22 and the direction of the--the final audit upon the ending of Phase I, which was the- 23 -the implied way of handling the ending of Phase I. So instead, we’re adding a LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 89 1 new audit--an additional audit should I say--because of the extension of Phase I, 2 and that I am concerned about it. I don’t want to stop the process. I think the 3 audit’s a good idea. But every time we do something, we’re spending ratepayer 4 money, and every time we do something, it’s a cost. And no one’s been able to 5 explain it to me yet. And so my concern is there. My--my caution is there. But I 6 understand the program needs to move on. I don’t want to disagree with this. I 7 think it’s fine. It’s just that the--as clear as the publishing may have been, it 8 doesn’t answer any of those questions, plus others that may move forward that we 9 don’t need to discuss here today. And since you’re adamant to move forward and 10 not even give it 30 days to discuss, let’s move forward. I’ll vote for it, but I--I 11 mean, like you said, burn through the money is an appropriate expression. That’s 12 exactly what we’re doing right now. But let’s move forward and get this thing on 13 the road and continue to work together. 14 CHAIRMAN SKRMETTA: Okay. No vote required. 15 SECRETARY GONZALEZ: No, you don’t need a vote. 16 CHAIRMAN SKRMETTA: No vote required. And the next issue, Mr. Frey. 17 MR. FREY: This is a directive to Staff to review the possibility of creating a 18 Louisiana RTO. 19 CHAIRMAN SKRMETTA: I just want to explain what this is about. This is 20 simply a backup plan. Because of the DOE NOPR to the FERC on this thing, we 21 just had Commissioner--excuse me--it’s just natural, Paul-- 22 MR. ZIMMERING: Zimmering. LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 90 1 CHAIRMAN SKRMETTA: Zimmering, explain for us is the concerns that the 2 only way to avoid being subject to this rule at this point is either to move to a 3 different RTO or to create our own RTO like ERCOT is formed or have MISO 4 take corrective action. So what--all I’m asking the Staff to do is for the Staff 5 themselves, without hiring any outside action, to look at how we would act to 6 have a Commission generated transmission organization for the state where we 7 would no longer be a participant in any other RTO, and that we would look at the 8 two different methods that we’ve created companies in the past. First is the 9 legislative creation through the LERC--as we did with the LERC, and as the 10 general corporations action the Commission took with the RAD. And so to find 11 out which one would be the proper way to go, if that ever becomes necessary, but 12 not taking any aggressive action beyond that point. Thank you. Any opposition? 13 [NONE HEARD] Okay. Thank you. Next item? 14 MR. FREY: Exhibit 14 - X Docket 34674 - LPSC, ex parte. In re: Dispute 15 between Washington-St. Tammany Electric Cooperative and Cleco Power 16 regarding WST’s expired franchise agreement with the city of Slidell. Discussion 17 and possible vote to hire outside counsel. This matter was docketed in response 18 to a directive to review the dispute between WST, Cleco, and the city of Slidell. 19 Staff issued a letter soliciting proposals for under 50 to qualified outside counsel 20 to assist Staff with this matter. Two proposals were received in response to the 21 solicitation which are summarized as follows: McQuaig and Associates, 36,800 22 in fees, 2,900 in expenses, for a total not to exceed of 39,700. And Patrick Miller, 23 LLC, 42,500 in fees, 1,500 in expenses, for a total not to exceed of 44,000. Staff LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 91 1 makes no formal recommendation since both firms are qualified and have 2 previously represented the Commission. 3 CHAIRMAN SKRMETTA: Chair moves to accept the bid of McQuaig and 4 Associates at 39,700. Any seconds? 5 COMMISSIONER FRANCIS: Second. 6 CHAIRMAN SKRMETTA: 7 opposition? [NONE HEARD] Hearing none, the matter’s approved. Next item. 8 MR. FREY: Exhibit 15. This is the next docket not yet published. LPSC, ex 9 parte. In re: Review and/or facilitation of relocation of certain electrical service 10 lines located at the Slidell municipal airport in order to facilitate airport 11 expansion. 12 anticipated, this counsel that’s hired in this proceeding will be able to 13 satisfactorily perform the services described for a bid less than 50,000 and thus 14 an RFP is not mandated. Staff issued a letter soliciting proposals for under 50 15 from qualified counsel. One proposal received in response to the solicitation as 16 follows: Patrick Miller, LLC, 46,500 in fees, 1,500 in expenses, for a total not to 17 exceed of 48,000. Staff recommends the Commission retain the sole bidder, 18 Patrick Miller, for the budget as proposed. 19 CHAIRMAN SKRMETTA: Chair moves to accept the bid of Patrick Miller, 20 LLC, total amount, $48,000. Any seconds? 21 COMMISSIONER CAMPBELL: I’ll second. 22 CHAIRMAN SKRMETTA: 23 opposition? [NONE HEARD] Hearing none, the matter’s approved. Next item. Seconded by Commissioner Francis. Discussion and possible vote to hire outside counsel. Any As it is Seconded by Commissioner Campbell. Any LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 92 1 MR. FREY: Sixteen was handled, so we’ll move to 17. I’m going to read the 2 directive, and Mr. Zimmering has an update before--actually, I’m going to read 3 the in re. He has an update about some recent action he just learned of and then 4 I’ll-- 5 CHAIRMAN SKRMETTA: Sure. 6 MR. FREY: --read the directive. 7 CHAIRMAN SKRMETTA: Okay. 8 MR. FREY: But this is the directive to Staff related to the Texas Hartburg- 9 Sabine MEP Transmission Project, currently under review as part of the MISO 10 MTEP 17 process. Request of Chairman Skrmetta. 11 MR. ZIMMERING: Thank you, Commissioners. Paul Zimmering, special 12 counsel. Again, Brandon’s going to--to read a directive in just a moment that 13 we’ve asked the Commission to make dealing with sort of a fix--fixing a problem 14 that has occurred because of the way the MISO tariffs are currently set up. In a 15 nutshell, for a huge $129 million projects--project, if we follow the way the 16 current MISO tariff was--is setup, 75 percent of the cost, essentially, would have 17 been allocated to Louisiana, even though we would have been getting only 25 18 percent of the benefits. And 75 percent of the benefits would have been allocated 19 to Texas, even though we were only getting--even though they were only getting 20 18 percent of the cost. We worked with Texas, particularly the Staff, closely, 21 came up with a solution which has to do with splitting local resource zones, and 22 they have their meeting today. We have our meeting today. They put the same LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 93 1 proposal up to their Commission, who we have just learned voted 3-0 in favor of 2 the proposal that would fix this problem. 3 CHAIRMAN SKRMETTA: 4 moment. 5 Commission for his help in this and his willingness to do this. Commissioner 6 Anderson is effectively retiring from the Texas Commission at the end of today. 7 Really, for longer than I’ve been on this Commission, I think he was a little bit 8 over nine years with the Texas commission, and he’s been a valiant adversary in 9 most things we’ve done. But he’s recognized the value of this settlement, and I And I would like to interrupt you just for a I want to commend Commissioner Ken Anderson of the Texas 10 want to commend him and wish him well in his future. Please go forward. 11 MR. ZIMMERING: Thank you. Yes. We--we would like to thank the Texas 12 Commissioners as well as the Texas staff and the staffs of the other Entergy retail 13 regulators for working with us on this to help align the costs and benefits and I 14 think we’ve got a good solution. And we’re most appreciative of the Texas 15 Commission taking the action that they did. Brandon’s got the directive. 16 CHAIRMAN SKRMETTA: Thank you. 17 MR. FREY: And here’s the--this is the directive. MISO has identified and will 18 seek approval from its board December 7, 2017 to direct construction of a 500 19 kilovolt transmission line from Hartsburg to Sabine located entirely in Texas. 20 This is the first market efficiency project or MEP to be built in MISO south since 21 Entergy Louisiana and Cleco became MISO members in 2013. The project is 22 estimated to cost about 129 million, and Entergy Texas is expected to enjoy about 23 72 percent of the economic benefits from the project. Yet, under MISO’s current LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 94 1 FERC approved cost allocation rules, will only be assigned approximately 18 2 percent of the cost. ELL is expected to receive 1.8 percent of the benefits and be 3 assigned over 59 percent of the cost. Louisiana, including Cleco, Entergy New 4 Orleans, and the city of Lafayette collectively will be assigned approximately 50 5 percent of the cost. Staff has been working with the Texas Commission staff, 6 MISO, ELL, and other Entergy regulators to develop a consensual solution that 7 will yield most equitable results. The proposed solution under consideration 8 would create a separate MISO load--local resource zone for Texas and Louisiana 9 for cost allocation purposes. If such separate zones are created, ELL’s share of 10 the cost would be reduced to approximately 24 percent. Entergy Texas’ share 11 would increase to approximately 62.5 percent, and the allocations to Entergy New 12 Orleans, Lafayette, and Cleco would be reduced. The Texas Commission is 13 considering the proposal this morning and FERC would need to approve the 14 allocation request after a MISO filing, which would need to be filed before the 15 December 7, 2017 MISO board meeting. This directive seeks to give authority to 16 the Staff to take all necessary steps to request that MISO make a FERC filing 17 containing the consensual resolution that, if approved, would result in the change 18 in cost allocation as described. It would also authorize the Commission executive 19 secretary, the chairman, or the commission’s executive counsel to execute any 20 dockets needed to accomplish this resolution filing. If, however, the consensual 21 resolution doesn’t move forward for any reason, in the alternative, this directive 22 would authorize the Staff, after consult--consultation with the executive secretary 23 and executive counsel be authorized to continue to pursue a remedy resulting in a LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 95 1 more equitable allocation of cost commensurate with benefits. And that 2 concludes the directive. 3 CHAIRMAN SKRMETTA: That is my directive. Commissioner Greene? 4 COMMISSIONER GREENE: I just wanted to say since everything’s bigger in 5 Texas, so should the cost be. But thank you for your hard work on this because 6 this is a big win for Louisiana. So, well done. 7 MR. ZIMMERING: Thank you, Commissioner, appreciate it. 8 CHAIRMAN SKRMETTA: Thank you very much. Any opposition to the 9 directive? [NONE HEARD] None. The matter moves forward. Next item, 10 please. 11 MR. FREY: Okay. Now we’ll move back to Exhibit 4, which is the last-- 12 CHAIRMAN SKRMETTA: Actually, we have one more to do. 13 MR. FREY: I’m sorry, we have 18. I’m sorry. We have an 18, that’s right. 14 CHAIRMAN SKRMETTA: Yeah. 15 MR. FREY: This is a directive regarding Cleco at the request of Chairman 16 Skrmetta, and I’ll read the directive. This is directive to Staff to work with the 17 Staff consultants and attorneys previously hired to work on Docket U-33434 18 regarding Cleco’s change of ownership and the compliance requirements adopted 19 in that proceeding to further direct them to work with Cleco Power, LLC, to 20 investigate and report back to the Commission any and all requirements that may 21 apply with regard to any of Cleco Power’s unregulated owners entering into any 22 agreements, acquiring any wholesale activities, which will be separate and distinct 23 from the activities of the regulated entity, Cleco Power. LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 96 1 CHAIRMAN SKRMETTA: Any questions? [NONE HEARD] Matter moves 2 forward. Back to item 4, I believe. 3 MR. FREY: Exhibit 4. 4 CHAIRMAN SKRMETTA: Okay. 5 MR. FREY: This is Docket T-34241 - Dynamic Environmental Services, LLC 6 versus Steve Kent Trucking, Inc. and Kent & Smith Holdings. In re: Complaint 7 against Steve Kent Trucking and Kent & Smith Holdings or K&S in petition to 8 rescind LPSC Order Number T-33737 and cancel Common Carrier Certificates 9 Numbers 5662-G and 5662-H. Discussion and possible vote on the motion for 10 review of interlocutory ruling. In this proceeding, DES filed a complaint against-- 11 with the PSC against Steve Kent Trucking and Kent & Smith Holdings alleging, 12 because of a licensing agreement between DES and Steve Kent, and a second 13 amendment to the licensing agreement, there was an encumbrance upon 14 Certificate 5662-F in favor of DES that was not recognized in Docket T-33737. 15 Docket T-33737 is a previous docket in which Steve Kent Trucking and K&S 16 filed a joint application with the Commission to transfer Common Carrier 17 Certificate 5662-F from Steve Kent to K&S. The transfer of that certificate was 18 approved in Order T-33737. 19 summary judgment, seeking denial, with prejudice, of one request raised by DES 20 in its complaint. In the motion for partial summary judgment, K&S sought a 21 determination on a single request raised in DES’ complaint. 22 contained two parts: 1) whether Certificate 5662-F was encumbered by the 23 agreements; and 2) whether, due to the agreements, Steve Kent was prohibited On July 26th, K&S filed a motion for partial That request LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 97 1 from assigning and/or transferring, to any party, Certificate 5662-F and/or the 2 right to use in perpetuity. K&S maintained the determination of the request raised 3 a purely legal issue and that there was no genuine issue of material fact in dispute. 4 According to K&S, the agreements provided for the farming out of a certificate, 5 which violates Commission Order 9901 as amended. K&S contends that because 6 the agreements violate Order 9901 as amended, they are absolutely null contracts 7 and thus cannot create any encumbrances. Further, K&S argued the agreements 8 are not leases and, therefore, any statute, commission order, rule, or regulation 9 pertaining to leases does not apply. DES countered with the agreements are not 10 leases under the guise of a motor vehicular lease and, therefore, do not violate 11 Order 9901. Further, DES countered that Louisiana law does not prohibit the 12 lease of a certificate and that 45:166 only requires the owner of the certificate to 13 demonstrate to the Commission substantial operations prior to the lease transfer. 14 In the ruling on the motion for partial summary judgment, the administrative law 15 judge stated as follows: 16 indicates that the requirements of 45:166(B) cannot be avoided through the use of 17 a motor vehicular lease. 45:166(B) and Order 9901, amended, do not conflict. 18 Instead, they work together to ensure that carriers do not avoid seeking 19 Commission approval for the lease for certificate by confecting a lease under the 20 guise of a motor vehicle lease. K&S has stated that the motion raises a purely 21 legal issue. That a matter of--as a matter of law, the agreements are prohibited by 22 Order 9901. However, the tribunal is not persuaded by K&S’ legal argument as 23 45:166(B) permits the lease of a certificate and Order 9901 only prohibits leases The prohibition in Order 9901 amend--as amended LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 98 1 that are confected under the guise of a motor vehicular lease. K&S has not shown 2 that the agreements were confected under the guise of a motor vehicle lease. 3 Moreover, there’s insufficient evidence in the record from which a determination 4 can be reached as to the legal nature and effect of the agreements. On October 13, 5 2017, the ALJ issued a ruling denying Kent & Smith’s motion for partial 6 summary judgment. The ruling on the motion for partial summary judgment 7 stated that a motion for summary judgment should only be granted if there is a 8 showing that there is no genuine issue as to material fact. The tribunal found that 9 there were remaining genuine issues of material fact as to the legal nature and 10 effects of the agreements. Accordingly, the motion for partial summary judgment 11 failed. On October 23rd, K&S filed a motion for review of interlocutory ruling 12 and a memorandum in support requesting the October 13th ruling be forwarded to 13 the Commission. In accordance with the procedures set out in Rule 57, the ALJ 14 did the following: 1) Declined to reconsider the October 13, 2017 ruling on the 15 motion for partial summary judgment; and 2) refer to the Commission the motion 16 for review of interlocutory ruling, filed by Kent & Smith Holdings. 17 CHAIRMAN SKRMETTA: All right. 18 MR. FREY: And this is to--to refer to you under Rule 57, you don’t have to vote 19 on a Rule 57. 20 CHAIRMAN SKRMETTA: Right. 21 MR. FREY: It’s already in front of you. 22 CHAIRMAN SKRMETTA: And so this is a motion to con--to confirm the 23 ALJ’s ruling or a motion to undo that ruling? LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 99 1 MR. FREY: This--this would be a motion to review the ALJ’s ruling and 2 overturn it. That’s what K&S filed. 3 CHAIRMAN SKRMETTA: And Staff’s recommendation is what? 4 MR. FREY: I don’t think Staff took a position on the motion for summary 5 judgment, but I’ll let Justin clarify that. 6 CHAIRMAN SKRMETTA: Okay. 7 MR. JUSTIN BELLO: Thank you, Commissioner. Justin Bello on behalf-- 8 CHAIRMAN SKRMETTA: Because the brief’s kind of wishy washy on where 9 everything is. 10 MR. BELLO: Justin Bello on behalf of Commission Staff. Brandon’s correct. 11 Staff did not take a position as to whether K&S has satisfied legal burden in order 12 to--for a summary of judgment be granted. However, we did take a position in 13 this docket. It was simply as to some legal issues that were raised by the motion, 14 but, no, we did not take a position as to whether summary judgment should be 15 granted. 16 CHAIRMAN SKRMETTA: Okay. 17 COMMISSIONER CAMPBELL: Let me ask a question. 18 CHAIRMAN SKRMETTA: Go ahead, Commissioner Campbell. 19 COMMISSIONER CAMPBELL: With all due respect, is this a little bit too hot 20 to handle? Is that why y’all didn’t do that? 21 MR. BELLO: No, Commissioner, I would disagree with that. I think this is 22 ultimately a contract dispute between three parties. You got DES, you got K&S, 23 and SKT. LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 100 1 COMMISSIONER CAMPBELL: I don’t understand that. It’s a--there’s a 2 motion of summary judgment. It was turned down, right? 3 MR. BELLO: That’s correct. 4 COMMISSIONER CAMPBELL: And the party wants to bring it here for us to 5 overrule, basically, the ALJ. That’s easy to understand. What--what’s the deal 6 over there? Why can’t y’all come up with a yes or no or what--what do you 7 think? 8 MR. BELLO: 9 indicated what we felt about the legal issues underlying it. Commissioner, we did put a position into the docket. We 10 COMMISSIONER CAMPBELL: Well, tell me about that. 11 MR. BELLO: Okay. If you--if you look at the agreement that’s at issue, 12 essentially, it’s a--it’s a licensing agreement that DES entered into with Steve 13 Kent Trucking, I think. Folks, who want to come up and talk more about that, 14 they’re more than welcome to. But that particular agreement, we consider it to be 15 a farm out agreement. 16 COMMISSIONER CAMPBELL: Yeah. 17 MR. BELLO: We consider it to be a type of agreement that’s not allowed under 18 Commission rules and regulations. 19 COMMISSIONER CAMPBELL: Yeah. 20 MR. BELLO: So that’s the position that we entered into the record. However, 21 we did not take a position as to whether K&S actually satisfied the legal burden 22 for the summary judgment. 23 COMMISSIONER CAMPBELL: Okay. LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 101 1 CHAIRMAN SKRMETTA: So, I mean, so the real question is, are there other 2 facts that need to be developed that the judge is looking at saying there--there is 3 no single issue that everyone can agree on what the problem is. There are 4 multiple problems associated with it? 5 MR. BELLO: Yes, Commissioner. The judge indicated that there were still 6 facts at issue. She also indicated that there are certain type of leases that are 7 allowed under Title 45:166. That was her--her ruling indicated that this might be 8 allowed under 166. It’s not--it didn’t say it was allowed, but again, she did 9 indicate that there were still facts at issue. 10 CHAIRMAN SKRMETTA: Any comments from the counsels for this matter? 11 MS. JANET BOLES: Yes, please. 12 CHAIRMAN SKRMETTA: And Ms. Boles, you’re representing K&S? 13 MS. BOLES: Yes. 14 CHAIRMAN SKRMETTA: Okay. And then opposing counsel, if they want to 15 come up, for Steve Kent. No, that’s Dynamic and you’re K&S, right? 16 MR. KENT PARSONS: Yes. 17 CHAIRMAN SKRMETTA: Okay. Trying to figure out who is who. 18 MS. BOLES: Janet Boles on behalf of K&S and with me is Carroll Devillier and 19 Bill Kirtland. Yes. First of all, I want to just satisfy one question. Y’all have the 20 exclusive right to deal with whether or not common carriers are complying with 21 the rules and regulations of the Commission. Even though this law is passed 22 where they don’t have to worry about PC&N and that’s being appealed and all of LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 102 1 that, that still doesn’t abrogate your exclusive jurisdiction to determine whether or 2 not the public utilities are complying with your rules and regulations. 3 COMMISSIONER CAMPBELL: On which case? 4 MS. BOLES: On this case, yes, sir. So this is properly before you. We’ll all 5 agree with that. The second--the sole issue before you is whether or not this 6 licensing agreement that was entered into, not by my client, but by DES, this 7 man’s client, and-- 8 COMMISSIONER CAMPBELL: That’s Kent Parsons. 9 MS. BOLES: And Steve Kent Trucking. Whether or not that licensing 10 agreement was valid. That licensing agreement’s two pages. 11 CHAIRMAN SKRMETTA: Janet, isn’t it accurate to say that the issue before 12 us is should the motion for summary judgment stand or fail? Isn’t that--that’s 13 what’s in the brief, right? 14 MS. BOLES: Yes. And it’s a motion for partial summary judgment on the one 15 issue. It’s whether or not this licensing agreement and the second amendment to 16 it, which are very brief--these are contractual agreements between two parties, not 17 which my client is a party, and whether or not--and they’re totally contained 18 within the four corners or those agreements. We don’t need other testimony. We 19 don’t need any parole evidence. We don’t need anything outside what’s in there. 20 You--this is a factual question. This is why this is perfect for summary judgment 21 because they’re very reticent to grant summary judgment. We know that. But in 22 this case, this single issue is a legal issue before you. 23 agreement and the second amendment comport with your rules, regulations, and Does this licensing LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 103 1 general orders. And I respectfully submit it does not. The licensing agreement 2 grants is--grant--purports for Steve Kent to grant to DES, Mr. Parson’s client, the 3 non-exclusive right to use the certificate of authority. Nobody can do that but 4 y’all. Nobody can do that. The reason they can’t is because if I own a certificate 5 and I say well, I’m going to go let Bill use it for a while or I’m going to go let Eve 6 use it for a while, or I’m going to go and--and parcel it out and let them use it, 7 well, I could have 20 or 30 people operating under my certificate without ever 8 coming to you for your approval. And the purpose of coming to you for your 9 approval is to make sure that those persons operating under my certificate are 10 qualified and abiding by the rules. So we do not allow farming out. You have 11 specific rule, and that has been the jurisprudence up here for 50 years. Fifty years 12 you’ve said, an authorized carrier cannot authorize an unauthorized person to 13 operate under his authority. And that’s what this licensing agreement did. Now, 14 there’s nothing--they’ve never claimed this was a lease until just newly. But the 15 lease--clearly, you can lease a certificate. You can lease vehicles. We’re not 16 objecting to that. They’ve never come before you and asked for you to determine 17 that this licensing agreement is valid. 18 COMMISSIONER CAMPBELL: I got a question. 19 MS. BOLES: Yes, sir. 20 COMMISSIONER CAMPBELL: State this again, Ms. Boles. I was sort of 21 confused. 22 MS. BOLES: Okay. LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 104 1 COMMISSIONER CAMPBELL: How long have we had this exclusive 2 agreement where people could have these permits? How long did you say? 3 MS. BOLES: You’ve had it--you’ve been granting certificates since way before 4 this, but in 1968, you adopted this General Order 9901. 5 COMMISSIONER CAMPBELL: Fifty year--50 years, you said, we’ve had 6 this? 7 MS. BOLES: Almost 50 years. 8 COMMISSIONER CAMPBELL: Well, let me ask you about this procedure. 9 Just--I’m just seeking information. 10 MS. BOLES: Yes, sir. 11 COMMISSIONER CAMPBELL: Now, for 50 years, this--this body here, a 12 long length of folks that’s been here, and I’ve been here the longest, if you wanted 13 to haul this stuff, you had to come get a permit. 14 MS. BOLES: That is correct. 15 COMMISSIONER CAMPBELL: 16 permit stuff. You know, I--I did a pretty good job about the platinum permit and- 17 -now, we’re talking about a platinum permit here on your deal, right? 18 MS. BOLES: Uh-- 19 COMMISSIONER CAMPBELL: This is a platinum one. 20 MS. BOLES: The one my client bought? 21 COMMISSIONER CAMPBELL: Yeah. 22 MS. BOLES: The one his client was using? And we’ve already been through all the LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 105 1 COMMISSIONER CAMPBELL: Yeah, that was a platinum--that was a 2 platinum Rolex. That’s the best of the best. 3 MS. BOLES: It has some restrictions in it, so I’m not sure of your definition. 4 But I-- 5 COMMISSIONER CAMPBELL: Well, I’m going to explain it to you. 6 MS. BOLES: I’ll say it’s a pretty good one. 7 COMMISSIONER CAMPBELL: No, it’s as good as you can get. It’s not a 8 gold Rolex. This is a platinum. And there’s only 12 people--I want this for the 9 people to know, there’s only 12 of them in Louisiana that have these things. So 10 no wonder they’re worth millions of dollars. Millions of dollars, I ain’t talking 11 about $100,000. We’re talking about million dollar here. So I just want the 12 record--I just want to--as we go along, I’m trying to understand this program. 13 And it’s very--and by the way, there’s not one of these north of I-10. Not one in 14 north Louisiana. 15 MS. BOLES: Well, the--the--there’s certain undisputed facts that I think are 16 imperative to you making a decision on this case today. And these are not dis-- 17 disputed by DES or by K&S. 18 transported regulated waste in the state of Louisiana since ’04 or ’05. That’s in 19 their deposition, they say that. 20 CHAIRMAN SKRMETTA: Yeah, I understand. 21 MR. KENT PARSONS: And can I--I’ve got to raise an objection about there 22 being undisputed facts. There absolutely are--and I apologize for interrupting And Steve Kent hasn’t appeared. DES has LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 106 1 you. I’m not trying to do that. I’m just--for the record, want to state that the facts 2 are absolutely disputed, and you know why they are? 3 CHAIRMAN SKRMETTA: That’s fine. We’re going to get to you. 4 MS. BOLES: Wait. 5 MR. PARSONS: All right. Okay, good. 6 MS. BOLES: These facts that I’m saying-- 7 CHAIRMAN SKRMETTA: I mean, when I start hearing it being repeated three 8 times is when I’ll ask her to wrap it up. 9 MR. PARSONS: All I wanted to do was just make my objection for the record. 10 CHAIRMAN SKRMETTA: I’m used to the three time repeat. 11 MS. BOLES: Well, I don’t--you’re not disputing this fact, that they’ve operated. 12 It’s in their deposition. They hired LPSC lawyer in November of ‘13 to get their 13 own authority, undisputed fact. 14 December of ’13 and didn’t tell their PSC lawyer they had executed it. Now, if 15 they thought this licensing agreement was all that and they could haul--had a non- 16 exclusive right to haul under this Rolex or platinum certificate, why would they 17 need to apply for authority? But two weeks after they filed--signed this licensing 18 agreement, they applied for authority from your Commission to get their own 19 authority. 20 COMMISSIONER FRANCIS: So you’re saying that they--they hired a PSC 21 special lawyer-- 22 MS. BOLES: Yes, sir. They executed the licensing agreement in LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 107 1 COMMISSIONER FRANCIS: --to make sure that all the documents and 2 paperwork and their authority would be good when they made the deal to sell; is 3 that true? 4 MS. BOLES: To buy their own authority. 5 COMMISSIONER FRANCIS: And who was their-- 6 MS. BOLES: I mean, to apply for their own authority. 7 COMMISSIONER FRANCIS: --attorney? What attorney was hired for this? 8 MS. BOLES: Marionneaux Kantrow. 9 COMMISSIONER FRANCIS: Yeah, they represent--they do a lot of activity 10 here and--is Marionneaux here or a representative? 11 MR. PARSONS: Yeah, he’s here. 12 COMMISSIONER FRANCIS: I think he’s-- 13 CHAIRMAN SKRMETTA: They’re in the back. 14 COMMISSIONER FRANCIS: This witness would be--this testimony would be 15 important in understanding, you know, all the things that are going on here. 16 MS. BOLES: The--the point of this is that D--DES never gave that licensing 17 agreement to their PSC lawyers, while they’re applying for their own authority. 18 Now, that’s a fact. DES never disclosed they had a licensing agreement when 19 they applied for authority two weeks later. Never disclosed it to the Commission. 20 They never disclosed they had been transporting regulated waste in their 21 application to the Commission. And they filed, in ’14, 13 leases under Steve Kent 22 Trucking’s authority, and they stated, under oath, that they never intended to 23 comply with one of those rules in that lease. And every question was asked about LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 108 1 invoicing, dispatching, paying the taxes, everything, and they did not comply with 2 any of the rules under those leases. Yet, they filed it with y’all, but they didn’t 3 comply with them. Subsequent to that, DES applied to buy an authority from 4 Deep South, and when they did, they didn’t disclose the licensing agreement. So 5 they had numerous opportunities to come to y’all and say, I have this licensing 6 agreement and I paid good money for it, and I should be able to operate under it. 7 Why had they not done that to date? In my opinion, I respectfully submit--this is 8 not one of the undisputed facts--is that they know it’s not worth the paper it’s 9 written on. 10 COMMISSIONER CAMPBELL: Why’d they give a million for it? 11 MS. BOLES: That’s--you would have to ask them. They--they paid $6 million 12 for the transaction which involved a lot of--an interest in a business, all sorts of 13 things. 14 COMMISSIONER CAMPBELL: But I’m just-- 15 MS. BOLES: And you and I know you can assign different amounts based on 16 what you’re going to get credit for, tax credit, and that sort of thing. 17 COMMISSIONER CAMPBELL: Let me ask you a question. 18 MS. BOLES: Yes, sir. 19 COMMISSIONER CAMPBELL: Why--if it wasn’t worth anything, they knew 20 it wasn’t worth anything--now, I’m just asking--why would anybody shell out a 21 million dollars to buy something they knew wasn’t worth anything? Why would 22 you do that? LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 109 1 MS. BOLES: You’ll have to ask them because I can’t get inside their brain. But 2 my opinion is that they just assigned a price to it as part of the purchase 3 agreement. And that’s done any time you have a business transaction. You do 4 part to Goodwill or part to whatever and depending on tax consequences. But I 5 don’t know the answer. 6 CHAIRMAN SKRMETTA: Well, I’d like to see if--could you get to a point 7 where you can complete your argument so we can at least hear from the other 8 side? 9 MS. BOLES: Yes, sir. I’ll try to--to--it’s--as I said, the sole issue before you is 10 whether or not the licensing agreement and the second amendment are valid. 11 That’s the motion for partial summary judgment. If they are--if they are in 12 violation of your rules and regulations and your general order against farming out, 13 then they are not valid and create no encumbrance. We think this is the perfect 14 case for a motion for partial summary to be granted, which is why we have asked 15 you to look at it. Take it away from the ALJ and make this decision. My client 16 wasn’t even a party to this. My client came in two years later and bought it, hired 17 lawyers, went through the process at the PSC, got the approval that everybody is 18 supposed to get to--to--and followed the rules. And yet, he has been in litigation 19 for an excess of a year, hemorrhaging legal fees to try to get this resolved, and he 20 wasn’t even a party to the agreement. They’re saying that we owed an obligation 21 to notify them. They didn’t even notify the Commission about the licensing 22 agreement. They’re arguing good faith, they didn’t do anything--all these other 23 things that I’ve listed that are unrefuted that they didn’t do, and yet, they’re going LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 110 1 to come with a good faith argument. The only one in good faith at this table is my 2 client. And they deserve to have a resolution to this matter, and it’s y’all’s 3 obligation, I respectfully submit, to bring closure to this unfair litigation and 4 resolve it by making a hard decision and deciding in favor of the motion for 5 partial summary judgment. 6 COMMISSIONER CAMPBELL: Okay. Let me ask you something. 7 CHAIRMAN SKRMETTA: Hang on a second. Go ahead. You need to use 8 your microphone, Commissioner. 9 COMMISSIONER CAMPBELL: What are you--and you’re doing a good job. 10 Okay. 11 MS. BOLES: Thank you. 12 COMMISSIONER CAMPBELL: You’re doing a good job. But what are you 13 so worried about going back to the ALJ for? That’s why we have those people. 14 And I’m just asking because if we go back to the ALJ, and they don’t rule in your 15 favor, then you can come back and make this argument again. I mean, what--I 16 mean, I don’t--help me with that. 17 MS. BOLES: Okay. I’ve heard the argument made from the other side and their 18 lobbyists that let the process play out. Let the ALJ finish it. I don’t even know 19 what a trial on this matter would look like. We’ve deposed every person, every 20 principal. Everybody’s had their say. What else is there to put forth on this? The 21 document speaks for itself. We can’t make the document something it isn’t. 22 Either it complies with your rules or it doesn’t. And your Staff attorney has said 23 it is an illegal farm out. The ALJ didn’t say it wasn’t an illegal farm out. She just LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 111 1 said I think we need more information. I think there’s a genuine issue of material 2 fact. There’s a dispute. 3 CHAIRMAN SKRMETTA: Okay. 4 MS. BOLES: Let’s go forward. 5 CHAIRMAN SKRMETTA: All right. So I think you cleared it up that if you 6 were not successful today, you’d still have the trial as a backup, number one. 7 MS. BOLES: Yes, sir. 8 CHAIRMAN SKRMETTA: Okay. Because I know-- 9 MS. BOLES: Whatever that may be. 10 CHAIRMAN SKRMETTA: No, I understand. And let me ask you a question 11 for Staff. Can we structure a constricted timeframe for the ALJ to have a hearing 12 and return a decision on it if we decide to go that way? 13 SECRETARY GONZALEZ: Yes, but I’ll let Justin speak to where they are 14 now, so that--if he has any additional facts. 15 CHAIRMAN SKRMETTA: Justin, can you give me a--a time and date aspect 16 of what this could go forward and be dealt with so it’s not just dragging on? 17 MR. BELLO: 18 Obviously, that was continued as a result of the filing of the partial summary 19 judgment. So I believe the parties are close to going forward to a hearing on it. I 20 don’t think it could take--wouldn’t take too long to prepare. 21 CHAIRMAN SKRMETTA: Can the Commission--can the Commission order 22 the judge? 23 MR. FREY: Yes. There was a hearing scheduled for this for September 13th. LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 112 1 CHAIRMAN SKRMETTA: So we can order the judge to have a complete 2 hearing on this in December, if everything’s already done, right? 3 MR. PARSONS: No. 4 CHAIRMAN SKRMETTA: No. Okay. January? 5 MR. PARSONS: Yes. 6 CHAIRMAN SKRMETTA: Okay. So basically, a delay of 60 days if that’s the 7 way this thing moves forward. I’m not saying it is. All right. And Commissioner 8 Francis, you had some questions before we move onto the other side? 9 SECRETARY GONZALEZ: Or you could make it more general that you want 10 a ruling from the judge by a certain date-- 11 CHAIRMAN SKRMETTA: Got it. 12 SECRETARY GONZALEZ: --for the Commission to consider either way. 13 CHAIRMAN SKRMETTA: What’s the--what’s the B&E date in January? 14 MR. FREY: We don’t have one yet. 15 SECRETARY GONZALEZ: I don’t think--I don’t think it would be ready for 16 January though. 17 CHAIRMAN SKRMETTA: Okay. All right. 18 SECRETARY GONZALEZ: Because they have, you know-- once there’s the 19 hearing, then you’ve got the ALJ has to review all the-- 20 CHAIRMAN SKRMETTA: I understand. 21 SECRETARY GONZALEZ: --evidence and then the parties get to, you know, 22 file objections. 23 CHAIRMAN SKRMETTA: Okay. Commissioner Francis? LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 113 1 COMMISSIONER FRANCIS: Knowing that Mr. Marionneaux practices 2 before us and got a good reputation and he’s involved in it, his representative is 3 here, I’d just like to know just briefly, Marionneaux was hired to help these 4 people understand the LPSC rules that we have on how you operate trucking 5 authority and what you do and don’t do. So why didn’t Marionneaux keep this 6 problem from coming before us? Okay. So what’s the answer? 7 CHAIRMAN SKRMETTA: You need to just state your name for the record. 8 MR. CONNELL ARCHEY: 9 Archey. I’m here representing Kyle Marionneaux and the Marionneaux Kantrow 10 Law Firm. And let me begin by saying that Mr. Marionneaux would love to get 11 up here and visit and give--answer these questions himself, but there are legal 12 ethical issues, litigation issues that I’m not allowing him to do so. So that’s on 13 me. All right. Let me address your question very directly and very specifically 14 because I can give you a perfect answer to this. DES hired Marionneaux Kantrow 15 Law Firm in December of 2013 to apply for a certificate. That is exactly what 16 they did. On January 2, of 2013, they applied for the--for certificate for DES. 17 DES never, ever once told the Marionneaux Kantrow Law Firm that they had 18 entered into this licensing agreement. And it’s even more difficult to understand 19 when you realize they entered in that license agreement two weeks before the 20 Marionneaux Kantrow Law Firm filed for this certificate on behalf of DES. DES 21 had entered into this licensing agreement and never, ever told this law firm about 22 it, ever, to this day. 23 COMMISSIONER FRANCIS: Did DES-- I will, Mr. Chairman. My name is Connell LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 114 1 CHAIRMAN SKRMETTA: That’s a different issue than is here today, correct? 2 MR. ARCHEY: Excuse me, Mr. Chairman? 3 CHAIRMAN SKRMETTA: That’s a different issue than is here today, correct? 4 MR. ARCHEY: Well, it goes to the question I’m answering for Commissioner 5 Francis. 6 CHAIRMAN SKRMETTA: Is that a yes or a no? 7 MR. ARCHEY: No. I think it is rolled up into this and this is why. 8 CHAIRMAN SKRMETTA: Okay. 9 MR. ARCHEY: Is that the licensing agreement is an illegal farm out just like the 10 Staff found and just like Mr. Marionneaux opined. And because of that, it never 11 had any play into this and he never advised--DES didn’t ask them to advise. And 12 matter of fact, they were asking him about leases and things like that and they 13 never said license agreement. I would say this goes to the good faith argument as 14 well. So the final point I’ll make and as I try to conclude this is Mr. Marionneaux 15 did the right thing. He was trying. He was doing what he could to follow these 16 rules. He looks at the Commission rules and says this is illegal farm out just like 17 your Staff found. The--as far as whether to send this back or not, I think the 18 answer to that is are there any set of facts whereby this could be valid? If there 19 are not, then I suggest to the Commission that you ought to rule right now and 20 find that either it could be valid or, like your Staff has found, it’s not. 21 COMMISSIONER CAMPBELL: Let me ask a question. 22 CHAIRMAN SKRMETTA: Go right ahead. Are you finished? 23 COMMISSIONER FRANCIS: Yes. LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 115 1 CHAIRMAN SKRMETTA: Okay. 2 MR. ARCHEY: Did I cover your question, Commissioner? 3 COMMISSIONER FRANCIS: Yes, thank you. 4 CHAIRMAN SKRMETTA: Thank you. 5 COMMISSIONER CAMPBELL: You say there’s no other facts, right? Mr. 6 Parsons probably wouldn’t agree with you on that. 7 MR. PARSONS: Absolutely disagree. 8 CHAIRMAN SKRMETTA: We’re still going to get to you. 9 COMMISSIONER CAMPBELL: Anyway. Let me get through talking to you 10 now. I’m talking. Now, I’m just asking, all due respect, so for me to hear the 11 whole deal, I--I’m just--first of all, I really--this whole thing makes me sick at my 12 stomach. 13 dollars to haul oilfield equipment and you force everybody else out of it. And 14 it’s--thank God the legislature passed a law knocking it out. Fifty years, this has 15 been a bad sit--situation. But anyway. I don’t understand, we have a ALJ. Y’all 16 as scared of her as you are a rattlesnake. What’s the deal? Go back and let her 17 have her day--have your day in court. And if--and you say you--you got all the 18 facts, that’s what you just said. There’s no other facts. He says there is facts. So 19 logically, you’ve got to let the facts come out. If they scare you, they scare you, 20 but if they don’t scare you, let them come out. If you’re so sure you’re right, 21 well, let it go back up there and let the woman make a decision and then you can 22 come here and say I don’t agree with her. And then we’ll get a chance to vote on 23 it. But you want to--you want to prejudge her. Some reason, y’all scared of this The whole deal does because you got millionaires paying million LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 116 1 woman as you are a rattlesnake. I don’t know what it is. You afraid she’s got 2 something you don’t want to hear. And that’s why we hire these people. And 3 listen, I been with Janet Boles a lot of times. I got a decision one time that I really 4 didn’t like from the ALJ, but that’s the way it happens. 5 MR. ARCHEY: Commissioner, to respond to your question, it’s not that there 6 are other facts that are or not in dispute, the position is there can be no other facts. 7 It’s, you know, the--the law says that, for instance, that circle--that seal has to be a 8 round circle, and I bring it to you and I say it’s square. Look at the document, it’s 9 not circle. It’s a square. We’re done. That’s where we are, and so because of 10 that, what I’m suggesting to the Commission is there can be no other set of facts 11 that could somehow turn this illegal farm out licensing agreement into something 12 legal. And so if that’s the case, then you should rule that this is illegal and done 13 and the reason for that--I would suggest is, it is expensive. And I would also 14 suggest to the Commission, there are other matters on which this one turns. 15 CHAIRMAN SKRMETTA: Thank you very much. 16 COMMISSIONER CAMPBELL: You said it’s expensive. You mean you’re 17 expensive. 18 MR. ARCHEY: I am. 19 COMMISSIONER CAMPBELL: Okay. 20 MR. ARCHEY: You are right. I hope so. My kids in college hope so. 21 CHAIRMAN SKRMETTA: Okay. Okay. Okay. 22 MR. ARCHEY: And that’s right. LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 117 1 CHAIRMAN SKRMETTA: Okay. I got two vampires at home too. All right. 2 Mr. Parsons. 3 MR. PARSONS: Yes. 4 CHAIRMAN SKRMETTA: 5 exhaust yourself. 6 MR. PARSONS: Exhaust myself. I’m--I’m not going to exhaust myself, but I 7 got exhausted hearing the stuff that wasn’t anywhere close to being on the record. 8 Commissioner Francis, everything you heard had--is not evidence yet. 9 Everything you heard. It’s your turn, and they took 20 minutes, so 10 CHAIRMAN SKRMETTA: It’s the my cousin Vinny defense, right? 11 MR. PARSONS: I--yeah, he won. Yeah, you’re right. This is my cousin Vinny, 12 yes. The ALJ did not say we win, and we heard from the Commission Staff, 13 respectfully, his opinion is this is an illegal contract. It’s their opinion. The ALJ 14 agrees with me on this point, that she doesn’t have enough facts to say one way or 15 the other. 16 specifically said does not apply. 9901 deals with a certificate of a lease under the 17 guise of motor vehicular leases, that is a farm out. My lease, which is under the 18 licensing agreements--leases are absolutely allowed under this Commission’s 19 rule--under the 45.166(B). What you just heard was a bunch of lawyer argument. 20 And one of the lawyers who argued represents lawyers who are not even a part of 21 this case. They’re not here. 22 CHAIRMAN SKRMETTA: Stick--stick to your primary argument, please. But the law that they cite, which constitutes the illegality, she LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 118 1 MR. PARSONS: What you’ve heard is lawyer argument. It’s not equivalent to 2 evidence. The Commission has a procedure by which the Commission’s duly 3 appointed administrative law judge hears the case. That judge calls balls and 4 strikes. 5 importantly, they make credibility assessments. They decide whether my client is 6 so bad and such illegal law breakers. This supposedly illegal contract, you know 7 who it was entered into with by my clients? A gentleman named Steve Kent. 8 You know who Steve Kent is an employee off today? K&S, Ms. Boles’ client. 9 He was an employee of K&S on May 4, 2015. On May 8, 2015, he took 10 $600,000 from my client for the right to use the certificate. In that document, he 11 specifically encumbered it and said I’m not going to sell this to anybody else. 12 Seventy-seven days later, on July 25th, what does he do? He turns around and 13 sells it to his employer. He goes to a Commission hearing and he doesn’t tell the 14 Commission a doggone thing about it. About the agree--about the supposedly 15 illegal contract we had. So you keep hearing all this stuff about us being such 16 outlaws. When my clients violated the law, didn’t tell anybody anything. The 17 person with the certificate--the person who owned the certificate is a gentleman 18 that is an employee today of Ms. Boles. He was an employee when he took the 19 last $600,000 of my client’s money. He was an employee on the day he testified 20 to the Commission that I follow every rule. I know the rules inside and out. I 21 follow them all. I know them to a T. So you got a lack of candor issue with this 22 Commission whenever he came to this Commission to get that certificate 23 transferred. Commissioner Campbell, I’ll tell you what they’re afraid of. They’re During the trial on the merits, they weigh the evidence, and most LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 119 1 afraid of Steve Kent being subpoenaed to testify, which I’m going to do for this 2 trial. We have filed a complaint, not just against her unattached, not having 3 anything to do with this agreement guy, but on the day the second amendment 4 was done, he was an employee. 5 CHAIRMAN SKRMETTA: Is there any prior depositions or statements from 6 Mr. Kent in the record? 7 MR. PARSONS: Yes, there are. There are some depositions, and they didn’t 8 cover this specific issue one--one iota. 9 CHAIRMAN SKRMETTA: Okay. Thank you. 10 MR. PARSONS: On the case before you, the one but very crucial legal 11 argument on the thing we’re talking about here today, whether this--these 12 licensing agreements, and we call it a lease, and the--and we refer to it as such, 13 and the ALJ did not dispute that. The ALJ did say she has insufficient facts 14 before her to make a finding, contrary to what they’re saying. She said she 15 doesn’t have enough facts. And she’s calling balls and strikes. And who--and she 16 does this for you. You’ve got to rely on your administrative law judge division. 17 COMMISSIONER CAMPBELL: 18 understand it still. This gentleman said there are no facts. That’s what you told 19 me, right? You say the ALJ says she needs some more facts. Somebody’s got it 20 mixed up. 21 MR. PARSONS: Well, her opinion matters. She wears the black robe. He 22 doesn’t. 23 interrupting, Commissioner--but she wears that black robe for y’all. If you didn’t I’m just--I’m trying--I’m trying to And she wears that black robe, very important--excuse me for LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 120 1 have an administrative law judge--judge division, all five of y’all would have to 2 come down three or four days a week and listen to all this stuff. That’s not the 3 way this Commission is set up. It’s a constitutional body. It’s unusual in the 4 United States, and so you’ve got the ability to live where you live, keep a job, not 5 necessarily have this be a full-time job, although it works out to be a full-time job, 6 virtually. But then you--but you’ve got an administrative law judge division that 7 calls those balls and strikes, make creditability assessments, and then gives you a 8 recommendation. All she did in this case was say I disagree with your position, 9 Ms. Boles. I disagree that there’s no genuine issue of material fact and this is 10 strictly a legal issue. She said I need more facts. And whenever your judge says 11 she needs more facts, if you don’t rely on that, then what--that’s the very 12 definition of the thing that violates the rule. The Commission can’t act in a way 13 that is--that looks like it’s arbitrary and capricious. That is the rule. That’s the 14 rule. When your judge says I don’t have enough facts and y’all haven’t sat for 15 any of the hearing and all of this stuff--all this lawyer argument, which is not 16 evidence, you’ve got to have a record of evidence before you before you can 17 make--listen to anymore of this stuff. Please let us go to a hearing. Embedded in 18 the ALJ’s decision is the very reason why you cannot grant the request being 19 made by K&S today. They’re asking you to overrule her. Embedded in that 20 decision is her statement, I don’t have enough facts. I need more facts. Let’s 21 have a hearing. Let’s have a hearing. Let’s tee it up. I’m ready to go. I was 22 ready to go on September 11, 12, and 13 this year. On June 25th, the ALJ said 23 we’re going to have a hearing on that day. The other side said, we want to file a LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 121 1 motion for summary judgment. The ALJ said then, I don’t--I disagree with y’all 2 about there being facts that are not in dispute. I think everything is in dispute in 3 this case. And if you file a motion for summary judgment, I think it’s going be a 4 waste of time. But--and she also said, if you file a motion for summary judgment, 5 you’re going to lose your trial date. They did it anyway. And so what did she do? 6 She scheduled the hearing on the motion for summary judgment on the day that 7 we were supposed to have this trial. Once again, the ALJ didn’t say we win, 8 didn’t say she loses--Ms. Boles, didn’t say her client loses. Says she doesn’t have 9 enough facts. And I want to make a point, again, these are only allegations. 10 These are only statements by lawyers. 11 CHAIRMAN SKRMETTA: If you would excuse for us for one second, let you 12 collect your thoughts. Commissioner Francis has a question. 13 COMMISSIONER FRANCIS: I got a question for Ms. Gonzalez. I want to 14 make sure--you know, there’s a lot of talk about deregulation and lawsuits about 15 our amending or changing our rules and regulations, what authority we have. At 16 this time, though, this--this particular rule that’s been accused of being broken, 17 it’s still in play, isn’t it? 18 SECRETARY GONZALEZ: Yes. 19 COMMISSIONER FRANCIS: It’s just exactly-- 20 SECRETARY GONZALEZ: It is. 21 COMMISSIONER FRANCIS: Okay. So there’s no deregulation at this timeof 22 our authority? 23 SECRETARY GONZALEZ: No. LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 122 1 COMMISSIONER FRANCIS: Just talk of changing some of the situation. 2 Okay. I just wanted to make sure. 3 SECRETARY GONZALEZ: Correct. And--and a lot of the issues in this are 4 not really totally related to the rule in question anyway, so. 5 COMMISSIONER FRANCIS: Okay. 6 COMMISSIONER CAMPBELL: Well, let me say something. I disagree with 7 Ms. Gonzalez. She’s not a law--she’s not a judge. And neither is Mr. Brandon 8 over there. They’re not judges. I think it’s illegal as hell because the legislature 9 passed a law. Now, this is not because it’s before the law was passed. This was 10 way back. But as of today, it’s as--what we’re today is absolutely relie--illegal 11 about anybody applying for permits now. They ought to be able to open the door 12 and let them have it. The legislature passed it. The governor signed it. It is legal. 13 Now, we got two judges over here says it’s not legal. But they didn’t--they not 14 judges. They didn’t get elected. But we’re acting like we’re judges. The only 15 way you can turn down a law--and y’all all know that. All of y’all are lawyers. 16 You know if the legislature passes a law, that’s the law until it’s proven 17 unconstitutional. They have not got a judge to put a stay on this law. Judge 18 Gonzalez and Judge Brandon is putting a stay on the law because they say it’s 19 taking a little bit of our jurisprudence--our authority. The legislature took the 20 authority away. But here we are, bowed up over here, saying I don’t care what 21 the legislature said. But they hadn’t got a judge to say that. They’re saying it. 22 And three people up here, we’re saying it. I think we’re operating totally illegal, 23 and y’all all know we are too. You know that, but under this case, now, I will LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 123 1 agree this is before the law was passed. But from now on, we ought to have the 2 doors wide open. Anybody wants a permit, go by the law because--or get you a 3 judge to say this law is unconstitutional. And they hadn’t done that yet. 4 COMMISSIONER FRANCIS: Chairman? 5 CHAIRMAN SKRMETTA: Yeah, go ahead. 6 COMMISSIONER FRANCIS: You know, I’ve got a lot of friends that want 7 these Rolex gold-plated authorities. If it’s deregulated, they can all come on 8 down and get some of it, huh? 9 COMMISSIONER CAMPBELL: Yeah. 10 COMMISSIONER FRANCIS: So is that--Ms. Gonzalez, is that true? Is--can I 11 tell my friends the door is open? 12 SECRETARY GONZALEZ: At this point, the Commission has directed us to 13 challenge the law. So the other--your current rules stay in place. We’re doing 14 what the Commission, as a whole, has directed us to do. 15 COMMISSIONER FRANCIS: All right. 16 SECRETARY GONZALEZ: So, no, they can’t. 17 CHAIRMAN SKRMETTA: Anyway. 18 COMMISSIONER FRANCIS: Okay. I’m through with that. 19 CHAIRMAN SKRMETTA: Okay. Mr. Parsons, would you like to continue-- 20 MR. PARSONS: Yes. 21 CHAIRMAN SKRMETTA: --continue, please. 22 MR. PARSONS: Yes, I would. There’s--just too close, there’s really no--there’s 23 absolutely no compelling reason to deviate from your established process, which LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 124 1 is to get all the facts before you rule. I think we’re at a place where, please allow 2 your administrative law judge to have the hearing and make a decision up or 3 down on all the issues that are set forth before them. And one last thing I want to 4 say, it would be constitutionally infirm--it would be constitutionally infirm for us 5 not to have the ability to cross-examine Steve Kent. We’ve got a due process 6 right to cross-examine Steve Kent because he--their employee, he is the person 7 they are saying was the certificate holder who engaged in the farm out. I want 8 Steve Kent to testify under oath that he took a million dollars from my client 9 pursuant to an illegal contract. That’s what they are saying, and I want to 10 discover that. 11 CHAIRMAN SKRMETTA: 12 question to Staff, because I want to make sure--because the complexity of this--so 13 the--this is an action brought by Ms. Boles. 14 MR. FREY: Correct. 15 CHAIRMAN SKRMETTA: And so it is--we vote in favor-- 16 MS. BOLES: No, it-- 17 CHAIRMAN SKRMETTA: I’m sorry? 18 MS. BOLES: It originated with-- 19 CHAIRMAN SKRMETTA: Oh, it originated with-- 20 MR. FREY: But you’re talking about what’s currently before you today. 21 CHAIRMAN SKRMETTA: No, I’m talking about what’s before us today. 22 MR. FREY: Correct, correct. 23 CHAIRMAN SKRMETTA: That is Ms. Boles’ issue. All right. Well, thank you very much. My LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 125 1 MR. FREY: Correct. 2 CHAIRMAN SKRMETTA: So a vote to affirm-- 3 MR. FREY: Would be affirming the ALJ’s interlocutory ruling. 4 CHAIRMAN SKRMETTA: Okay. 5 MR. FREY: Which, that’s the way I would interpret it, if that’s your intent. 6 CHAIRMAN SKRMETTA: Okay. 7 MR. FREY: If it’s--otherwise would be to overturn the ALJ. So you either 8 affirming or overturning. 9 CHAIRMAN SKRMETTA: Okay. Because it’s a fairly complex thing. But I 10 will--go ahead, Commissioner Campbell. Go ahead. 11 MS. BOLES: And may I just call for one retort? 12 CHAIRMAN SKRMETTA: Sure, as long as it doesn’t take 20 minutes. 13 MS. BOLES: 14 deposition. 15 SECRETARY GONZALEZ: We need to--we need to put on your mic or-- 16 CHAIRMAN SKRMETTA: You might need your microphone, Janet. 17 MS. BOLES: Steve Kent submitted to a six hour deposition, so they’ve had 18 plenty of time to ask him about everything--everything. Kent--and he didn’t use 19 any of the depositions in his arguments or his briefs, as I did with Mr. Upton. 20 CHAIRMAN SKRMETTA: And I understand. 21 MS. BOLES: Kent--Kent has not--Mr. Parsons has not mentioned-- 22 MR. PARSONS: Distinction of Kent. We’re talking about-- It’s just two seconds. Steve Kent submitted to a six hour LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 126 1 MS. BOLES: Mr. Parsons has not mentioned any fact which would make that 2 agreement valid. The language in that agreement--that licensing agreement--is 3 unambiguous and clear, and there is--it is invalid under your rules. And he’s not 4 mentioned one fact that changes that. 5 CHAIRMAN SKRMETTA: Okay. Mr. Campbell--Commissioner Campbell. 6 COMMISSIONER CAMPBELL: I want to make a motion. 7 CHAIRMAN SKRMETTA: Go ahead. 8 COMMISSIONER CAMPBELL: And help me here, Ms.--Judge Gonzalez, 9 help me here. 10 SECRETARY GONZALEZ: I’ll do that. 11 CHAIRMAN SKRMETTA: She’s on her way to being a judge. January, 12 somewhere. 13 COMMISSIONER CAMPBELL: Anyway. The motion I want to make is to 14 send it back to the ALJ. And that’s what--so give me the motion. 15 MR. FREY: For the full hearing? 16 SECRETARY GONZALEZ: Basically, yeah, you want to affirm her ruling. 17 COMMISSIONER CAMPBELL: I do. 18 SECRETARY GONZALEZ: Okay. So your motion is to affirm the ruling of 19 the ALJ. 20 CHAIRMAN SKRMETTA: Any seconds? 21 COMMISSIONER CAMPBELL: And she goes back--it goes back to her, 22 correct? 23 MR. FREY: Yes. LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 127 1 SECRETARY GONZALEZ: Yeah, it will go back to her for the full hearing, 2 uh-huh. 3 CHAIRMAN SKRMETTA: Okay. 4 COMMISSIONER CAMPBELL: Okay. 5 CHAIRMAN SKRMETTA: 6 opposition? [NONE HEARD] Hearing none, the matter is done. 7 MS. BOLES: Thank you. 8 CHAIRMAN SKRMETTA: Chair moves to adjourn. Any seconds? 9 COMMISSIONER FRANCIS: Second. 10 CHAIRMAN SKRMETTA: 11 Meeting’s adjourned. Any seconds? Chair will second. Hear any opposition? Any [NONE HEARD] 12 13 14 (WHEREUPON THE MEETING WAS ADJOURNED) 15 LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 128 1 I certify that the forgoing pages 1 through 128 are true and correct to the 2 best of my knowledge of the Open Session of the Business and Executive 3 Meeting held on November 17, 2017 in Baton Rouge, Louisiana. 4 *************************************************************** 5 6 _______________________ November 28, 2017 7 Jaime G. Melancon, Date 8 Administrative Assistant IV/Hearing Reporter 9 10 ****************************************************************** 11 Proofed and finalized by: 12 13 _______________________ November 28, 2017 14 Nicole Hopper, Date 15 Administrative Assistant IV/Hearing Reporter 16 17 **************************************************************** 18 Proofed and finalized by: 19 20 _______________________ November 28, 2017 21 Kathy Dykes, Date 22 Administrative Assistant IV/Hearing Reporter 23 LPSC B&E Open Session November 17, 2017 Baton Rouge, LA 129