Santee Cooper Bombshell

Sparks fly between rogue utility, legislative leaders …

South Carolina’s government-run utility Santee Cooper is attempting to enter into an agreement with an out-of-state investor-owned utility in direct contravention of the wishes of the governor’s office and the S.C. General Assembly, which are currently mulling whether to sell the toxic asset or allow a private sector company to manage it.

The utility may also be acting outside the scope of a law passed earlier this year seeking to establish a framework for its future.

According to a series of letters obtained exclusively by this news outlet, the debt-addled utility is seeking to enter into a “memorandum of understanding” with Atlanta, Georgia-based Southern Company.

Many believe the deal is an attempt by Santee Cooper to “thwart potential buyers” as the utility’s future remains very much up in the air following the 2017 #NukeGate debacle – a failed crony capitalist experiment that cost taxpayers and ratepayers $10 billion.

This “memorandum of understanding” is being pursued over the objections of governor Henry McMaster’s administration – and the objections of powerful state senator Hugh Leatherman, who wrote the new chief executive officer of Santee Cooper on Monday and told him to stand down.

In his letter to Santee Cooper CEO Mark Bonsall dated September 2, 2019, Leatherman indicated that McMaster (below) might use his appointment authority to remove Santee Cooper board members who went along with any such agreement.

(Click to view)

(Via: S.C. Governor)

“I request of you to ensure that Santee Cooper does not enter into any agreement, understanding, or contract that would prevent the General Assembly from seeing the resolution process is complied with and not undermined,” Leatherman wrote to Bonsall. “In my opinion such action would be grounds for board removal if the governor so chooses.”

Leatherman raised his concerns in the context of a letter sent by McMaster’s Department of Administration (SCDOA), an agency lawmakers tasked with sorting through competing bids for Santee Cooper and recommending one sale proposal and one management agreement for lawmakers to consider.

Santee Cooper also gets to submit a reform proposal, although the agency has angered lawmakers by openly discussing its machinations at a time when all parties to the process were supposed to adhere to strict confidentiality regarding their plans.

According to a letter to Bonsall from SCDOA director Marcia Adams dated August 31, 2019, “it’s imperative that Santee Cooper avoid engaging process participants … or non-participating third-parties who may seek to gain an economic or other advantage that could have a chilling effect on the process.”

According to Adams’ letter, such arrangements could “interfere with the Department-run process or undercut the letter or spirit” of the law that is supposed to be governing it.

Adams added she was “very disturbed” to discover Santee Cooper had “engaged in discussions with one or more other companies” and that Bonsall “refused to identify those companies or the matters that they discussed with you.”

“We cannot and will not permit any additional efforts by Santee Cooper to advantage itself at the cost of process integrity,” Adams wrote.

The rogue utility’s response? Continued defiance …

(Click to view)

(Via: Travis Bell Photography)

In a September 3, 2019 letter addressed to Leatherman (above) from Bonsall, the Arizona utility executive said his agency was acting in a manner “consistent with the mandate (its board) … gave to us,” and was posing “the right kind of questions pursuant to enhancing the value of Santee Cooper as we look to developing and submitting our reform plan.”

According to him, the one-year agreement – reached with two subsidiaries of Southern – “is the right thing to do for the customers of Santee Cooper.”

“There is no basis to criticize it,” Bonsall wrote of the memorandum of understanding, “and we stand by it.”

“It only seeks to find ways to make things better,” Bonsall continued. “That, however, seems precisely why it is being attacked.”

Wow … fighting words.

Take a look at the heated exchanges contained in these exclusively obtained documents …

(Click to view)


(Via: Provided)

Developing …

UPDATE: Unpacking the bombshell …



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