Most people relish being right. Winning an argument with a friend or family member is not only gratifying, it boosts one’s credibility. The same is true in the media business, where veracity is coin of the realm within our “marketplace of ideas.” Consistently get things right? People come back. Consistently miss the mark? People go elsewhere for their news.
Anyway, nearly fourteen years ago this media outlet first proposed selling South Carolina’s cataclysmically failed government-run power provider, Santee Cooper.
My argument at the time? That government shouldn’t be in the utility business – and that offloading this asset to the private sector would result in a multi-billion dollar windfall for taxpayers.
Did members of the S.C. General Assembly heed my advice? No, they did not. With liberal lawmakers like Senate judiciary chairman Luke Rankin leading the way, they opted to authorize more than $4 billion in new Santee Cooper debt – as well as $2 billion in socialized private investment – to fund NukeGate, a spectacularly failed command economic boondoggle.
NukeGate was supposed to produce a pair of next generation, pressurized water nuclear reactors in Jenkinsville, S.C. in 2016 and 2017. Alas … it did not. Despite the massive government debt and ratepayer investment, they were never completed – and Santee Cooper and its private sector partner couldn’t afford the estimated $10-16 billion price tag necessary to finish them.
Santee Cooper eventually pulled the plug on the project, and shortly thereafter it was revealed executives at both utilities knew the reactors were doomed for years and didn’t warn the public. Instead, they allegedly concealed this critical information from regulators while continuing to raise rates and rack up additional debt.
Santee Cooper, for example, flat out lied on bond documents … and attempted to raise rates on its customers just a week before pulling the plug on the project.
(Click to view)
(Via: High Flyer SC)
Astoundingly, none of its current or former leaders have faced criminal consequences … although they are still billing taxpayers for criminal defense attorneys.
In the aftermath of the NukeGate fiasco, state lawmakers received a $9.6 billion purchase bid for Santee Cooper from Florida-based NextEra Energy. This deal would have wiped away Santee Cooper’s tidal wave of red ink and set the utility on a sustainable fiscal path moving forward. Unfortunately, Rankin used his influence to shut down negotiations – leaving Santee Cooper (and taxpayers) with no pathway forward for addressing its rising tide of red ink.
Why did lawmakers go along with Rankin after he played such a starring role in the original collapse of this utility?
That’s a good question … one which is already yielding some incredibly costly answers.
Last month, my news outlet exclusively reported on Santee Cooper’s latest adventures in red ink – $150 million in new borrowing approved by a legislative panel on August 17, 2021.
“Back to business as usual … which is exactly what landed Santee Cooper in its current predicament,” I noted at the time.
For months, I have warned readers the only way Santee Cooper could possibly remain afloat (absent its offloading to the private sector) was to accumulate more debt – or raise monthly bills on its already beleaguered ratepayers.
There is simply no other way out of the vise … as the utter collapse of the agency’s so-called “reform” plan has proven.
Earlier this month, Santee Cooper called a special board meeting to discuss its search process for its next chief executive officer.
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“It kinda went like this … welcome, we are now going into executive session,” a source who attended the gathering told me. “Then when they returned from behind closed doors, the meeting was declared done.”
Sound familiar? It should. “Behind closed doors” is exactly how Santee Cooper has conducted its business for years – even though legislative leaders (and governor Henry McMaster) explicitly told them to knock it off.
“Transparency in your operations is of the utmost importance and several-hour executive sessions by your governing body, followed by immediate adjournment, gives rise to concern that the board is making decisions in secret rather than in public,” five ranking House members wrote in a letter to the utility’s leadership last May. “The public’s right to know what is happening during Santee Cooper board meetings is vastly superior to the board’s desire for secrecy.”
Indeed it is … especially the way this board operates.
Wait a second, though … wasn’t Santee Cooper supposed to be ushering in a new era of transparency this year? In fact, wasn’t that a central plank in its “reform” agenda? And didn’t McMaster vow back in April that former lawmaker Peter McCoy – his pick to lead the utility’s scandal-scarred board – would bring “much-needed transparency and accountability” to Santee Cooper.
Yes, he did …
(Click to view)
(Via: S.C. Governor)
“I am confident that Peter McCoy will be a true change agent, and he will work to change the culture of closed door deals and secret contracts at Santee Cooper,” McMaster (above) said at the time.
So far, though, the new boss seems to be running things a lot like the old bosses.
In addition to the ongoing lack of transparency, last month Jodi Shafto of The (Charleston, S.C.) Post and Courier reported that Santee Cooper was once again doling out massive bonuses to its leaders “based on goals achieved during a half-year of performance.” Chief executive officer Mark Bonsall and deputy chief executive officer Charles Duckworth received bonuses totaling $402,000 in late June. Now, according to Shafto, they are in line to receive another $207,500 in bonuses prior to January 9, 2022.
Again … sound familiar?
Bonsall’s base salary is $1.1 million a year, incidentally. And Duckworth’s is more than $560,000 a year.
So to recap: After running this utility even deeper into debt, continuing to operate it in secrecy and utterly failing to deliver on any of the promises made to state lawmakers earlier this ear … Santee Cooper’s already overpaid leaders are now getting six-figure bonuses?
I hate to say “told you so,” but …
If I have said it once, I have said it a million times: As long as Santee Cooper remains under state control, South Carolina ratepayers and taxpayers will continue to be taken advantage of. The sooner lawmakers realize this – and realize they have once again been lied to by Rankin – the sooner they can get state government out of the electricity business once and for all.
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ABOUT THE AUTHOR …
(Via: FITSNews)
Will Folks is the founding editor of the news outlet you are currently reading. Prior to founding FITSNews, he served as press secretary to the governor of South Carolina. He lives in the Midlands region of the state with his wife and seven children. And yes, he has LOTS of hats (including that St. Louis Cardinals’ bird lid pictured above).
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