Pinocci wants legislators out of office over invasive mussels

Public Service Commissioner Randy Pinocci said Friday that the Legislature passed a bill last session that raised rates for NorthWestern Energy customers to fund the invasive mussels program, and every legislator who voted for the bill should be removed from office.

"I'm telling you he should be replaced," Pinocci said. "I don't care if they are Republican, Democrat, Constitution Party, you go after them.They were not acting in your best interest and I shouldn't be the judge, you should be.

He was talking about House Bill 411, which revised the laws related to the aquatic invasive species program and created a fee for all hydroelectric dams to help fund the program. 

The state has implemented a program to detect and prevent the spread of aquatic invasive mussels, first detected in the state in 2016.

Pinocci was in Havre Friday at the North Central Pachyderm meeting to share information with people on the duties and responsibility of the PSC as well as what has happened in the PSC since he was elected in 2018.

He said that the passage of HB 411 was a clear example of government overreach, with the Legislature specifically picking out NorthWestern Energy customers to foot the bill for the program. He added that legislators passed the bill so they would not have to raise taxes.

"That's right," he said. "You who have NorthWestern Energy pay a million dollars that directly goes to Fish, Wildlife and Parks, but all the other energy companies and cooperatives don't pay a dime."

But a representative of NorthWestern Energy said differently.

The text of HB 411 does not target NorthWestern Energy in any language. The bill says, "In recognition of the threat that invasive species pose to Montana's hydroelectric power structures and systems, a hydroelectric facility shall pay a quarterly invasive species fee based on the facility's nameplate capacity."

NorthWestern Energy Media Relations Director Jo Dee Black said that NorthWestern Energy advocated for the bill during the legislative session because invasive mussels could not only pose a risk to recreational use of lakes and other bodies of water, but any hydroelectric dams.

"The way they are doing that is through an increased tax for hydroelectric facilities," she said. "So it isn't just NorthWestern that is paying that."

She added that NorthWestern Energy has 10 hydroelectric dams within the state and all taxes on the hydroelectric dams are passed on to the customers through the rates they pay. The money, which is collected through the increased tax, will go to FWP boat inspections to help prevent invasive mussels from entering Montana waterways.

If the invasive mussels enter the water ways, they could be detrimental to clams.

Pinocci said the cost should come from state's general fund, so all Montanans have to pay for the program, adding that FWP already receives too much funding. He said that FWP is having a number of these checks all over the state and should only be focusing on the border so no outside visitors can bring in invasive mussels. He added that FWP should also start charging people with smaller, non-motorized boats, such as canoes, or paddle boards to help fund the program.

Any legislator who voted for the bill should be removed from office, he said. He pointed to state Rep. Jacob Bachmeier, D-Havre, for voting for the bill as well as the full list of state representatives and senators who voted for the bill.

"I want you to know who voted for it," Pinocci said. "... You tell him that I said he should be replaced. I'm telling you he should be replaced."

The bill had bipartisn support. In the House, 62 representatives voted for the bill and 35 voted against, with three representatives excused from the vote.

In the Senate, 44 senators voted for the bill and six voted against it.

Among those who voted for the bill in the House were Reps. Bachmeier and Joshua Kassmier, R-Fort Benton.

Rep. Casey Knudsen, R-Malta, voted against the bill and Rep. Jonathan Windy Boy was excused.

Among the senators who voted for the bill were Frank Smith, D-Poplar, and Russ Tempel, R-Chester.

Sen. Mike Lang, R-Malta, voted against the bill.

Pinocci said the entire PSC staff and attorneys told him not to let the bill pass and he testified against the bill during the session. He said that cooperatives are not required to pay into the program, adding that many of the co-ops receive their power from out of state and out-of-state hydroelectric dams should be included.

"Your legislators just picked out NorthWestern Energy," he said. "... I didn't even want to say their names, I want you guys to look at it and say their names. But anyone who voted for this, you guys need to get on it. I want people running against these people."

"Let me ask you this," he added. "In the next legislative session, if we need highway funding or money for schools, how do I know if the Legislature's not going to add it to the NorthWestern Energy bill."

He added that the invasive mussels pose little to no risk to hydroelectric dams, and he has worked hard to expose the Legislature for allowing the bill to pass.

"They just want your money," he said.

Evidence of invasive mussels was found in Tiber Reservoir south of Chester and Canyon Ferry Reservoir near Helena two years ago. Experts say these mussels can cause significant problems for hydroelectric facilities. The mussels, which have no natural predators here, clump up and clog facilities, causing billions of dollars worth of damage to hydroelectric facilities in Great Lakes states.

Bachmeier said HB 411 was a bi-partisan piece of legislation that actually reduces fees on hydroelectric facilities, but extends the fees beyond the sunset of the original implementation.

He added that considering the PSC approves any changes with NorthWestern Energy's rates, Pinocci needs to be held accountable for not stopping rate increases and not understanding simple legislation or his job.

"Randy Pinocci is incompetent and fundamentally misunderstands his job as a Public Service Commissioner," Bachmeier said. "The core purpose of Randy Pinocci's job on the PSC is to regulate NorthWestern Energy, and approve or deny their requests to increase rates on utility payers."

Bachmeier added that NorthWestern Energy netted $197 million in profits in 2018, which was a 21 percent increase in profits from 2017, and he has no sympathy for any rate increases requested by the company.

Tempel, who also voted to approve the bill, said that the idea of the bill was to spread the cost of the invasive mussel species program so it did not fall on just one entity.

“My idea was to try to spread out the cost a little bit so that one outfit didn’t absorb the whole thing,” Tempel said. “… It’s not just NorthWestern Energy.”

He said that was why he voted the way he did. Tempel added that he serves on the energy committee in the Senate and heard the arguments. NorthWestern Energy was in support of the bill, but did not want to be the only ones paying for it, which was understandable, he added.

Pinocci said that in September of last year NorthWestern Energy filed an electric rate case, the first one in 10 years. He added that the case had a two-week hearing in May and the decision should be made later this year.

He said that he cannot say how he is going to rule in the case because he needs to listen to both sides, but he believes the rate payers for NorthWestern Energy should be looking into the situation and give feedback to the PSC.

“I’m not telling you what to do, I’m just saying it’s fair to ask these questions,” he said. 

He added that the questions people may be wanting to ask is if NorthWestern is seeing record profits, if they have cut staff and if the rates are cheaper than Montana-Dakota Utilities.

“I don’t know, but if I were you guys, I’d work on it,” Pinocci said.

He said he was told that NorthWestern Energy had cut a number of employees and charges more than Montana-Dakota Utilities in Sidney after Montana-Dakota Utilities was approved a rate increase.

Pinocci added that he also unsuccessfully voted against the Montana-Dakota Utilities request for a rate increase, although the PSC approved it. He said Montana-Dakota Utilities was closing its coal-fired plant in Sidney, with all of the jobs moving out of state, and it could have adverse effects on the community. If Montana-Dakota Utilities is closing down the plant they don’t need a rate increase, he said.

Black said that, in the past 10 years, NorthWestern Energy has invested more than $850 million in its electric delivery system in the state, purchasing more hydroelectric dams, which goes directly to Montana customers and other projects.

“Those are some of the factors that go into our request for a different rate and since the rate review was filed,” she said.

She added that NorthWestern has made significant investments in safe, reliable and smarter energy infrastructure as well as diversified the company’s portfolio.

Black said if the rate increase is approved, it would be a 1.23 percent increase, a total of about $6,500,000 a year, and a break down to 70 cents a month on average for customers.

She added that NorthWestern has not reduced its number of employees and has had a generally steady profit margin. 

Black said that, for the second quarter of this year, NorthWestern has made $47.7 million. For the same period in 2018, the revenue was $43.8 million, she said. The difference is mostly due to income tax benefits recognized in 2019 and a reduction in revenue to 2018 due to tax cuts and new programs for customers.