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Will the Sun Set on PUCs?

Fortnightly Magazine - July 15 1998

land in a hearing room. Rate-based regulation will be history. Long, hard looks at commission functions will prompt the taking on of new duties. About 40 commissions have been, or are being, reorganized, according to the NRRI.

One of the most important changes acknowledged both in the report and at the summit was the change of culture and skill-mix, within commissions and staff, Jones says.

Commissioners feel they have much work ahead to change staff culture.

Changing culture is especially difficult because the center of commissions is an adjudicatory process, and commission ceremonies center around public hearings. The NRRI report notes: "One symbol is the different colored badges worn at NARUC meetings ... which communicate both a distinction between the regulated and the regulators and variations in rank within the commissions. The badges are one expression of the differing social status within the regulatory tribe."

Other roadblocks include "beliefs about human nature and activity." They "vary among commissioners partly by political affiliation and the accompanying orientation towards government. Among staff, there may be less variation and more inclination to take a jaundiced view of the effectiveness of the social contract between utilities and ratepayers.

"They may see utilities as powerful local Goliaths rather than global competitors," according to the report. "They may see no way to be accountable to the public except through exquisitely detailed procedure."

What are the solutions to these problems? Jones admits the summit was light on strategies and that there was only recognition that these problems need to be faced. Commissioners will push to address them.

Some commissions already are. NRRI in the past 18 months has visited 17 commissions to be "honest brokers and family to help the staff and commissioners get closer together," Jones says. "To see what the obstacles are, see how culture needs to change, to see what resistance there is.

"I don't want to suggest it's chewing at the fat," the NRRI director says. "It's they have tried to, in a fairly orderly way, get facilitators ... to help the staff."

NRRI has worked with the Iowa Utilities Board to invent a new organizational structure. With the Washington Utilities and Transportation Commission, it identified how everyone at the commission communicates, how they should communicate, and how they can learn together before they determine the changes needed.

Paula S. Dierenfeld of the Iowa Utilities Board, a summit attendee, says the process of creating a new structure goes beyond mechanics; it examines skills and culture. For her board's staff of 75, most with 12 to 30 years tenure, the process began over a year ago.

"There are some in our staff who believe competition is not here to stay," Dierenfeld says. "It's kind of a trendy thing to do right now. They've been around for 20 years and they don't see a need for change. And they figure if they wait around long enough, this will pass."

During planning, the Iowa board broke into three teams -- one to look at structural changes, one to look at skill changes and the last to look at