Posts Tagged ‘state regulatory services’

Despite New Options for Engagement with Regulatory Groups, Old Rules Still Apply

July 15, 2014

By Mark Anderson, Esq., Senior Vice President

Engaging Regulatory Groups

I have worked with State Regulatory Groups throughout my career. While they can be challenging to navigate, I have found that the meetings can be effective forums to develop key relationships and advance state and federal issues. But unlike most Groups of elected officials, Regulatory Groups typically have no formal avenue for private sector participation. In the past this has been an obstacle to effectively engaging with these Groups, but recent changes at some of the smaller policy-focused Regulatory Groups are creating new opportunities.

Large Groups, such as the National Association of Regulatory Utility Commissioners (NARUC) and the National Association of Insurance Commissioners (NAIC), have substantial funding streams from publications and conferences. The smaller Groups are often more reliant upon federal funding. As these funding streams have dried up in recent years, these Groups are becoming more creative about financing their operations.

Sponsorships are one way these Groups are augmenting their budgets. The Association of State and Territorial Solid Waste Management Officials (ASTSWMO), a Group I work with closely, recently instituted a sponsorship policy for the first time since the organization was founded in 1974. The policy acknowledges that sponsors may obtain a benefit from being able to provide information to its members, but it also provides strict anti-conflict guidelines.

As another example, the Environmental Council of the States (ECOS) has instituted a one-day State Environmental Protection (STEP) meeting. The STEP meeting allows attendees to focus on a topic that benefits from a more in-depth and inclusive discussion than is possible at regular ECOS meetings. Unlike other ECOS conferences, private sector organizations are allowed to sponsor the meetings and participate in discussion. Last year, the STEP meeting considered the issue of hydraulic fracturing. This year, the STEP meeting is addressing the Clean Air Act 111(d) rule proposal, released by the United States Environmental Protection Agency on June 1. This meeting will help the states to prepare comments on this rule and begin planning compliance plans.

Whether these two developments are anomalies or mark the beginning of a trend remains to be seen. Now is still a good time to assess what Groups representing regulatory officials are doing in your issue areas of concern. If you are not presently engaged, look into getting to know these Groups and their leaders. Consider taking advantage of the new programs for private sector participation.

1. Regulatory Groups are not always open to the public. I have frequently heard complaints from the private sector that these meetings should not be closed due to state sunshine laws. The reality, however, is that these meetings are not used to develop state policies. They are used instead to share information and take positions on federal issues. State sunshine laws, therefore, do not apply. If you want to attend, you must be invited by the organization.

2. Most Regulatory Groups do not have corporate membership or programs. When you attend one of these meetings, you are attending as a guest. The Regulatory Groups that I have dealt with are wary of being seen as influenced by the business community. Members may have differing degrees of sensitivity to this that may be dependent upon political issues in-state, or the industry you represent. You should be respectful of their delicate position. Do not be surprised if your offer to take a member to dinner, buy a drink or even a cup of coffee is denied for this reason.

3. Respectfully mind the relationship between regulators and the regulated community when engaging on issues at Regulatory Groups meetings. Many of the individual state members of these organizations will agree with you that education from stakeholders is critical to good policymaking. While lobbying occurs at these meetings, and I would argue that it should occur, discretion is critical. When state regulators are perceived to be influenced by lobbying from stakeholders, they lose credibility among their peers. In the long run, that only hurts you and the regulator.

4. Regulators appreciate your understanding of their area of expertise. For regulators, one of the satisfying aspects of these national organizations is the opportunity to interact with people that deal in the same, sometimes very narrow, arena. I have found that the best way to develop good relationships with regulators is to begin by being proficient in discussing their areas of expertise.

5. Be prepared to discuss your issues. Small Regulatory Groups are often sparsely attended by the private sector. This creates great opportunity for substantial interaction with members of the Group. However, if you attend one of these meetings, you and your organization will be noticed. Be prepared to explain why you are at the meeting and which particular issues interest you.

If you have a policy issue to address, there is almost assuredly a Regulatory Group appropriate to address the issue. New avenues for participation are making this easier than before and bringing new stakeholders to the table. If you follow the foregoing best practices for respectful participation, working with Regulatory Groups will be an effective way to engage your issues.

###

Mark Anderson, Esq. is Senior Vice President working at Stateside Associates managing the Regulatory Services Division. He advises clients on engagement strategy and directs educational and “grasstops” campaigns directed at governors and regulatory officials. Mr. Anderson also has created issue advocacy coalitions and facilitates work group meetings of state and federal stakeholders addressing environmental issues.

Burning Water

April 17, 2014

By John Howell, Esq., Vice President

blog - burningwater

The debate surrounding hydraulic fracturing, or “fracking”, is hot…almost as hot as burning water. At the federal, state, and local levels a battle is being waged and there seems to be no middle ground, no room for negotiation. While fracking has been around for decades, this battle over its future viability is just beginning. Pitting the environment against energy independence, a stream of documentaries and even a feature film, has certainly led to greater awareness and, perhaps, greater vitriol on both sides of the issue. If nothing else, watching this debate and monitoring the regulatory activity across the country is a fascinating exercise as the federal government, state legislatures, governors, local municipalities and courts are all active participants.

Last month, the U.S. Department of Energy’s Secretary of Energy Advisory Board (SEAB) published its Task Force Report on FracFocus 2.0. FracFocus is the reporting mechanism through which companies engaged in fracking disclose the chemicals added to their respective fracking fluid. This disclosure is intended to provide stakeholders with sufficient information to make informed decisions concerning environmental impacts due to fracking. FracFocus is maintained by the Ground Water Protection Council (GWPC) and the Interstate Oil and Gas Compact Commission (IOGCC) lending credibility to the data contained in FracFocus.

The Task Force Report is informative and I believe it is a good tool to limit the environmental impacts of fracking fluid…but, absent a willingness to find a middle ground concerning fracking, will it be effective? Claims of sickness, higher concentrations of cancer, undrinkable water, and even earthquakes have been attributed to fracking by its opponents. Will detailed and effective reporting of chemical use somehow lessen the import of these claims when those same claims are based on the use of chemicals? Not in Butte County California.

Last week, the Butte County Board of Supervisors voted to draft an ordinance that could ban fracking in the county. If this ordinance is ultimately passed Butte County will be the first county in California to enact a ban. One Supervisor, speaking in support of drafting an ordinance, cited a concern that fracking “is moving a lot of stuff underneath us that’s holding us up…by taking the foundation away, we’ll crumble”. Can middle ground exist if people are concerned with falling into the earth? It is worth noting that there have been no fracking operations in Butte County to date so, perhaps, everyone is safe.

Texas – a solidly pro-fracking state – utilizes a framework of sophisticated industry-friendly regulation that governs recycling practices for fracking flowback fluids and for casing, cementing, and well control of fracking well holes. Similarly, the Texas Commission on Environmental Quality adopted rules in 2013 to regulate disposal of certain radioactive tracers used in the exploration, development, and production of oil and gas resources. In Flower Mound Texas that may not be enough. Last week the Flower Mound City Council convened to “discuss and consider action related to gas drilling and development” with a focus on “community health issues related to hydraulic fracturing.” In Denton, Texas, a local activist group is working to place an ordinance banning fracking on ballots. The ordinance may result in a possible legal battle over the authority of local governments to ban fracking in Texas. In New York State, the November elections appear to be keeping the fracking discussion to a slow crawl. Now in the 6th year of a moratorium to study the effects of high-volume hydraulic fracturing, New York is not expected to issue final regulations anytime soon….certainly not before the elections. Despite dozens of bills sitting in the State Legislature and claims that the lack of movement in New York on the issue is having a significant economic impact and stunting job creation, final regulations are not expected from the Department of Environmental Conservation until at least April 2015. As a result, in February, a pro-fracking group filed suit against Governor Andrew Cuomo (D) to compel the state to complete its review of high volume hydraulic fracturing. In addition, the New York Court of Appeals is expected to hear cases soon regarding whether municipal governments have the authority to ban fracking within their borders.

While the fracking battle is being waged in these states and others across the country, money is flooding into North Dakota due to roughly 1 million barrels of oil production per day from the Bakken shale formation. This oil boom transformed North Dakota into the second largest oil producer in the country, only surpassed by Texas in terms of oil production. As a result, the unemployment rate in North Dakota is the lowest in the nation and the state has the most counties with increases to median household income. While North Dakota supports disclosure of fracking fluid chemical use in FracFocus and has recently adopted rules addressing oil and gas exploration, neither the court of law nor the court of public opinion seem to be impeding the state’s economic velocity.

Effectively monitoring state legislative and regulatory activity surrounding fracking is a true national effort. We are aware of the same dynamic playing out in Maryland, Minnesota, Los Angeles and everywhere else in between. Rarely have we monitored an issue this polarizing and divisive. Federal activity and the jurisdictional battles being waged in courtrooms across the country only add complexity and dimension to this effort. While issues often start out contentious and resolve with a predictable compromise, we do not see a compromise on the fracking horizon. Rather, we see the hydraulic fracturing debate being waged for years to come by two sides firmly entrenched in their beliefs.

About that burning water: in certain localities across the country, tap water can be lit on fire due to the level of methane in the water. Opponents of fracking claim methane in tap water as direct evidence that fracking fluid is poisoning groundwater and is not worth the environmental risks. Supporters of fracking point to the fact that tap water has been lit on fire since the 30’s – predating the first fracking operation. How, then, is fracking to blame? If we cannot agree on burning water, what can we possibly agree on?

###

John Howell is Vice President of Regulatory Services at Stateside Associates. With substantial policy and legal experience, Mr. Howell guides Stateside Associates’ regulatory counsel and provides clients with hands on Regulatory Issue Management support from strategic planning, regulatory advocacy, and working with groups of state and local officials.

Greetings From Hotel California

February 20, 2014

By John Howell, Esq., Vice President

cell towersThe National Association of Regulatory Utility Commissioners (NARUC) Winter Committee Meetings presented an interesting blend of discussion concerning both long-standing issues such as broadband deployment and E9-1-1 location accuracy and more recent “hot topics” such as Net Neutrality, Hydraulic Fracturing and the future of the Electric Grid. Depending on the room you were in it either felt like you were at the Renaissance Washington Hotel…or “Hotel California.”

Those of us who have worked in the telecommunications industry and, more specifically, emergency communications understand that E9-1-1 is like living at Hotel California, a fictional place made famous by The Eagles. “You can check out any time you like but you can never leave.” Having spent the better part of a decade at a national wireless carrier and then at a firm dedicated to building a nationwide wireless broadband network for public safety communications, I had “checked out” of the industry and the debate for the past 5 years. Apparently, I never left because there I was at NARUC, in Hotel California, listening to a panel discussion about the need for better accuracy of wireless 9-1-1 calls outdoors and for new accuracy standards for wireless calls indoors to include elevation/altitude.

Such discussions are immensely worthwhile and the presentation at NARUC was no exception. Anything industry or regulators can do to foster greater location accuracy of 9-1-1 calls is potentially life-saving and, therefore, of the highest importance. However, the discussions at NARUC were the same exact discussions I participated in almost 10 years ago within industry groups as well as while I served as steering committee chair of the Federal Communications Commission’s Network Reliability and Interoperability Council (VII).

While I am encouraged that emergency communications held such a prominent position at the NARUC meetings, 10 years is more-than-enough time for discussion. It is time for action and NARUC should be applauded for passing a resolution in support of enhanced location accuracy.

Perhaps the most lively discussion, if not debate, centered around the recent net neutrality decision handed down by the U.S. District Court of Appeals for the D.C. Circuit. The decision held that the FCC overstepped its authority when it prohibited broadband providers from blocking or discriminating against certain types of traffic. The NARUC panel, spiritedly represented by advocates for both sides, disagreed on what the decision meant and even disagreed on who won and lost. What the panel agreed on, though, is that the net neutrality debate is not close to being decided. All panelists agreed that the FCC would respond quickly, perhaps promulgating new rules. On Wednesday the FCC did just that as Chairman Wheeler announced the Commission will be proposing new net neutrality rules that conform to communications laws.

No discussion at the NARUC meetings was better-attended than those centered on the future of energy generation and distribution. Topics included “Beyond Net-Metering Wars: Real Solutions for Real Challenges” and “Developing Distributed Energy and Smart Grid Value through Collaborative Stakeholder Engagement and Policymaking.” During a panel discussion on “The Value of the Integrated Grid”, Mike Howard, President and CEO of the Electric Power Research Institute (EPRI) announced EPRI’s publication of the “The Integrated Grid – Realizing the Full Value of Central and Distributed Energy Resources.” Mr. Howard stated that the grid is expected to change to incorporate new stakeholders and that careful analysis is required to consider the associated costs as well as the impact new technologies will have on existing technologies.

Mr. Howard encouraged NARUC to base their regulation on informed policy and fact-based information while working to incorporate all sources of energy in the transformation to an integrated grid. In a separate presentation during the NARUC meetings, Senator Lamar Alexander (R-Tennessee) warned regulators to learn from issues Germany has experienced regarding price, reliability and quality in order to incorporate additional sources into their grid. The Senator called Germany an “energy mess” that if emulated in the U.S. would cause 25% of the nation’s nuclear power plants to shut down.

The NARUC winter meetings are, perhaps, best summarized by two distinct presentations to the General Assembly. Gregg Kantor from the American Gas Association provided an impassioned call for hydraulic fracturing (“fracking”) and the benefits of natural gas. He likened fracking to the computer revolution when describing what he believes to be a “shale gas revolution” that the country is about to embark upon. From the benefits of shale gas to fuel natural gas vehicles with significantly lower carbon emissions to the potential for significantly reduced reliance on foreign fuel sources – at lower costs – Mr. Kantor made a compelling case for fracking and natural gas exploration.

At the same time, Senator Joe Manchin (D-West Virginia) in a refreshingly apolitical presentation cautioned that regulators and industry alike should learn from the recent chemical contamination of the water supply in his state. The takeaway from Senator Manchin’s presentation was that progress is good and working to develop sources of energy is encouraged, but we cannot allow something as critical as drinking water to be contaminated; that there is a role for regulators and regulation in managing the use of chemicals (for such things as fracking) – but it might have to be accomplished at the state level. On a somber note, the Senator stated that while he hoped that progress could be made in Congress on all the issues being discussed at NARUC, that the reality is Congress is divided to the point that there are no guarantees progress will be made on the Federal level anytime soon.

It would appear that progress is stalled. I hope that in 10 years that none of us will find ourselves in a wing of Hotel California where energy issues, intelligence, advocacy and unrealized solutions reside.

***

John Howell is Vice President of Regulatory Services at Stateside Associates. With substantial policy and legal experience, Mr. Howell guides Stateside Associates’ regulatory counsel and provides clients with hands on Regulatory Issue Management support from strategic planning, regulatory advocacy, and working with groups of state and local officials.