THE LAST TIME a governor fired the chairman of Santee Cooper, the only “cause” he could cite was the fact that he didn’t like the chairman. But he got away with it anyhow.
This time, the Santee Cooper board has spent $4 billion on two now-abandoned nuclear reactors and withheld information from regulators that could have halted enormous rate hikes for SCE&G’s 700,000 customers. Yet it is by no means a safe bet that Gov. Henry McMaster will succeed in ridding himself of the chairman.
The difference is all about state law — which is all about South Carolina politics. And if Santee Cooper Chairman Leighton Lord wins his lawsuit contesting the governor’s right to fire him, it will provide the best evidence ever for why the new law — and the old politics — must change.
Indeed, someone looking to make sense of why the governor would take action on such shaky legal ground might wonder if he knows he’s likely to lose, but wants to make the strongest case he can for why the law has to change.
A 1994 state law for the first time gave S.C. governors the authority to fire just about anyone they appoint to governing boards. But it was largely ignored until Gov. Jim Hodges used it to remove political powerhouse John Rainey as chairman of Santee Cooper. Mr. Rainey sued, arguing that an older law granting board members seven-year terms applied. The Supreme Court, correctly, ruled against him.
There were a few perfunctory attempts to rescind this power, but nothing changed. Until Mark Sanford was elected governor, and he started … well, being Mark Sanford. In response, in 2005, the Legislature changed the law back to say Santee Cooper board members serve for fixed terms and can be removed only for “malfeasance, misfeasance, incompetency, absenteeism, conflicts of interest, misconduct, persistent neglect of duty in office, or incapacity.”
It’s the same law that protects a handful of other positions — members of the ethics and election commissions among them — and it is not an easy standard to meet. I can count on one hand the number of times governors have been able to use it. Ever.
Mr. McMaster is trying to use it on Mr. Lord.
“Here we have an enterprise where the chairman of the enterprise arrived in 2009 as a member and became the chairman in 2013 and it is now $8 billion in debt, which is evidence of some lack of attention or corrective action,” the governor told me Thursday.
It’s a good argument. It ought to be reason enough to clean house. But it’s not the reason he gave Mr. Lord for removing him. Instead, in an attempt to meet the standards of the law, he said the chairman had engaged in “a pattern of misfeasance, malfeasance, and persistent neglect of duty.” He accused the Columbia attorney of refusing to turn over documents to the governor, providing information that was “incomplete and misleading,” failing to attend some legislative hearings on the nuclear debacle and demonstrating a “lack of cooperation” with the governor’s efforts to chart a path forward for the agency.
The only charge we know meets the requirements of the law (a Supreme Court opinion says so) is refusing to turn over documents to the governor. And in a lawsuit filed Wednesday, Mr. Lord says Santee Cooper did turn over the documents. Put them in a “digital data room” for the governor, and verified that the governor’s office could access them. And there, according to the lawsuit, they sat, unopened.
Mr. McMaster says it was “unresponsive” for Santee Cooper to dump a pile of documents into the data room, not tell him what specifically was there and expect his staff “to go through there and find it like a needle in a haystack.” Besides, he says, that was six weeks after he asked for the documents, and the law requires officials to comply with his requests “immediately.”
Perhaps Mr. McMaster will prevail on this point, but if he doesn’t, he’s left with much squishier charges: that Mr. Lord didn’t attend enough legislative hearings (he says he’s not required by law to attend any, and that Santee Cooper representatives were always present), that “uncooperative” allegation, and the charge that Mr. Lord gave an “incomplete and misleading” response to his request for “a detailed explanation of any corrective action taken by Santee Cooper in response to the Bechtel Corporation’s findings.”
Mr. Lord calls that last charge “the most dangerous part of the letter,” because it suggests that “you can ask a board member for an opinion, and you don’t like his opinion, you can remove him.” I don’t agree that it’s dangerous, since I think a governor ought to be able to remove his appointees for any reason or no reason, but I suspect the governor will have a hard time convincing a court that it rises to the level of misconduct.
Even if you think the 1994 “fire anyone for any reason” law was too broad — and I obviously don’t think it was — it should be clear that the current law is far, far, far too restrictive. It means Mr. Lord or other Santee Cooper board members can’t be removed just because they make decisions that end up costing ratepayers or all taxpayers billions of dollars. And keep mum when they have information that would allow utility regulators to understand how badly out of control the whole project was, so they could stop approving all those SCE&G rate hikes.
If Mr. McMaster manages to win this case, it will be because of what happened after the nuclear project collapsed, not before. Which is what Mr. Lord and the other board members need to answer for.
Surely our Legislature can see what a problem that is — and fix it.
Ms. Scoppe writes editorials and columns for The State. Reach her at email@example.com or (803) 771-8571 or follow her on Twitter or like her on Facebook @CindiScoppe.
Here are some other pieces I’ve written about this that you might find helpful: