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Wisconsin Supreme Court sides with former regulator in power line bias case

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Wisconsin’s state Supreme Court says a former utility regulator who exchanged messages with company executives and later sought a job with one of the companies he was tasked with regulating did not violate due process protections.

In a 4-3 ruling released Thursday, the court’s conservative majority sided with former Public Service Commission member Mike Huebsch in a case that stemmed from a disputed power line through southwestern Wisconsin.

The court did not address approval of the power line itself, but said a lower court was wrong in ordering the former Republican Assembly speaker and member of Gov. Scott Walker’s cabinet to testify and turn over his personal cellphone for inspection.

Reversing a decision by Dane County Circuit Judge Jacob Frost, the court found that a mere “appearance of bias” does not amount to a violation of due process.

The court said there was no evidence Huebsch’s private communications with utility executives tainted his vote in favor of the roughly $500 million project, nor did his subsequent application to lead one of those utilities.

Jacob Frost

Frost

Instead the court said regulators, judges and other officials should enjoy a presumption of impartiality and that it’s possible to set aside personal relationships when deciding cases before them.

Opponents of the line had sought to question Huebsch about communications — including some using an encrypted messaging app — with utility executives and his eventual attempt to land a job with one of the utilities.

The high court agreed to hear the case after Huebsch challenged the groups’ subpoenas.

Patience Roggensack

Roggensack

Writing for the majority, Justice Patience Roggensack said power line opponents failed to show that Huebsch “presented a serious risk of actual bias in favor of approval of Cardinal-Hickory.”

“There is no factual evidence of any wrongdoing,” she wrote.

Justice Brian Hagedorn went further, calling the allegations against Huebsch “meritless and borderline frivolous.”

Jill Karofsky

Karofsky

The three liberal justices filed a dissenting opinion accusing the majority of judicial overreach in a case they argued against hearing.

“Four members of this court transform a ‘procedural anomaly’ into a procedural tragedy,” wrote Justice Jill Karofsky. “Strikingly, this unbounded exercise of judicial power comes with no explanation, leaving all to speculate as to why this case and this subpoena recipient receive such special treatment.”

‘A big win’

Huebsch called the ruling “a big win” for himself and for regulators across the country who had been watching the case.

Mike Huebsch

Huebsch

“They said if you lose this, we’re out,” Huebsch said. “If that assumption of impartiality is gone, then there’s really no way to do this job.”

An attorney for the power line opponents said the ruling creates incentives for public officials to hide communications and undermine public trust in the regulatory process.

“They’re providing protection to commissioner Huebsch that aren’t afforded to regular citizens,” said Brad Klein, senior attorney with the Environmental Law and Policy Center.

The PSC issued a statement saying integrity is core to its mission of ensuring safe, reliable, affordable and environmentally responsible utility service.

“Today’s decision reaffirms that integrity remains strongly in place and helps protect public servants against frivolous, unfair, and unfounded claims of bias,” agency spokesperson Matthew Sweeney said.

Photo3

A substation for the planned Cardinal-Hickory Creek power line along Highway 14 near Cross Plains.

Project challenged

After the PSC voted unanimously in 2019 to approve construction of the 102-mile line between Dubuque, Iowa, and Middleton, conservation groups, along with Dane County and other local governments, claimed the commission’s vote was tainted by the appearance of bias.

They cited Huebsch’s service on an advisory board for the regional grid operator, MISO, which supported construction of the line, but later discovered that Huebsch traded dozens of messages with utility executives while the case was in front of the PSC and later applied to be CEO of Dairyland Power, a job he didn’t get.

Huebsch said the messages were purely personal exchanges with old friends.

Agreeing that the evidence created an “appearance of bias,” Frost ordered Huebsch to submit to questioning and turn over his personal cellphone and passwords.

Opponents gave up on the phone records after Huebsch appealed, but they later issued a second subpoena demanding Huebsch testify in court.

Huebsch then asked the Supreme Court to block the subpoena and overturn Frost’s “appearance of bias” standard.

More to come

While it was a setback for opponents, Thursday’s ruling clears a path for a federal judge to consider the same due process claims and for Frost to rule on the merits of the PSC’s construction permit itself.

“A fair review of the evidence will show that there are better, more cost-effective, more environmentally sound, and more flexible alternatives for reliable clean energy in the Wisconsin Driftless Area,” attorney Howard Learner said.

Approved Cardinal-Hickory Creek transmission line route map

A federal judge previously ruled the line cannot cross the Upper Mississippi River National Wildlife and Fish Refuge, which stretches some 261 miles from Wabasha, Minnesota, to the Quad Cities.

Utilities have continued building on either side of the river — spending more than $277 million so far — while a federal appeals court considers the case, despite the judge’s admonition against creating “an orchestrated train wreck.”

In May, the utilities notified regulators that the project would exceed the approved $492 million price tag by more than 10% because of rising material prices and the ongoing legal battle.

Consumer advocates have called on regulators to halt construction until the court case is settled, arguing “the project is operating without a route, expected benefits, or a cost cap,” but the PSC has so far ignored such requests.

Utility spokesperson Alissa Braatz said they “look forward to successfully concluding the litigation” for the project, which they say is needed to support dozens of clean energy resources across the Midwest

“Utilities across our region are depending on the Cardinal-Hickory Creek project to facilitate the region’s transition away from fossil fuels and support decarbonization goals,” Braatz said.

Photo2

A work crew begins to install a tower Thursday as part of the Cardinal-Hickory Creek power line along County Highway P in Cross Plains.

Gas plant

Thursday’s high court ruling also undercuts efforts to block construction of a $700 million gas-fired power plant in Superior.

Environmental groups challenged the PSC’s approval for the Nemadji Trail Energy Center, a 625-megawatt generator to be jointly owned by Dairyland and two Minnesota utilities.

Frost ruled in May that the PSC’s environmental review of the plant was sufficient under state law. But he delayed ruling on whether Huebsch’s application to lead Dairyland created an appearance of bias until the high court issued a decision in the Cardinal-Hickory Creek case.

Opponents last week appealed his May decision.


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