San Bruno blast: Senator rebukes UC for ties to gala to honor disgraced ex-PUC boss Michael Peevey

State Sen. Jerry Hill rebuked the University of California for its close ties to a $250-a-plate dinner gala in San Francisco to honor Michael Peevey, the disgraced former boss of the state Public Utilities Commission who presided over a culture of lax PUC oversight of PG&E that contributed to a fatal explosion of natural gas in San Bruno.

The event was held Thursday night at the swank Julia Morgan Ballroom in the Merchants Exchange Building. The net proceeds, according to an invitation, were touted as being funneled into the coffers of UC Berkeley’s Goldman School of Public Policy.  The guest of honor: Peevey, who stepped down at year’s end as the powerful president of the PUC and one of its five commissioners under a cloud of scandals and controversy.

“Peevey is at the center of multiple, converging scandals surrounding the natural gas explosion in San Bruno that killed eight of my constituents and the shutdown of the San Onofre nuclear plant in Southern California,” Sen. Hill wrote in his letter to Dean Henry Brady of UC Berkeley’s Goldman School of Public Policy. “Accepting money from an event honoring Michael Peevey sends the wrong message to your students and alumni.”

The scandals were disclosed in a series of emails that sketched a picture of cozy ties between PG&E and its chief regulator, the PUC.  Critics believe Peevey orchestrated backroom deals to benefit power utilities in California and fostered cozy ties between the PUC and PG&E. The emails showed PG&E often sought out Peevey to influence proceedings before the PUC. Peevey also offered public relations and procedural advice to PG&E, and wined and dined at least one regulatory executive with the company, PG&E lobbyist Brian Cherry. According to the emails, Peevey dangled the prospect of a favorable decision on power rates if PG&E contributed to statewide ballot initiatives that Peevey favored as well as a 100th anniversary celebration for the PUC a few years back.

“How would it look should the entities donating money or purchasing tables at the fundraising event end up being the very utilities that have co-opted the CPUC under Peevey’s watch, allegedly through improper means?” Hill asked in his letter.

It’s also possible the event is honoring an individual who may be revealed to be a person of interest, or the target of an investigation, by both state and federal law authorities. The U.S. Attorney’s Office is looking into the email scandal, and the state Attorney General’s Office has served search warrants at PUC headquarters in San Francisco, the Peevey resident in Los Angeles County and the Cherry residence in Orinda.

Legal experts believe the search warrants signal a more intense probe by state investigators.

“The search warrants tell you that there is serious interest in criminal prosecution,” Michael Asimow, a law professor at Stanford University, said in a recent interview. “The warrants mean there has been a prosecutorial decision to at least look at potential criminal activity here.”

A federal probe previously concluded that PG&E’s shoddy maintenance and flawed record keeping, combined with the PUC’s lazy supervision of the utility giant, were the primary factors that contributed to the explosion in September 2010.

Peevey is also on the radar screen at other educational facilities in California — but perhaps in a manner that’s less flattering than is contemplated by the Goldman School with its ties to the Thursday dinner with Peevey as the guest of honor.

“During the past few days I have become aware that other graduate level public policy programs in California have decided to use Michael Peevey’s tenure at the CPUC and this Goldman School event as a case study in ethics classes,” Hill wrote in his letter. “Michael Peevey’s actions as president of the CPUC have caused Californians to lose trust in the agency, whose mission is to protect consumers. The Goldman School’s participation in this event could lead to a further erosion of trust in California’s public institutions.”



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