1994 Permanent House Journal Printed Pages 2440-2449 - South Carolina Legislature Online

Journal of the House of Representatives
of the Second Session of the 110th General Assembly
of the State of South Carolina
being the Regular Session Beginning Tuesday, January 11, 1994

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Printed Page 2430, Feb. 24 | Printed Page 2450, Feb. 24

Printed Page 2440 . . . . . Thursday, February 24, 1994

A. As a representative for the State of South Carolina, I would think to provide an adequate and needed service on a continual basis to the citizenry.
Q. Would you have any other employment if you were elected to the Public Service Commission?
A. I'm in the Army Reserves.
Q. In terms of your employment with the Town of Mount Pleasant, what would be your intention with that?
A. If elected, I would go to the mayor and recommend -- and, of course, let her know that this has occurred and what would her -- what would be her feelings about it. And I should imagine that she would have none.
Q. What will your feelings be, though? I mean would -- are you going to continue to serve in that capacity as well?
A. Yes, sir.
Q. Would you see any possibility for any type of conflict of interest in that -- in those dual roles?
A. No, sir.
Q. You are aware of the Consumer Advocate in South Carolina. From time to time, he appears before the commission. What is the role of the Consumer Advocate and what is your role, vis-a-vis, the Consumer Advocate? How should you cooperate?
A. I'm not aware of the role of the Consumer Advocate. I can't speak to it.
Q. Are you familiar with the concept of wheeling?
A. I'm sorry.
Q. Wheeling, w-h-e-e-l-i-n-g?
A. No.
Q. Wheeling? How about lata, L-a-t-a?
A. No, sir.
Q. How about rate base?
A. It would be the rate that the consumer pays for the service.
Q. The rate base would be the rate the consumer would pay for the service. What types of utilities does the Public Services Commission regulate, Mr. Reynolds?
A. Private utilities, electrical, water and sewer and if that occurred, things having to do with open road trucking, telephones.
Q. How about the concept of generational mix for environmental purposes?
A. I'm sorry. Say that again.
Q. Generational mix of fuels for environmental purposes, are you familiar with that?

Printed Page 2441 . . . . . Thursday, February 24, 1994

A. No, sir.
Q. From time to time, there is a trade off to be made in the role of the Public Service Commission between representing the public's interest and the interest of the industry which needs to make a profit. How would you approach those questions?
A. I'm always more interested in the public.
Q. At what point does it become a problem in terms of rate making from a constitutional standpoint or from a legal standpoint to overemphasize the public's interest versus an industry interest?
A. I would say wherein overregulations would diminish the community's ability, one, to have the service and, two, the possibility of destroying that service capabilities.
Q. And that would be destroyed because of?
A. Economics destruction.
Q. Failure to make a profit?
A. Yes, sir.
Q. If you had to pick a type of hat that a Public Service Commissioner wears, would it be more likely to be that of a public relations person, more likely to be that of a traffic cop, more likely to be that of a judge or more likely that it be of an agency official. Which of those hats would you see yourself wearing most often from time to time?
A. Probably the latter two, the judge and the agency official.
Q. What is the role of the PSC staff, vis-a-vis, the role of the commission? What will you be looking for them -- from them? What should they provide to you? What role should they have?
A. Guidance and history relative to whatever subject is afoot at the moment. At the present.
Q. Mr. Chairman, for the benefit of the record, your staff has checked the appropriate reports from SLED and credit agencies, all were negative in the sense that they have no entries noted there.

Are you aware of any activity that would limit your service -- current activity on your part that would limit your service on the Public Service Commission in the sense of -- as I said, we talked about stocks. I want to talk about your employment, is there anything else that would cause you to have to recuse yourself from time to time?
A. No, sir.
Q. Mr. Reynolds, do you have recommendations for improving this screening process that you are only part of the way through, but you don't -- you're a good bit of the initial phrase, what recommendations would you have for improvement?
A. None.

Printed Page 2442 . . . . . Thursday, February 24, 1994

Q. Mr. Chairman.
REPRESENTATIVE WILKES: Thank you, Mr. Couick. Do any members of the screening committee have questions for Mr. Reynolds?
SENATOR COURTNEY: Mr. Chairman.
REPRESENTATIVE WILKES: Yes, Senator Courtney.
EXAMINATION BY SENATOR COURTNEY:
Q. Mr. Chairman. Mr. Reynolds, you're the Public Services
-- Director of Public Services for --
A. For the town of Mount Pleasant.
Q. What are your duties there?
A. We administer the services of garbage trash collections, streets and drainage, building and grounds and street maintenance, that sort of thing.
Q. Does it have anything to do with the water and sewer system there?
A. No, sir.
Q. You mentioned earlier in a question from Mr. Couick that you did not feel that you would have any conflict of interest working for the city and also working as a commissioner?
A. No, sir.
Q. Are you aware that there are situations where municipalities provide water and sewer to the areas outside of the town perimeter?
A. No, sir.
Q. And they would be in competition with private utility companies?
A. There are some communities that have their own water system and a private contractor provides a similar system in nearby outlying areas.
Q. Does your town --
A. Did I describe that correctly?
Q. Well, does your town own the sewer and water system there?
A. The -- are you familiar with the Public Service Commission situation, the town does not. What the town does is they sign a general obligation bond that the Public Service Commission has let to get the money to operate. I function as an employee of the town. It does not intersect that at all.
Q. Do any of the general funds from the municipality go toward keeping or maintaining the water and sewer system?
A. No, sir.
Q. Should a private utility company before you as a commissioner seeking a rate increase, so that they could expand services maybe to an area that is targeted by a municipal system, wouldn't you see that as a potential conflict of interest maybe as to whether or not to grant that increase to provide competition?

Printed Page 2443 . . . . . Thursday, February 24, 1994

A. No, sir. And the reason for that is, again, what I do daily as an employee of the town, I do not get involved in anything.
Q. Some --
A. Frankly, if I may finish, I don't even hear of it.
Q. Are the commissioners of your utility company there, are they any of the town council members?
A. No, sir.
REPRESENTATIVE WILKES: Representative Huff.
EXAMINATION BY REPRESENTATIVE HUFF:
Q. Mr. Reynolds, what utility provides electric service to the municipality that you work for?
A. Two. Primarily it's SCE&G and the secondary one is Berkeley Electric Co-op.
Q. And I would assume that that municipality has a franchise with that particular city, do they not?
A. I'm sure that's the way it operates.
Q. Do you not perceive a problem if you retain your position as an employee with the city and any conflicts that may arise with regard to the franchise or the granting of franchises or the dealing with a cooperative should that city annex into a cooperatively assigned territory?
A. No, sir, for the same reasons I mentioned to this, I just don't deal with them.
Q. But what I'm saying in your role as a Public Service commissioner, certainly you may have, maybe not an opportunity, but maybe a situation arise where the interest of the municipality may be adverse to that of a competitive utility, vis-a-vis, SCE&G and the co-ops, would you not feel that because of your retained position as an employee of that municipality that you could run afoul of a conflict in passing upon any questions that might arise between the cooperative's interest and the utility's interest?
A. It's important to -- in the mayor-council form of government that we have in Mount Pleasant, the council handles those issues directly. Employees of the town, we never -- frankly never hear about it.
Q. But if you're paid by the city and the city has a franchise with SCE&G, don't you think that might give a perception that you're predisposed --
A. It may.
Q. -- to find in the interest of the --
A. It may, but in the actual working of things, that's reaching out a long way to make the connection.
Q. Do you think that the appearance of a conflict may be as important as an actual conflict as the credibility of the PSC may be at issue?

Printed Page 2444 . . . . . Thursday, February 24, 1994

A. The appearance of conflict is an important issue, yes, sir.
Q. And would you not believe that because of an appearance, it might be inappropriate for you to vote in that -- notwithstanding that fact that there may not be a direct conflict, but because there is an appearance of a conflict that you should not vote in that situation should you be on the PSC?
A. I'm not sure how to answer that.
Q. Well, do you think that there must be a direct conflict of interest that would prevent you from voting whereas if there is only an appearance you would not find that to be significant enough not to vote as well? In other words, do you find those to be equal in the importance than -- that an appearance is as equally as important as a direct conflict?
A. I do agree with that.
Q. And if there was an appearance, what would you do? While you examined the situation and certainly found that legally there was no conflict, but there was an appearance of a conflict, what would you perceive your position to be in that situation?
A. Well, where that situation developed, I would abstain.
Q. And understanding that if you retained your role as an employee of a city which subsequently could be involved in that type of situation, do you think it might be a better choice to not be an employee as opposed to retain the employee role and then work on the PSC as well?
A. I would prefer not to do that. I would prefer to stay in the job in the Town of Mount Pleasant also.
Q. If the choice was to have one or the other, which would you keep?
A. The Town of Mount Pleasant.
Q. All right, sir.
REPRESENTATIVE WILKES: Senator Jackson.
EXAMINATION BY SENATOR JACKSON:
Q. Thank you. Mr. Reynolds, who do you answer to as the Director of Public Services for the Town of Mount Pleasant?
A. The Town Administrator.
Q. The Town Administrator. In your Public Service Commission, your local Public Service Commission, how are they chosen?
A. They are elected by their own organization. The commissioners of the water and sewer section in the town of Mount Pleasant, it's important to know these are two separate entities all together, not to be identified or associated with each other.
Q. Who decides on the franchise for the town of Mount Pleasant SCE&G or electric co-op? Who would make that decision?
A. Council.

Printed Page 2445 . . . . . Thursday, February 24, 1994

Q. The council?
A. Yes. Elect the commission.
Q. And the council hires the Town Administrator?
A. Yeah.
Q. Who -- you then report to the Town Administrator?
A. Yes.
Q. So do you see that as an apparent conflict if you reported to a town administrator who is hired by the council, that council makes decisions on the services of a utility company that you may regulate?
A. I see where you're heading. That's reaching three or four levels away and -- I see what you're saying, but the answer is no, I do not see that. It would not occur.
Q. Okay. Thank you, sir.
REPRESENTATIVE WILKES: Are there any other questions from the screening committee? Yes, sir.
EXAMINATION BY MR. BILTON:
Q. Mr. Reynolds, why are you apply for this position versus what you're doing now?
A. I've always been interested in the Public Service Commission and what they do in that, and to answer Mr. Couick's first question, I've done this so very long, the Public Service, that I believe I can be of help to the State of South Carolina by serving on the commission.
Q. Did you -- did I understand you wrong that if you -- if there was a choice to be made between the two that you would remain where you are?
A. I'd remain with the town with the Mount Pleasant, yes, sir.
Q. So this is more or less a plus for you in your opinion?
A. Yes, sir.
Q. Thank you.
EXAMINATION BY REPRESENTATIVE WILKES:
Q. Mr. Reynolds, is your job with the town of Mount Pleasant a full time position?
A. Yes.
Q. Are you aware that the Public Service Commission often meets two to three days a week?
A. Yes, sir.
Q. So how would you reconcile two full time jobs, so to speak, in one?
A. What I would do in that case is just not accept the pay of the town of Mount Pleasant for the time that I'm dealing with the PSC.
Q. So who would assume your duties --
A. My deputy.
Q. -- in the town of Mount Pleasant while you're here?

Printed Page 2446 . . . . . Thursday, February 24, 1994

A. My deputy.
REPRESENTATIVE WILKES: Thank you. Are there any other questions from the committee? Thank you, Mr. Reynolds, you're excused.
A. All right.

PERSONAL DATA QUESTIONNAIRE SUMMARY

1. Mr. Furman M. Reynolds
Home Address: Business Address:

113 Ashley Hill Dr. Town of Mt. Pleasant

Goose Creek, SC 29445 P.O. Box 745

Mt. Pleasant, SC 29464

2. He was born in Charleston, South Carolina on March 24, 1943.

Social Security number: ***-**-****.

3. S.C. Driver's License Number: *********.

S.C. Voter's Registration Number: 4 478 242.

4. He was married to Thelma Elizabeth Reynolds on July 7, 1979. He has two children: Furman M. Reynolds, IV, age 22; Cherie R. Galloway, age 21.

5. Military Service: US Army Active Reserve, Major, from 1961 to present.

6. He attended The Citadel from 1971 to 1973 and from 1979 to 1981, business management; University of Louisville from 1974 to 1979, business management.

9. He was a tool designer for Lockheed Aircraft Company from 1963 to 1974; Plant Supervisor for Metropolitan Sewer District from 1974 to 1979, Louisville, Kentucky; Superintendent of the Seabrook Island Company from 1979 to 1985, (utility corporation); Superintendent of Summerville Water Systems from 1985 to 1990; Director of Public Services, Mt. Pleasant, SC, from 1990 to present.

26. Professional organizations: Water Pollution Control Federation; Water Pollution Control Association of SC; American Wastewater Association; Reserve Officer's Association.

Printed Page 2447 . . . . . Thursday, February 24, 1994

29. Five letters of reference:

(a) Mr. Hardy
First Federal Bank of Charleston
P.O. Box 10968
North Charleston, SC 29411-9984
(803) 863-9852

(b) Mr. Dennis Harmon
City Administrator, Goose Creek, SC
City of Goose Creek
125 St. James Ave.
Goose Creek, SC 29445
(803) 797-6220

(d) Van D. Hipp, Jr., Esquire

2138 Ashley Phosphate Road

Suite 201

North Charleston, NC 29406

(803) 764-2474

(e) John A. Skorupski, Jr.

S.C. State Ports Authority

Post Office Box 817

Charleston, SC 29402-0817

(803) 723-8651

30. First District

THE CHAIRMAN: I suggest we go to lunch at 1:00 o'clock and come back at 2:30? Any questions? 2:00? See you back at 2:00. Meeting adjourned.

(A lunch break was taken)
THE CHAIRMAN: I would call the meeting to order. Mr. Couick.
MR. COUICK: Mr. Chairman, our next candidate is Mr. William Saunders. I believe you go by Mr. Bill Saunders, is that right, Mr. Saunders?
A. Yes.
Q. While you're coming forward, I'm going to ask Ms. Hammond to come around and get either your voter registration certificate or your driver's license from you.

Printed Page 2448 . . . . . Thursday, February 24, 1994

Mr. Saunders, while you're standing if you could raise your right hand and take the oath, if you will.
WILLIAM SAUNDERS, having been duly sworn, testified as follows:
MR. SAUNDERS - EXAMINATION BY MR. COUICK:
Q. Mr. Saunders, is it correct that your address -- your current address is 6191 Chisholm Road? It looks like PO Box 36, Johns Island, South Carolina?
A. Yes.
Q. 29455. Johns Island is in Charleston County; is that correct?
A. Right.
Q. You live in the Charleston County rather than the Colleton County part?
A. Right.
Q. Would you please state for the record your full name, Mr. Saunders?
A. William Saunders.
Q. Mr. Saunders, counsel for the committee has several questions that relate to some research done on your -- with credit agencies and also with SLED regarding some noncriminal matters, it would be my request at this time that the committee go into Executive Session to protect your privacy at this point with the option of coming out very soon.
THE CHAIRMAN: The Chairman to entertain a motion?
SENATOR COURTNEY: Mr. Chairman, I would move.
REPRESENTATIVE WILKES: Move.
THE CHAIRMAN: Move into Executive Session. Any objection to Executive Session? Executive Session.

(Executive Session)
MR. COUICK: Mr. Chairman, I've just discussed with Mr. Saunders that what you want to do is go back into Public Session now, have the general interview based on some other questions about his qualifications, but one issue that you want to address is the credit reports and the judgment. He understands that that will happen. I believe you indicated your assent to that?
A. Yes.
THE CHAIRMAN: And also in regards to the letter?
MR. COUICK: Yes, sir, with regard to the letter. Yes, sir.
CONTINUED EXAMINATION BY MR. COUICK:
Q. Mr. Chairman, back in Open Session, Mr. Saunders, you had been previously sworn. I'd like to ask you some questions about your understanding of the operation of the Public Service Commission. Could you please tell the committee very briefly why you would like to serve on the Public Service Commission as a commissioner?

Printed Page 2449 . . . . . Thursday, February 24, 1994

A. Well, I think that my background in broadcasting and being a part of an industry that I saw that -- that was not -- was a regulated industry for a long time and was deregulated. And I was almost destroyed with some of the small broadcasters that I see the possibility of some of these things happening as it relates to regulation or the power industry being deregulated and I think that I have some expertise in that.

I've got a good background to working with people and my history is pretty good in that area and I know a lot about what goes on.
Q. What major topics or major problems or concerns are being confronted by the Public Service Commission or should be confronted by the Public Service Commission? If you had to list one or two areas that you would be concerned about, what would they be?
A. Again, I guess the area of making sure that everything continued to run smoothly and being able to make sure that we have a harmonious state as it relates to the utility companies and telephone company.
Q. What role should the Public Service Commission staff play in the deliberations, Mr. Saunders?
A. I think that the commissioners have to make the final decision, but I think the staff has to play a role in the deliberations.
Q. Mr. Saunders, if you had to pick the kind of hat that you think that you would most often wear as a public service commissioner, would it be the hat of a traffic cop, the hat of an agency director, the hat of a judge or the hat of a public relations person? Which hat do you think you would most be often called to wear?
A. Okay, even if I could add another one to it, I believe also as a mediator sometimes. People that's going to look at some of those things that are going to effect people that already have made some decision of being able to bring them together and have -- have them to make the right decision that's going to be best for the state.
Q. Which one of those hats would you wear most often, do you believe in your day to day work at the commission?
A. I think making some judgements or decisions.
Q. Serving as a judge?
A. Yes.
Q. If that be the case and you were called upon to make decisions particularly about rates that place you deciding something that may effect the public and on the other hand effecting a company which in the free enterprise system needs to make a profit to survive, how are you going to make those judgments? What's going to be your thought process as you go about doing that?

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