SCC falls prey to power politicsState Corporation Commission, with 1 judge and 2 vacancies, falls prey to power politics

RICHMOND-Power politics is blocking the election of two judges to the State Corporation Commission, which is now relying on one member and a substitute to rule in cases of statewide importance to business and consumers.

Created in the 1902 state constitution as a body independent of the General Assembly and its political interests, the SCC has been a hostage of legislative politics for a year. House Republicans and Senate Democrats have refused to agree on candidates to fill two seats. The two vacancies initially had appeared to make it possible for each party to get one pick.

Instead, the two chambers are locked in a political stalemate with no end in sight, despite the assembly's passage last month of legislation to restore some authority to the SCC to regulate electric utility rates.

"Right now, you're in a standoff and waiting for the other side to blink," House Majority Leader Terry Kilgore, R-Scott, acknowledged on Tuesday.

Waiting in the wings is Gov. Glenn Youngkin, a Republican who might be able to step in an make the appointments himself if the assembly is no longer in session. Except, Senate Democrats say, they never adjourned a special legislative session last year (even though the House did), and will remain in session until the new assembly elected in November takes office in January.

Youngkin spokesperson Macaulay Porter said Tuesday, "I will decline to comment on the SCC."

It was not supposed to be this way. Former SCC Judge Judy Jagdmann resigned from the commission at the end of last year, in part to make it easier for the assembly to fill a seat. It already had been vacant for almost a year, after House Republicans refused to re-elect Judge Angela Navarro to the three-member panel. Two years earlier, Democrats, who then controlled both chambers, had refused to re-elect - or even interview - Judge Patricia West, a Republican who had joined the commission a year earlier.

Republicans and Democrats had even come up with an innovative way to make the two terms almost equal in duration. With five years left in Navarro's term and just one for Jagdmann, they introduced bipartisan legislation in each chamber to add a fourth seat with a six-year term. The legislation then would eliminate the seat that Jagdmann had held for 17 years.

But the legislation died on Feb. 25, the final day of the General Assembly session, because House Republicans and Senate Democrats still could not agree on candidates to fill the two seats. The Senate wanted to re-elect Navarro, a former deputy secretary of Commerce and Trade and previously deputy secretary of Natural Resources in Democratic administrations, but the House refused because it had rejected her a year earlier.

"They don't want us to tell them who to pick, but they want to tell us who we can't pick," fumed Senate Majority Leader Dick Saslaw, D-Fairfax. He said Republicans had rejected Navarro last year as payback for the decision by Democrats to strip West from the commission in 2020.

"They took her off strictly for retaliation," Saslaw said Tuesday. "It had nothing to do with her ability."

Lost in the political fray is stability of what is sometimes called the fourth branch of Virginia government.

The SCC - created as constitutionally independent to counteract the railroad industry's political control of the assembly at the beginning of the 20th century - regulates public utilities, insurance companies, banks and financial institutions, and registers corporations and other entities doing business in Virginia. In January, it will begin operating the state's first health insurance marketplace.

"These are important things the commission does - banking and insurance and utilities," lamented former Commissioner Hullie Moore. "It shouldn't be political."

Instead, Moore said, "They're trying to make the commission not really be independent. It's 'This person isn't enough on my side, and that person is too much on your side.'"

The irony of the impasse is that the General Assembly finally agreed to restore some measure of authority to the SCC over electricity rates charged by the state's two big investor-owned utilities: Dominion Energy and American Electric Power. The move came after more than two decades of restricting the commission's ability to rule impartially on major projects and the rates that monopoly customers pay for electricity.

"In order for somebody to be looking out for the little guy, we have to have a regulator that's ready to follow through on all of the discretion that's being given to them under this bill," Sen. Scott Surovell, D-Fairfax, said on the assembly's final day as the Senate prepared to adopt a compromise on the utility legislation.

"None of this works unless we can reach that compromise and it hasn't happened yet," he said, "and that's very disappointing to me."

Surovell had introduced one of the bills to temporarily expand the commission's size and then eliminate the seat with one year left in its term. House Commerce and Energy Chair Kathy Byron, R-Bedford, introduced the House version, which would have made the two remaining seats almost equal in duration.

But they disagreed, not only on who should fill the seats, but on how the candidates should be selected.

Byron said House Republicans would not accept Navarro after they rejected her the previous year. But the Senate "just doubled down and said, 'It's this person or no one,'" she said.

She described the Senate's position as: "'We get a pick, you get a pick. We can't question yours. You can't question ours.'"

"That's now how we want to make an appointment," Byron said.

But Surovell said that is exactly what House Republicans demanded in 2022, when the legislature elected two judges to the Virginia Supreme Court, as well as a member to the Court of Appeals after Judge Wesley Russell rose to the high court.

"Now there are two spots [on the SCC] and they say the rules are different," Surovell said.

Both majority leaders acknowledged Tuesday that the battle comes down to which philosophical viewpoint holds a majority on an odd-numbered commission. Then-Gov. Ralph Northam appointed the lone permanent member of the panel, Judge Jehmal T. Hudson.

Kilgore suggested that the assembly could simply expand the commission to four members to encourage compromise on contentious issues. Chief among them is how to interpret and apply the Virginia Clean Economy Act, which the assembly adopted in 2020 under Democratic control and over Republican opposition.

"I'm all for doing some of this green energy stuff, but we need ... somebody over there calling balls and strikes to make sure it's affordable and reliable," he said.

Saslaw called the idea of a four-member commission unworkable because of split decisions and deadlock.

"You don't want that," he said.