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HomeNewsArchivesPSC Debate: How Public is Financial Info of a Public Utility?

PSC Debate: How Public is Financial Info of a Public Utility?

Dec. 16, 2005 – The Public Services Commission on Friday debated the question of how public should financial information about a public utility be?
Shaun Pennington, publisher of the V.I. Source and who requested copies of the V.I. Telephone Company's audited financial statements on Sept. 22, read from a November letter she sent to Keithley Joseph, executive director of the PSC. The letter said, "There is not a single exemption in the language of the V.I. Public Records Act that has any relevance to this effort to hide the Vitelco financial reports."
The Source has twice asked for the audited financial reports of the public utility. The first request in 2001 was denied by the PSC and the second request a year or so later was never acknowledged by the commission.
Attorney Kevin Rames representing Innovative Telephone, referred to a letter dated Dec. 2 that he had sent to Joseph. The letter said, "The response of the V.I. Source is based upon the mistaken premise that Innovative Telephone is obligated to provide both its high-level financial statements as well as its detailed backup information to the Commission."
The Rames letter, which had not previously been seen by the PSC's legal counsel Frederick Watts or by Pennington, raised some questions from commission members. Member Joseph Boschulte asked for a definition of "high-level financial statements." Watts said there was no real legal definition for the term; it was just a term that Innovative used.
Boschulte then asked, "Are not financial audit reports simply financial audit reports?"
Rames argued that the telephone company had a history of supplying an abundance of information to the PSC just to keep the relationship between the phone company and the PSC on good terms, and the PSC has maintained a tradition of keeping that information confidential.
He further referred to a confidentiality statement signed by former PSC vice-chairman Alric Simmonds in September when Innovative was filing information with the PSC in its effort to get millions of dollars in grant money from the Universal Service Funds administered by the Federal Communications Commission. (See "PSC Likely to Approve Vitelco's Receiving USF Money"). At that time a concern over whether the phone company was forthcoming with information was raised by then-board chairman Valencio Jackson. He said the company had failed to submit required audited annual financial reports to the commission.
Rames argued Friday that Innovative understood the information it submitted would remain confidential because of agreements "clearly written and made orally."
Boschulte asked Watts if the agreement signed by Simmonds covered the financial statements. Watts said he wished he could answer that statement, but he could not. At the end of the meeting the request by Pennington was tabled and Watts was directed to find an answer to that question and to get a definition of "high-level financial statements."
Rames said several times that the financial statements and related documents contained trade secrets and information that could be injurious to Innovative if known by its competitors.
Joseph had asked Rames to specifically point out what items those were. However, in his written response Rames did not. Watts asked Rames twice at the meeting to point out specifically what areas of the audited financial statements contained trade secrets or potentially injurious material. Rames response seemed to indicate that he thought there were so many areas that it would be laborious to go over all of them. He gave no specifics.
Commissioner Verne C. David said he saw Rames' position, but did not agree with everything Rames was saying. David said that the PSC has often found Innovative "resistant" when information was requested. He asked Rames why material that could be potentially harmful to Innovative was not taken out of the material submitted to the PSC.
Rames said that would be "very difficult." He said the history was that Innovative was once effectively a monopoly and did not need to worry about competition. He said that technology and the rise of cell phone use had changed that and Innovative now had competitors.
David said he was not buying the argument that it was "too difficult" to sort the information.
Rames requested that if the board did decide, as PSC regulations quoted by Pennington stated, "all facts and information in the possession of the Commission shall be public, and all reports, records, files, books, accounts, paper and memoranda of every nature whatsoever in its possession shall be open to inspection by the public" applied, that the information still not be released until Innovative had the opportunity to try the matter in court.
Pennington told the commission that as the owner of a small business she did not want to get into a legal battle with Innovative, nor did she think that was an appropriate avenue. She also told the commission she was not representing the Source in this issue, that she was representing the public and defending its right to information about publicly owned utilities.
One of only two V.I. print newspapers, the Daily News is owned by Innovative owner Jeffrey Prosser. She also questioned, "What is Innovative trying to hide by keeping this information secret?"
Rames also made the argument that some of the financial reports were made to individual commission members and therefore not in the possession of the commission.
Simmonds is no longer on the commission. Alecia Wells, vice chair, presided.

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