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Cardinal-Hickory Creek: Former regulator asks Supreme Court to take over power line dispute

With less than three weeks until a trial over the permit for a controversial power line through southwestern Wisconsin, a former utility regulator is asking the state’s conservative high court to take over the case.

The Driftless Area Land Conservancy and Wisconsin Wildlife Federation – along with Dane County and other local governments – are suing the Wisconsin Public Service Commission in an effort to block construction of the Cardinal-Hickory Creek line between Dubuque, Iowa, and Middleton.

The groups claim that former Commissioner Mike Huebsch’s relationships with executives of the utilities seeking a permit for the $492 million project created an appearance of bias, which the judge overseeing the case has said would be enough to invalidate the permit.

Huebsch, a former state legislator and member of Gov. Scott Walker’s cabinet, argues that’s an impossible and unlawful standard for public officials and says he’s the object of “unrelenting innuendo and harassment” in an effort to sway future decisions.

“After all, who would want to oppose a group that might later subject the decisionmaker and her friends to intrusive and expensive discovery based merely on an allegation (damaging in its own right) of ‘appearing’ biased?” attorney Ryan Walsh wrote in a petition asking the Supreme Court to intervene.

Last month the plaintiffs dropped efforts to inspect Huebsch’s phone for records of encrypted communications with more than two dozen people connected to the project. That prompted an appeals court panel to dismiss Huebsch’s effort to block that subpoena.

But the plaintiffs issued a second subpoena demanding that Huebsch testify in court during a hearing scheduled for Sept. 29-30.

Now Huebsch has asked the state Supreme Court to block that subpoena, to overturn the court of appeals decision on the withdrawn subpoena or to take over the case entirely from Dane County Circuit Judge Jacob Frost.

‘Breathtaking implications’

Huebsch says Frost is acting as “a one-man grand jury of sorts” and has turned what should be a narrow review of an administrative decision into “a roving commission” to probe whether Huebsch’s conduct “gave rise to an ill-defined ‘appearance of bias,’ supposedly in violation of the Due Process Clause of the Fourteenth Amendment.”

The petition argues Frost has wrongly adopted an “appearance of bias” standard rejected by the Supreme Court majority that could “have breathtaking implications for adjudicators of all kind(s).”

“All it would take for a party to flout a court’s final decision would be to make speculative allegations of connections between chambers and interested law firms, businesses, or other entities,” Walsh wrote. “Maybe even the judge’s extracurricular involvement with law clerks, industry, or working groups would similarly raise due-process concerns. And if a judge left the bench and pursued employment at a company or firm that had a matter before it previously, perhaps that would even be grounds for vacating the judge’s previous decisions.”

The plaintiffs say Huebsch’s petition lacks legal standing and accuse him of trying to delay the case even as the utilities seek to begin building the line.

“He’s acting as a stalking horse for the transmission companies,” said Howard Learner, lead attorney for the Driftless Area Land Conservancy and Wisconsin Wildlife Federation. “In the meantime the transmission companies say they want to start building the line in October. They can’t have it both ways.”

The state Department of Justice, representing Frost, has also asked the court to deny Huebsch’s motion, arguing he is circumventing the legal process and should first ask the circuit court to block the subpoena.

PSC takes stand

Attorneys for the PSC and the utilities have encouraged the high court to step in, arguing that allowing the plaintiffs to continue digging into Huebsch’s personal relationships will impact decision-making across state agencies and even discourage others from public service.

“Petitioners have continued their scorched-earth attempts to comb through individual Commissioners’ personal communications to find some basis for possible bias that they did not have when they filed their Petition for judicial review, and still do not possess,” the PSC brief states. “Discovery into the personal communications of Commissioners other than Huebsch has already been requested, and will likely become part of the playbook for individuals searching for some way to challenge a decision they don’t like.”

The court has not taken any action on Huebsch’s petition, though he has requested it take over or issue a stay by Sept. 17.

Huebsch has also asked a federal appeals court to keep in place a hold on district court proceedings challenging three separate federal agency approvals.

Web of issues

Unanimously approved in 2019, the 102-mile line from Dubuque to Middleton is a joint venture of American Transmission Co., ITC Midwest and Dairyland Power Cooperative.

The utilities, which have spent at least $126.4 million so far on the project, say it is “critical to ensuring Wisconsin can transition to a cleaner, more reliable, and more affordable energy future” by enabling the import of energy from wind turbines in Iowa.

The plaintiffs, who say the line is unneeded and would be a blight on the environmentally sensitive Driftless Area, initially challenged the permit on the grounds that Huebsch served on an advisory board to the regional grid operator, which had supported the line before the commission, and that PSC chair Rebecca Valcq previously worked as an attorney for the majority owner of ATC.

Frost dismissed claims against Valcq but said in May that he would revoke the permit if the plaintiffs could show even one commissioner had a legitimate conflict of interest.

Through a separate federal case, the plaintiffs discovered that Huebsch applied to be CEO of Dairyland after leaving the commission in February 2020, though he did not get the job.

In June, the project owners revealed that Huebsch had communicated with utility executives using the encrypted messaging app Signal and asked the PSC to revoke and reissue the permit. The PSC has not acted on that request.

Huebsch has testified he used Signal to send encrypted, ephemeral messages to longtime friends in the industry but never to discuss official commission business. And he says he applied for the job as a courtesy to Brian Rude, a friend and mentor who was the La Crosse-based utility’s director of regulatory affairs.

In short, Huebsch argues there’s nothing wrong with those relationships.

“Nothing in state or federal law suggests that these friendships prevent Huebsch from impartially adjudicating matters in which their employers just so happened to be parties,” his petition states. “Nor is there anything problematic about a former adjudicator, having developed expertise in an industry, applying for a job in that industry.”