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San Diego’s new government-run power agency, which started providing service for residential customers on Tuesday, tried in 2020 to offer its top position to an employee beloved by clean power advocates in the region.
But a state ethics watchdog ruled her ineligible because she helped set up the organization’s bylaws.
Now elected leaders on the board of San Diego Community Power or SDCP are launching a second national search for a permanent CEO. Yet advocates are upset because they want Cody Hooven, the agency’s current chief operating officer who got the agency on its feet as interim executive officer, to take the job after she was the agency’s top choice following a national search in 2020.
This all began when Hooven went to city of San Diego’s ethics department for an opinion on her interest in applying for the position, confirmed Joe Mosca, an Encinitas city councilman and chair of the SDCP board. The city said there was an issue involving the state’s code, Mosca said, so SDCP’s attorneys decided to ask the state before the agency acted on their CEO selection.
The Fair Political Practices Commission – a watchdog agency that regulates campaign finance, conflict of interest, ethics and lobbying statewide, including advising local governments on those matters – issued a letter in August of 2020, advising the agency that state code prohibits hiring Hooven as CEO because she was in a position of leadership when the agency’s bylaws were written. That doesn’t pass the state’s code test of whether she participated in the making of a contract for herself.
The state code prohibits public officers or employees from participating in the making of contracts in which they might be financially interested. The purpose of the rule is to catch instances of “impropriety … or the appearance of impropriety,” according to the commission. In other words, it applies regardless of whether any actual fraud or dishonesty occurred. The commission noted in its ruling that Hooven took steps to insulate herself from the CEO hiring process by handing off the recruitment effort to an outside consultant and the board.
“This conclusion does not suggest improper motive on the part of Ms. Hooven,” the FPPC wrote. “The rule operates chiefly as a preventative measure to protect the honor of well-meaning officials and safeguard the public interests they serve.”
The bylaws in question are called the Joint Powers Authority, a legal document that lays out rules jurisdictions that joined the agency – city of San Diego, La Mesa, Imperial Beach, Encinitas, National City and the County of San Diego – will follow as a single public power agency.
Yet advocates favored her leadership so much, they asked the board to change the agency’s bylaws to allow her to serve.
“Our community has asked the SDCP board to amend the JPA agreement and resolve the obstacles to allow all qualified candidates to be able to be the CEO but we believe the board has not done that nor explained the reasoning,” said Tara Hammond, a member of the agency’s Community Advisory Board and co-founder of a pro-solar energy group called Hammond Climate Solutions. “We simply want the best candidate to be able to be CEO of the state’s second-largest community choice energy program.”
In its letter, the commission pointed to a similar case in the city of Los Altos where a city councilmember applied for the CEO position at Silicon Valley Clean Energy after representing their city in the making of a similar JPA agreement. But because the bylaws didn’t contain an express requirement to hire a CEO – unlike in the SDCP case – the commission ruled differently.
So far San Diego Community Power’s board hasn’t said whether it plans to make any changes to its bylaws. When asked, the agency pointed to the commission’s letter and comments made publicly back in November by assistant general counsel Nick Norvell of Best Best & Krieger law firm.
“The FPPC determined Ms. Hooven was precluded from the CEO decision because she was considered to have participated in making of the contract for the position itself,” Norvell said in November.
Hooven declined to comment when reached on Monday.
After the FPPC ruling, the board offered the job to an interim CEO, Bill Carnahan, a career director of public power agencies who came out of retirement to take the position for a year. In September, the board extended his contract another six months to conduct another national search for a permanent CEO.
“It’s not in the best interest of SDCP to hire somebody that the state says has a financial conflict of interest,” Mosca said. “I think the expectation would be to do a robust competitive solicitation to recruit a CEO and hire the most qualified person to serve in that role, which is what we’re doing.”
Advocates have been calling into public board meetings for months to complain.
“I want to ask why the board is wasting its time and money to do a national search for a CEO when it has a perfectly qualified and capable woman among its staff,” asked Joyce Lane, president of San Diego 350, a nonprofit that pushes for action on climate change, during an October board meeting. “I can’t help but think some conscious or unconscious sexism at play.”
“If we truly want the best, we need to allow the most intimately knowledgeable person to apply,” said Eddie Price, a city of San Diego appointee to the agency’s Community Advisory Committee during that same meeting. “This type of behavior and action epitomizes systematic oppression and I hope we are better than that.”
At its Jan. 22 meeting, board member Steve Padilla, a Chula Vista city council member running for state senate, and board member Bill Baber, a La Mesa city councilman, volunteered to run the second CEO search committee. They said the application window closed at the end of the month and finalists will interview with the board in March. The board would take input from the community advisory committee, staff and other stakeholders, Padilla said.
San Diego Community Power, formed in 2020, is one of dozens of public agencies created statewide to produce cleaner, less expensive electricity than investor-owned utilities. Whoever is in charge is responsible for executing its mission: provide electricity at a lower rate than its private competitor, San Diego Gas and Electric, and 100 percent renewable energy by 2035.
“SDCP is the fastest way for any jurisdiction to reduce its (greenhouse gas) emissions,” said Mat Vasilakas, co-director of policy at Climate Action Campaign. “If it gets the wrong leadership, it could slow that progress down or make decisions that go against the intent of why we this community created the program in the first place.”
Correction: This story has been updated to correct the name of the pro-solar energy group called Hammond Climate Solutions, and include that Nick Norvell is assistant general counsel.