Minnesota's state watchdog agency dings utilities commission on dealings with public

The state's internal watchdog ripped the Public Utilities Commission (PUC) for at times being inconsistent and opaque in dealings with the public, particularly on a controversial new $2.6 billion oil pipeline proposed by Enbridge.

The Office of the Legislative Auditor issued a report Monday on the PUC's process for public participation, finding myriad shortcomings — including a historical lack of outreach to Minnesota Indian tribes — and making several recommendations.

One of those is for the PUC, which regulates the energy and telecommunications industries, to improve basic communications.

The PUC "has done a poor job educating the public about [its] unique role and processes, and has not provided adequate resources for the public to participate," the report said.

In a response published with the report, the PUC said it had been working "diligently" over the past year to correct mistakes in public meetings. It cited a new policy for engagement with tribes, the rebuilding of its website and hiring of more people to manage public outreach.

The PUC rules on electricity and gas-rate cases and a bevy of infrastructure issues from power plants to pipelines. It has five commissioners who are appointed by the governor to staggered six-year terms. No more than three of them can hail from the same political party.

The legislative auditor's report stemmed from the PUC's handling of Enbridge's proposed replacement for its aging Line 3, a 340-mile pipeline that would transport Canadian oil across northern Minnesota to Superior, Wis.

The auditor examined public participation in the Line 3 process from 2015 to 2020. It did not look at the validity of the PUC's rulings on the pipeline.

After a court ruling ordering additional research, the PUC reapproved the project in February, though Enbridge must still get other state and federal permits, which will take several months.

The legislative auditor didn't have a problem with the number of public meetings for Line 3. Several rounds of informational public meetings have been conducted on Line 3 since 2015. And in 2017, an administrative law judge held an additional 16 public hearings on Line 3.

The legislative auditor found that notices for those 16 hearings "were not easily accessible and did a poor job explaining how the public could be involved." But most of the report's Line 3 criticism centered on the public "agenda meetings" where the PUC made major rulings from 2018 through early 2020.

PUC agenda meetings don't play to full houses — except in the case of Line 3, where opponents and supporters both tried to pack the house. "Officials told us the Line 3 case was the first and only case to date in which [the PUC] used admission tickets," the report said.

However, the ticket system was plagued with problems. There were inconsistencies in how many tickets were allotted to parties in the case; for example, Enbridge getting 10 and the Red Lake and White Earth Ojibwe bands — both Line 3 opponents — getting five altogether, the report said.

Also, the PUC's rules for the agenda meetings "changed over time and staff enforced them inconsistently," the report said. Nor did the PUC give its staff adequate support to administer the meetings, which were at times chaotic.

The current Line 3, one of six Enbridge pipelines crossing the state, is corroding and running at only 51 % capacity due to safety issues. Pipeline opponents — environmental groups and some Ojibwe bands — said the Line 3 replacement would open up a new part of Minnesota to oil spills and contribute to global climate change.

The PUC initially approved the project in June 2018, but was ordered to review it by an appellate court that ruled the PUC didn't handle the project's environmental impact statement properly. The PUC later approved a new environmental impact statement and reapproved the rebuilding of the pipeline this past February.

Mike Hughlett • 612-673-7003