The consultants who have long assisted the New Orleans City Council with regulating Entergy New Orleans will keep their lucrative jobs, after one council member's two-month drive for change fizzled Thursday for lack of support.
The council voted 6-1 to ratify a committee’s earlier approval of new contracts for the international law firm Dentons US, the Legends Consulting Group Limited of Denver and the local law firm of Wilkerson and Associates.
The odd woman out was Stacy Head, who tussled with Councilman Jason Williams as she unsuccessfully pushed for a deferral on the matter Thursday. Both were continuing a fight they first had in December after Head accused Williams of overseeing a bidding process rigged in the incumbents' favor.
“I think we should at least have a serious discussion about the way we do utility regulation, and the way we select our consultants, such that we don’t have to select all of our consultants at one time,” Head said.
But Williams, who chairs the council’s Utility Committee, said Head was grinding a personal ax.
“City Hall is not a place to try to send contracts in the direction of your friends, or, in like manner, get contracts away from people that you don’t like personally,” he said.
All three firms help the council fulfill its unique role of regulating a private energy utility, Entergy, in a state that also has a state-level regulatory agency.
The firms have long operated under one-year contracts with the council that may be renewed annually for up to five years. Dec. 31 was the final day for the latest set of contracts, which totaled $5.675 million in 2016 and up to $28.7 million overall for the past five years.
Although the council advertised for bids from other firms in July and responses were forwarded to the various council members' offices in September, a staff selection committee did not send its report to council members until Dec. 8 — six days before the Utility Committee’s December meeting.
The selection panel, composed of members of the council’s central staff, did not rank the nine firms that responded but provided written evaluations of eight applications. It dropped the ninth for being late.
Head said that timing did not give her a chance to review the selection committee’s work and meet with those who might advise her on her decision.
She also has called for a change in the council’s regulatory structure, one that could cut down the number of consultants the council employs and more closely evaluate the services they provide.
But Williams and others said in December that all council members had the same amount of time to review the proposals and that the council's selection process favored experienced firms with local ties.
Williams also suggested that the council should keep the same advisers while it prepares for an upcoming vote on Entergy's controversial proposal for a new power plant in New Orleans East.
Notably absent from that December discussion was Dentons' proposal to raise its rates. In bid documents the firm submitted to the council last year, it proposed that its senior attorneys would collect $600 hourly in 2017, up from $565 last year; that other Washington, D.C.-based attorneys would make $475 hourly, up from $425; and that Wilkerson would be paid $375 hourly, up from $300.
That doesn't include the hourly rates the council pays to professional staff who work with Dentons on specific issues.
While the council routinely limits the annual amount Dentons may charge, the firm has historically exceeded those caps by rolling bills over from one year to the next, said Pearlina Thomas, chief of staff of the council's Utility Regulatory Office. She said that practice most recently was seen in 2015, when the council approved a $530,000 payment for overages. Even with that payment, Dentons still billed the council an additional $200,000 in overruns, Thomas said.
Dentons pledged in its bid to find "cost-effective ways" to work within the council's budget. Longtime Dentons partner Clint Vince, the council's primary legal adviser on Entergy, has long maintained that the firm offers its services to the city at a discount.
Still, the rates proposed by others vying for the job were generally cheaper, with three firms promising to install billing caps.
In any case, the rates proposed by the winning firms are merely proposals, with the final contract amounts to be hashed out in negotiations. The council's Utility Committee is also expected to consider new billing guidelines for the advisers later this month.
But Head, armed with information on the proposed increases, argued Thursday that the council could get more for its money. She also disputed Williams’ claim that her call for change was rooted in spite.
“This is the first time that we had gotten such robust responses,” she said after Williams questioned why Head didn’t push for change years ago.
Councilmen Jared Brossett, James Gray and Williams all said they had researched the matter and deemed the incumbent firms best suited for the job. “Another council member’s lack of preparation is not going to stop government, and it's not going to stop me from doing my job,” Brossett added.