Former Clinton Aides Reveal Ties to Cal. Power Company

By Seth Lewis CNSNews.com Staff Writer June 25, 2001

(CNSNews.com) - California conservatives are grumbling over what some see as a possible conflict of interest involving two consultants Gov. Gray Davis hired to help shape his energy policy.

Former Clinton White House officials Chris Lehane and Mark Fabiani officially disclosed their relationship Thursday with Southern California Edison, a power company that recently struck a high-dollar deal with the state of California.

"You have two individuals on the government payroll who had previously been on the Edison payroll, and it's not clear to whom their loyalties are," Derek Cressman of the California Public Interest Research Group told the Sacramento Bee. "Just because they've revealed it doesn't mean there's not a conflict there, and that they're not serving two masters."

Lehane and Fabiana each received $10,000 under contract with Edison, the Bee reported Friday. Critics say the Edison connections raise questions about the consultants' role in Davis' decision to buy the company's transmission system for $2.76 billion - 2.3 times Edison's book value - to keep the utility from going bankrupt.

While some lawmakers called the deal a coup for Edison, Davis spokeswoman Hillary McLean defended the former Clinton White House officials.

"There is no conflict of interest," McLean said. "Chris Lehane and Mark Fabiani have been absolutely up front from Day One about their relationship, and since the governor and Edison are working together [on the energy crisis], we're working toward the same purpose."

But not everyone finds that argument plausible. California conservative activist Lewis Uhler filed a lawsuit to block the state from paying Lehane and Fabiani's $30,000-a-month salary until they disclosed their relationship with the power company.

Lehane and Fabiani filed such disclosures late last week in accordance with the Fair Political Practices Law, which requires state employees to reveal their assets and financial ties within 30 days of hire, McLean said.

But Uhler questioned what he called the "Houdini price" the state is paying for Lehane and Fabiani, whose salary tops the $13,750 earned each month by the governor.

"Davis realizes he's in serious political trouble, and he's doing everything he can to ameliorate the problem," said Uhler, president of the National Tax-Limitation Committee.

California Controller Kathleen Connell, who has the final say on state paychecks, has expressed her own skepticism about the consultants, saying in a statement that she wouldn't pay them "until my concerns are addressed."

"I would like assurance that their work is directly related to solving California's energy crisis and not the political strategy that Fabiani and Lehane have built a reputation for through their work at the White House," Connell said.

-- (gray.davis.is.getting.gr@y.er), June 25, 2001