PG&E exec scores massive severance

A former PG&E senior executive who lost his job following the disclosure of inappropriate emails to regulators will receive a $1.1 million severance payment, according to a report filed by the utility with the Securities and Exchange Commission.

Thomas Bottorff, the former senior vice president of regulatory affairs, was one of three executives whose employment was terminated in September when PG&E revealed a set of emails to the California Public Utilities Commission that appeared to show improper judge-shopping.

Bottorff’s separation agreement was included in San Francisco-based PG&E’s quarterly report to the SEC, filed on Oct. 28. The agreement was signed by Bottorff on Sept. 12 and said he resigned as of that date.

Conditions of the severance package are that Bottorff must cooperate in legal and regulatory proceedings concerning PG&E, must not sue PG&E for any reason, and must refrain from demeaning the utility’s reputation.

The agreement says, “Even though Mr. Bottorff is not otherwise entitled to them, in consideration of his acceptance of this agreement, the company will provide to Mr. Bottorff” certain separation benefits.

The benefits include the $1.1 million in severance pay; continued vesting of stock given to him in an incentive plan; $29,000 in health insurance payments for 18 months; and $12,000 worth of career-transition services.

PG&E spokesman Keith Stephens said today:

“The benefits that were provided were in accordance with the company’s officer separation policy and are based on individual compensation levels and years of service. … The agreements are in line with what other officers have received who have left the company with commensurate years of service.”

Stephens said. The emails were announced by PG&E on Sept. 15. They were written in January by former Vice President for Regulatory Relations Brian Cherry, whom Bottorff supervised, to a PUC staff member and Commissioner Mike Florio.

The messages concerned apparent attempts to influence the selection of a PUC administrative law judge for a PG&E gas transmission and storage rate case. PG&E said when disclosing the messages that it believed they violated the PUC’s rules barring private communications to commissioners and staff on regulatory matters.

An administrative law judge who held a hearing on the messages ruled on Oct. 16 that the “PG&E’s actions severely harmed the integrity of the regulatory process.”

The commission is scheduled to consider a penalty at a Nov. 20 meeting. Cherry and Vice President of Regulatory Proceedings and Rates Trina Horner were also terminated from PG&E employment in September. The Oct. 28 SEC filing did not provide any information on the terms of their separations.

On Oct. 6, PG&E released a second batch of emails written by Cherry in 2010 and 2013 and said those messages also appeared to violate the rules.

In an email report sent to Bottorff on May 31, 2010, Cherry described a private dinner with PUC President Michael Peevey at which, according to Cherry’s letter, they discussed several regulatory proceedings and Peevey allegedly asked PG&E to contribute $1.1 million to an anniversary dinner and a campaign against a ballot initiative.

Cherry reported to Bottorff at the start of the message:

“The evening was social but we did delve into some work matters.”

The 2013 emails were exchanged between Cherry and Florio and concerned whether the pressure in a disputed natural gas line in San Carlos could be restored to normal operating level.