Norwich — The new municipal electric consumer advocate will work to ensure that the Connecticut Municipal Electric Energy Cooperative has strong ethics and conflict-of-interest policies and makes as much of the agency's operational information available to the public as possible, recently appointed advocate Bill Kowalski told the CMEEC board of directors Thursday.

Kowalski started Jan. 2 in the position created by a state law that took effect Oct. 1. He told the CMEEC board that while his prime duty is to protect the interest of cooperative member ratepayers, that goal will not necessarily be adversarial to the CMEEC board.

The board would benefit from strong ethics and conflict-of-interest policies, he said. He attended the Jan. 9 CMEEC Ethics Committee meeting and submitted written comments on a revamped ethics policy in the works. The committee expects to complete its draft in February and present it to the full board in March.

Kowalski recommended the revised ethics policy should include clear definitions of conflicts of interest and “appearance of impropriety.” Conflicts of interest should include prohibitions on “related party transactions” involving financial arrangements between CMEEC and employees, board members and immediate families.

He also suggested the board consider a policy on gifts “at least as strict as the strictest municipal member ethics policy.” He said expenses of spouses, family members and friends invited to CMEEC functions and retreats should not be paid for by the agency, calling that a “common provision” of current corporate codes of ethics.

Rather than a policy that covers so-called reasonable travel expenses, Kowalski recommended the board establish preferred travel arrangements with hotels and other entities, with discounts negotiated in advance.

Kowalski also said having strong ethics, conflict-of-interest policies and whistleblower protections would help protect the cooperative in possible future federal investigations into potential violations. Federal guidelines allow for reduced criminal fines and sentences if an organization has strong compliance with ethics policies already in place, he said.

The municipal advocate position was created after a public outcry over CMEEC’s hosting of controversial trips to the Kentucky Derby for dozens of cooperative staff, board members, their families, business associates and public officials throughout the state. The trips from 2013 to 2016 cost the cooperative a collective $1.02 million and were paid for through a margin fund of profits from sales and services to nonmember entities and a surcharge on member rates. Those trips included no official CMEEC business meetings, presentations or workshops.

Kowalski also said his request that CMEEC compare its financial performance with the nearly 900 other nonprofit electric cooperatives nationwide could prove to be good for the Connecticut cooperative if the comparisons are favorable. If the comparisons are not favorable, he said, then the board will be able to work on improving its performance.

CMEEC already routinely compares its wholesale power costs to investor-owned Eversource. During Thursday’s meeting, CMEEC CEO Drew Rankin gave his monthly review of CMEEC’s wholesale rate comparison, called a benchmark, with surrounding investor-owned utilities. In December, CMEEC’s wholesale power price to members was 23 percent lower than the wholesale rate by investor-owned utilities in the region. CMEEC ended 2017 at 29 percent below investor utilities’ wholesale cost, slightly below CMEEC’s goal of falling at least 30 percent lower than the region’s investor-owned utilities, Rankin said.

Kowalski said ensuring CMEEC operations and finances are more transparent will be a main goal going forward. He will recommend CMEEC release budgets and financial information comparable to other nonprofit cooperatives.

He also will review the state-mandated five-year forensic audit, expected to be completed this spring.

Kowalski will provide quarterly reports to the CMEEC board and to the CMEEC member municipalities — Norwich, Groton, Jewett City, Bozrah and Norwalk — and will hold its state-mandated annual public forum in October.

c.bessette@theday.com