April 28, 2015
Nonprofit endorsements for sale? That might be the takeaway when more than thirty charities in the District of Columbia write to government regulators in support of a popularly opposed regulatory action sought by a local funder, with many even lending their logos to full-page newspaper ads.
Pepco, a regional electric utility that serves the District (and mid-Atlantic region) wants to sell itself to Exelon, a national energy company with a poor reputation among environmental groups and consumer advocates. The overwhelming majority of the charities endorsing the acquisition in letters to DC's Public Service Commission (DCPSC) have a couple of things in common: they have no environmental mission or apparent expertise on energy issues, and they have received or benefited from Pepco philanthropic funding, which Exelon promises to continue for ten years.
The offered premium of 24 percent over market valuation is enough to convince Pepco to seek approval to sell its electric distribution network to Exelon. The opportunity to become the largest utility company in the country and use Pepco’s significant ratepayer base to dilute its nuclear electric generation investments is motivation enough for Exelon. But what’s in it for local charities?
A big part of the answer was summed up nicely by Meta Williams, the regional development director in the United Negro College Fund's Washington, D.C. Area Office. In a letter to D.C Public Service commissioner Brinda Westbrook-Sedgwick, Ms. Williams noted that Pepco and Exelon are important donors to UNCF, provide a great deal of support to other charities, and are admirable corporate citizens, making their plan worthy of endorsement. Yet, she went on to say in conversation with me that she had not considered environmental, energy, or related issues in deciding to write to the Public Service Commission, that policy was not made in her office, and that she was speaking only for UNCF's fundraising arm and not for the organization itself – none of which is clear from her letter.