Entergy CEO rakes in $54M in 3 years

> Sep 8 - McClatchy-Tribune Regional News - Bob Audette Brattleboro
> Reformer, Vt.
>
> On Aug. 28, J. Wayne Leonard, the CEO of Entergy Corp., bought
> 330,600 shares of his company's stock at $23 each.
>
> That same day, Leonard sold 193,350 shares at nearly $80, netting
> $7.8 million.
>
> Those numbers are courtesy of the Securities and Exchange
> Commission, available to the public via Form 4, Statement of Changes
> in Beneficial Ownership.
>
> Earlier in August, on the fifth, Leonard received 50,000 shares
> from Entergy, which he sold back to the company at $81, clearing more
> than $4 million. Also in 2009, Leonard was awarded 125,000 shares at
> no cost to him.
>
> But to start the year off right, on Jan. 6, Leonard received a
> deferred payment on 111,245 shares at nearly $84 each, taking to the
> bank
> $9.3 million.
>
> With the year not even over, Leonard has taken home more than $20
> million.
>
> That's not counting his annual salary of $1.3 million.
>
> Leonard has been with Entergy since 1999 and his net worth, in
> 2007, was $223 million, according to Forbes.com.
>
> But that's OK with Entergy stockholders, because during his 10-
> year tenure, the company's stock has realized an 11 percent return.
>
> Who it's not OK with is the Mississippi Attorney General, the
> Utility Workers Union of America, ratepayers in Louisiana and Texas
> and Vermonters concerned about Entergy's management of Vermont Yankee
> nuclear power plant in Vernon, which it owns and operates.
>
> Entergy has applied to the Nuclear
>
> Regulatory Commission to extend the operating license of Yankee
> for another 20 years, from 2012 to 2032.
>
> A recent audit of plant reliability concluded that Yankee should
> not be allowed to continue to operate unless a number of conditions
> are met prior to 2012. Those include a financial investment in the
> plant's structures, components and personnel.
>
> The Vermont Department of Public Service also reached a similar
> conclusion in its filing with the state's Public Service Board, which
> must issue a certificate of public good for Entergy to keep the plant
> running.
> DPS also asked that the PSB ensure Entergy has instituted adequate
> funding mechanisms that will guarantee there will be enough money
> available to fully cleanup the site whenever the plant ceases
> operations.
>
> In the past two years, the Vermont State Legislature has passed
> bills requiring just that, but both were vetoed by Gov. James Douglas.
> However,
> the Legislature has the authority to write a resolution denying
> Entergy the authority to continue operation unless it fully funds the
> decommissioning fund.
>
> Entergy has promised legal action if the Legislature issues such
> a condition.
>
> In response to losses in the fund due to the stock market crash,
> Entergy has promised the Nuclear Regulatory Commission it will
> contribute more than $50 million to the decommissioning fund to help
> it achieve the financial returns necessary to pay for the site's
> cleanup.
>
> In the last three years, Leonard received $54.6 million in salary
> and other compensation, according to Mississippi Attorney General Jim
> Hood, who is suing Entergy for access to documentation that may or may
> not prove it has been engaging in price fixing, resulting in increased
> costs for Mississippi ratepayers.
>
> In 2008, Entergy took in revenues of $13 billion.
>
> Some Windham County legislators said executive compensation at
> Entergy was indicative of an attitude that will only do harm to the
> Green Mountain State.
>
> "Vermonters should be suspicious of a company that says they
> can't afford to clean up their mess while padding their wallets at the
> same time,"
> said Senate President Pro Tem Peter Shumlin, D-Putney, who has been
> pushing for complete funding of the plant's clean-up costs prior to
> 2012.
>
> "The way Entergy Louisiana does business is not in keeping with
> the way we do things in Vermont," he said. "They'll happily reach
> deeply into your pocket while they're crying poverty and filling their
> coffers with cash."
>
> Mike Mrowicki, a Democrat who represents Putney, Dummerston and
> Westminster in the Vermont House of Representatives, agreed with
> Shumlin's sentiments.
>
> "This is an example of the kind of corporate mentality we are
> dealing with here," he said. "It was in evidence during the freefall
> the stock market took with companies getting all they could,
> especially through executive pay, and then turning over the
> liabilities to the public sector.
> That's the sense many of us are getting with regard to the
> decommissioning fund."
>
> Rep. Mike Obuchowski, D-Rockingham, was impressed by Leonard's
> net worth of $223 million, but suggested another use for it.
>
> "Isn't that the amount we need for the decommissiong fund?" he
> asked.
>
> Attorney General Hood, who has accused Entergy of fraud, unjust
> enrichment, anti-trust violations and other illegal conduct, has
> reached a similar conclusion.
>
> "Every month, these customers pull out their wallets and
> faithfully and trustingly pay their electric bills to a company that
> apparently just sends a big portion of their hard-earned money back to
> its CEO,"
> stated Hood
> in an April 6 press release.
>
> Hood's allegations followed a request by Entergy of Mississippi's
> Public Service Commission to raise electric rates by 28 percent.
>
> Hood's case against Entergy is pending.
>
> Entergy's legal troubles don't end in Mississippi, however.
>
> In 2000, Entergy was forced to refund $72 million to customers in
> Louisiana. In 2008 it was ordered to refund another $32 million. In
> Texas, Entergy is facing a class-action lawsuit alleging it sold
> overpriced power to its customers.
>
> And in 2006, Entergy was found guilty of bid rigging by the
> Federal Energy Regulatory Commission. Entergy was warned by FERC to
> discontinue the practice or else it could face civil penalties.
>
> In addition to Leonard's compensation, four other top executives
> in Entergy received $16 million in compensation in 2007, according to
> the Utility Workers Union of America.
>
> "We believe that these amounts are clearly excessive," stated the
> UWUA. "Even a public perception that an investor-owned public utility
> ... is awarding excessive pay to top executives can be damaging to our
> company's business and reputation."
>
> Money paid to Leonard and other Entergy executives could be
> better spent on hiring more employees at the plant in Vernon, said one
> critic of the company.
>
> "At $100,000 total cost per employee, for every million dollars
> Leonard gives up means Entergy Nuclear Vermont Yankee could hire 10
> additional people," said Arnie Gundersen, a member of a public
> oversight committee that recommended increased investment in the plant
> and its clean-up fund.
>
> A spokesman for Citizen Awareness Network, which opposes the
> continued operation of the plant, said Yankee employees are the lowest
> paid in the industry.
>
> "It is shameless that this man receives this kind of money for
> what he does," said Bob Stannard, who said it's Entergy's plan to
> leave Vermonters "holding the bag" when it comes to decommissioning
> the site.
>
> Another anti-nuclear activist agreed.
>
> "Entergy is sucking all the money they can out of the old Vermont
> Yankee reactor before something breaks that's too expensive to fix,"
> said Ed
> Anthes, of Nuclear Free Vermont by 2012. "Entergy needs to prove they
> have the billion dollars set aside that it will take to clean up the
> Vernon site to Vermont standards. Entergy agreed to that when they
> bought the reactor."
>
> Even a man who supports the relicensing of Yankee was critical of
> Entergy's compensation packages.
>
> "This is a reflection of the way our whole corporate culture has
> become rotten," said Howard Shaffer, a nuclear engineer who assisted
> in start-up operations at Yankee in 1972. "What surprises me is how
> the current executives don't realize that they are repeating the
> 'Robber Baron Era' at the end of the 19th and into the 20th centuries.
> This led to the anti-trust laws. A similar reaction is bound to take
> place in a few years."
>
> Bob Audette can be reached at [email protected], or at
> 802-254-2311, ext. 273.
>
>