Longtime Davis ally expected to be named commission president

San Francisco Examiner

Never one to straddle the fence, Loretta Lynch climbed over one last spring to get to an important meeting with Gov. Davis and a land developer.

Lynch – a veteran Democratic Party campaigner and a member of Davis’ inner circle – scaled a chain-link fence with Assemblyman Tom Torlakson, D-Antioch, after they realized they were on the wrong side of the Livermore airport. If they hiked all the way around, Torlakson risked missing the meeting.

So up and over they went, Torlakson said.

“She goes to no end to serve the governor,” he said. “She has open channels of communication with him and an understanding of where he wants to see the state go.”

Lynch, 37, now brings those connections and that energy to the state’s Public Utilities Commission, where she was sworn in this month to fill the seat vacated by Joel Hyatt. Hyatt, who served for six months, stepped down in December to focus on teaching at Stanford University‘s Graduate School of Business and on private sector opportunities.

Lynch is expected to become the PUC‘s president later this year, sources said. Under new legislation signed in 1999, the governor will appoint the PUC president, thus strengthening the bond between the two offices. In the past, the five-member commission elected its president.

Lynch, who is considered a tenacious fighter by her colleagues,said she look forward to tackling the issues the commission faces: The upcoming auction of PG&E‘s $3.3 billion hydroelectric assets, the shortage of telephone area codes and increased competition in telecommunications.

“I take my cue from the governor. I try to talk it out and see where the middle is,” said Lynch, a Yale University-educated attorney and former partner at San Francisco corporate law firm Keker & Van Nest. “The big challenge for the PUC is figuring how to get more folks involved in the process.”

Lynch served most of last year as the director of the Sacramento-based Office of Planning and Research, which helps develop policy for the governor. She was his go-between with legislators, consumer groups and private industry on difficult issues such as HMO reform. Lynch also advised Davis on PUC issues.

“The governor has a small, tight staff (in which) he has a high level of confidence in putting fires out,” said state Sen. Steve Peace, D-El Cajon. “Loretta is one of those people.”

The first year of a new administration can be chaotic with a steep learning curve – one that Lynch aptly climbed, legislators said.

“She learned quickly how to grasp enormous details with a high level of analysis,” said Assembly

woman Sheila Kuehl, D-Santa Monica, author of a bill affecting health maintenance organizations bill and chair of the Assembly Judiciary Committee. “She was wonderful to work with – the sort of woman you could hold a two-hour meeting with in 10 minutes.”

Those who battled with Lynch on the health care issue concede she’s strong and aggressive.

One exhaustively debated bill would let patients sue their HMOs if they suffered from an HMO decision to delay or deny care. Davis wanted to rein in the cost of patient benefits to keep premiums down, while some reformers wanted more consumer protection.

“She put her foot down on some reforms, saying it would not happen unless there was some compromise with the HMOs,” said Jaime Court, a consumer advocate with the Foundation for Taxpayer and Consumer Rights in Santa Monica.

“It was my role, as the governor’s advocate, the make sure his goals were met,” Lynch said about the issue.

Lynch came to policy from the world of politics, having worked in key positions on several Democratic election campaigns, including those for President Clinton; U.S. Sen. Dianne Feinstein, D-Calif.; state Superintendent of Public Instruction Delaine Eastin; and Davis. Lynch worked closely with the governor’s wife, Sharon, during the campaign, assisting in scheduling and staffing her events.

“Loretta is extremely focused on what’s important and what’s not,” said San Francisco attorney Cliff Staton, who ran Eastin’s first election run. “That’s the role she often played in the campaign – keeping everyone, including the candidate, on track.”

Lynch said that although she enjoys the adrenaline rush of a good fight – whether litigating in the courtroom or strategizing in Clinton’s “war room” – she also has a passion for policy-making.

“I decided to make a new chapter in my life. Instead of getting folks elected, I wanted to see how I could make a difference in policy,” said Lynch, who is in the midst of selecting her PUC staff even while occasionally commuting to Sacramento to finish work at the Office of Planning and Research.

Having grown up in Independence, Mo., birthplace of the late President Harry Truman, Lynch said she felt compelled to be a good Democrat and actively participate in the political process.

This stint is her second on the PUC. She and Tal Finney, the governor’s director of policy, were sworn in as commissioners for one meeting in June as a stopgap measure to delay the vote on crucial Internet issues before Commissioners Carl Wood and Hyatt came aboard.

Besides Lynch, the current slate of commissioners consists of Davis-appoin tee Wood, Henry M. Duque, Josiah Neeper and Richard Bilas.

Working on the PUC is a tough, unglamorous position that requires making decisions affecting millions of Californians, lawmakers said.

“It’s not the kind of work that begs for headlines unless something goes wrong,” Peace said.