Following suit with City Council, Utility Board tables LP&L discussion
Mar 20, 2013 (Lubbock Avalanche-Journal - McClatchy-Tribune Information Services via COMTEX) --
It took city leaders less than 12 minutes to call off a special City Council session aimed to discuss backlash from the city's request for a special Lubbock Power & Light audit.
And two weeks later, Lubbock's Electric Utility Board followed suit.
The governing board of municipally owned Lubbock Power & Light opted to table the topic without discussion during its afternoon meeting Tuesday, March 19, voting 7-2 to hold off what was posted as a discussion on the mayor's and city staff's concerns about utility board and LP&L procurement practices.
Board members said they decided against airing the issue in public until an audit of LP&L's procurement procedures with private contractors is complete some time later this month.
"We're not looking for a battle or anything," board chairman Gail Kring said after the meeting. "We're waiting for the audit. We're trying to show that LP&L is operating correctly."
Board member Carroll McDonald, who voted against tabling the discussion, said he was caught off guard by the decision -- a sentiment ex-officio board member Mayor Glen Robertson shared.
"I don't know why they pulled it and I'm not going to guess," Robertson said.
But Robertson said he was glad the board held off the discussion until the audit is complete.
Lubbock's external auditor, BKD, is exploring LP&L's procurement procedures with private contracts following City Manager Lee Ann Dumbauld's concerns in February about how LP&L could be financially affected by a pending lawsuit in Amarillo against a contractor working for the city, Robertson said.
The Avalanche-Journal last week filed an information request for the audit, which is expected to be complete later this month.
Robertson called for a special City Council meeting March 5 to discuss the audit.
But the meeting never got that far, with council members voting 4-3 to support Councilman Victor Hernandez's request to adjourn the meeting after less than 12 minutes to take action at a later, unset date. Councilmen Floyd Price and Todd Klein joined Hernandez and Councilwoman Latrelle Joy in voting to adjourn the meeting.
Joy questioned if the city manager has the authority in the city charter to request the audit.
"That is strictly under the Electric Utility Board -- that is their function," she said at the time.
Robertson said the city is acting within its powers in requesting the audit.
"There again I have an opinion and (Joy) has one and we're both entitled to those opinions," Robertson said. "Our city attorney has sided with me and said that he believes (Dumbauld) does have the right, not only the right, but the legal, fiscal, fiduciary responsibility to the citizens of this city to call for this audit."
A matter of trust
Board member Clayton Isom on Tuesday deferred questions about the meeting to Kring, but said he agreed with the decision to table the discussion he believed would have delved into recent media interviews Robertson has given questioning the integrity of LP&L's finances.
"I think the comments of the mayor are the comments of the mayor," Isom said. "I don't think it was pertinent to talk about those comments in this meeting."
Both Kring and Robertson played down the appearance of distrust or political confrontation between the board and City Council, with Robertson adding he believes concerns are rooted in poor but improving communication between LP&L and city financial staff.
In November, the board voted unanimously to spend up to $260,000 on an electric rate study, analyzing LP&L's cost of service and rate design models, hiring Richardson-based utility consultant J. Stowe & Co. after the city made a public request for a quote this fall.
LP&L opted to pursue a rate study after the council rejected utility board requests to increase LP&L rates about 7 percent to match an Xcel Energy increase. Those no votes occurred twice last summer and once in 2011
Xcel provides power to LP&L and West Texas Municipal Power Agency cities as part of a purchase-power agreement. That agreement ends in 2019.
At the time, Robertson and council members told the board the council would not approve a rate increase without better data from the utility, which forecast a 2012 deficit up to $9.8 million before revenue from a hot summer shored up much of the deficit.
"The thought is if you get data to support some sort of rate and show what the rate should be, that would be quite helpful for all of us in making decisions," Pam Moon, the city's chief financial officer, said at the time.
The rate model study will analyze LP&L expenses, cost of service for customers in different rate classes -- such as commercial, residential and industrial -- and what revenue is needed to cover expenses.
The study is expected to be completed by June and will give LP&L information, skills and a model to set rates on its own in the future, without the help of a consultant.
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