Auditors Say EPB Overbilled City By $17,000; Street Light Billing Now On Track, Officials Say

Monday, August 25, 2014 - by Gail Perry

EPB auditors have given adjusted figures on whether EPB over-billed or under-billed the city of Chattanooga on the street lighting program.

EPB officials said, "The net impact of the 89-month audit shows the city was over-billed by $17,000."

Stan Sewell, city internal auditor, said, "During a meeting with Mauldin & Jenkins last week, we reviewed a (draft) revision Mauldin & Jenkins developed to the adjustments they initially reported in their July 21, 2014 dated report.  These adjustments resulted in a change from almost $700,000 due from the city to EPB to approximately $17,000 due from EPB to the city."

The issue next goes to a city audit committee.

Going forward EPB has an improved billing process in place for city street lighting, President and CEO Harold DePriest said Monday.

An update on the independent audit relating to the cost of streetlights in Chattanooga was given at a meeting of the EPB board of directors.

The audit was done at the request of Chattanooga Mayor Andy Berke in response to a media report that EPB overbilled the city over $5 million. The independent audit conducted by Mauldin and Jenkins covered 89 months that ended in May 2014, the entire time that records are retained by EPB.

Focus was on energy usage, facilities charges and for the “secondary line loss” which is the energy that is lost as it transmitted along the power lines.

Misclassification of the type of lights was discovered 12-18 months ago, with a number of them misidentified as mercury vapor which is an older and less energy efficient light source than high pressure sodium lights that are more commonly in use.

Street lights should be billed on 4,377 hours per light of burn time which is calculated on the average sunlight during the year. The audit discovered that EPB had only been billing the city for 4,200 hours yearly and resulted in under-billing in that category.

The Environmental Protection Agency supplies information about the loss of energy as it is distributed along the lines. That loss has been calculated at five percent which must also be billed. It was discovered that EPB had not been adding this loss when billing for the street lights, another issue of under-billing Chattanooga.

 Facilities charges include overhead as well as the physical cost of the structures.  Operations and maintenance such as dealing with power outages and replacing lights that have burned out and poles that are damaged also fall into this category which had been slightly under billed.

 The audit of 26,000 street lights for the past seven years showed that the over- and under-billing resulted in almost “a wash.” The processes are being corrected, said EPB's John Pless.  The city’s audit was prepared with different assumptions and it covered a shorter amount of time than the audit prepared by Mauldin and Jenkins. These factors caused differences between the independent audit and the one done by Chattanooga.

Mr. DePriest said he wanted to make sure that Daisy Madison, finance officer of Chattanooga, was comfortable with the corrective action plan. Mike Kaiser, assistant vice president of finance, indicated that Ms. Madison is being kept informed on the corrective action plan in progress.

The monthly financial report given by Greg Eaves, finance director and CFO, showed that electric revenue for July 2014 came in below forecast due to less electric sales. This was because of mild temperatures during the month. During the same time period, the fiber optics business revenue came in above what was  budgeted.

 In the five years since the smart grid and fiber optics system was installed, 60,000 residential and 5,100 business customers have signed up for fiber optic services. This is of benefit to all customers, said Mr. Pless. Revenue from fiber optics helps keep the electric rates lower since that side of the business pays the electric side for use of the fiber lines.

Revenue from those leases has been used to pay down the debt on the telecom business that was in place before the fiber optics network was installed. EPB Telecom debt is expected to be totally paid off by next spring.

 


Latest Hamilton County Jail Booking Report

Here is the latest jail booking report from Hamilton County: ALLMON, MELISSA LYNNE  1608 NORTH CHESTER ROAD HIXSON, 37343  Age at Arrest: 26 years old Arresting Agency: Hamilton County VIOLATION OF PROBATION (POSS. OF CONTROLLED SUBSTA --- ANDERSON, ANDREA AUSTIN  1109 COPPERWOOD DRIVE HIXSON, 37343  Age at Arrest: 31 years old Arresting ... (click for more)

Retired Police Chief Freeman Cooper Awarded Top Law Enforcement Honor

The Tennessee Association of Chiefs of Police held its 2016 Annual Conference in Chattanooga.  This year’s Joe Casey Award went to Retired Chattanooga Police Chief Freeman Cooper. The award was presented by TACP Past President and Retired Metro Nashville Police Chief Joe Casey to Chief Cooper in the company of police chiefs and dignitaries from across the ... (click for more)

Pedestrians Have The Right Of Way - And Response (2)

Often I visit Gold's Gym at Chestnut and 4th Street. I  park in the theater parking lot at Broad and 4th Street.  I depend on the walk signs to get me there safely.  Most days I almost get hit by someone turning left or right coming from the exit ramp off 27 or turning right on 4th street from Chestnut. This happened yesterday as I was almost mowed down by a garbage ... (click for more)

Roy Exum: The Gold & Ivory Tablecloth

Not long ago, in my morning reading, I happened across an obscure tale about a special tablecloth. And, as things like this are more and more wont to do, I was instantly blessed by this story. As I tracked down its origin, I learned it originally appeared in a 1954 edition of Reader’s Digest. Written by the Rev. Howard C. Schade, who at the time was the pastor of the First Reformed ... (click for more)

McColley Scores 4 TDs As McCallie Crushes Blackman, 49-10

Senior running back Shawn McColley struck early and often Friday night, scoring McCallie’s first four touchdowns and propelling the Blue Tornado to a 49-10 rout of Blackman at Spears Stadium. Once the game started at 8 p.m. – there was a 30-minute lightning delay – the Blue Tornado needed just 60 seconds to get on the scoreboard. McColley did the honors from 10 yards out. ... (click for more)

Notre Dame Beats Tyner In Weather-Delayed Game, 25-7

The Tyner-Notre Dame football game finally ended early Saturday morning. After enduring a so-called weather delay that sent the two teams to their dressing rooms for almost two and a half hours, the home-standing Irish improved to 2-0 with the 25-7 non-district win at Notre Dame. Sophomore kicker Andy McMeen squibbed a line-drive kick 35 yards for a field goal with 2:10 ... (click for more)