Berlin, Utility Consultant Working On ‘Fair’ Compensation After Major Error

1 berlin electric

BERLIN – Town officials say they’re working with their electric consulting firm responsible for last year’s $435,000 mistake to recoup some of the funding.

In the wake of the news of the generation error that cost the town $435,876, Berlin Mayor Gee Williams said this week officials were working with Booth and Associates, the consulting firm reportedly responsible for the error, to recover some of the money.

“Ultimately we’re hopeful we’ll find a level of financial compensation from Booth and Associates we can all agree is fair,” he said. “As with any contractual conflict, there’s always the potential it could end up in litigation.”

In late December, the town was charged by the Maryland Public Service Commission (PSC) with recovering $435,876 in power costs. According to Town Administrator Laura Allen, Berlin officials meet with the regulatory body each December to review the Berlin Electric Company’s Power Cost Adjustment (PCA). The recent review revealed that the town had failed to generate during a peak period in February 2015. The PSC said the missed peak, because it was one of five the town should have generated during 2015, meant the town would need to recover $435,876 during the next three years.

In an effort to soften the impact on ratepayers, Allen said the town was using $100,000 in contingency funds toward the loss and would increase customer bills $2.50 a month, starting in February.

That decision has yielded criticism from some town council members. Last week, Lisa Hall and Thom Gulyas both expressed disappointment in the fact that the council wasn’t made aware of the news until mid-January.

“I don’t care that it’s a minimal cost,” Gulyas said last week. “That’s not right. I’m aggravated as hell we didn’t know about this until after the fact.”

Williams says the lack of communication came from the fact that three planned council meetings were canceled in December.

“This was on the executive session agenda for Dec. 14,” Williams said, “which is when it would have been shared if we were able to have a quorum.”

He went on to say that it was the responsibility of the mayor and the town administrator to handle issues like this one.

“That’s our job,” he said. “Our job is to take care of things as they happen.”

Nevertheless, Jason Walter, a Berlin resident and former member of the now-disbanded Berlin Utility Commission, says there was no reason the information shouldn’t have been shared with the council as soon as it came to light — something he says happened in the fall.

“To intentionally withhold any mention of this debacle from public session at the absolute minimum constitutes an unethical act,” Walter said. “There is no excuse to justify keeping the citizens of Berlin and its council members in the dark nor for the mayor to make a unilateral decision to utilize contingency funds.”

Walter also questioned the need for the information to be shared in an executive session of the council. He said that according to the Maryland Open Meetings Act, closed session discussion should be limited to obtaining legal advice and consulting with staff about pending litigation.

“The act clearly explains other discussion related to the issue would not qualify for closed session,” he said.

According to Williams, the information was disseminated in closed session based on a recommendation from the town’s electric attorney.

When asked whether the Berlin Utility Commission — which was abruptly eliminated by the mayor and council in 2011 — would have proved helpful in determining a solution to the current situation, Walter said at a minimum it would have ensured the information was properly disclosed.

Going forward, Williams said that if and when an agreement is reached with Booth and Associates, something that could take months, the entire council will be asked to approve it.

“We have three years to get this resolved,” Williams said. “I want to do it right and I want to do it thoughtfully.”

In spite of the fact that Booth and Associates was responsible for the town missing a generation opportunity, Williams says the firm has been a huge help to the town since 2008.

“They give recommendations on every aspect of the electric operation,” Williams said. “There’s always something coming down the pike. Other than this very disappointing situation they’ve made significant improvements in our system. You don’t throw the baby out with the bathwater.”

He pointed out that during his time as mayor and since Booth and Associates had been hired, the town’s electric rates had decreased dramatically.

“We’ve made significant strides in controlling costs and reducing charges to customers,” he said. “That tends to get forgotten in situations when there is an error.”

Williams called the public criticism of the handling of the rate decision a symptom of the upcoming election season. Hall has made it known she plans to run against him for the position of mayor this fall.

“Unfortunately it started here last spring instead of this summer,” he said.

In a letter to the editor this week in response to last week’s story, Williams expanded on his view that political aspirations have influenced the expressed outrage from Hall, specifically.

“Council member Hall has told anyone and everyone who would listen that she is “going to be the next mayor of Berlin.” I can only assume in her own way this means she will be filing for election for the office in the town election of Tuesday, October 4th,” Williams wrote. “Unfortunately, the way she has presented this message, repeated during her multiple visits to Town Hall nearly every week for months, has given some Berlin employees the false impression that I will not be seeking re-election. Council Member Hall’s Town Hall campaigning along with repeated interrogations of town employees demanding they tell her ‘what’s really going on’ strongly implying that there must be some political dirt they can share. As a result, the town administrator, the managing director, and some department heads have been dealing with a measurable drop in morale among many town employees.”

 

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