By Gary Ogle
gogle@wbcowqel.com
Galion city officials including the mayor, law director, city council president and city treasurer agreed on one thing at a Friday press conference: there have been irregularities in the way Galion electric consumers have been billed since 2009.
How much overbilling those potential errors might result in remains unknown, but Law Director Roberta Wade’s detective work seems to indicate things haven’t been kosher with a 2005 ordinance regarding billing calculations since 2009.
“So there are absolutely two different areas of non-compliance with this ordinance. One is that the previous administration did not do the calculations twice a year and change the PCA twice a year,” Wade said. “The other is that it was rounded up to that .02 figure.”
The ordinance Wade referred to is No. 2005-37 and gives a formula for calculating a Power Cost Adjustment, or PCA. The PCA basically adjusts consumer billing according to actual costs charged to the city for the power it acquires. It is one of multiple parts that determine consumers’ monthly electric bills. The ordinance further places the responsibility of determining the PCA on the city manager and electric superintendent under the recently abolished city charter.
In addition, the ordinance reads in part, “The Utility shall review the PCA calculations and shall make projections for the periods beginning February and August. Following such PCA review and calculation, the City Manager shall direct the PCA to be applied, having considered the recommendations of the City’s Finance Director and Electric Superintendent and having obtained the Utility’s power supply provider a projection power supply cost and a statement of past invoices and the status of payment such invoices since the last PCA calculation and review, as deemed necessary to accomplish recovery of the Utility’s power supply cost in a timely manner.”
Wade said she first began investigating the matter when she was asked by a Galion resident to explain exactly how electric rates are set and bills determined.
Mayor Tom O’Leary, who admittedly did not appreciate how Wade brought the matter up in the most recent Galion City Council meeting, did praise Wade for her effort in putting together all the information that led to the discovery.
“I know Roberta worked hard in pulling this issue together,” O’Leary said. “Like any good mayor would do, we’re going to look into this.”
Wade had gathered figures from bills and Galion Auditor Brian Treisch pertaining to PCA charges. What she found was a constant calculation of .0200 from September of 2009 through September of 2013. Wade said that was impossible considering that prior to that the PCA had changed every few months.
Using PCA calculations, Wade’s hypothetical example indicated Galion electric consumers might be being overcharged as much as $17.75 on monthly utility bills. Wade intimated that potential difference being responsible for a $7 million balance in the city’s electric operating fund – a fund that at one point was supposed to have a target balance of $3.5 million and at another time a $4.5 million figure was set as a goal.
“Think about what that would mean to this economy if we had left that other $3 million in the community,” Wade said. “It would have meant a lot in terms of quality of living for a lot of people, and for businesses that are struggling. This is a failure of the charter form of government.”
O’Leary agreed with Wade that this issue needed to be analyzed and looked into by city officials, the city council and Belinda Miller who is the auditor from the state helping oversee Galion’s way out of fiscal emergency. The mayor wasn’t quite on board with crediting all the excess in the electric operating fund to overbilling, or even that the overbilling has been to the extent Wade seemed to paint it.
“We’re trying to understand if there has been an over collection. The other reason the fund balance is so high is we have been under spending,” O’Leary said, pointing to prolonged staffing shortages in the electric department.
O’Leary said when all the analysis of the issue was completed; the overall picture might be somewhat different.
“An accurate overall picture will average closer,” O’Leary predicted. “Whether there is a recovery or a rebate, I don’t think we’re there yet.”
O’Leary said it was imperative that City Council be involved and indicated possible hearings or a series of Utility Committee meetings could be in the near future. He also intends to talk about the situation with previous city managers, city council members, finance directors and line superintendents to “give some context” to the issue.
City Council President Don Faulds and Treasurer Paula Durbin also credited Wade with bringing the issue to the forefront.
O’Leary said in spite of the complexity of the issue, he did not anticipate it would delay the city from coming out of fiscal emergency.