The Board of Public Utilities, at its meeting Wednesday night, responded to a statement by new Mayor Tyrone Garner that he would do top-to-bottom independent audits of the Unified Government and the BPU.
The primary point made by BPU administrators and board members was that BPU already does an external audit by an independent firm.
BPU board member-elect David Haley, who has not been sworn in yet, stated during the public comment section of the BPU meeting that the BPU might want to share with the new mayor that the BPU already does an external audit, so there is not a duplication of services from the UG in suggesting an audit.
BPU General Manager Bill Johnson said at the meeting that he plans to meet with Mayor Garner, have a discussion and let him know they have had several audits of the BPU, and audits are ongoing.
“I hope their audit focuses on free services the BPU provides,” Jeff Bryant, a BPU board member, said at the meeting, “so they can understand how much they gain from having BPU in this position, and be a little more cognizant of how much it costs every resident for the services we provide.”
BPU Board President Bob Milan said they need to make sure to have an orientation with the new mayor to bring him up to date on what they do as an entity.
Milan said there is a perception by some that the BPU doesn’t do audits, which is not true.
Board member Rose Mulvany Henry asked if BPU audits were available on the BPU website.
Lori Austin, BPU chief financial officer, said external audits are on the website, but not internal audits
Some audits are on the website as part of the meetings records, according to BPU officials, and they could consider creating a separate tab for them to make them easier to find.
Every year, an external auditor presents an audit report at a BPU meeting, and the audit becomes part of the public record.
Johnson said there are internal audits, external audits by an outside agency, and financial audits from the chief financial officer. Then there are other reports that might fall into the audit category as well, he said.
Mulvany Henry said she thought that the mayor and his administrative team might be interested if there are different functional areas in the UG and BPU performing the same functions. She said the UG and BPU both have information technology departments, but it’s a whole different deal to run a power and light company.
Board member Tom Groneman thought that perhaps the administrative team is thinking about eliminating duplication of services, not necessarily doing an audit.
The BPU has its own elected board, although it is considered an agency of the UG.
Johnson said during the administration of former Mayor Joe Reardon, the BPU did a report taking a look at some costs of combining services of the UG and BPU.
“We’re certainly a lot different from the city-county government,” he said.
BPU board members also mentioned possibly having another joint meeting with UG commissioners.
Mayor Garner made a campaign statement about the audits in July 2021: “Working with stakeholders, we will seek systems changes in staff administration that will involve a top-down audit of the U.G and BPU as a means to streamline government, stamp out fraud, waste and abuse, with an emphasis of locating and removing bureaucracy, as well as finding real tax relief.”
“Usually during an election, the word audit can have a nefarious meaning,” board member Mary Gonzales said at the BPU meeting. “That’s how it happens.”
In another part of the meeting, the BPU held a moment of silence to remember Joe Dick, who died Dec. 10. Dick was a former BPU board member, a former Wyandotte County commissioner, a former BPU employee and a former BPU lobbyist. Milan recalled that he had recommended Dick to be hired as an employee, because he did such a good job as lobbyist. He recalled asking Dick to assume responsibility for the youth program the BPU was sponsoring.
The BPU board also heard a COVID-19 update. There are three BPU employees who tested positive for COVID, and two in quarantine, waiting test results. According to Johnson, a high percentage of employees have received vaccines.
During the early part of the meeting on Wednesday, the BPU board held a recess for several minutes when a thunderstorm warning advised residents to take shelter.
BPU approves 2022 budget
The BPU board approved a $350.7 million budget for 2022, an increase of $2.2 million.
According to BPU officials, there was an increase in personnel costs and purchase power costs.
The budget objectives, according to Austin, included a positive net income, positive cash flow, funding for capital projects and maintaining cash balances and debt coverage.
According to figures presented by Austin, the operating budget was up $1.4 million; the debt service budget was up $11,995; the PILOT was up $1.8 million; and the capital budget was down $1 million.
The PILOT, which is a fee or tax the UG puts on BPU bills, makes up about 10 percent of the total BPU budget, according to a chart presented by Austin.
Board member Ryan Eidson questioned a line item in the budget, where the BPU is budgeting for five people but does not intend to fill one of the positions where a person retired. He said if there are 565 people budgeted for, but they only intend to hire 500, then they should take the budget number down to 500.
Johnson said they have scaled back their staffing every year for several years. But he said they have to start planning ahead, for what tomorrow’s utility will look like.
Mulvany Henry asked about where the BPU stands in staffing in relation to other utilities. Johnson said when comparing the BPU’s staffing to other utilities’ staffing, they have to factor in items such as number of customers, unions, the age of the distribution system and other challenges.
The budget passed, with two “no” votes from Eidson and Mulvany Henry.
Employee agreement, general manager’s contract approved
The BPU board also approved a collective bargaining agreement, a physical unit working contract, for July 2020 through June 30, 2023.
Also approved was a contract for a BPU clerical unit.
Milan voted yes, but said he was voting reluctantly. Later in the meeting, Milan said he believed that negotiating was not done in good faith on both ends.
The BPU board also went into a series of closed, executive sessions, to discuss the general manager’s contract.
Eidson and Mulvany Henry voted no on the general manager’s contract, which passed.
David Mehlhaff, BPU spokesman, said Johnson will receive a 5 percent increase in the new one-year contract. His current contract is $307,000.
Groneman said he was in favor of the contract but his personal acceptance is contingent on Johnson following through and getting someone in place to be the second in command at the BPU.
At the last BPU meeting, Johnson discussed a preliminary plan for an assistant general manager position, who would be available to assume the duties of the general manager in case of emergency, illness or need. Mehlhaff said the BPU is working on succession plans for all BPU executives.
The BPU board also voted to approve Juneteenth as a BPU holiday, on a unanimous vote.
