Utility chief: Report led to war of words (Citrus County)
By Terry Witt
A top executive in a government utility this week likened the ongoing exchange of words between the utility and a county government consultant to a “scud missile war.”
Robert Sheets, systems manager for the Florida Governmental Utility Authority, was describing FGUA’s written and verbal volleys during the past month with Rose, Sunstrom & Bentley,LLP, the consultant hired to evaluate whether the county should buy the utility.
“It seems now we have a scud missile war,” Sheets said in a meeting with the Chronicle editorial board. “They say this, we say that.”
The unpleasant exchanges started when the consulting firm issued an acquisition report suggesting FGUA would be forced to raise rates in a few years and suggesting two Tallahassee law firms have “an intimate relationship with FGUA and one other.”
FGUA fired back that the report was laced with inaccurate and misleading information that should not be the basis for a decision by the county commission on whether the county buys the multimillion-dollar utility.
FGUA officials said the consultant provided no data to support its assertions about future rate hikes, but John Jenkins, who headed the consulting team that wrote the report, said FGUA didn’t challenge its numbers. Jenkins said FGUA merely questioned the economic assumptions it used to predict the rate hikes.
The two sides were ordered by the commission to meet during the Christmas and New Year’s holidays to talk about their differences, but the meeting never took place. Commissioners were forced to cancel a Jan. 17 meeting to discuss the purchase. They rescheduled it for 9 a.m. on Feb. 7.
Commissioner Vicki Phillips suggested that FGUA and Government Services Group, the company that administers and operates FGUA’s utilities, have the responsibility to prove that the county’s acquisition report is inaccurate, since FGUA made the allegations.
“They challenged our report. Let GSG provide information to support their challenge,” Phillips said.
David Miles, special project administrator for FGUA, produced a nine-page response detailing factual errors and inaccuracies he said he found in the acquisition report prepared for the county commission.
“This document is not an exhaustive accounting of mistakes, but it is a balanced correction of the facts and the public record,” Miles wrote in the Jan. 12 letter to the county commission.
Among the corrections Miles makes:
n He said the acquisition report contained a number of “inaccuracies and inappropriate assumptions” in claiming the county could operate FGUA’s systems at a lower cost.
n He said FGUA has a four-member governing board, not a five-member board as the report stated. The board has members from Polk, Lee, Osceola and Citrus counties.
n He said the acquisition report, in claiming FGUA lacked accountability, was quoting from a December 2002 study of the Florida Water Services Authority.
Miles said an interlocal agreement between FGUA and Citrus County defines what is meant by accountability. The agreement, he said, gives the county the ability to regulate FGUA and its rates.
However, Miles failed to mention the controversy that initially caused the county commission to consider purchasing FGUA’s local assets. FGUA initially refused to review the property assessments the utility planned to impose in Citrus Springs.
FGUA told its customers and county officials it was operating as a local government, like the county, and that the county had no jurisdiction over the assessments imposed on its customers. FGUA never backed away from that position, but it voluntarily gave the county’s Water and Wastewater Authority the right to review the assessments. The assessment has been approved by WWA.
But the conflict was the first spark that started a firestorm of criticism.
FGUA’s contract with the county gives the county the option to buy FGUA’s local utilities. Sheets said FGUA has no objection to the purchase, but he said the county should use factual information to make the decision.
The makeup of FGUA has also led to questions. FGUA is a government group by law, but it is not run by elected officials. That fact has also led to charges that there is no accountability. Some customers complained they had elected officials to file complaints with.
Sheets noted in his interview with the editorial board that FGUA is a professional utility management organization, which is rare in Florida.
He said FGUA spent “hundreds of thousands of dollars” researching and investigating the utilities it purchased from Florida Water Services Corp. in November 2003. The utilities it currently owns in Citrus County were purchased from Florida Water.
Sheets said FGUA spent weeks in New York City meeting with bond underwriters to convince them the purchase was a sound investment. He said they knew exactly what they were buying. He said FGUA physically inspected every water and sewer line, and sewer lift station it purchased.
He said the county, by contrast, has hired a law firm to investigate whether it should purchase FGUA’s utilities in Citrus County.
Sheets said the county would do well to investigate thoroughly before it makes one of the biggest purchases in county history.
A top executive in a government utility this week likened the ongoing exchange of words between the utility and a county government consultant to a “scud missile war.”
Robert Sheets, systems manager for the Florida Governmental Utility Authority, was describing FGUA’s written and verbal volleys during the past month with Rose, Sunstrom & Bentley,LLP, the consultant hired to evaluate whether the county should buy the utility.
“It seems now we have a scud missile war,” Sheets said in a meeting with the Chronicle editorial board. “They say this, we say that.”
The unpleasant exchanges started when the consulting firm issued an acquisition report suggesting FGUA would be forced to raise rates in a few years and suggesting two Tallahassee law firms have “an intimate relationship with FGUA and one other.”
FGUA fired back that the report was laced with inaccurate and misleading information that should not be the basis for a decision by the county commission on whether the county buys the multimillion-dollar utility.
FGUA officials said the consultant provided no data to support its assertions about future rate hikes, but John Jenkins, who headed the consulting team that wrote the report, said FGUA didn’t challenge its numbers. Jenkins said FGUA merely questioned the economic assumptions it used to predict the rate hikes.
The two sides were ordered by the commission to meet during the Christmas and New Year’s holidays to talk about their differences, but the meeting never took place. Commissioners were forced to cancel a Jan. 17 meeting to discuss the purchase. They rescheduled it for 9 a.m. on Feb. 7.
Commissioner Vicki Phillips suggested that FGUA and Government Services Group, the company that administers and operates FGUA’s utilities, have the responsibility to prove that the county’s acquisition report is inaccurate, since FGUA made the allegations.
“They challenged our report. Let GSG provide information to support their challenge,” Phillips said.
David Miles, special project administrator for FGUA, produced a nine-page response detailing factual errors and inaccuracies he said he found in the acquisition report prepared for the county commission.
“This document is not an exhaustive accounting of mistakes, but it is a balanced correction of the facts and the public record,” Miles wrote in the Jan. 12 letter to the county commission.
Among the corrections Miles makes:
n He said the acquisition report contained a number of “inaccuracies and inappropriate assumptions” in claiming the county could operate FGUA’s systems at a lower cost.
n He said FGUA has a four-member governing board, not a five-member board as the report stated. The board has members from Polk, Lee, Osceola and Citrus counties.
n He said the acquisition report, in claiming FGUA lacked accountability, was quoting from a December 2002 study of the Florida Water Services Authority.
Miles said an interlocal agreement between FGUA and Citrus County defines what is meant by accountability. The agreement, he said, gives the county the ability to regulate FGUA and its rates.
However, Miles failed to mention the controversy that initially caused the county commission to consider purchasing FGUA’s local assets. FGUA initially refused to review the property assessments the utility planned to impose in Citrus Springs.
FGUA told its customers and county officials it was operating as a local government, like the county, and that the county had no jurisdiction over the assessments imposed on its customers. FGUA never backed away from that position, but it voluntarily gave the county’s Water and Wastewater Authority the right to review the assessments. The assessment has been approved by WWA.
But the conflict was the first spark that started a firestorm of criticism.
FGUA’s contract with the county gives the county the option to buy FGUA’s local utilities. Sheets said FGUA has no objection to the purchase, but he said the county should use factual information to make the decision.
The makeup of FGUA has also led to questions. FGUA is a government group by law, but it is not run by elected officials. That fact has also led to charges that there is no accountability. Some customers complained they had elected officials to file complaints with.
Sheets noted in his interview with the editorial board that FGUA is a professional utility management organization, which is rare in Florida.
He said FGUA spent “hundreds of thousands of dollars” researching and investigating the utilities it purchased from Florida Water Services Corp. in November 2003. The utilities it currently owns in Citrus County were purchased from Florida Water.
Sheets said FGUA spent weeks in New York City meeting with bond underwriters to convince them the purchase was a sound investment. He said they knew exactly what they were buying. He said FGUA physically inspected every water and sewer line, and sewer lift station it purchased.
He said the county, by contrast, has hired a law firm to investigate whether it should purchase FGUA’s utilities in Citrus County.
Sheets said the county would do well to investigate thoroughly before it makes one of the biggest purchases in county history.
posted by Editor Facts & Myths @ 10:14 PM
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