Chattanooga streetlight whodonit intensifies as auditor wades into fray

Chattanooga streetlight whodonit intensifies as auditor wades into fray

May 26th, 2014 by Ellis Smith in Local Regional News

A light fixture lies on the counter at Global Green Lighting.

Photo by Angela Lewis Foster/Times Free Press.

Document: Chattanooga streetlight replacement audit

Chattanooga internal auditor Stan Sewell found that charges from EPB added significant costs to the city's streetlight replacement program.

The Hardy Boys would name it "The Mystery of the Misplaced Light Bulbs: A Municipal Adventure."

In this electrifying thriller, the amateur sleuths attempt to solve a city's streetlight woes but get caught up in a cryptic puzzle of spreadsheets that leaves them with more questions than answers. The cliffhanger? An auditor auditing an audit.

OK, so it's not exactly a page-turner. But with hundreds of jobs on the line, thousands of missing light bulbs and millions of dollars in potential billing discrepancies, Chattanooga City Auditor Stan Sewell has pledged not to rest until he solves this whodunit.

For the foreseeable future, Sewell will spend his days at EPB's downtown headquarters, examining the utility's account of its billing and maintenance practices. It is a continuation of an investigation that began in February after City Council members questioned delays and disagreements related to Chattanooga's streetlight replacement contract with Global Green Lighting.

The City Council originally asked Sewell to look at the deal with Global Green to settle claims by EPB that the energy-efficient Global Green lights were failing at an alarming rate. Nearly one in five of Global Green's lights needed some sort of repair, EPB said. Based in part on those numbers, which the Berke administration asked the utility to supply, the mayor's staff came up with a 15-year return on investment for the then-$27.5 million project -- a project that began under his predecessor, former Mayor Ron Littlefield.

But Sewell's audit uncovered discrepancies in billing, maintenance and power savings in the EPB data. Once those were taken into account, the return on investment shortened to 13 years and the cost fell to $24 million.

It didn't convince Berke to salvage the deal with Global Green Lighting. That deal originally called for the company to replace all 27,000 city streetlights in rapid succession. Now the mayor wants to rebid the process and replace around 700 lights per year, which would reduce the expenses of each light but also reduce the city's energy savings.

EPB responded to Sewell's first audit with an audit of its own, showing that though it may have overbilled taxpayers for thousands of power-hungry lights that have long been removed from its poles, those charges were more than offset by underbilling for the per-unit cost of the streetlights that replaced them.

The utility's list of lights shows a huge decrease in September for the billed number of mercury-vapor lights, the old-fashioned kind that use more electricity. EPB said it made an accounting adjustment when it found that as many as 6,200 of those lights had long since been replaced by new high-pressure sodium lamps, for which the utility hasn't fully recovered the cost. EPB calls it a misclassification, not overbilling.

Sewell said he plans to test EPB's claims.

"We're not stopping until we have an answer," Sewell said at a meeting of the city's audit committee last week. "I don't know how long it's going to take, but we're going to get you the answers."

The mayor's proposal -- which is expected to be officially unveiled Tuesday -- calls for EPB, the city and any potential vendor to work together to create a plan to operate the lights. They will look for ways to execute new maintenance and meter reading agreements and new contracts to reflect slower LED light deployment. That leaves the Global Green contract in limbo while expanding EPB's role.

City Councilman Larry Grohn said that's a curious choice, given the questions about EPB's billing and maintenance records.

"EPB has a serious problem with credibility," Grohn said. "I mean, good heavens. It's craziness, absolute craziness."

EPB spokesman John Pless declined to discuss Sewell's ongoing audit of EPB's own audit, referring questions to Sewell.

Lacie Stone, director of communications for the city of Chattanooga, said she was "not sure what EPB billing discrepancies you are referring to," claiming that Sewell's report found no discrepancies.

"You might want to speak to [Sewell] about that because questions do not persist on that front," Stone said.

Sewell was happy to oblige.

"You're talking about a quarter-million dollars per year that we've been overbilled for energy," Sewell said.

The mystery continues.

Contact staff writer Ellis Smith at esmith@timesfreepress.com or 423-757-6315.

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