Council refutes claims of illegal utility charges

In an attempt to dispel rumors of illegal and erroneous utility charges to the citizens of Brady, the Brady City Council held a special public meeting Tuesday morning. “We have been accused of overcharging the citizens of Brady by nearly $1 million on their utility rates,” stated Mayor Clarence Friar. “The purpose of this meeting is to address these accusations and answer any questions citizens might have.” The Council presented Charles Freeman, a professional engineer from Electric Power Engineers, Inc. of Waco, as the professional contracted by the City to research and provide any pertinent information. As the meeting began, Mayor Friar informed the audience that two issues and only two issues would be discussed during the meeting. Those two issues were first the question of whether or not the City defrauded its citizens of over $1 million, either knowingly or by accident and second, if the City was in compliance with current city ordinances about the charging of utility rates. After giving the audience a brief synopsis of his qualifications and his experience, Freeman began his discussion with a blanket statement about the questions asked by the mayor. “In my professional opinion, the City of Brady has not illegally or even unitentionally overcharged the citizens for electricity,” said Freeman. The accusations as presented to the City stemmed largely from letters written by Gayla Bowen citing various items of concern. Specifically, the four issues addressed were: ‘ “The citizens have been overcharged by a fictitous fixed rate entitled the Brady Factor during the period of March 2000 to Dec. 2000. ‘ “In Jan. 2001, the base rate was changed from .05093 to .04662 in violation of ordinance 671. ‘ “Demand customers are paying twice, once though the Power Cost Recovery Factor (PCRF) and then again through the metered demand. ‘ “The averaging method of demand overcharges the residential and small commercial customers.” In his discussion, Freeman addressed each issue in Ms. Bowen’s letter and gave his professional opinion and explanation as a rebuttal. In an attempt to clarify the complicated issue involving the infamous PCRF he explained how this variable is used to level the amount of money overcharged or undercharged on a month to month basis. In a study conducted by his firm and presented to the Council in May, Freeman identified some inconsistencies in estimating kilowatt-hours (kWh) sold. Those along with arithmetic errors caused more revenue to be collected by the PCRF than warranted by changes in wholesale power cost and in other months, less revenue to be collected than warranted by changes on the wholesale power cost. “Anticipating errors, ordinance 671 provides for correction for over or under PCRF cost recovery in previous months,” stated Freeman. “No attempt was made to determine net over or under collection. To make such a determination would require a starting point, probably years earlier, to be selected and the calculation would involve considerable expense and in my opinion, PCRF efforts would tend to cancel themselves out.” Freeman also told the audience that the Electrical Power Engineers’ study presented to the Council in May concluded that the PCRF calculation he had suggested at an earlier time was operating properly to stabilize the electric system margins despite fluctuations in wholesale power cost. In response to the issue of the conflicting base rates charged, Freeman explained that in his opinion, the two numbers were essentially the same because one is comparing cost per kWh sold (.05093) to the base wholesale power cost (.04465). “The difference between the two numbers (EPE study and Brady Factor) is approximately the percentage of losses on the City’s electric distribution system,” said Freeman. “Since they are apparently the same number stated differently and since revising the PCRF calculation checklist was not intended to and did not increase or decrease net electric system revenue, ordinance 671 does not appear to be violated.” In response to the final two accusations concerning demand customers and averaging method of billing, Freeman stated that based upon the lack of evidence in calculations presented to him to support these statements, in his opinion the statements were untrue. “Ms. Bowen does not define her usage of the averaging method of demand and offers no calculations to support it. If her intent is to state that residential and small commercial customers would be more accurately billed using a meter that measures both energy and demand, I agree,” said Freeman. “Due to the additional cost of the meters that measure both kWh and kilowatts and due to the additional complexity in billing, electric industry and City of Brady standard practice is to bill residential and small commercial customers using a meter that measures kWh only. In my opinion, residential and small commercial customers are not being overcharged.” Ms. Bowen addressed the Council following Freeman’s presentation and after distributing several sheets of data, proceeded to argue several points of concern. One point of concern was of the possibility of double collection for line loss. According to Ms. Bowen, the City is charging customers twice for a factor that adjusts for line loss. She claimed that the factor is already accounted for in the formula used to calculate the PCRF and then it is assessed again during the calculation of the Brady utility bills. Freeman disagreed and stated that the numbers are not double charging residents for the line loss. Ms. Bowen also presented information to the council and audience that graphed the costs of Brady utilities as compared to area and even state averages and asked the Council for a reason. She also asked for an explanation about cost variance from actual charges by the City as compared to a spreadsheet from West Texas Utilities. According to Ms. Bowen, there was a variance in what the City was billed and what the City actually charged. After an initial inspection of the spreadsheet, it was determined that the information presented was not the same as used for billing by the City. The Mayor again asked Freeman for a synopsis of his conclusion and following a reiteration of his statement that the City is in line with its current utility billing practices, the meeting took a turn for the worse. Heated verbal exchanges between the Mayor and several citizens caused tempers to rise. Accusations and sharp criticisms led to a stalemate as the Mayor insisted that no answer would satisfy the individuals presenting the questions. In an attempt to reach a more definite solution, members of the audience suggested that the volumes of information on which Ms. Bowen was basing her argument be researched by a review board of citizens or professionals. The meeting concluded with no goals accomplished and no final conclusions given. After the meeting, Ms. Bowen informed the Standard-Herald that the information and concerns she had presented to the Council were being forwarded to the Public Utility Commission for review. In response to the outcome of the meeting, Councilman Billy Patterson stated, “I feel like we (the City) have done everything we can to answer the questions presented to us, and I hope that this assures the citizens that we have nothing to hide.”

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