Money Wasted

Lake Worth Utilities
Waste Meter
... for an arc flash study that Mr. Reyes was qualified to do in house and at no cost to taxpayers.
... the estimated engineering cost of the express feeder which could also be done in house at no cost to taxpayers.
... wasted when insurance requirements were circumvented by the city manager and utility director.
... wasted when plant manager Dave Mulvay’s first attempt at writing a scope of work contained a defect that cost taxpayers an extra $123,098 for tainting the bidding process and giving unfair advantage to one bidder over another. - April 2009
... wasted when the Matrix organizational study to save taxpayers money was scrapped in favor of higher cost outsourcing by city manager Stanton.
... wasted engineering design cost of water piping and tanks (original county water deal) that will never be built.
... wasted when additional costs were incurred for not following insurance procedure on transformer repair.
... wasted when the commission unanimously voted to order transformers when we had equivalent replacements already in stock since the upgrade. - 15 Sep. 2009
Total Taxpayer Dollars Wasted:

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27 November 2021 18:02:27 EST

Posted on Tuesday, July 17, 2007 @ 15:40:58 EST by admin

Lake Worth


August 24, 2007 Friday - 2:15 PM - left message with Sammy requesting the disclosure of the figures he said he would release weeks ago. At my last meeting with him, he did say they were all estimates and no RFPs have been put out yet.

August 23, 2007 Thursday - Our Monday meeting was cancelled. When we finally met, Sammy said he couldn't reveal the figures until he informs the commission. Since he didn't say when that was, it looks like this could be an indefinitely lasting stall job. We will revisit this on Friday the 24th.

I asked if he had looked into other power providers for us so the people could know that at least we were looking for more cost effective alternatives to FMPA our current power provider whose rates are very high according to the rate analyst and other industry experts. Sammy reiterated that if I had a better deal to offer that I should make it. I responded that since I was not hired by the city, it was his job to present to the commission and the public a balanced and honest view of possibly getting a better deal even if it meant getting out of FMPA which we will be able to do ONLY FOR A MATTER OF MONTHS NOW. I don't think this subject went well and it may be because Sammy was a former FMPA executive member. So it seems the stalling is continuing. When I suggested that it was on good account that a surplus had been generated from the fuel adjustment, he again denied any truth to the allegation.

August 13, 2007 Monday - Last Friday I called to set up an appointment with Sammy Faried. He asked that I call Monday afternoon for an appointment. I just called (3:15 PM) and we have an appointment set for next Tuesday afternoon at which time he says he should be able to reveal all the figures. He also said it was important that he communicate with the commission and his boss before revealing those figures to me.

August 8, Wednesday - I left a message for Sammy requesting an appointment to look over the figures he mentioned in his call. On the original emails, one of them asked about the utility accounts and how much of the bond we have used since the RO water project is said to be going about 150% over the bond amount of 39 million.

August 1, 2007 Wednesday - I received a call from Sammy Faried yesterday morning (July 31, 2007 Tuesday - when I was in transit from NC to Florida so this posting is 24 hours delayed).

He assured me that no fuel adjustment surplus ever existed and that any claims to the contrary were completely false. And hence, no customer refunds would be forth coming.

He also said that since FMPA (our power provider since we don't generate any power anymore) was raising their rates since one of their lowest cost contracts has expired with FPL. He stated that everyone's rates (meaning FPL as well) were going up in general.

(note: a forecast was made to the Electric Utility Task Force, that a rate increase of about 10% would take place over the next few years due to our debt service. Additionally, FMPA announced that their rates would likely increase about 12% over the next few years due to low cost contracts expiring with FPL and other providers. The chairman of the Task Force suggested that we investigate other opportunities to lower our power costs and it was agreed by all members of the Task Force to pursue this path. To date, the commission has done nothing in that regard and FMPA has made plans to place generation on our site which would bind us to their rates for the next 30 years.)

Mr Faried also stated that 7.5 million had been spent on the upgrade to the electric system and that another 33 million would be required to finish the upgrade.

I have made arrangements to meet further with Sammy who offered to show me all the figures.

On the lack of a storm plan issue - Sammy said that flow charts had been designed that would now designate who would be in charge of what.

More on all this over the next few days.

July 27, 2007, Friday 7:30 PM ...I haven't gotten a response from the email I sent to the utility director on Friday July 13th. I haven't heard from anyone on the commission or the mayor who have been made aware of the possible 2 million dollar customer refund. And I have nothing further from Laura Hannah or anyone on staff. Beginning Monday, I will followup again and by late week will introduce more utility issues that I'm now accumulating information about. This should prove to be interesting.

July 23, 2007 1:17 PM - still haven't received any response to messages left on July 19 for the commissioners (minus Vespo who wasn't called) and the mayor.

EMAIL: Coakley response to Laura Hannah sent 12:14 PM July 23, 2007

Laura - Thanks for getting back to me today with your email... but the finance department isn't answering the question. The question was:

is there somewhere around 2 million dollars in overcharges on the fuel adjustment? And if that's correct, when do we expect to get it returned to the customers. As I understand it, the utility director has the answer to this.

Thank you, William Coakley, former Chairman, Electric Utility Task Force

EMAIL: from Laura Hannah received 11:05 AM Monday July 23, 2007 see attached pdf

Mr. Coakley - Wanted to provide the attached to you and hope this email
address is still good and this message reaches you!

After speaking with you on Thursday, Finance sent the attached
information on the Electric Fund's Revenue. I went ahead and used blue
highlight to differentiate between the residential and commercial sales
revenue, yellow for fuel adjustment revenue and green for total revenue.
Have a great day - Laura

Laura J. Hannah, Assistant City Manager City of Lake Worth 561-586-1630 (o) 561-586-1798 (f) copies of this email were sent to: Mark Bates; Samy Faried; Cara Jennings; David Vespo; Jeff Clemens; Jo-Ann Golden; Retha Lowe.

Florida has a very broad public records law. Most written communication
to or from local officials regarding City business is considered public
records and available to the public and media upon request. Your e-mail
communications may therefore be subject to public disclosure.


Friday July 20 - 5:30 PM - received a call back from Laura Hannah (assistant city manager) and she is not aware of anything unusual about the FAC (fuel adjustment charge) and is apparently unaware of any surplus or overcharges. She apologized for not making a connection sooner and explained that she couldn't promise an answer on Monday but that she would get back to me as soon as she could with an answer.

Friday July 20 - 5 PM - no response yet, but she does work late occasionally.

Friday July 20 - 10:43 AM - I called and the secretary said Laura said she was going to call me back today for sure.

Thursday July 19 - Two calls were placed to the assistant city manager today . The first call was placed at 9:55 AM and the secretary said that Laura was in a meeting and would return my call. I placed the second call at 12:19 PM. I have yet to receive a call back.

Thursday July 19 - I left messages for JoAnne Golden, Cara Jennings and Retha Lowe prior to sending the mayor an email about it. The email was sent at 12:31 PM. I haven't heard back from anyone as of Thursday midnight.

Thursday July 19 - still no response from last weeks email inquiries sent to the utility director's office.


LAKE WORTH MEDIA NEWS FLASH posted Tuesday July 17, 2007

Source says Lake Worth holding onto possibly millions in customer refunds.

Lake Worth Media has learned from a reliable source that the city has been sitting on a chunk of money said to be possibly as high as 2 million dollars that resulted from an overcharge on the FUEL ADJUSTMENT charges (now called power adjustment) during the past true up period. To date, the utility director has not notified the public of a refund and to the best of our knowledge hasn’t notified the commission that this money exists; nor has he announced a schedule for its return to customers.

Perhaps the money has been earmarked for other purposes but we could not confirm that since the Utility Director was unavailable for comment this afternoon.

Lake Worth Media is trying to find out how long the utility director has had the money and why he didn’t notify anyone.

According to the Florida Public Service Commission which controls all major power providers -- all fuel adjustment charges are deemed to be “pass thru charges” and the power companies are prohibited from adding any additional charges. However, Lake Worth has maintained the practice of violating that principle by TAXING the fuel adjustment charges for Lake Worth customers.

The nature of the fuel adjustment charge as a pass thru charge implies that customers are due a refund which apparently is being withheld. Below is a copy of the email sent to the utility director last week.


Original email sent to the utility directors assistant

Friday, July 13, 2007 1:11 PM
from william coakley

Hi, I'm trying to confirm a rumor that there was an overcharge on the fuel adjustment and seeing as its a pass thru charge to customers, I'm just wondering what the time table is for returning that overcharge to customers... and how much of a surplus was generated?

Thank you, William Coakley; former Chairman, Lake Worth Electric Utility Task Force


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by SaveOurBeach on Monday, July 23, 2007 @ 15:36:07 EST
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I notice where you say that you contacted all the commissioners other than D. Vespo. Is there some reason why you didn't contact him as he is the one who ran on fiscal responsibility? They all should give a courtesy of a reply, however, even if they don't have an answer just yet.



by oscar_night on Monday, August 27, 2007 @ 20:41:05 EST
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Any update on this story?


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