DPU structure gets scrutiny

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Council: Ad hoc committee to address autonomy and oversight

By Arin McKenna

The Charter Review Committee’s intensive examination of the county charter revealed a major flaw in charter sections addressing the Department of Public Utilities and its board.

At Tuesday’s council meeting, County Attorney Rebecca Ehler summarized the problem.

“State law prescribes responsibility and liability for municipalities; and H class counties, of which Los Alamos is the only one, is included in that definition of municipalities.

“The responsibility for what goes on in a municipality rests solely with this council. And by law you can’t delegate your liability that way to any other organization. We don’t want our government passing on its responsibility to organizations we can’t hold accountable as voters.

“Under the current system of our charter, you’ve not been given oversight. So if there is an operational infirmity, you can be held liable ultimately, but you don’t have the ability to direct the operations to correct whatever that infirmity might be.”

Under the current charter, the DPU is virtually autonomous. The manager reports to the Board of Public Utilities, not the county administrator. Council’s only oversight is its ability to appoint board members and approve all budgetary issues.

The CRC wrestled with how to address this “infirmity” and proposed an amendment that would allow council to remove one or more board members without cause by a 5-2 vote.

The BPU opposes the amendment on the grounds that council could use that authority to pressure board members for political ends, such as raiding the utilities’ assets to balance the general fund.

CRC Chair John Hopkins also noted that several of the committee’s members were also not happy with the proposed amendment, but it seemed to be the best solution to ensure council had some recourse should some future board get off track. No one is suggesting there are any problems with the current DPU management or board.

“The important point is that the utilities board has legal authority but little or no legal responsibility, while council has the responsibility but little authority, particularly to address problems that might be deemed time urgent,” Hopkins said.

Council Chair Sharon Stover asked Ehler if other counties had encountered similar issues. Ehler provided a firsthand account from a previous job where an agency operating autonomously under the direction of a board had made a bad decision and the board refused to correct it. The city was ultimately held liable.

“When I walked in they were in the process of removing the entire board through a public hearing. It was very ugly, very divisive for the community,” Ehler said. “Ultimately what happened was they dissolved that board, made themselves the board and brought the agency in as a department of the city in order to have control over that, because the lawsuit that resulted was very expensive.”

In an Oct. 23 decision, council voted to have Ehler’s office draw up alternative ordinances on the DPU charter amendments. One ordinance included all the proposed changes as one body. Another option isolated the board removal amendment as one ordinance and an amendment that would allow council to assign new utilities to the DPU as another ordinance. The rest of the proposed changes were combined in a third ordinance.

Neither option reached a vote Tuesday. Council Vice Chair Geoff Rodgers made a motion to take no action on the ordinances, but to form a five member ad hoc committee to study the autonomy/liability issue and return to council with recommendations within six months.

The committee will consist of one council member, one BPU member, a member of the community with management experience, a member of the community with accounting experience and a member of the community at large. Ehler will advise the committee.

The committee will also study another issue raised at Tuesday’s meeting: the possibility of returning profits from utilities back to the department and allowing profits from one utility to support another utility.

The CRC did not look at this aspect of the charter at all, but DPU’s proposed hikes in sewer rates to replace aging infrastructure has brought the issue to the forefront. Under the current charter profits from the utilities go into the general fund, and an ordinance prevents money from one utility such as gas being used to support another utility such as sewer.

“Some have said this is too important to kick the can down the road, but I think it’s too important to kick the wrong can down the road as well,” Rodgers said. “Perhaps if we start with those stakeholders at the table with maybe five fresh faces to talk through this in a collaborative effort, we can come up with recommendations that don’t leave us at a meeting like this where we’re considering sending things before the voters that there’s still a great deal of contention over.”

CRC members Harry Ettinger and Kyle Wheeler opposed the motion during public comment, but Chris Chandler, another CRC member, spoke in support of it.

Councilor Rick Reiss cast the only vote against the motion. “I think if we approve the ordinances introduced by Councilor Rodgers that we won’t have the opportunity to get the feedback of the public at large,” Reiss said.

Reiss supported the option that split the proposed amendments into three ordinances, so the vote would determine exactly what the voters supported.

Councilor Mike Wismer summarized the general sentiment expressed by council.

“The most compelling issue for me is what the CRC has brought to our attention, that we essentially have control in one body and responsibility in another body,” Wismer said. “And the attorney informed us of the problems that she has run into before, and she has alerted us to the fact that accountability and responsibility lies with us. So taking time to rethink the solution to that problem is worthwhile.”