The much-disputed forensic audit is again on the City Council agenda, along with another one that would probe PSE&G costs for a share of any savings.
The agenda-fixing session is 7:30 Monday in Municipal Court, 325 Watchung Ave., but in light of the daunting weather predictions for Monday, many may opt to wait for the televised meeting.
The forensic audit is different from the required annual audit in that the company would examine fiscal records for fraud and waste. The annual audit is based on information the municipality provides to the auditors, who may then make recommendations for improvement.
A council majority rejected the proposed audit in December. Plaintalker posted a commentary on the high degree of turnover in the past administration that pointed to the need for something beyond the routine annual financial audit.
The other audit is just for city utility bills. The resolution states that the city pays $80,000 a month to PSE&G. The company that wants to do the audit, International Consulting Group, would take 40 percent of any savings or refunds it achieves. Otherwise, there will be no cost to the city. Because it is a specialty, such an audit could probably not be done easily in-house.
--Bernice
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For the street lighting, that I'm almost positive we, the city, pay PSEG, an audit of street lighting needs to be completed for lights that are out or are missing.. my street alone on two blocks has 2 missing street lights that were never replaced after Hurricane Sandy.. I know in municipalities in NYS the cities/towns pay the utility company for the number of street lights on an annual basis -- on or not. The towns are required to report outages to the utility or they never get fixed and they still pay for them being on.... not sure how it works here in NJ.
ReplyDeleteWorks the same way here.
DeleteConsiderable due diligence is in order prior to making a commitment. For what duration does International Consulting receive the 40% savings? One year, two years, into perpetuity? Before this goes forward it is necessary to establish a time line regarding their profit sharing participation, and an iron clad standard as to how "savings" are quantified. We do not need another litigation a year down the road. I would also request a summary of recent audits, the results of those audits, and corroborate the representations by interviewing the Municipalities where audits were previously conducted. A call to the Division of Consumer Affairs is in order. Is this a cover for selling an alternative power supplier? If you review those deals you will observe that these alternatives sometimes achieve savings and sometimes do not. The "Auditor" has nothing to lose other the insignificant amount of time commited to making the transfer to the alternative power distributor.. During the periods in which there are savings he garners a commission. During the periods there are no savings he says, Ho Hum, and waits for a reversal. .If it is a backdoor method of selling an alternative power source, and if the Council wants to use an alternative power supplier in anticipation of a caving, they can achieve this with a phone call and retain the entire anticipated savings. If the study involves substituting alternative more efficient lighting systems, which is feasible, then there should be a time limit on the savings achieved. Frequently these "Consultants" attempt to have their own Contractors install the improved power systems. Their designated contractors are seldom low cost operators. Caveat emptor. Bill Kruse
ReplyDelete.
Rob, you can go to the pseg website and report a streetlight that is out. Dont wait for the city to do it. It wont happen. They usually respond within the week.
ReplyDeleteactually Jeff these are street lights completely missing since Hurricane Sandy.... was reported REPEATEDLY after the storm and months later ( reported about 30x immediately after the storm as the missing poles w/lights had a live wire laying across the sidewalk on West 8th ) and they never responded to any reports..... so, I'm sure the city is still paying for them
DeleteGood point Bill about just inviting some consulting group to come in without a clear understanding of who they are, what their "real' agenda is and references from past client communities. I feel certain the Administration could easily get citizens to help review and analyze its utility bills for potential savings. All the street light are identified by pole id and type of fixture. As part of a bill review, volunteers from the block associations could check the poles listed to see if the fixtures are still there and and if they are working at night. It would also be an excellent time to review the City's street light plan as a whole. Mayor Mapp mentioned his "Light up the City" initiative. Our neighborhood submitted a unanimous petition to the Mayor six years ago requesting brighter streetlights to make it safer for people to walk through the neighborhood at night and as a crime deterrent. We are still waiting for the upgrade. I am sure other neighborhoods could benefit fro brighter streetlights as well.
ReplyDeleteTom Kaercher
PSE&G has this link to report streetlight outages: https://www.pseg.com/home/customer_service/outage_info/streetlight_out.jsp
DeleteTypically these rate saving advocates merely review the last 1 or 2 years bills. There is no profound "audit" as one associates with a forensic audit of the City Finances. Advances in technology have yielded distribution and lighting elements that can save in the order of 30 to 40 % of the power that is consumed by old technologies. The stumbling block is the first cost, that is, the cost of the replacement equipment and its installation. The payback on the first cost can be as rapid as 2 to 3 years. This kind of analysis can be preformed by a competent contractor in anticipation of acquiring the work at no cost. What the "plans" may offer, that the private contractor can not, is a financing package. This generally entails guaranteeing the Consultant a percentage of the savings for a defined period, usually in the order of 10 years. It will be interesting to see what is put on the table?
ReplyDeleteElectric bills have 2 components: Distribution and Power. The distribution system is owned by PSE&G and their portion of the bill remains unaltered. The Power can be supplied by PSE&G, or the "alternate" supplier. This is where a potential saving might be achieved. Sometimes the alternate suppliers rates are less than PSE&G, sometimes the same, and sometimes more. The alternate supplier will not guarantee consistent savings. They will point to periods when there were savings by using their plan and they will omit the information as to when their plan was more expensive. They might demonstrate that their current rate is less than PSE&G, but they will not guarantee that it wil remain less forever. Bill Kruse
What about the quirks of users? I knew someone in City Hall who couldn't stand to be cold and kept a heater running under her desk all the time.
DeleteHow does the free lighting provided to City owned buildings come into play?
ReplyDelete