Froedge explains his side of GEPB controversy
Editor’s note: This letter is being printed in its entirety without editing.
I’m a private person, a business person, and a theoretical physicist. I hate notoriety and don’t participate in social media publicity. I generally avoid explaining decisions, and I don’t like writing this, but I feel the users and owners of the City’s power company need to know.
I own and operate a business, built over a period of 40 years that has personnel and a budget much larger than the City of Glasgow. It has always paid 15% of salaries into a 401k, and maintains full family health coverage for everyone. I didn’t arrive here by making stupid business decisions, and I would not under any circumstance jeopardize the power company owned by the citizens of Glasgow.
In Jan 2018 I was asked to join the Board of the EPB, primarily because of the turmoil generated by the rate changes of 2015.
After appointment to the Board it did not take long to figure out what was causing the problem. The rates had been changed to move millions of dollars of cost from the high end user, to the people who could least afford it.
The most illustrative example of what happened is in an e-mail to TJ Sampson Community Hospital in August 2016. The Superintendent explained that as the result of the rate change, they would be receiving an annual rate reduction of at least $150,000. This change wasn’t significant to TJ, but when you add up all the rate reduction to the other high end users that received it, it was millions of dollars per year. This millions of dollars in rate reduction had to be made up by other users, and was transferred directly to those least able to pay. It didn’t take a theoretical physicist to figure this out.
Subsequent to this change, there has been a multiplicity of obfuscations to disguise what has been happening, peak rates, flat rates, betting on peak hours, etc., but the total bill has to be paid, and the poor and least able to afford it have to pay a heavy part of it. There are a large number individuals and families that are forced to turn off heat and AC during the worst heat and cold, and suffer through it.
The current Superintendent is intractably committed to this scheme, despite this facility being nearly the only utility in TVA’s 150 utilities doing so.
After watching this for a year I decided that the only way to change the direction was to replace the chairman who acts contrary to the GEPB owners best interest, and I believe this has become obvious for most of the members of the Board. Since first presented to the Board, legal threats and continuous social intimidation has restrained action by those otherwise would have immediately taken action. The level of resistance has now escalated to illegal levels, and directed e-mail storms, by citizens that don’t seem to know what is going on.
These unfair rates and costs do not compare with the latest and most abhorrent, egregious action by the outgoing board. A 20 year rolling contract offered, and fostered by TVA, in exchange for a 3.1 percent reduction in rates, and a partial moderation of future rate increases.
This contract accepted and rushed through by the outgoing Board, on advice of the Superintendent without input, by experts familiar with power costs, or any legal considerations, commits the GEPB to unimaginable downsides. After a few years the buyout cost exceeds anything the Board has on hand, or even can borrow. A board 10 years down the road will have to pay anything the TVA asks with no way out, even if other power suppliers sell at half the price or are virtually giving away power.
I can’t imagine any business focused person, without a gun to his head, signing something like this, and I think that before it is too late we should make every effort to extract the GEPB from this contract. For years we’ve had and still maintain an ongoing contract with TVA that would let us out after 5 years, in the event the future market changes. Being locked into a 20 year rolling irreversible contract is irresponsible beyond imagination.
Fixing this problem is not going to be easy. After years of attending, and voting on board issued [sic], when I and two other members called a special meeting adverse to interest of the superintendent, suddenly the chairman decided I was a non-member, the superintendent locked us out of the building, and the meeting canceled.
Personally, the actions of this board have very little adverse effect on me. From the start, the $200 fee for attending meeting has been contributed back into the Roundup Fund, and the cost of my electric bill is unknown to me. I do know however that I pay less per KW hour than those who are less fortunate. I also do know many people whose standard of living continues to be severely depressed by the actions of this board.
DT Froedge, Glasgow