Traverse City Record-Eagle

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March 13, 2013

Report: City commission, TCL&P board are utility's biggest problem

TRAVERSE CITY — A final report on the efficiency of Traverse City Light and Power points to constant political conflicts between the city commission and the utility’s board of directors for the organization’s overall “disarray.”

The city commission and TCL&P contracted with Hometown Connections, a subsidiary of the American Public Power Association, for a comprehensive assessment of the city-owned utility’s efficiency. The 98-page report gives strong marks to the utility for its low rates, reliability, customer satisfaction and strong balance sheet. But governance, the report said, is an area that needs significant work.

“We believe that many of the utility’s challenges can be traced back to the two governing boards and the struggles that have defined their relationship for some time,” the report said. “Fingers are pointed, causes are cited, board members turn over, and executive directors are terminated.”

The report’s authors concluded the economic downturn exacerbated the situation as the city struggled with declining revenues while TCL&P built up cash reserves. But the biggest issue is not about money or who the executive director may be. Instead, it’s the “highly visible struggles for control of the utility’s direction,” according to the report.

City Manager Ben Bifoss said much of the conflict has resolved itself over the last four to six months with a change in the executive director and makeup of the TCL&P board.

Former Executive Director Ed Rice was dismissed from the utility in October.

“There was a tendency for the Traverse City Light & Power board to become more independent from the city,” Bifoss said. “Communication has improved substantially at the board level and at the staff level.”

The report found a disconnect between the role envisioned for the utility when the city charter was drafted and the role envisioned by current leaders. It recommends engaging the community in deliberative discussions about the utility’s future, followed by joint meetings between the commission and TCL&P board to find common ground. It also recommends more training for utility board members about the public power industry.

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