CU sets deadline for audit response

CU General Manager and CEO John Twitty announced on Friday the key elements of the utility’s action plan. CU’s initial report will:

• be presented to the CU Board of Public Utilities by Jan. 31;

• identify audit recommendations that already have been addressed as well as those currently being addressed; and

• suggest a process time line to address the remaining audit recommendations.

Twitty named Brenda Putnam, associate general manager-chief internal auditor, and John Black, associate general manager-general counsel, as directors of completing the action plans.

“We view the findings and recommendations from the state audit as an opportunity to improve our operations,” Twitty said in a news release. “We are absolutely committed to addressing each of the recommendations in a timely fashion, while realizing that some of them cannot be addressed by CU alone. In those areas where a broader discussion of the issues is necessary, we will work to bring together those parties whose input is important in finding a solution.”

The audit, released by State Auditor Susan Montee on Dec. 18, criticized various spending issues, including CU’s subsidization of other utility sectors and the city’s transit system, CU’s donations to nonprofit organizations and CU employee perks. The audit noted that such expenses are more typical of a private corporation and could result in utility rates higher than necessary.

Among CU expenses for the fiscal year ended September 2006 that the audit said are not “necessary or essential to the operation of the utility”:

• $1.2 million in payment in lieu of taxes to the city from water revenues, which are not spelled out in city charter;

• Leases on two parcels of land, worth nearly $2.7 million, to the Springfield-Greene County Park Board at no cost;

• Donations of money and services to local organizations totaling more than $259,000;

• $89,000 to the Downtown Community Improvement District for wireless Internet service costs;

• $19,000 for CU’s 2006 Family Day Picnic; and

• $3,125 for a suite at Hammons Field for Springfield Cardinals games.

“If City Utilities were a private corporation, we would say this is a company being a good corporate citizen,” Montee said. “The problem is, City Utilities is not a corporate citizen – it’s a public body.”

Twitty has defended the spending.

“Most of the people that I visit with in our community want City Utilities to be operated as a business – they want good, solid business practices employed every day to provide good service to customers,” Twitty said. “It just happens to be that this utility is owned by the city of Springfield.”