Carmel on the Case
Air Date: Monday, February 13, 2006
Florida power and light has been in the spotlight since the hurricane season. But not all the coverage has been positive. Now Seven News has turned up information that indicates FPL could be making big money from taxpayers by charging for street lights - that don't exist. Investigative reporter Carmel Cafiero is live in Pompano Beach with this - "Power Play".
Carmel Cafiero: "I'm standing on a street that is supposed to have a street light right where i'm standing. But look what happens when we turn our camera lights off. I'm in the dark - and so are South Florida taxpayers."
Since hurricane season, the condition of power poles has become a lightening rod of criticism for Florida Power and Light.
Now Seven News has learned - there's a new issue - cities paying tens of thousands of dollars - for lights on FPL poles that do not exist.
Mike Danvers: "It's a big problem because its not in one particular area but it's right across - across the city."
Mike Danvers was hired to count FPL power poles with lights for the city of Pompano Beach.
According to his report - he could not find four hundred fifty three of them.
This despite the fact FPL has charged the city for both the cost to operate and the cost to maintain these non existent poles.
Mike Danvers: "Looking back at the bills that I've seen, that I've audited - we're talking about years."
How much a city pays is based on the kind of pole and wattage of the light bulb.
In Pompano Beach - it appears the city has been over-paying close to fifty thousand dollars a year.
Mike Danvers: "I figure what FPL needs is better monitoring of their poles and inventory."
For example - Danvers' report shows 13 lights exist along NW 18th Drive.
But he says the city is being billed for 36 lights - 23 more than are actually there.
Here on SW 6th Court - the city pays for 11 street lights - but Danvers says he found only eight.
Mike Danvers: "The last street light stops right here. But they are saying there are three more street lights beyond here."
And what's beyond here is a highway.
Mike Danvers: "And these street lights based on the address do indicate that it stops right over there by the wall."
Carmel Cafiero: "No one from Pompano Beach would talk with us about all this. A spokesperson says the city manager does not want - and I quote - to instigate a problem with FPL by dealing with this through the media."
But documents obtained by seven news speak volumes about what has been going on between Pompano Beach and Florida Power and Light.
For more than a year fpl has failed to credit the city for past charges and has continued to charge for the non-existent light poles.
The first letter from the director of public works, D.C. Maudlin, put FPL on notice...453 lights were not found.
That was in December of 2004.
Then for the next year - a series of e-mails also failed to get a refund.
The memos from Maudlin reflect his frustration.
In May - he wrote "It's been six months since I asked you to correct our monthly invoice".
In July - "When will our bill be reduced"?
By October - "My patience and understanding have run out".
And in December - one year from the first letter - Maudlin sent a request for a 48 thousand dollar credit and reduction of the monthly bills.
Today - the city is still being billed and is still paying.
Carmel Cafiero: "So what does FPL say? Nothing to us. Despite the fact Seven News spent weeks calling and asking for an interview about this issue - no one from the company would answer our questions."
And now a second city has discovered it is being billed for lights that don't exist.
The City of Tamarac also hired Mike Danvers.
The final report isn't in - but again thousands of dollars a month are at stake.
Jack Strain: "So we feel that there are definitely uh poles that we are being billed for that aren't there."
Public works director Jack Strain believes his city stands to save a substantial amount of money.
Jack Strain: "If there's a five per cent error that could be as much as 30 thousand dollars. Carmel Cafiero: A year? Jack Strain: A year."
He says Tamarac will give the report to FPL and request a refund.
Jack Strain: "This is what we've got. It's through your due diligence now to prove us wrong. Carmel Cafiero: Otherwise give us our money back? Jack Strain: Otherwise give us our money back pretty much in a nutshell."
Carmel Cafiero: "This "power play" could have far reaching consequences. Danvers has found the same problem in a third South Florida city. And there's no telling how many others may have the same situation."
FOR MORE INFORMATION:
If you have a story for Carmel:
Call her in Dade at 305-627-CLUE
Tuesday, March 14, 2006
Carmel on the Case: Power Play Follow Up
Florida Power and Light has finally decided to comment in connection with a Seven News investigation that aired last month. That report - power play - revealed cities could be paying tens of thousands of dollars for streetlights - that do not exist. Investigative reporter Carmel Cafiero broke the story and is - on the case.
WSVN--Last month, our investigation revealed the city of Pompano Beach believes it is being charged by FPL for hundreds of street lights that do not exist. And it is costing taxpayers close to fifty thousand dollars a year. For weeks before the story aired - I called Florida Power and light asking for an interview. But FPL had nothing to say. Now - that's changed.
Mayco Villafana: "Well, we're commenting now. But certainly are the time we felt that it was important that we respect the customer."
Spokesman Mayco Villafana says FPL did not answer our questions because its customer - the city of Pompano Beach - did not want to air the issue in the media. The city also refused to comment for our report. But public records obtained by Seven News told the story. Letters and memos revealed that for more than a year - the city asked for a credit of almost 49 thousand dollars and a monthly reduction of its bill by four thousand dollars. The findings came after a study by consultant Mike Danvers.
Mike Danvers: "I've figured more or less, what FPL needs is better monitoring of their poles and inventory."
According to Danvers report, Pompano Beach is being charged for 453 lights - that do not exist. In February of 2005 - FPL told the city it was working to verify Danver's audit. Now - more than a year later - FPL still hasn't concluded its counting.
Carmel Cafiero: "Is there any excuse for that?"
Mayco Villafana: "No. There's no excuse except the fact that there were, there were two hurricane seasons that were very, very strong."
Villafana says two terrible hurricane seasons plus problems with the way the information was reported - contributed to the Delay. But he says now that FPL is counting streetlights in Pompano Beach - it is disputing the 453 missing lights listed by Danvers.
Mayco Villafana: "It's only 405 that we have found so far."
Plus FPL says the city records show 200 other lights that it should have been billing for and has not.
Mayco Villafana: "And in other cases there are street lights that we do not have in our books that they have identified."
How all this washes out remains to be seen. Mike Danvers meanwhile is busy meeting with officials from other cities that now want their streetlights counted. He says surveys in three cities have revealed about a ten percent error.
Mike Danvers: "That's telling me that when you stretch is right across the state, it's basically going to be the same problem."
Mayco Villafana: "Well again these are his findings. And when we go out there and we validate what the city is presenting to us, what we have in our books and what the city has in their books, we find sometimes a very different story."
Carmel Cafiero: "It would seem a pretty simple and straight foreword job - is there a street light here or not. But apparently it get quite complicated figuring city boundaries and such. One fact not in dispute - taxpayers - should not be charged for lights that do not exist."
FOR MORE INFORMATION:
If you have a story for Carmel:
Call her in Dade at 305-627-CLUE
Or in Broward at 954-921-CLUE
FPL streetlight charges
Four cities' audits find FPL charged for street lights that don't exist
Cities negotiate for credits; in some cases owe the utility money
By Julie Patel South Florida Sun-Sentinel
December 7, 2009
Four South Florida cities that conducted independent audits of street lights run by Florida Power & Light
scored $388,000 in credits - charges for hundreds of lights that don't exist.
The cities - Tamarac, Miramar, Pompano Beach and most recently, Coconut Creek - hired West Palm Beach-based Danvers Consultation and Research Firm consultant to do the audits and negotiate with FPL
The independent audits are in addition to those done by the utility company.
FPL audits streetlights every five years to correct outdated inventories, said FPL spokesman Mayco Villafana. After its audits, FPL has charged cities more and returned money – all without consultants.
Cities typically pay FPL not just for the electricity they use for the street lights, but also for the upkeep and installation of lights. Some cities, like Fort Lauderdale, do spot checks"of FPL's audits, but few do full inventories.
The number of street lights in each city changes, whether because of new construction, severe storms or car accidents, Villafana said. That's why the utility works with cities to correct old inventories, and "it can take time as both sides iron out their differences."
"There are many factors that impact the margin of error. The level of growth in that city, the impact of new construction," Villafana said.
For instance, Villafana said FPL's audit in Fort Lauderdale resulted in the city receiving a credit of $185,478 last year. A city spokeswoman said the audit found the utility had charged the city for 500 lights that didn't exist and had not charged for 200 other lights.
FPL hasn't completed its audit of all Palm Beach County
cities, but West Palm Beach officials said FPL's recent audit found the city owes the utility an additional $29,446 for street lights.
In total, FPL returned $544,784 to Broward cities, most of it to the four cities that hired Danvers. His audits that found FPL sometimes charged two or three times for a single light or charged higher for low-wattage bulbs. In one case, a city was charged for street lights that FPL maps indicated were located in the middle of a canal.
Officials from the cities that did independent audits said it wasn't easy getting the utility to agree to credits.
"It was two years of everyone making sure their interests were at the foremost," said Coconut Creek City Manager Dave Rivera.
After Tamarac hired Danvers, an FPL representative e-mailed Public Works Director Jack Strain to say the utility had done its own audit and found it was undercharging the city, not over-charging it, for street lights.
But Strain persisted. "The idea of FPL doing a self audit was not acceptable," Strain said. "They obviously had a vested interest in the outcome."
Errors in street light counts are common, said Joe Seeber, of TriStem Consulting in Hewitt, Tex., a utility critic who has recovered millions in utility overcharges for cities across the country. But he said when there are errors with more than 4 percent of the lights, it's considered "out of line" – based on his company's experience.
"Street light bills are always paid with taxpayer money. My thought is that it's the fiduciary responsibility of the city council or whoever approves them to make sure the bills are accurate," Seeber said. The error rate for the four Broward County
cities ranged from 4 percent to 10 percent.Pompano Beach
was the first in the county to hire Danvers a few years ago. The audit found the city was being overcharged for 490 of the city's 6,187 lights, said Sandra King, a spokeswoman for the city. In 2006, the city received a $65,225 credit for charges going back a little over a year. "I think it is very safe to assume the inventory was inaccurate for more than 1.3 years; however the only document we could present to justify the inaccurate streetlight count was the inventory we completed with Mr. Danvers' support," King said.Tamarac
officials heard about Pompano's audit and hired Danvers. At first, FPL said the city owed $394 a month. After the city's audit, FPL agreed to provide a credit going back five years. But when the city's utility director found an incorrect inventory of FPL street lights from 2001, FPL agreed to a $200,000 credit for 425 lights. The city agreed to start paying for 42 lights that old inventories hadn't accounted for, Villafana said.Miramar
received a credit from FPL of $52,464 last year for problems with 183 lights, including 35 lights on a small residential street that has only 13. An FPL map of some lights showed they were located in the middle of a canal near the city's water treatment plant. As part of the agreement, the city started paying for 146 lights that it wasn't charged for before, Villafana said.Coconut Creek
received about $70,000 credit for 121 lights after a city audit turned up errors, Rivera said. But Villafana said FPL's audit also found 155 lights that the city wasn't paying for. The city still received a credit because most of the undercharges were for streetlights that the city only pays electricity on while most of the overcharges include maintenance costs, according to Danvers.
Villafana said FPL reviewed Danvers' audits from some cities and found some "incomplete and inaccurate" findings. Villfana noted that Danvers – who charged each city from $9,000 to $37,000– makes money off the audits "whereas we do this for free for the cities."
An independent auditor's fee "is a small price to pay for money that likely never would have been recouped in the first place," said Pete Sepp, a vice president for the National Taxpayers Union.Julie Patel can be reached at 954-356-4667 and jpatel@SunSentinel.com.
Street Light Audits Uncover Wasted Tax Dollars
It turns out that long before there were “phantom congressional districts” and “phantom zip codes” identified as receiving federal stimulus funds (ht: Rio Grande Foundation Reporter Jim Scarantino
), something equally strange had surfaced at the local government level: phantom street lights.
I first became aware of this issue late last year, when yours truly was briefly mentioned in a Florida Sun-Sentinel story
which reported that “Four South Florida cities that conducted independent audits of street lights run by Florida Power & Light scored $388,000 in credits - charges for hundreds of lights that don’t exist.”
But the story has a much longer lineage, as Mike Danvers, owner of a consulting firm which first discovered the discrepancies, was kind enough to explain. Here is his account, which will likely resonate with many exasperated taxpayers in cities across the U.S., whose leaders are crying poverty and seeking property tax hikes:
“In the summer of 2004 DC Maudlin and the City of Pompano Beach decided to hire someone with accounting and inventory knowledge to get an accurate streetlight counts within the city limit. I was selected for the job. As I combed the streets carefully I realized that there were irregularities when compared to the Florida Power and Light inventory. I could not locate the poles at the addresses, and there were duplications of addresses. Because neither DC Maudlin nor the City’s electricians could answer some of the questions I asked about the discrepancies and errors stretching across the City, meetings were arranged with an FPL representative. Answers were given which did not make sense.”
“This led me to wonder if the City would ever locate such problems on its own and ask FPL for an explanation. That prompted me to start a consultant business of my own in October 2004. I completed the project with the City of Pompano Beach in January of 2005. The City requested a credit from FPL; however, nothing happened for awhile.”
“After I talked to several cities about the discovery in Pompano Beach, I was given the break by the City of Tamarac for its streetlight bill audit and inventory. The job was done on a consignment basis and I was not surprised by the results. The local television news station, Channel 7 News, got involved and the crew assigned to the case did two reports in early 2006. The City later received a $65,000 refund from FPL.”
“The City of Coral Springs asked for about one-tenth of the city’s streetlights to be audited, with the understanding that if errors were located, then my firm would be allowed to examine the rest of the city’s streetlights. Although a 7 percent error rate was discovered, FPL was able to convince the Coral Springs City Manager and the Director of Public Works not to go any further. The City of Miramar and the City of Coconut Creek also hired my firm, resulting in similar findings. However, in these cases we used GPS mapping on the streets in Miramar and Coconut Creek, with even more startling results. In Miramar, one association was paying for streetlights that have been charged to the city, while in another ase FPL’s maps indicated that there were streetlights in the middle of a canal. Three streets had lights that FPL had billed in triplicate.”
“After FPL was given the discrepancy lists from the cities, the representatives denied the results my firm uncovered and instead FPL attempted to assess additional charges to each city. Yet, after several meetings and many months, in which my company endured attacks on its professionalism, FPL decided to give credits to Tamarac, Miramar, and Coconut Creek in the amount of $200,000, $52,000 and $70,000 respectively. The City of Coral Springs refused to fight for the taxpayer’s money. “
“I believe FPL should be fined for its stubbornness to stop overcharging these cities and interfering with other cities getting their audit done. In some cases charges for phantom services had been going on for decades. The Florida Public Service Commission was given the scope on FPL’s activities with the overcharges; however, they turned their heads too. This is a terrible disservice to the citizens of our state.”
NTU is not in the business of advertising for private firms. However, Mr. Danvers has made himself available for questions from Government Bytes! subscribers who may be wondering whether their own cities could use a little enlightenment over local government electric bills that are ultimately passed along to taxpayers. Read more about him and his firm here