Addition to Previous Watchdog Reports by Hal James

March 12, 2013


This is Rhonda's first report on the New Bern Board of Aldermen meetings using this medium. We are really pleased to begin this series of reports on the New Bern Board of Aldermen Meetings.
Hal

Addition to Previous reports by Hal James on the subject meetings:

1. More on the City Manager bonus - no it is not a done deal yet. As we heard per the individual aldermen comments at the Feb 26 regular Board meeting, aldermen Bengel, Taylor, Kinsey, White and Outlaw expected to formally vote and therefore, they assumed, put into law, a contract amendment that would grant City Manager Epperson a bonus incentive to stay the sum of $10K per year at the end of 2014, 2015, and 2016 should he remain in that position. This bonus amendment was a proposal for discusion per the Feb 16 Retreat agenda. Aldermen Taylor & Outlaw stated that if they had known at the time of the Retreat discussion that Mr. Epperson was seeking out other employment after being here for only 2.3 years they would not have voted for the bonus incentive amendment. Alderman Bengel stated she would have voted to offer it regardless of this information while Alderman Bucher stated that what his thinking was either at the Retreat or this current Feb 26 meeting was not important. He felt that Mr. Epperson was deserving of the bonus and that offering such an incentive was consistent with private industry in executive retention. Also both he and Alderman Bengel believed it would be more costly to the city in both time and money to go through the selection process to hire another city manager. Alderman Kinsey said that he had heard rumors that Mr. Epperson had been looking for a job elsewhere but that he did not make decisions based on rumors. His yes vote at the Retreat was based on the merits of Mr. Epperson's job performance and therefore he was deserving of the bonus. He also thought, however, that the board would need to cast the formal vote at this Feb 26 BOA regular meeting so the public would be aware of all the particulars. Alderman Outlaw stated that the Mayor, against protocol, had signed the employment contract amendment to award the bonus, $30K over the next 3 years, prior to the Board discussing and voting in unanimous affirmation of it.

The reason for the agitated discussion over the approval of minutes in Item 11 of the Feb 26 agenda is due to the fact that Alderman Outlaw knew those Feb 16 Retreat minutes had to be approved by the Board in order to make the bonus lawful and the employment contract amendment binding and awardable. This reporter also has a problem with City Manager Epperson taking official minutes (mandated by NC gen statute) regarding awarding himself a raise -- conflict of interest perhaps?

Which leads us to the Wed, Mar 6, 2013 "special called meeting" of the board. We learned about the importance of those Retreat minutes being recorded, the content agreed upon then being voted for approval. The City Attorney Scott Davis explained the aldermen have to approve a set of minutes stating, at a minimum, the Retreat's meeting date & time, who was in attendance so as to ascertain a quorum, the purpose and enough detail that one would have a general ideal of what public business transpired. It does not matter who nor how many of the aldermen take notes nor how these notes are put together to constitute a set of minutes. The only requirement is that the aldermen agree on the content and then approve them as a body. So, at this point, any or all of the aldermen can decide that their recollection of the Retreat is that the City Manager bonus was not formally approved, and that their intention was to present, discuss and vote on the bonus amendment in front of the public at the next regular BOA meeting. However, the next BOA meeting is Mar 12th and it is NOT on the agenda.

Additionally, I totally agree with Hal James CCTA Watchdog Report of this Feb 26 meeting portraying the Mayor as having bullied his way through the agenda. To address Mr. James comments about the lack of practicing parliamentary procedure, I refer readers to the Feb 14, 2012 BOA minutes. The minutes show that at this meeting's start, Mayor Bettis announced that as a result of the heated discussions, name calling and accusations of various unethical behaviors committed by the Mayor and several alderman during the Jan 10, 2012 BOA meeting, that the Mayor demanded the Board make a decision of which format of Robert's Rules of Order they would follow (the formal version or the NC School of Government simplified version - he preferred the simplified version). Per Alderman Outlaw's suggestion during the announcements, they were to decide at the next work session of Mar 20, 2012, but there is no mention of any decision about Robert's Rules in those minutes. Perhaps this is why board discussions unfold the way they do, unruliness and all.

In reading through archived Board minutes, I have discovered the following meetings have no posted minutes: Retreat of Aug 8, 2010, Retreat of Mar 10, 2012, (the City Clerk tells me the Board told her not to come to either the 2012 or 2013 Retreats) and a "special called meeting" (vice a closed session for personnel matters) to discuss the city manager position on Sep 24, 2012 @ 6pm @ Morgan's Restaurant. This record for this meeting is important because there is a discrepancy between Mayor Bettis's and some of the aldermen's accounting of when the Board members learned of Mr. Epperson seeking other employment opportunities. Also, Mr. Epperson stated during the Feb 26, 2013 regular BOA meeting that he wanted to inform the public and state for the record that he was unaware of any bonus nor was he offered any bonus nor did he discuss any bonus. As I wrote in the first paragraph, some of the aldermen stated they did not know that Mr. Epperson was looking elsewhere. However, during an interview that Mayor Bettis requested of and participated in on the Wed, Feb 27, 2013 Phil Knight Show (CTV-10), he stated that Mr. Epperson informed the Board of his applying for the Melbourne FL city manager job. Phil asked him: "he came to you?". "Yes" said Mayor Bettis. Now, legally, if one says "the Board" was informed that means at least 4 members; however Outlaw and Taylor said they had no knowledge of Epperson looking elsewhere and Kinsey said only that he'd heard rumors. This interview can be found on Facebook at "Bob Phil Knight Show" for the Feb 27, 2012 posting. It's posted in 4 parts.

2. More on CCTA Watchdog Report of 3-11-13 re: BOA Mtg of 2-26-13 agenda Item "1) Hometown Connections".

It is my wish that this report serve not only for info purposes but to teach a little lesson about why Official Minutes are important. As Mr. James stated in this Watchdog Report, Mr. Blodgett from Hometown Connections presented the city with its "Organizational Check-up" for the NB Electric Dept. I think it should be made transparent to the citizens of New Bern and Craven County who pay their electric bills to the City of New Bern that the at least $363,160.56 (includes $20K for two lobbyists to work on our behalf before NCLeg & NCUC, legal fees and travel) spent on fighting the now-successful merger of Duke Power & Progress Energy came from their Electric Enterprise Funds, which are derived from a portion of all of our electric bill payments.

How do "Minutes" fit into this conversation? From the time of the public's first official briefing on this effort on Thursday, Apr 21, 2011 during a "special called meeting - Town Hall" @ 7pm @ the Craven Regional Library, wherein the citizens were their first and only cost brief, we were told it would cost between $68k- $100K. This "special Town Hall" is not recorded in any written minutes so they are not posted to the public. From April 21, 2011 until the present the citizens have not been given an official brief of any substance. I had to pay $5 to the City in order to receive a CD w/out transcription of this meeting. We've heard the Mayor threaten to take down the ElectriCities CEO Graham Edwards, we've heard one-liners such as "the FERC granted New Bern major concessions and mitigations" or "hooray, the FERC found in New Bern's favor and stayed the merger and Duke is going to appeal so we're staying in the fight". Contrasting, Rocky Mount Telegram was frequently chronicling interviews it had obtained with our Washington DC attorney. However, the only way one could read these interviews was to pay for a subscription to the Rocky Mount Telegram newspaper for their premium content, which I did for 6 months. I discovered by combing through the hundreds of legal bills that every time our DC attorney gave one of those outside-of-New Bern interviews it cost us about $800 and it took 3 junior attorneys & their staffs to compile the info for him. Thank goodness the Sun Journal was finally able to get a statement from Mayor Bettis on June 15, 2012. His estimate of how much the city spent up to that time was "nearly $250K...". At that time he was off on the low side by $83,979.95. This money was approved via a series of approximately 24 closed sessions as of Aug 8 2012. New Bern launched an appeals process on that date; therefore, the closed sessions on this matter have continued. It took me personally petitioning the city Board and city attorney from Feb 2012 until July 2012 to get these closed session minutes unsealed and published for the public. When I received my personal copies that the city attorney asked the city clerk to provide me, I discovered the only info that the minutes provided were the date & time of each meeting, who made the motions to go into & out of each closed session, and a one sentence description of the purpose that was typically worded: "to discuss the city's intervention of the Duke-Progress merger" or "legal issues surrounding the city's activities in intervening into the Duke-Progress merger". Not one mention as to what was going on, not one mention of how much money was authorized to be spent or what it was spent for or from what fund it came! And it's all legal procedure. Despite having received hundreds of documents (invoices, purchase orders, spreadsheets, itemized legal bills, travel vouchers) from NB Finance Dept in accounting for the city's intervention against the Duke-Progress merger, as well as going through the Finance Dept budget presentations for Jan 2011 through the present, I have not been able to locate from exactly which fund, much less a budget line item, that city officials paid for this litigation. The morning of Feb 28, 2013 Alderman Bucher informed me that all intervention costs were derived from the Electric Enterprise Funds. We City of New Bern electric customers (of which 40% are outside the city limits) financed the litigation on behalf of the 32 other ElectriCities towns of which only 4 other towns pitched in around $12,420K each toward only the initial legal consultation to see if the interventon was feasible. Rocky Mount has paid not quite half of the total partnership with New Bern for legal fees only. During this same fiscal year, 2011/2012 the city transferred about 23% of it's budget from these enterprise funds. I have not asked for the current figures on enterprise transfers. I do know that when the Board approved the construction of the new Emergency Operations Center on Sep 25, 2012, the Finance Dir, Mr. Fiaschetti stated it was to be paid from equal portions of each of the enterprise funds, that being electric, sewer, and water. Remember these funds are derived from our bill payment to each of these utilities.

In the first paragraph under Item 2 above, I used the words "at least $363,160.56 because New Bern is still in appeals litigation to receive more mitigations as well as to recover the attorneys' fees to go on this quest. On Feb 18, 2013 I received a spreadsheet generated from NB Elec Dept Dir Jon Rynne, showing an updated figure of $471,137.35. Point being, the citizens have to hunt for this info on their own vice receiving a briefing in the public Board meeting.

One of Mr. Blodgett's criticisms is the NB electric fund debt: he said "he would like to see the enterprise fund set up more on a business model, and pay down the debt, which is 0.5 percent higher than the national average". The NC towns which have the lowest customer electric bills have either stopped or tremendously reduced their use of siphoning money derived from these Electric Enterprise Funds into the general funded projects (eg., Apex & Fayetteville)

Lastly, Mayor Bettis stated on the Feb 27, 2013 Phil Knight Show that although we gained these mitigations we electric customers would only see pennies off our electric bill. Two alderman have confirmed that to me (Bengel & Bucher). After hearing what Mr. Blodgett had to say in response to Alderman Outlaw's and the Mayor's questions regarding our debt to ElectriCities, those pennies will most likely disappear soon as utilities are asking for/needing increases to power plants. The Mayor's remarks at this Board Feb 26 meeting were that because of the rate increases that both Duke and Progress are asking for and are assured of being granted at least some of, they will at least now be on parity with NB rates once we receive the pennies we receive from the Duke Energy mitigations.

Yet the debt still looms until 2026. And if we don't continue utilizing the Electric Enterprise Fund transfers we may need to raise property taxes. This was brought up during the Board's Jan 15, 2013 Work Session. At meeting's end the Board said they would discuss the topic of electric rates and property tax increases more in depth at the Mar 19, 2013 Work Session. This will be open to the public and televised live and on tape via the PEG-TV3 channel. Also interesting to note is the discussion of electric rates appeared on the agenda for the Sat, Feb 16, 2013 Retreat - you know the meeting that was not given much publicity though the city claims it passed the legal smell test. I'm on the website at least twice each day every day since the Jan 2011 intervention in the Duke-Progress merger and I never saw it. The Sun Journal chronicled the same in its Mar 3 & 5, 2013 article "Flawed process creates unnecesary turmoil". The city should be able to substantiate its claims via a time/date stamp on the hard drive but they have not agreed to do so. I received my copy of the Retreat agenda via Alderman Bengel about 3 hours before the Feb 26 BOA meeting.

TO WATCH FOR:

1. And back to minutes... As a result of the uproar and confusion pertaining to minutes at the Feb 26 BOA meeting, the Board is discussing revising their methods of minutes taking and publishing. One of the methods, suggested by Alderman Bengel, is for the city clerk to take minimal written minutes and back them by the city's PEG-TV ch 3 tape.

The reason is because the clerk has a burdensome workload and minutes suffer. However, if one does not subscribe to Suddenlink one does not receive the city PEG TV channel. So, your sources of what goes on with any official city meetings is to view it live at City Hall or spend $5 on a CD copy. That is, when the city can get around to it.

Result: it will be very difficult to ensure the Board does what they say they are going to do.

2. The March 19th BOA work session. Topic: electric rates, using enterprise fund transfers vice property tax increase to fund city projects.

3. The FY2013/14 budget work sessions. Especially pertaining to the method that "special appropriations" funded organizations may or may not be included.

4. A city briefing on how we benefitted from our intervention into the Duke Progress merger to explain just what concessions and mitigations the citizens and electric customers have spent their tax dollars on. I have been on the Board about this. Since Board campaign season is upon us perhaps we'll finally get one. Alderman Outlaw has wanted to do one all along the way. I petitioned Alderman Bucher on Feb 28th to hold this brief and he said he'd have to think on it. Also to note, Alderman Outlaw has been the only alderman on record to suggest and hold fast for every Board meeting, work session, retreat, town hall, special called meeting and otherwise to be on the PEG channel. He is also the only alderman to request the Board hold a "State of the City" briefing - to include Q & A. Notice the rest of the Board and city manager have not granted those requests. Original PEG development channel Board member reps were Bengel, Outlaw and Kinsey.

5. How the Renaissance Gateway Project will be funded (grants, matches) and what the city will do with the old Days Hotel at 5-Points. One thought is a municipal building and a library. Note the Craven-Carteret-Pamlico Regional Library is a few blocks away. The city is under a contractual obligation since 1989 wherein we fund them $75K per year. So, why are we going to pay for another?

Rhonda Taylor
New Bern Ward 6