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Money Wasted

Lake Worth Utilities
Waste Meter
$50,000
... for an arc flash study that Mr. Reyes was qualified to do in house and at no cost to taxpayers.
$200,000
... the estimated engineering cost of the express feeder which could also be done in house at no cost to taxpayers.
$591,898
... wasted when insurance requirements were circumvented by the city manager and utility director.
$123,098
... wasted when plant manager Dave Mulvay’s first attempt at writing a scope of work contained a defect that cost taxpayers an extra $123,098 for tainting the bidding process and giving unfair advantage to one bidder over another. - April 2009
$64,000
... wasted when the Matrix organizational study to save taxpayers money was scrapped in favor of higher cost outsourcing by city manager Stanton.
$450,000
... wasted engineering design cost of water piping and tanks (original county water deal) that will never be built.
$59,975
... wasted when additional costs were incurred for not following insurance procedure on transformer repair.
$82,620
... wasted when the commission unanimously voted to order transformers when we had equivalent replacements already in stock since the upgrade. - 15 Sep. 2009
Total Taxpayer Dollars Wasted:
$1,621,591
 
 

 
 
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  Screwing Taxpayer Dollars
Posted on Sunday, September 11, 2011 @ 16:35:58 EST by admin

LW Utilities

SCREWING TAXPAYERS & MISAPPROPRIATING FUNDS

September 11, 2011 -  please note that comments are disabled... see end of article for explanation. You can post comments here:

Over the past few months, I’ve tried to answer the inquiries and calls as to why the delay in writing such an important piece …so let me begin here for those who didn’t receive a response.

For the past few months, the Lake Worth budget was a work in progress and nearly impossible to pin down long enough to write about it. Figures and projections were shuffling around and items were being edited and deleted as city staff scrambled to get out from under the reign of terror that descended on them concerning millions “misappropriated” in the electric utility funds.

So my apologies for not committing this to writing sooner but it would have been a disservice if I had done so.



We say “misappropriated” (see our definition – bottom of article) because funds allocated at half the cost of a project induces the city to commit to that project that will double in cost. Therefore, funds used in that manner can be considered a “lure” or “bait” and thus would be improperly used whether intentional or not.

It all began mid summer 2011, when the utility director dressed up a wonderfully appealing plan for the conversion (sometimes called “the upgrade”) of the electric system to a standard 13.2 kV. Finally, after five years and 6 – 10 million dollars squandered we got the voltage right. The utility director thought of everything that would appeal to the commission and residents. It was her crowning achievement to introduce a plan that had been totally under her direction for many months… and under her careful direction this had now become her big moment to revel in the appreciation of a grateful commission.

City staff and the commission sat placidly in their plush chairs… earnestly accepting every word as gospel truth. Not a single commissioner raised an eyebrow at the 21 million dollar price tag for the whole upgrade including under-grounding everything east of Dixie Highway and a smart meter system. They had no idea the figure was 20 million dollars off.

As 40 year utility expert Larry Moore and his associates, including engineers and accountants, began sifting through the figures for the utility upgrade …they quickly recognized that something was seriously wrong. They concluded that the upgrade plan submitted by the utility director was at least 20 million short of paying for the all the features she had included. Next move was to find a commissioner who might be interested in pressing the issue privately with the city. Scott Maxwell expressed an interest, met for two hours and left with a list of carefully written questions that were to be answered PUBLICLY. But Commissioner Maxwell did nothing, said nothing and that was the end of it. He didn’t even ask for an accounting of how we had already spent 17 of the 34 million out of the bond.

Mr Moore himself contacted city management and at first was well received. But tolerance grew thin as he asked the city to itemize their 21 million dollar figure.

He relentlessly bombarded staff and the city manager with facts and figures showing that the utility director’s estimate of 21 million for completing the upgrade conversion was off by at least 20 million dollars. Mr Moore, some may remember, helped us get out of the ill fated 26 kV upgrade after Cara Jennings jump started it against all good advice in 2006. By the time this wrong upgrade could be stopped, 6 – 10 million dollars of taxpayer money had been wasted for substandard work, because no one was qualified on staff to establish construction standards, proper inventory control, materials manifests etc etc. The work had proceeded literally with… an open checkbook and contractors took full advantage of that opportunity to shaft the city.

As pressure mounted for the city to justify the 21 million… city/utility management decided to reshuffle the deck and like a squid in a cloud of ink… 10 million dollars vanished in allocations for the upgrade with an ambiguous set of reduced features that no one understands. Clearly Mr Moore was right. But more astounding is the fact that not a single commissioner eyebrow twitched with the deleting of 10 million dollars ...not a single question was asked …nothing from sleepy hallow.

But in Lake Worth, no good deed that saves taxpayers millions …goes unpunished. City management showed its heart felt appreciation for Mr Moore’s free professional services saving taxpayers millions… by summarily blocking any further emails and communications from him …perhaps because the truth he has to offer was incompatible with city management goals and it certainly appears that saving taxpayers millions of dollars is not one of those goals. And this isn’t the first time individuals have saved the city millions of dollars and were spit on for doing so by city staff and the commission.

Thus, with a small allocation of funds, the city was being lured into yet another of these lethal boondoggles that defy imagination. And like the 26 kV upgrade, the cost is said to be one thing and after its too late to turn back, staff runs out of money and the public is then forced to pick up the tab.

And this incompetence/misfeasance/malfeasance (you decide) takes many forms. For example a few years ago, the utility department made many attempts to steer the city into wasting 30 million on a rotten water deal with the County. The same utility director boldly and confidently told the commission and the public that it would cost $1,000,000 dollars for a booster station in order to get supplemental water from WPB when in fact… the booster station was already there in plain sight.

And this is nothing new. City staff has a well established record of lying to the commission and the public on issues such as the landfill, the Casino building, Shuffleboard building, the 26 kV upgrade, on FMPA, the County water deal. And then there’s a former finance director who wrote out unapproved checks totaling around $300,000 to the Public Works Director’s consulting friends… and did so without commission approval or knowledge. She was never held accountable and without that… she was free to move on and do the same thing at some other unsuspecting city. This is exactly how WE end up with such gross incompetence and corruption of normal decision making processes that have pushed this city into bankruptcy. And nothing stops it. As soon as you get rid of one culprit, another is hired who’s worse.

No matter what the blunder, no matter how many times it costs millions to taxpayers… no one has been held accountable for anything. How is that “city management?”


And imagine the same incompetent staff members who rallied at a commission meeting in 2006 and spoke vehemently against the standard (13.2 kV) upgrade and pushed the commission to jump into the 26 kV upgrade are the same ones being allowed to manage the conversion to 13.2 kV the very upgrade they fought against just five years ago. And it is these people that were unqualified then and are still unqualified to manage an upgrade project of this magnitude. And if they can’t be trusted with the 6 – 10 million they wasted on the wrong upgrade… why would you turn around and trust them with 21 million?

It’s no wonder these boondoggles keep happening… and why should staff worry; they know they won’t be held accountable even if they’re a mere 20 million off. And keep in mind these millions are not staying in the city… they are exported out to consultants, contractors, purveyors and others who eagerly await the next chunk of slop ($$) in the public troth where they feed.

And no offense intended but it doesn’t make any difference who gets elected or which of the two factions is ruling… one is just as bad as the other and they all end up doing the same thing… making matters worse. They make campaign promises they don’t keep, always raise taxes, when they run out of fees to increase they invent new ones, and they never stop staff from wasting millions a year… nor are they even interested in doing so.

And let’s not forget how as a candidate, the former mayor was so disturbed about waste, that he matched my promise for a forensic audit of the utility and made the promise publicly. Soon after being elected, he forgot his promise and refused to discuss it.

Next we will take a look at another form of waste allocation we are all paying for.

DEFINITION - "Misappropriation" of funds and "misfeasance"

Although some legal definitions of “misappropriation” may include “intent” to misuse certain funds and involve committing “illegal acts”…I cannot ascribe that intent, motivation or illegal activity to any individual.

My point is that a project listed at half the cost functions as an inducement for project approval which will lead to double that amount spent. It’s a form of ‘bait and switch’ if it was intentional. If not intentional, then it certainly qualifies as gross incompetence to be 100% off on costing out a taxpayer funded project.

The misuse comes in with a smaller allocation, in this case one half of what it should be, making it more likely to induce the city into approving the project.

This could be the result of misfeasance or malfeasance. Either way the amount listed can be considered an inducement for approval where double that amount of money will be spent. It is at a minimum, the performance of a lawful action (projecting costs in a budget) in an improper manner either through ignorance or possibly intentionally. I consider the term “misappropriation” could mean that funds in this case that are half of what they should be would provide a sufficient inducement to gain approval for a project that will end up costing the city double the projected amount. Misfeasance - Negligent acts committed out of ignorance.

==========================================

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