The Willmar Municipal Utilities and its commission have become dysfunctional and are in danger of costing the city of Willmar multi-millions over the next decade if the right decisions are not made in a timely manner.
The utilities functionality may be the greatest issue the city has faced in decades. It is critical the Willmar City Council immediately step up to ensure that the correct decisions are being made on a number of utilities issues.
* First, the Willmar Utilities Commission and its individual commissioners must be brought under control and receive proper guidance in proper governing. The commission voted Monday to place General Manager Bruce Gomm on 30-day paid leave for "preliminary consideration of possible misconduct." Then Commission President Doug Lindblad and Vice President Dave Baker met with the utilities staff Monday afternoon and reportedly told employees that Gomm "probably would not be returning" and that "it will take three to six months to hire a new general manager and we will advertise nationally, locally and internally." Then Baker told the Tribune Monday night that the co-interim managers would be in charge until a new general manager was found. This all shows that some commissioners may have the intent of terminating Gomm, when they should be seeking an appropriate investigation of allegations against the general manager. All these actions may have significantly increased the city's legal liability if Gomm pursues legal action over his employment status.
* Second, there appear to be problems between general manager and some of the department heads and/or staff at the utilities. Whether this turmoil is resulting from Gomm's management, staff resistance to change, personality conflicts or all three does not matter, these issues must be resolved quickly to restore the utilities' functionality. If these problems continue, again the city's liability exposure increases significantly.
* Third, there appear to be problems between some commissioners and the general manager. Whether this turmoil is resulting from Gomm's management, commissioner actions, undue influence of staff or all three does not matter, these issues also must be resolved quickly to restore the utilities' functionality. If these problems continue, the city's liability exposure increases with each passing day.
* Fourth, the utilities' practices have been in place for many years. In today's environment and economy, there is a need for government organizational improvements and efficiency. It should be the goal of the commission and its management to be seeking the necessary changes for improvements and efficiencies in all operational areas of the utilities. To be doing anything less would be a dereliction of their fiduciary responsibility. It is imperative that this issue be reviewed immediately to ensure the utilities' direction toward such goals.
* Fifth, the utilities have been in negotiations for future power supply contracts, which were expected to be completed soon. Gomm has been the primary negotiator on these contract proposals. Currently, the utilities' power supply rate is about 5 cents per kilowatt hour. The utilities currently use about 300 million kilowatt hours per year. The top power supply average rate in Minnesota is about 9 cents per kilowatt hour. That cost difference equates to possible additional costs to the city's utilities of $12 million per year over the next decade. This would be a significant cost increase to the utilities, all its customers and the city if these power supply contracts are not completed with satisfactory terms in a timely manner. It is critical that our utilities' stability be restored, so the best power supply contracts can be completed and that power supply opportunities are not missed.
* Sixth, the utilities has been in negotiations with the Environmental Protection Agency for a modification of the current air permit for the proposed plant improvement project. Gomm has been the primary negotiator with the EPA to this point. The EPA has been extremely interested in the utilities' plans of upgrading the power plant and possible utilization of wind, solar and biomass as alternative power sources.
After Gomm was placed on administrative leave Monday, the commission voted against the proposed solar project. Baker told the Tribune that the commission feels that it does not need one more distraction in operations at this time. According to staff, the utilities rejection of the proposed solar project could endanger EPA negotiations for the current permit modifications for the power plant improvement project. This in turn could impact renewal of the permit, which will expire at the end of 2012. This permit is a critical to the power plant and the city. If the permit is not renewed in 2012, the power plant likely could face closure and the central heating district would have to find an alternative heat source and/or cease operation. This is a major issue with significant financial risks to the city, its businesses and economic development.
* Finally, Lindblad's and Marv Kray's commissioner terms expire at the end of the month and they have said they do not intend to seek reappointment. Mayor Frank Yanish has not yet announced any plans yet for the positions. Thus, it is possible the commission may be operating with only five members initially in January at a critical time when major decisions need to be made on utilities management, power supply contracts, power plant projects and permit issues.
The dysfunctional state of utilities and all of these issues pose significant financial risk to the utilities, all of its customers and the city. It is imperative that the City Council immediately get involved, regain institutional control and make sure the appropriate decisions are being made.
The time for Mayor Yanish and the City Council take action to stabilize the utilities crisis is now. This leadership must begin at Monday night's City Council meeting and start a process to address this utilities crisis.