This post is going to begin with, what is a state interest?
State legislatures pass laws to address matters of public interest and concern.
A law that sets speed limits on public highways expresses an interest in protecting public safety.
A statute that requires high school students to pass competency examinations before being allowed to graduate advances the state's interest in having an educated citizenry.
A statute which addresses regulatory matters is a state interest.
Well as I have previously shown there are regulatory laws of a state interest which this city is not following.
So how do I determine what the courts would rule were I to challenge them?
Well there are 2 tests that the courts must use.
The rational basis test.
The strict scrutiny test.
In this case both tests apply as not only does this deal with violations of state laws on the books but our very charter has been violated.
The rational basis test is a judicial standard of review that examines whether a legislature had a reasonable and not an arbitrary basis for enacting a particular statute.
The term arbitrary describes a course of action or a decision that is not based on reason or judgment but on personal will or discretion without regard to rules or standards.
An arbitrary decision is one made without regard for the facts and circumstances presented, and it connotes a disregard of the evidence.
In many instances, the term implies an element of bad faith, and it may be used synonymously with tyrannical or despotic.
The strict scrutiny test is a standard of judicial review for a challenged policy in which the court presumes the policy to be invalid unless the government can demonstrate a compelling interest to justify the policy.
Now I am going to provide links.
These links are legal opinions on what home rule is today and where and if a city can conflict with state law.
These links in fairness to the city will show both the for and against arguments although the final outcome is the same.
This first link deals with land use but it defines home rule.
http://www.law.uoregon.edu/org/olr/archives/85/853burgundy.pdf
This link deals with criminal and civil home rule authority.
https://scholarsbank.uoregon.edu/xmlui/bitstream/handle/1794/9754/Diller.pdf?sequence=1
Although this is a lot of reading I ask each of you;
Now that the city is fully aware that they are in fact violating the law.
Exercising power in which they do not in fact have.
Should the 5% right of way fee be repealed, along with should all other uses of electrical funds for other municiple uses be stopped without delay?
Should this be done by this sitting council?
Should the city have to repay these misused funds back into the electrical fund?
In fairness I invite the city to weigh in on this as well.
Cody
Sunday, November 28, 2010
Monday, November 22, 2010
Do The Math!
Using the only stats for the 2009 year.
Lets compare the average rates of the 12 municipal utilities in Oregon.
So everyone can verify this this study can be found here.
http://www.oregon.gov/PUC/commission/statbook.pdf?ga=t
So let's compare them, found on pages 33 and 34.
City of Ashland-$617
City of Bandon-$933
Canby Utility-$785
City of Cascade Locks-$1,477
City of Drain-$1,086
Eugene Water and Electric-$1,042
City of Forest Grove-$848
Hermiston Energy-$866
City of McMinnville-$738
Milton-Freewater-$1007
City of Monmouth-$962
Springfield Utility-$793
So what do you think?
Cody
Lets compare the average rates of the 12 municipal utilities in Oregon.
So everyone can verify this this study can be found here.
http://www.oregon.gov/PUC/commission/statbook.pdf?ga=t
So let's compare them, found on pages 33 and 34.
City of Ashland-$617
City of Bandon-$933
Canby Utility-$785
City of Cascade Locks-$1,477
City of Drain-$1,086
Eugene Water and Electric-$1,042
City of Forest Grove-$848
Hermiston Energy-$866
City of McMinnville-$738
Milton-Freewater-$1007
City of Monmouth-$962
Springfield Utility-$793
So what do you think?
Cody
Friday, November 19, 2010
One More Time
In response to the inquiries concerning my constant statement that the city is violating the law.
In response to are you sure?
I do not carry my notes around to show you and this telephone explaining is not working as you need to see it to understand it.
Although I am pressed for time I will condense the 3 points I found you are all having trouble grasping.
Then the worry warts I have and the doubters can judge for themselves.
I will begin with the 5% right of way fee.
It is a distribution charge passed on to the consumers of that service.
For those not of the utility world a distribution fee, is a fee charged to a utility for the privilege to connect to its distribution or transmission system.
In the utility world this is known as a privilege tax.
All one must do is look at your phone bill under taxes and surcharges and you will see City Franchise Tax. $.40 per month.
Before I go into the law as I read it, let me put this into perspective.
Yes a city can charge a right of way tax.
But only to other utility business who use the telephone poles to affix the cable they need throughout town. This applies to all other utilities like our water, sewer, cable TV and internet as well.
So in using just the telephone and comparing it to my electrical bill here is the low down.
My electric bill was $108.59 this month. This is the gross revenue for that utility.
So at 5% that would mean that $5.4295 of my bill this month went to municipal funding for non electrical uses.
So in reality the city only charges $.40 cents to a private utility and $5.4295 to me for a right of way privilege tax.
Now does that seem fair to you?
After all, we own the utility and the right of way, so the city is taxing us for something we own.
Now lets see if this taxation on ourselves is legal.
ORS 757.600 Definitions for ORS 757.600 to 757.689
(4) "Consumer-owned utility" means a municipal electric utility, a people’s utility district or an electric cooperative.
ORS 757.667 City authority over rights of way. Nothing in ORS 757.600 to 757.667 shall diminish, or authorize regulations that diminish, a city’s authority to control the use of its rights of way and to collect license fees, privilege taxes, rent or other charges for the use of the city’s rights of way. [1999 c.865 §17]
As I said a city can charge for the use of our right of ways. BUT NOT TO THEMSELVES!!!
They should have read the law once again before passing more illegal legislation.
ORS 757.672 Application of ORS 757.603 to 757.667 to consumer-owned electric utility; reciprocal electricity sales. (1) Nothing in ORS 757.603 to 757.667 is intended to limit or restrict the rights and authority of a consumer-owned utility, or to subject a consumer-owned utility to the regulatory authority of the Public Utility Commission not otherwise provided by law. ORS 757.603 to 757.667 shall not apply to a consumer-owned utility.
Note this law says; ORS 757.603 to 757.667 shall not apply to a consumer-owned utility. 757.667 granted authority for cities to charge a right of way priveledge tax and 757.672 is where the PUC bows out and on any regulations.
Look at it this way.
You own a car. You pay everything for that car.
But before you can drive that car you must pay a fee to spend on other things besides that car.
That is sure going to make it hard to keep that car running isn't it?
Quite the business logic we have here.
Yet what blew my mind was the attempts to quite those whom mentioned franchise fee, distribution fee or tax during discussion of this legislation by our City Administrator and City Attorney, although the title of this legislation was a right of way fee in the end it was called "a payment in lieu of" by our City Administrator.
Oh I must give him kudos for creativity but in the end it was in lieu of everything the city could not legally do.
Why you might ask. Because it is a privilege tax.
So you understand much like a private company using our telephone poles the minute we connect are utilities to the distribution network this provides direct access to our property from the utility.
ORS 221.655 Privilege tax on distribution utilities; maximum rate; allocation of tax among customers. (1) The city council or governing body of an incorporated city may levy and collect from a distribution utility providing direct access to electricity services under ORS 757.601 (1) or 757.676, except a municipal electric utility,
Let me make this clear.
A right of way is established when another utility hooks up to our network to sale a service.
That privelege tax is determined in the case of our telephone poles by the amount of poles used in most cases. That varies by cities.
Some businesses only use a portion of a network and pay less.
Those whom use more pay more.
But in our case the moment we hook up to the distribution network we are taxed for the privilege of the entire network for that one direct access point and it is not for the sale of anything.
We are being taxed for our own network here folks.
We pay for that network to survive in our fees and now we are being taxed to use it.
Is it that hard for them to understand?
What we have here is for over 25 years this city has been stealing from us.
Yes folks they have been just budgeting and taking who knows how much for over 25 years without the proper ordinance or resolution to authorize that.
So they learned that to continue to keep stealing from us that they needed to come up with a way for this to comply with budget law and fabricate some resolution so the city could continue stealing from us.
That council meeting reminded me of the boy who got his hands caught in the cookie jar and threw a fit to keep them there.
Remember that story?
Remember how he got in trouble and tried to sneak back into it?
Now remember what happened to him when he got caught again?
Well that is what is happening here right now.
Now lets further determine what uses the city can spend a municipal utilities funds on.
ORS 225.250 Application of earnings. The earnings of the electric plant or distributing system shall be applied and used in payment of warrants and interest thereon issued in connection with operation of any such plant or system, and also in payment for alterations, improvements, additions or extensions and for redemption and retirement of outstanding bonds, together with interest thereon, and shall be expended only in connection with and for improving such plant or system and not for other municipal purposes, except as otherwise provided in ORS 225.270.
ORS 225.270 deals with surplus earnings. Suplus earnings are additional earnings above what is budgetted, to maintain and operate the utility along with keeping a healthy reserve for emergencies.
Those earnings are to be used to lower property taxes.
Here they are.
225.270 Use of surplus earnings. When any city which owns or operates a municipal electric power plant or system or distributing system, has paid principal and interest to date on all indebtedness incurred in connection therewith, and has created and accumulated an adequate depreciation and replacement reserve in the judgment of the officer having control of such plant or system, the city shall, for the purpose of reducing general property taxes within such city, pay to itself not less than three percent of the annual gross operating revenue of such plant or system, or a volumetric charge based upon the amounts of electricity delivered, transmitted or distributed to retail electricity consumers regardless of the source. The volumetric charge shall not be less than the equivalent of three percent of the gross operating revenues of the municipality utility in 1999. The city shall adjust a volumetric charge to end users such that charges established for different customer classes bear the same approximate relationship as the gross revenues per kilowatt hour paid by the classes in 1999. [Amended by 1999 c.865 §32]
One would think that with this theft over 25 years that our property taxes would be zero.
Yet we have the highest rate the law allows.
In response to are you sure?
I do not carry my notes around to show you and this telephone explaining is not working as you need to see it to understand it.
Although I am pressed for time I will condense the 3 points I found you are all having trouble grasping.
Then the worry warts I have and the doubters can judge for themselves.
I will begin with the 5% right of way fee.
It is a distribution charge passed on to the consumers of that service.
For those not of the utility world a distribution fee, is a fee charged to a utility for the privilege to connect to its distribution or transmission system.
In the utility world this is known as a privilege tax.
All one must do is look at your phone bill under taxes and surcharges and you will see City Franchise Tax. $.40 per month.
Before I go into the law as I read it, let me put this into perspective.
Yes a city can charge a right of way tax.
But only to other utility business who use the telephone poles to affix the cable they need throughout town. This applies to all other utilities like our water, sewer, cable TV and internet as well.
So in using just the telephone and comparing it to my electrical bill here is the low down.
My electric bill was $108.59 this month. This is the gross revenue for that utility.
So at 5% that would mean that $5.4295 of my bill this month went to municipal funding for non electrical uses.
So in reality the city only charges $.40 cents to a private utility and $5.4295 to me for a right of way privilege tax.
Now does that seem fair to you?
After all, we own the utility and the right of way, so the city is taxing us for something we own.
Now lets see if this taxation on ourselves is legal.
ORS 757.600 Definitions for ORS 757.600 to 757.689
(4) "Consumer-owned utility" means a municipal electric utility, a people’s utility district or an electric cooperative.
ORS 757.667 City authority over rights of way. Nothing in ORS 757.600 to 757.667 shall diminish, or authorize regulations that diminish, a city’s authority to control the use of its rights of way and to collect license fees, privilege taxes, rent or other charges for the use of the city’s rights of way. [1999 c.865 §17]
As I said a city can charge for the use of our right of ways. BUT NOT TO THEMSELVES!!!
They should have read the law once again before passing more illegal legislation.
ORS 757.672 Application of ORS 757.603 to 757.667 to consumer-owned electric utility; reciprocal electricity sales. (1) Nothing in ORS 757.603 to 757.667 is intended to limit or restrict the rights and authority of a consumer-owned utility, or to subject a consumer-owned utility to the regulatory authority of the Public Utility Commission not otherwise provided by law. ORS 757.603 to 757.667 shall not apply to a consumer-owned utility.
Note this law says; ORS 757.603 to 757.667 shall not apply to a consumer-owned utility. 757.667 granted authority for cities to charge a right of way priveledge tax and 757.672 is where the PUC bows out and on any regulations.
Look at it this way.
You own a car. You pay everything for that car.
But before you can drive that car you must pay a fee to spend on other things besides that car.
That is sure going to make it hard to keep that car running isn't it?
Quite the business logic we have here.
Yet what blew my mind was the attempts to quite those whom mentioned franchise fee, distribution fee or tax during discussion of this legislation by our City Administrator and City Attorney, although the title of this legislation was a right of way fee in the end it was called "a payment in lieu of" by our City Administrator.
Oh I must give him kudos for creativity but in the end it was in lieu of everything the city could not legally do.
Why you might ask. Because it is a privilege tax.
So you understand much like a private company using our telephone poles the minute we connect are utilities to the distribution network this provides direct access to our property from the utility.
ORS 221.655 Privilege tax on distribution utilities; maximum rate; allocation of tax among customers. (1) The city council or governing body of an incorporated city may levy and collect from a distribution utility providing direct access to electricity services under ORS 757.601 (1) or 757.676, except a municipal electric utility,
Let me make this clear.
A right of way is established when another utility hooks up to our network to sale a service.
That privelege tax is determined in the case of our telephone poles by the amount of poles used in most cases. That varies by cities.
Some businesses only use a portion of a network and pay less.
Those whom use more pay more.
But in our case the moment we hook up to the distribution network we are taxed for the privilege of the entire network for that one direct access point and it is not for the sale of anything.
We are being taxed for our own network here folks.
We pay for that network to survive in our fees and now we are being taxed to use it.
Is it that hard for them to understand?
What we have here is for over 25 years this city has been stealing from us.
Yes folks they have been just budgeting and taking who knows how much for over 25 years without the proper ordinance or resolution to authorize that.
So they learned that to continue to keep stealing from us that they needed to come up with a way for this to comply with budget law and fabricate some resolution so the city could continue stealing from us.
That council meeting reminded me of the boy who got his hands caught in the cookie jar and threw a fit to keep them there.
Remember that story?
Remember how he got in trouble and tried to sneak back into it?
Now remember what happened to him when he got caught again?
Well that is what is happening here right now.
Now lets further determine what uses the city can spend a municipal utilities funds on.
ORS 225.250 Application of earnings. The earnings of the electric plant or distributing system shall be applied and used in payment of warrants and interest thereon issued in connection with operation of any such plant or system, and also in payment for alterations, improvements, additions or extensions and for redemption and retirement of outstanding bonds, together with interest thereon, and shall be expended only in connection with and for improving such plant or system and not for other municipal purposes, except as otherwise provided in ORS 225.270.
ORS 225.270 deals with surplus earnings. Suplus earnings are additional earnings above what is budgetted, to maintain and operate the utility along with keeping a healthy reserve for emergencies.
Those earnings are to be used to lower property taxes.
Here they are.
225.270 Use of surplus earnings. When any city which owns or operates a municipal electric power plant or system or distributing system, has paid principal and interest to date on all indebtedness incurred in connection therewith, and has created and accumulated an adequate depreciation and replacement reserve in the judgment of the officer having control of such plant or system, the city shall, for the purpose of reducing general property taxes within such city, pay to itself not less than three percent of the annual gross operating revenue of such plant or system, or a volumetric charge based upon the amounts of electricity delivered, transmitted or distributed to retail electricity consumers regardless of the source. The volumetric charge shall not be less than the equivalent of three percent of the gross operating revenues of the municipality utility in 1999. The city shall adjust a volumetric charge to end users such that charges established for different customer classes bear the same approximate relationship as the gross revenues per kilowatt hour paid by the classes in 1999. [Amended by 1999 c.865 §32]
One would think that with this theft over 25 years that our property taxes would be zero.
Yet we have the highest rate the law allows.
So here again the city is forbidden from using the earnings of the municipal utility for other municipal uses and excess is to go towards lowerring property taxes.
Can anyone explain to me. With these laws. Just how this City thought that they were going to get away with this?
I have nothing but time yet the city now has until January 1st to set the rates.
ORS 225.210 Compliance with rate regulations. Each city which owns and operates an electric light and power system or which distributes electric energy for hire, shall charge such rates therefor as meet the requirements of ORS 225.220 to 225.300.
ORS 225.220 Enforcement of statutory requirements. (1) The requirements of ORS 225.210 to 225.300 shall be enforced and observed by that officer who by the charter is charged with the administration of any electric light and power plant or distributing system owned or operated by the city.
(2) As used in this section, “officer” includes board or other public authority of the city.
ORS 225.230 Rates set in accordance with estimates of annual expenses. (1) The officer referred to in ORS 225.220 shall annually before January 1, make a written estimate of the probable expense of maintaining and conducting the electric light plant or distributing system during the next ensuing year, including the cost of any contemplated alterations, improvements, additions or extensions, together with the probable amount necessary for redemption of any unpaid warrants and the interest thereon, as well as the amount required for payment of interest and maturing principal on any outstanding bonds of the city issued for or in connection with any such electric light plant or distributing system.
(2) The officer shall thereupon ascertain and prescribe as near as can conveniently be done an electric current rate or rates for the ensuing year which will create a fund sufficient to meet all requirements in subsection (1) of this section.
(3) The officer may also include a further amount sufficient to create such fund, as in the judgment of the officer may be desirable or necessary to meet requirements of future contemplated additions, improvements or extensions to the plant or system.
As this city wants to claim that all powers not specified in our charter are general powers of the council.
This means it must be done in public by council.
They claimed that power.
They threw it in our faces during the charter review.
I have it on video.
All power not specified in the charter is a general power of council.
They wanted it so it is theirs.
Now lets see what they are going to do with it?
It appears council has until January 1st to set the rates in accordance with estimates of annual expenses.
I do not believe these people realize the work this is going to require to get to the point that they can write the estimate to set the rates.
Not to mention they are going to have to seperate utility from other municipal uses and account for those expendatures, from some other source now.
Yet they want to cancel upcomming council meetings?
ORS 162.415 Official misconduct in the first degree. (1) A public servant commits the crime of official misconduct in the first degree if with intent to obtain a benefit or to harm another:
(a) The public servant knowingly fails to perform a duty imposed upon the public servant by law or one clearly inherent in the nature of office; or
(b) The public servant knowingly performs an act constituting an unauthorized exercise in official duties.
(2) Official misconduct in the first degree is a Class A misdemeanor. [1971 c.743 §215]
Now I am not an attorney but I can read.
So take all of your own city utility bills and come to a total.
Do not include the meter reading fee as that is another fee of its own.
Times that total by .05.
That is what you are being illegally charged this month.
Mine came to $8.349 and I do not have internet and only channel 23.
Take your totals for a year and what is that total?
Now think about every customer of the city utilities.
Now factor in expendatures above and beyond this 5%.
O.E.O. vehicles, trips to D.C. and all the rest and what do you have?
The highest rates around along with the maximum property taxes.
That is what you have.
Keep in mind that 5% of gross is before they pay the bills.
So just how much has that 5% increased?
Now what do you have?
Well we have once again the customer appriciation program to look forward to.
Yes they want to treat us as good little children and reward us with candy, to pay our bills on time.
Just like what is coming to council in the next meeting being the rules for our electrical company.
I presented documentation which conflicted with the law.
Yet is this referred to in the council packet?
Did I get a reply?
All I want to know is what statutory authority did this city base this legislation on as well as the changes being discussed.
Looks like that too will be on main street next week.
Looks like that too will be on main street next week.
Cody
Wednesday, November 17, 2010
The Nail In The Coffin?
Gary posted a comment on the last blog.
That comment was an article from the Oregonian.
It dealt with what is going on in the Bell, California, corruption case.
This reporter brought to light the lack of oversight our State has, which could give the very opportunity for what happened in Bell, to happen anywhere in our State.
One statement this reporter made hit me in the head like a ton of bricks.
That statement was;
"Yet an absence of internal accounting controls and practices should be immediately apparent to auditors and send up a red flag".
Our very auditor has raised that red flag for years now.
That red flag has been a need for a departmental wide work order, purchase order and inventory control system.
To make it clear this blog subject is not saying or pointing a finger at anyone of pocketing city funds as happened in Bell.
But this blog subject will expose a problem we have.
Gary the timing of your comment could be no more perfect.
You see Gary I sent out a question to council around one month ago.
Knowing that the city could not raise the rates due to the initiative petition that the voters approved I informed council of the law.
That was that a municipal utility must do and have completed a rate study and have the rates set by January 1st of each year.
I then reminded them that since an officer of the utility has not been stated in the charter as required that council is that officer.
I then asked if this rate study would be coming before council will all information to determine and set the rates be in the council packets.
I got a reply from the city saying "thank you Cody for bringing this to our attention".
Now some of you might be saying what does the rate study have to do with the rest?
A little history.
I myself working in the utility field knew the importance of a work order, purchase order and inventory control system.
I have been requesting the city to enact these business tools for years.
I even ran on that platform when I ran for a council position 4 years ago.
This very summer a heated meeting between our city administrator, the head of our electrical department, a city council member and myself took place.
In this meeting I pointed out to all attending that there is no way that this city could tell me exactly what it cost to run our utilities because they do not use what our auditor has been asking for years for.
Therefore there is no way they could set the rates.
I was informed by our city light director that he kept work orders.
Now I do not know what this system is and he offered to show me but a work order system is two fold.
The first is known as a project and the second the worker.
In the project this describes the project and separate line items account for materials used, equipment used and the time spent on the project by each worker on that project and a description of the work preformed.
The worker portion is a daily log the worker maintains. It accounts for project work and refers to the assigned project number if a worker is not on a project and for example is doing warehouse work that worker describes that work and enters the time spent.
The work order system works hand in hand with the purchase order and inventory control system.
Now in the utility field on completion of every project the work order was turned in to the department head.
At the end of every week the daily logs for the week was turned into the department head.
The department head would review the orders ensure that the times matched the order and the workers log.
The department head would evaluate the time the project took.
If the manager thought that to much time was spent he would find out why and note the reason.
The problem could be a worker is not properly trained and training is needed or the worker was just taking to much time.
Or the problem may be with the project and a situation arises which could be a problem in the future and this problem would be documented and future problems known in advance.
The department head would then attach the purchase orders and document the inventory used on the project.
Then it would go to the bookkeeper.
For internal projects or meetings which did not have a work order and was found in the employee work log the department head would generate a work order and go through the same process as above.
The purchase order system is self explanatory.
They are two fold themselves.
Project or inventory.
They are an accounting of parts and supplies which need to be purchased for an individual project or inventory stock.
Every purchase has a project or inventory number.
The inventory control system is also self explanatory.
X project required x out of inventory.
Or in the warehouse is a inventory log. So x worker documents that x worker took out x to restock vehicle x.
Now all equipment and company owned tools has a number assigned to it.
In the heated meeting mentioned above I brought forth another issue.
Taking the bucket truck for example it goes out on a project.
That project is for work required to repair an electrical outage.
It is noted on the work order.
No big deal as that depreciation is due to the use it was purchased for from the electrical fund.
But hold on what if that bucket truck is needed to go out on a job for the cable TV or the internet. Or maybe the port wants to borrow it again.
Then it becomes a big deal.
That vehicle was bought for the municiple electrical department.
It was bought from the earnings of the municiple electrical department.
It was not purchased form the earnings of the cable TV, the internet or the port.
None of these other enterprises or the port pays for the maintenance or needs of that vehicle.
All of this comes from the municiple electric departments funds.
That purchase was factored into our rates for our electricity.
Every hour of depreciation is factored into our electrical rates.
So where are the intergovernmental agreements that set the rate of return for any other city enterprise business or other governmental agency which pays for the use of this vehicle to cover the depreciation that occurs the moment it is started and used for purposes other than the high voltage electrical it was purchased for?
So why does what we have to pay for our electric have to support these other non electrical uses of that vehicle which do not pay any depriciation or usage costs?
Then we must also factor in that I have made the city aware that under the law a municipal utility cannot charge a distribution fee.
For those not of the utility world a distribution fee is a fee charged to a utility for the privilege to connect to its distribution or transmission system.
Better know as a right of way charge.
So why did I ask for a rate study?
I did so as over the past 6 months, I have made this city aware that, any other use of municipal electrical utility funds for other uses is against the law.
I have also made this city aware that, the 5% gross revenue distribution fees, from all of our utilities, for the use of our right of way, is also a violation of the law.
For those whom do not understand why, the state has a law saying a city may not charge a right of way fee to itself, I will explain.
Simply because you cannot tax yourself.
In a nutshell we the people own these utilities and we own the right of way.
When our city government passed that resolution, what that did was created a tax upon the people.
A tax for something we already own.
That is why the law says a city may not do it.
Now council is also fully aware that they have some real problems.
Factor that in with the fact, I have also made them aware of, being, the only determining factors for setting the rates for municipal electric is the anticipated cost to operate and maintain that specific utility and to keep that specific reserve fund healthy.
So now the very council whom passed this 5% right of way has until January 1st to bring out the books.
Then they have to separate the municipal electrical department from all other utilities.
Determine what was spent this year for that specific utility.
Disclose what was spent from this specific utilities funds for other purposes.
Disclose the cost to purchase the electricity.
Break it down to a kilowatt hour.
Determine vehicle and tool depreciation.
Determine inventory needs for the next year.
Determine if the reserve is healthy or needs a rate hike to keep it healthy.
Then determine that rate.
Now they are damned if they do or damned if they don't.
How do you think this is going to work out for them?
The nail in the coffin?
Thanks again Gary as you gave me a fine lead in to this.
Cody
That comment was an article from the Oregonian.
It dealt with what is going on in the Bell, California, corruption case.
This reporter brought to light the lack of oversight our State has, which could give the very opportunity for what happened in Bell, to happen anywhere in our State.
One statement this reporter made hit me in the head like a ton of bricks.
That statement was;
"Yet an absence of internal accounting controls and practices should be immediately apparent to auditors and send up a red flag".
Our very auditor has raised that red flag for years now.
That red flag has been a need for a departmental wide work order, purchase order and inventory control system.
To make it clear this blog subject is not saying or pointing a finger at anyone of pocketing city funds as happened in Bell.
But this blog subject will expose a problem we have.
Gary the timing of your comment could be no more perfect.
You see Gary I sent out a question to council around one month ago.
Knowing that the city could not raise the rates due to the initiative petition that the voters approved I informed council of the law.
That was that a municipal utility must do and have completed a rate study and have the rates set by January 1st of each year.
I then reminded them that since an officer of the utility has not been stated in the charter as required that council is that officer.
I then asked if this rate study would be coming before council will all information to determine and set the rates be in the council packets.
I got a reply from the city saying "thank you Cody for bringing this to our attention".
Now some of you might be saying what does the rate study have to do with the rest?
A little history.
I myself working in the utility field knew the importance of a work order, purchase order and inventory control system.
I have been requesting the city to enact these business tools for years.
I even ran on that platform when I ran for a council position 4 years ago.
This very summer a heated meeting between our city administrator, the head of our electrical department, a city council member and myself took place.
In this meeting I pointed out to all attending that there is no way that this city could tell me exactly what it cost to run our utilities because they do not use what our auditor has been asking for years for.
Therefore there is no way they could set the rates.
I was informed by our city light director that he kept work orders.
Now I do not know what this system is and he offered to show me but a work order system is two fold.
The first is known as a project and the second the worker.
In the project this describes the project and separate line items account for materials used, equipment used and the time spent on the project by each worker on that project and a description of the work preformed.
The worker portion is a daily log the worker maintains. It accounts for project work and refers to the assigned project number if a worker is not on a project and for example is doing warehouse work that worker describes that work and enters the time spent.
The work order system works hand in hand with the purchase order and inventory control system.
Now in the utility field on completion of every project the work order was turned in to the department head.
At the end of every week the daily logs for the week was turned into the department head.
The department head would review the orders ensure that the times matched the order and the workers log.
The department head would evaluate the time the project took.
If the manager thought that to much time was spent he would find out why and note the reason.
The problem could be a worker is not properly trained and training is needed or the worker was just taking to much time.
Or the problem may be with the project and a situation arises which could be a problem in the future and this problem would be documented and future problems known in advance.
The department head would then attach the purchase orders and document the inventory used on the project.
Then it would go to the bookkeeper.
For internal projects or meetings which did not have a work order and was found in the employee work log the department head would generate a work order and go through the same process as above.
The purchase order system is self explanatory.
They are two fold themselves.
Project or inventory.
They are an accounting of parts and supplies which need to be purchased for an individual project or inventory stock.
Every purchase has a project or inventory number.
The inventory control system is also self explanatory.
X project required x out of inventory.
Or in the warehouse is a inventory log. So x worker documents that x worker took out x to restock vehicle x.
Now all equipment and company owned tools has a number assigned to it.
In the heated meeting mentioned above I brought forth another issue.
Taking the bucket truck for example it goes out on a project.
That project is for work required to repair an electrical outage.
It is noted on the work order.
No big deal as that depreciation is due to the use it was purchased for from the electrical fund.
But hold on what if that bucket truck is needed to go out on a job for the cable TV or the internet. Or maybe the port wants to borrow it again.
Then it becomes a big deal.
That vehicle was bought for the municiple electrical department.
It was bought from the earnings of the municiple electrical department.
It was not purchased form the earnings of the cable TV, the internet or the port.
None of these other enterprises or the port pays for the maintenance or needs of that vehicle.
All of this comes from the municiple electric departments funds.
That purchase was factored into our rates for our electricity.
Every hour of depreciation is factored into our electrical rates.
So where are the intergovernmental agreements that set the rate of return for any other city enterprise business or other governmental agency which pays for the use of this vehicle to cover the depreciation that occurs the moment it is started and used for purposes other than the high voltage electrical it was purchased for?
So why does what we have to pay for our electric have to support these other non electrical uses of that vehicle which do not pay any depriciation or usage costs?
Then we must also factor in that I have made the city aware that under the law a municipal utility cannot charge a distribution fee.
For those not of the utility world a distribution fee is a fee charged to a utility for the privilege to connect to its distribution or transmission system.
Better know as a right of way charge.
So why did I ask for a rate study?
I did so as over the past 6 months, I have made this city aware that, any other use of municipal electrical utility funds for other uses is against the law.
I have also made this city aware that, the 5% gross revenue distribution fees, from all of our utilities, for the use of our right of way, is also a violation of the law.
For those whom do not understand why, the state has a law saying a city may not charge a right of way fee to itself, I will explain.
Simply because you cannot tax yourself.
In a nutshell we the people own these utilities and we own the right of way.
When our city government passed that resolution, what that did was created a tax upon the people.
A tax for something we already own.
That is why the law says a city may not do it.
Now council is also fully aware that they have some real problems.
Factor that in with the fact, I have also made them aware of, being, the only determining factors for setting the rates for municipal electric is the anticipated cost to operate and maintain that specific utility and to keep that specific reserve fund healthy.
So now the very council whom passed this 5% right of way has until January 1st to bring out the books.
Then they have to separate the municipal electrical department from all other utilities.
Determine what was spent this year for that specific utility.
Disclose what was spent from this specific utilities funds for other purposes.
Disclose the cost to purchase the electricity.
Break it down to a kilowatt hour.
Determine vehicle and tool depreciation.
Determine inventory needs for the next year.
Determine if the reserve is healthy or needs a rate hike to keep it healthy.
Then determine that rate.
Now they are damned if they do or damned if they don't.
How do you think this is going to work out for them?
The nail in the coffin?
Thanks again Gary as you gave me a fine lead in to this.
Cody
Wednesday, November 10, 2010
Is This To Much Government?
After struggling through the static on Monday nights council broadcast I became concerned about a workshop issue being discussed and realized once again we may have to much government in our fair city.
Government which may just play a role in the failure of our city to remain stagnant in the growth of our commercial downtown zone as it is now.
After hearing testimony of problems business is facing today to make improvements on their own property I decided to read the entire Downtown Development plan and strategy.
Although it is all in all a good piece of legislation one section of it being "Develop architectural standards for all new construction and remodeling relating to the history of Cascade Locks"
Now I could fully understand this if this dealt with just city owned properties and projects but it does not.
It pertains to private owned businesses on private owned lands which I feel government has no right telling any land owner what style building they may and may not build or remodel. As long as that design meets the standards of our building codes.
I was always taught that government was to promote job creation not to be an obstacle to it.
When I see things like this in our government policy all it does is reassure me that government has no clue about business.
Let me explain.
When our government recognizes the importance of entrepreneurship to economic growth and their national/regional competitiveness or just a needed local service, and loosen regulations, along with implementing programs to support entrepreneurs then maybe this government will learn they can create jobs.
But when government is an obstacle, delayer, and an impediment to economic progress government needs to realize this and think about what they have done here.
When our government should be taking all possible steps to help get businesses to the launching pad, and reduce governmental obstacles to economic growth, especially the start-up costs that are levied on businesses and the cost of doing business in our city at all levels and our government does the opposite I have a problem with that.
Yet what we have here is a government policy that is contradictory to the imperatives of business ownership.
Every dollar they don’t have to turn over to government is a dollar that can be invested for future growth yet it seems that inflating the utility rates due to unjust expenditures raising the costs of doing business in our town not to mention the highest legal tax rates our business owners now pay is not enough and our government wants to control the identity and personality of private businesses and charge them $800.00 for it.
So it seems that our government does not understand that personality strengths and weakness when considered from the point of business are manifold. These strengths and weaknesses are the one to take a business towards success or failure.
Just like people, all businesses have a personality. Whether it is shallow and instrumental or deep, emotionally charged and outgoing
This personality is crucial. Why?
To put it boldly: personality is a key issue in our society. Look at politics in comparison: the popularity of politicians and government leaders is personality based.
Yet any governmental regulation such as this, that restricts what changes a business owner may or may not do to the building of a business to improve it is wrong.
If a business owner can apply for the permits and pass the inspection required to insure the public safety standards are met then what right does this city have to further insure that the personality of any business meets the one-dimensional dream that the city has?
Just the thought that all businesses should look like what the city wants is ludicrous.
Business is not a one-dimensional market and each business has its own unique personality.
Business is a two and three-dimensional market and that dimension is set by its own unique personality.
That personality is who and what they are.
Lets use Paul Allen's Rock-'N'-Roll Museum in downtown Seattle or the Space Needle there?
The City of Seattle would have made a great financial mistake to not allow these to be built in Seattle.
Having an identity means being what they are, following their own, determined, but individual path. Not the path of government.
Consumers of businesses relate with the identity of a business and that is the personality.
That personality is the business as that is their brand.
So what right does our government have imposing their dreams and controls on the free market place?
They have no right and they have no business legislating such rubbish which only harms our city.
What I believe this government needs to do is learn to manage their own businesses legally and morally and leave the market place to those willing to invest here and create jobs.
So what do you thank about this?
Cody
Government which may just play a role in the failure of our city to remain stagnant in the growth of our commercial downtown zone as it is now.
After hearing testimony of problems business is facing today to make improvements on their own property I decided to read the entire Downtown Development plan and strategy.
Although it is all in all a good piece of legislation one section of it being "Develop architectural standards for all new construction and remodeling relating to the history of Cascade Locks"
Now I could fully understand this if this dealt with just city owned properties and projects but it does not.
It pertains to private owned businesses on private owned lands which I feel government has no right telling any land owner what style building they may and may not build or remodel. As long as that design meets the standards of our building codes.
I was always taught that government was to promote job creation not to be an obstacle to it.
When I see things like this in our government policy all it does is reassure me that government has no clue about business.
Let me explain.
When our government recognizes the importance of entrepreneurship to economic growth and their national/regional competitiveness or just a needed local service, and loosen regulations, along with implementing programs to support entrepreneurs then maybe this government will learn they can create jobs.
But when government is an obstacle, delayer, and an impediment to economic progress government needs to realize this and think about what they have done here.
When our government should be taking all possible steps to help get businesses to the launching pad, and reduce governmental obstacles to economic growth, especially the start-up costs that are levied on businesses and the cost of doing business in our city at all levels and our government does the opposite I have a problem with that.
Yet what we have here is a government policy that is contradictory to the imperatives of business ownership.
Every dollar they don’t have to turn over to government is a dollar that can be invested for future growth yet it seems that inflating the utility rates due to unjust expenditures raising the costs of doing business in our town not to mention the highest legal tax rates our business owners now pay is not enough and our government wants to control the identity and personality of private businesses and charge them $800.00 for it.
So it seems that our government does not understand that personality strengths and weakness when considered from the point of business are manifold. These strengths and weaknesses are the one to take a business towards success or failure.
Just like people, all businesses have a personality. Whether it is shallow and instrumental or deep, emotionally charged and outgoing
This personality is crucial. Why?
To put it boldly: personality is a key issue in our society. Look at politics in comparison: the popularity of politicians and government leaders is personality based.
Yet any governmental regulation such as this, that restricts what changes a business owner may or may not do to the building of a business to improve it is wrong.
If a business owner can apply for the permits and pass the inspection required to insure the public safety standards are met then what right does this city have to further insure that the personality of any business meets the one-dimensional dream that the city has?
Just the thought that all businesses should look like what the city wants is ludicrous.
Business is not a one-dimensional market and each business has its own unique personality.
Business is a two and three-dimensional market and that dimension is set by its own unique personality.
That personality is who and what they are.
Lets use Paul Allen's Rock-'N'-Roll Museum in downtown Seattle or the Space Needle there?
The City of Seattle would have made a great financial mistake to not allow these to be built in Seattle.
Having an identity means being what they are, following their own, determined, but individual path. Not the path of government.
Consumers of businesses relate with the identity of a business and that is the personality.
That personality is the business as that is their brand.
So what right does our government have imposing their dreams and controls on the free market place?
They have no right and they have no business legislating such rubbish which only harms our city.
What I believe this government needs to do is learn to manage their own businesses legally and morally and leave the market place to those willing to invest here and create jobs.
So what do you thank about this?
Cody
Sunday, November 7, 2010
A NEW HOPE.
My conclussion of what happened in our recent election, is what I beleive those whom were unseated forgot to remember, being;
That we are still a republic form of government.
In which the people or some portion thereof retain supreme control over the government, and in which the government is not a monarch or a dictatorship.
Now the last blog came about with my anger over our sitting council knowingly violating the laws.
In killing that blog, it is my hope that this new blog, gives the new council a chance without the negativity of the previous council.
To the sitting Council for the City of Cascade Locks, Oregon.
You have been elected by the people to manage the affairs of our city.
It is up to each of you to put aside your personal beleifs and govern on the statutory authority granted to you by law.
That all legislation you pass must be in the best interest of the city.
That all legislation you pass must be in compliance with the law.
Many parts of our legislation on the books at this time are in violation of the law.
When you take your oath of office it will be your duty to not only legislate on what comes before you but to address and correct mistakes made by previous council's.
I myself demand accountability to all those elected or otherwise in our city government and services.
To the visitors to this blog.
Let us use this blog to put aside the past and work towards a positive future.
We can't change the past but we can shape our future.
Who better than the people to pave the path for that future.
This blog is a media and an outlet we can use to give input, for our elected officials to hear from the public at large.
So to begin with I ask visitors to answer these 4 questions.
1. Why do you beleive there was such a change in our city government at this last election?
2. What do you expect of your city governemt and officials?
3. What legislation do we have that you doubt is legal or just morally wrong?
4. What legislative actions would you like this council to adress?
That we are still a republic form of government.
In which the people or some portion thereof retain supreme control over the government, and in which the government is not a monarch or a dictatorship.
Now the last blog came about with my anger over our sitting council knowingly violating the laws.
In killing that blog, it is my hope that this new blog, gives the new council a chance without the negativity of the previous council.
To the sitting Council for the City of Cascade Locks, Oregon.
You have been elected by the people to manage the affairs of our city.
It is up to each of you to put aside your personal beleifs and govern on the statutory authority granted to you by law.
That all legislation you pass must be in the best interest of the city.
That all legislation you pass must be in compliance with the law.
Many parts of our legislation on the books at this time are in violation of the law.
When you take your oath of office it will be your duty to not only legislate on what comes before you but to address and correct mistakes made by previous council's.
I myself demand accountability to all those elected or otherwise in our city government and services.
To the visitors to this blog.
Let us use this blog to put aside the past and work towards a positive future.
We can't change the past but we can shape our future.
Who better than the people to pave the path for that future.
This blog is a media and an outlet we can use to give input, for our elected officials to hear from the public at large.
So to begin with I ask visitors to answer these 4 questions.
1. Why do you beleive there was such a change in our city government at this last election?
2. What do you expect of your city governemt and officials?
3. What legislation do we have that you doubt is legal or just morally wrong?
4. What legislative actions would you like this council to adress?
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