The relationship between the city of Albany and the Albany Water, Gas & Light Commission has been an odd one in many ways. The utility company acts as an autonomous agency in many ways, but also falls under the city umbrella when it comes to liabilities.
It’s a delicate balance, this relationship between the city of Albany and WG&L. At times, the relationship has seemed to function smoothly while at other times it’s been rocky.
We’re in one of those rocky periods now.
The driving issue at this point is the city’s liability for a manufactured gas plant on Society Avenue. Georgia’s Environmental Protection Division has ordered that possible contamination at the site of the plant, which operated in the early 20th century, be checked and corrected. The exploratory digging is supposed to start by Sept. 1.
That cleanup could carry a price tag of $5 million.
WG&L asked the joint city-utility Longterm Financial Planning Committee for $750,000 to start the exploration. That committee oversees the spending of about $30 million of the rebate from the Municipal Electric Authority of Georgia. The committee consists of three city commissioners and two WG&L commissioners, and the vote to recommend that the City Commission deny the request fell along that 3-2 line. In addition to the denial, the committee voted to ask WG&L to provide a detailed account of how it spent $1 million it was given from the fund in 2010 for roof and elevator repairs on its buildings.
What has gotten under city commissioners’ skin on the issue of the 1912 plant is the fact that, in the end, the city of Albany is liable for correcting anything that is found at the plant, which was taken out of service in 1948. Exacerbating the situation is WG&L’s decision to settle with an insurance company for a fraction of the cleanup cost — $150,000. That decision, city officials say, was made without any input from the City Commission.
This isn’t the first friction between the commission and utility by any means. Earlier this year, for instance, city commissioners were miffed to learn that WG&L was looking to buy a building on Broad Avenue for just over $4 million for new headquarters.
It does appear the City Commission is becoming more inclined to assert authority over the utility. Commissioner Bob Langstaff made a motion for called meeting last week to consider a change to the City Charter that would make the general manager of WG&L report to the Albany city manager. That motion failed 4-2, with city commissioners instead tasking Mayor Dorothy Hubbard, who as mayor chairs the WG&L board, with collecting information on the gas plant cleanup.
The reason for giving WG&L a large measure of independence from the City Commission is that it separates the business of providing utilities from the business of elected government. With no direct control over the utility, a city commission cannot increase revenues by imposing a rate increase in lieu of a tax hike. City commissioners appoint the members of WG&L’s governing board, but they can’t control what the utility’s board does.
On the other hand, those same city commissioners — and the taxpayers they represent — are bound to ultimately deal with the repercussions of any bad decisions their appointees on the utility board make. And city commissioners are convinced this expensive gas plant cleanup is going to fall into that category.
How this issue plays out very likely will determine the structure of the future relationship between the city and the utility.