A new Wedowee Utilities Board was sworn in on Wednesday, and a special-called meeting was held to address issues brought up in Tuesday's Town Council meeting.
Preliminary audit notes showed possible discrepancies. On Tuesday, the Council replaced Chairman Tim Coe, who is also the town's mayor, with Barry Waldrep, and replaced member Veronica Austin with Richie Traylor.
Board members' terms are set at six years, but Coe served for nine.
A Wedowee Police vehicle guarded the Wedowee Utilities Board building throughout the evening on Tuesday and into Wednesday morning, until the building's locks could be changed.
Notes entered into the record by Councilman Jerry Huddleston detailed multiple questions that Wedowee Utilities Board contract employee Brenda Boone said she could answer on Wednesday.
Boone has been with Wedowee Utilities for 35 years. She retired from her full-time position but remained a contracted employee to do bookkeeping.
Waldrep said his concern is that, when he attempted to access documents such as bank statements and payroll records, office employees told him only Boone had access.
"Well, probably the reason behind that is we're a very small utility," Boone replied.
Boone said she had questions after seeing notes on a preliminary audit. She said she disagreed with many of the findings but acknowledged there are issues, such as late tax payments. However, she said the utilities do not currently owe the IRS. Boone also acknowledged an operating deficit.
"You want to know why we're poor? Because we are so overextended and we're spending more money than we're making," Boone said. "We're not doing anything wrong."
Among the issues Boone said she has been sounding the alarm about are a 1989 bond issue and challenges with the water treatment plant.
"But what they're wanting to know is how much do we owe from a bond issue from 1989. Do you know? Because I don't know," Boone said. "And I've had three auditing firms try to tell me how much money we owe on a $16 million, which is probably $64 million, 35 years later, that we owe on a bond issue. No, I can't tell them that."
Since the water treatment plant was implemented, Boone said it has been impossible to find enough plant operators to run the system. She said Wedowee Utilities contracts with Clearwater Solutions for $167,000 per quarter to manage operations. The board had to implement water rate increases and cut back on overtime to save money.
"When you have a five, six man crew out here that works in ditches in the middle of the night, you've got to pay them overtime," Boone said. "But we've tried to make sure and I've talked to them, you know, 'Don't flush. If you're called out to flush a hydrant, wait until the next morning, wait until you're back on,' and we have implemented things to cut back – right or wrong guys – to try to make this work."
Boone said the audit numbers are correct and that Wedowee Utilities is losing money. However, she said issues such as those found with the Retirement Systems of Alabama (RSA) were already addressed and cleared with RSA.
Still, Waldrep said if the utility is spending more than it is taking in, something needs to change. As for excessive overtime, he said it would make more sense to hire more employees at a standard rate.
Boone said she had already suggested hiring six new employees, but she lacks the authority to make decisions. When asked whether she has the authority to give pay raises, another issue came to light.
At the board's last meeting, an executive session was called in which board members voted on pay raises. Under Alabama's Open Meetings Act, it is illegal to vote on those matters in an executive session.
Boone said the vote was illegal, but emphasized she has no voting power or authority and only offers her opinion on matters.
Waldrep requested a list of employees and their pay.
"The board is not comfortable with you handling the checking account any longer, and Tim was voted off, so the bank accounts have been changed," Waldrep said. "And as far as tomorrow's payroll, everyone will be paid. What is needed for everyone to be paid is knowing what to pay everybody. So, we need that information."
A discussion of employee bonuses revealed that those payments were not processed through the regular payroll system. The checks were issued in the same manner as the utility pay bills. Boone said she spoke with a "state person" who told her it was okay because treating the checks as wages would trigger retirement deductions. While the bonuses raised IRS compliance concerns because IRS and Alabama tax rules require employer withholding, Boone said the taxes were paid.
"We, as employees, had to pay our part of the payroll taxes on those bonus checks," she said. "And I was told that that was okay."
The board voted to suspend Boone's services with pay due to the audit findings.
"I just want to clarify why I'm being suspended," Boone said.
"Because of the audit," Waldrep replied.
"But does the audit say that I have written checks that I should not have?" Boone asked.
"People that have been writing checks is you and Tim," Waldrep answered.
Boone reiterated that the board instructs her on what invoices to pay and who to pay.
For added transparency, Waldrep announced Wedowee Utilities has three bank accounts with balances of $19,245.13, $342.42 and $369,683.72. There is a $500,000 CD with First Bank of Alabama that Boone said is in the name of Wedowee Utilities, although Waldrep said the bank has it assigned to the Town of Wedowee.
Waldrep said the auditor has not completed the audit because they have not received all the necessary documents. Boone requested that the board request a list of items needed for the auditor to complete the report.
Boone accused the board of violating the Alabama Open Meetings Act by holding a special-called meeting without giving a 24-hour notice. However, there are exceptions, including immediate action to prevent injury or property damage. Waldrep noted that a patrol vehicle was stationed outside the Wedowee Utilities building to prevent any property from being damaged or taken after board members were replaced on Tuesday.
No one in the town has been reported to the Ethics Commission or charged with a crime.
Coe has not returned a call from 1819 News.
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