The V.I. Water and Power Authority Governing Board convened an emergency meeting Tuesday to approve a cost increase for the utility’s existing contract with consultant firm Ernst & Young from $195,000 to $250,000 per month.
The matter was discussed during a regular board meeting last week, but they opted to table the issue to review a redlined contract. Chief Financial Officer Lorraine Kelly noted during that meeting that the net cost to the authority won’t change, as the funds can be reimbursed through the Federal Emergency Management Agency.
“The work that they will be performing — as was previously approved by the board — is to assist the authority in the preparation of the single audit, to include the required financial statement audit that’s required as part of the single audit,” she said.
Kelly later explained that when the contract was initially approved two months ago, FEMA funding had not been finalized.
“So rather than it being $195,000 paid for by WAPA, it’s now going to be $250,000 paid for with reimbursed funds by FEMA, such that the cost ends up being zero,” she said. “So I just want you to know that in the time frame of the board first approving it, WAPA was going to have to incur those costs out of operational funds, and … what we’ve been able to do is secure the scope such that we can secure FEMA funding for this under administrative costs.”
WAPA General Counsel Dionne Sinclair added that, beyond the price increase, the only other adjustments to the contract were changes to the language intended to bring it into line with federal regulations.
“So the language changes somewhat from the prior agreements that we’ve had with EY, where there’s a master service agreement and then there’s a scope of work or scope of services — [that] language had to conform to what is required in order for federal funding to be implemented,” she said. “And the scope of work had to align with that which the federal partners were willing to cover.”
