In an emergency meeting Tuesday, the V.I. Water and Power Authority Governing Board approved an extra $1.5 million to the R.W. Beck company for technical consulting on Alpine Energy Group’s waste-to-energy facilities in both districts.
A year ago, the WAPA board authorized $2 million for negotiations and contract preparation, divided among the firms: Boston Pacific, R.W. Beck and the law form of Skadden and Arps to develop and manage a proposal process, evaluate the bids and negotiate the terms and conditions of power-purchase agreements and interconnection agreements.
The additional $1.5 million brings the total to $3.5 million. When all is said and done, the grand total for consulting services will be in the $6 million range, said WAPA Executive Director Hugo Hodge Jr. At least some of the cost is due to the expense of repeatedly flying groups of highly paid technical consultants to the territory to testify and answer questions in both government and public forums, he said.
"We already know Sen. (Craig) Barshinger is calling hearings in January," Hodge said. "And we know we will be holding a forum for questions and answers for the public, too, to hopefully put an end to some of the questions in the community. We need to fund these extra expenses."
The emergency meeting was called specifically to fund Beck because under federal procurement rules set up by Congress under the Sarbanes-Oxley Act, Beck cannot proceed with work unless funding is already approved, and Hodge needed board approval before committing the funds, he said. As a result, Beck has stopped work and the sooner funding is in place, the sooner work resumes and the less it will cost, he said.
Commissioner of Planning and Natural Resources Robert Mathes, a member of the WAPA board, said the increasing expenses concerned him and asked WAPA to have an outside auditor track and audit all expenses associated with the alternative energy provider.
"I’m not comfortable at all with the amount being spent today," Mathes said, participating by telephone. "I know we can all explain it away. But it is a significant amount of cash."
Mathes said an outside audit would help assuage him and provide a transparent, undisputed document trail down the road, helping the board and WAPA to cover itself.
Hodge said he did not object to a second audit, in addition to WAPA’s in-house auditing, but cautioned the audit itself would cost money. He also defended the cost of the consulting.
"I just want to put it in perspective, the five or six million dollars as compared to the potential savings of $200 million. It is a certain amount of money, but it pales in comparison to the benefit of the project."
The motion to increase authorized expenses from $2 million to $3.5 million passed unanimously. The meeting was held via teleconference in the WAPA offices on St. Thomas and St. Croix. Board members present were Mathes, Licensing and Consumer Affairs Commissioner Wayne Biggs, Brenda Benjamin, Cheryl Boynes-Jackson, Donald Francois, Personnel Director Kenneth Hermon, Noel Loftus and Chairwoman Juanita Young. Member Gerald Groner was out of the territory and absent.
