Journal-Times (Grayson, KY)

October 3, 2012

AG reviewing Olive Hill utility complaints

By Joe Lewis - Staff Writer
Journal-Times

Oct. 3, 2012 — A representative for Kentucky Attorney General Jack Conway has confirmed that the agency currently is reviewing numerous customer complaints concerning electric rates in Olive Hill.

In a telephone interview Monday, Deputy Communications Director Shelley C. Johnson also informed the Journal-Times that Conway’s office still has not received any official communication from Olive Hill city government requesting a formal investigation.

Spearheaded by Council member Kenny Fankell, City Council voted unanimously at its Sept. 18 regular meeting to file a formal request with the AG for an investigation of the city-owned utility operation.

Johnson also stated that official correspondence regarding the ongoing complaint review was sent from Conway’s office to Mayor Sparks and Utility Office Manager Derrick Jones on Sept. 28.

The Journal-Times obtained a copy of that letter, which reveals that the city was initially contacted by the Attorney General’s office on July 9 about potential utility rate issues and responded by sending copies of the current rate ordinances.

The letter, signed by Jennifer Black Hans, executive director of the Office of Rate Intervention, also states:

“A preliminary review of the city ordinances you provided and of the representative billing statements provided by the complaining parties reveal possible inconsistencies between the electric and natural gas rates established by the ordinances referenced above and the rates actually being charged.”

The letter also requests that the city provide specific information regarding the nature of the rate increases as well as the persons responsible for implementing them.

Johnson was quick to point out that, while the AG’s office is currently reviewing the situation, a formal investigation has yet to be opened.

Questions surrounding the city-owned utility company surfaced in a Sept. 12 Journal-Times article that outlined numerous electric rate increases that were implemented without public notice – a requirement for municipal electric agencies under KRS 96.534.

Specifically, Olive Hill raised the electric rate a total of 20 times over a six-year period without informing the public.

Section 8 of KRS 367.150 gives the Attorney General’s office the authority to act “on behalf of consumer interests involving a quasi-judicial or rate-making proceeding of any state or local governmental branch, commission, department, agency, or rate-making body whenever deemed necessary and advisable in the consumers' interest”.

Still, it is yet unclear what action, if any, the Attorney General’s office might take against Olive Hill Utilities for multiple violations of the public notice statute or any other potential infractions.

The AG’s office encourages consumers with questions or concerns about their utility bills to contact the Office of Rate Intervention at (502) 696-5300.

Joe Lewis can be reached at jlewis@journal-times.com or by telephone at 286-4201.