CNNGA to discuss changes following “Uncovered”

NEWBERRY — Following an article from The Post and Courier this month called “Uncovered” the Clinton Newberry Natural Gas Authority (CNNGA) will examine long standing practices, according to Vice Chairman Foster Senn, during their meeting tonight, Feb. 23.

The “Uncovered” article detailed various spending from CNNGA over the last few years, the following are some highlights of what was discussed in the article about CNNGA:

• During the past five years, the agency spent more than $337,000 on its board retreats, dinners, parties and Christmas gifts, records show.

• That includes a $57,000 stay at The Sanctuary on Kiawah Island in 2016 and a $47,000 meeting in 2017 at the Omni Grove Park Inn. It includes a trip, in 2018, at the Montage Palmetto Bluff, upriver from Hilton Head Island. Payments to the hotel were $44,000. Lastly, in 2019, Clinton Newberry officials went to the Old Edwards Inn. Their hotel bill was $31,000, including $3,234 spent at Acorn’s, boutique at the inn. It’s unclear what was purchased. The agency wasn’t able to provide receipts or an explanation about what these public officials received. There were no public notices for any of these meetings.

• $1,742 spent on 13 blue “fringe blankets” and the $826 for 13 “ole big boy” oyster knives by Carolina Shuckers.

• The gas authority has its own showrooms in Clinton and Newberry that stock heaters, gas logs, grills and other appliances for sale. If you’re a board member or employee, you can buy these appliances at cost, a savings of at least 15 percent over prices regular customers pay. Lemont Glasgow, a board member who also sits on Newberry City Council, took advantage of this discount seven times over the past four years, records show. Glasgow got more than $4,000 in appliances at cost: water heaters, gas logs — even an $800 meat smoker fueled by wood pellets. Foster Senn, mayor of Newberry and the board’s vice chairman, saved about $300 on an electric washer, gas logs and a grill. Authority workers delivered and installed the appliances for free.

• The state’s five natural gas authorities, by law, are supposed to turn over profits to municipalities they serve. Clinton Newberry distributed $9.4 million over the past 10 years, equally split between the cities of Clinton and Newberry.

Senn, who is the mayor of Newberry, provided the joint statement that he and Chairman Bob McLean (Clinton’s mayor) provided The Post and Courier and addressed some of what was discussed in the article during an interview.

The statement describes CNNGA as, “being formed in 1952 by two cities to bring natural gas to a rural area that did not have access to natural gas. Since then, CNNGA has grown its service region and now serves more than 13,000 customers. We are a vital part of economic development and growth for our communities and have been able to serve the needs of our customers, which range from some of the world’s larges companies to our local small businesses and our thousands of residential customers.

“Unlike board members of corporate utility companies, our board members do not receive a salary nor are they beholden to shareholders. Instead, our board members represent the ratepayers in the communities in which we live and work and we are able to focus on providing fair and competitive rates for our communities. CNNGA ratepayers are currently experiencing some of the lowest gas rates in decades.”

The CNNGA Board is a seven member board, members are appointed by the City of Newberry and the City of Clinton, according to Senn. The board consists of the cities mayor, and two council members each, as approved by their councils. There is also a seventh member who is not on either council.

While on the record, Senn discussed some of what was brought up in the “Uncovered” article.

In regards to the trips, and the cost of the trips, the joint statement says, “in order to bring in knowledgeable speakers and compensate the board for taking time away from their jobs, these training sessions are held at convention hotels. The board training sessions are budgeted for and approved annually by the entire board during open, public budget meetings. It’s important to note that the CNNGA operating budget that these funds come from is separate from its rate budget. During the training sessions, no official business is brought before the board and therefore no FOIA notifications are sent nor are any minutes taken.”

The statement also says that, “CNNGA is a transmission and distribution company and therefore its board members must be educated on highly technical information. During these educational conferences, CNNGA will bring in industry experts to educate our board members and staff on important industry regulations, market trends, safety measures, strategy and long range planning.”

Senn echoed this point, he said transmission lines are a “big deal” and they want to attract really good speakers, industry experts.

“It is important for utility boards, whether it is electrical, water, natural gas, be educated and have some industry knowledge. As we’ve seen in recent years around the country, a number of examples, things have not gone well and has greatly impacted, negatively, the population. I think all boards should be educated so they can make knowledgeable choices,” Senn said.

Senn added that they needed to go to more upscale locations in order to attract those experts.

As an example, he said through these retreats the board learned early they did not need to build a new transmission line, and they needed to find a different solution.

“I’ve attended numerous training sessions over the years, and that’s made me a better elected official. For CNNGA, our board training led us to understand early that building a new transmission line from Greenville (where the Williams Transco pipeline is) to Clinton and Newberry in response to new government regulations would be very expensive. The estimated price tag was $46-$85 million. Instead, CNNGA has a plan in place that does not require a new transmission line to be built, which is a huge benefit to customers and avoids unneeded environmental impacts,” Senn said.

Senn added that the retreats have been happening since before he was on the board, which was 2010.

While he said they did not take minutes, everyone who attended the retreats had to go to the educational components. He said those who attended included the board, CNNGA staff, speakers and spouses. He did not have an exact number of how many individuals have attended the retreats.

In regards to not taking minutes at the retreats or giving notice, it was previously stated that no official business is brought before the board. However, in the “Uncovered” article states, “two attorneys for the South Carolina Press Association, Jay Bender and Taylor Smith, said these meetings violate the state’s Freedom of Information Act. The law requires public bodies to give notice and keep minutes whenever they meet, no matter the location or whether the officials take action.”

Senn said if an error was made in not doing minutes, that will be fixed in the future.

In regards to the employee discounts and gifts, the statement says, “from time to time, CNNGA will provide small tokens of appreciation to board members, company employees and local charities. These items are budgeted for and approved by the entire board during open, public budget meetings.”

In response to the purchases at Acorn’s, Senn believes that was a purchase for gift bags.

The Post and Courier article also made mention of the board taking advantage of the rebate offered to them. The joint statement states, “CNNGA provides board members with the same employee benefit it provides all of its 50 plus associates, which is purchasing appliances at cost. These appliances are not gifts as board members pay the cost of the appliance, but are waived the 15% markup that is found in the CNNGA retail stores. Appliances are marked up 15% to CNNGA customers, unlike a retail store typically charging higher margins. All associates of CNNGA are able to purchase appliances and the accompanying installation materials at cost. Installation fees are waived as CNNGA sees value in having its associates use the products it sells in order to be able to make recommendation to inquiring customers.”

According to Bender (an attorney for the S.C. Press Association), under the state ethics law rebates to board members would be gifts, the receipt of which must be revealed on statements of economic interests required to be filed by public officials.

In response, Senn said he contacted the South Carolina Ethics Commission, who told him he should be filing those and update his reports — Senn said he was originally unaware of this and will rectify the error.

The “Uncovered” article also made mention of the board going out to eat at local restaurants following meetings. The joint statement says, “historically, since the meetings take place after office hours, the board members and employees will be provided dinner after the meeting takes place. These dinners support local restaurants, local jobs and provide fellowship among board members and CNNGA staff to strengthen relationships.”

The funds that these meals are paid for are separate from its rate budget, the joint statement states.

Other highlights from Senn’s interview:

• While the board does not receive a salary or benefits, Senn said they do receive a $100 per diem per meeting.

• The money the City of Newberry receives from the CNNGA makes up about six percent of the city’s general fund budget.

• The CNNGA works on a budget of $22 million annually.

• There were no retreats last year or this year, due to COVID-19.

• In recent years, CNNGA has run gas lines and started serving residents in the Town of Peak, the Town of Silverstreet, the Mount Pleasant community, new service areas of Pomaria, and areas around Lake Murray and Lake Greenwood. CNNGA has run lines to numerous other locations, including new agriculture operations.

• In response to the pandemic, CNNGA waived facility charges, with a total of $964,122 waived charges from May to September. On average, 3,000 customers a month had bills of $0 for the months of May-September.

• The board selected a new general manager, Jimmy Capps, in 2020. Capps has a great deal of experience and knowledge and is a great asset for our communities, according to Senn.

• Customers will be getting a nine dollar credit in March, CNNGA will be passing a rebate along to the customers, total approximately $117,000.

“CNNGA will continue to provide safe, reliable and affordable natural gas to the citizens of our communities. We have an outstanding staff and new general manager, Jimmy Capps, who is very knowledgeable and has much experience,” Senn said.