South Note: bold by MAMEC
Lighting plant faces changes
Town wants shift in unit's autonomy
By Matt Carroll, Globe Staff | January 5, 2006
The Hingham Municipal Lighting Plant -- whose higher-than-average salaries and operational autonomy have not endeared it to town officials -- is under pressure to substantially change how it operates.
A town committee that has spent more than a year examining the department was expected this week to submit a report recommending that the three-member light board be expanded to five, with the two new members appointed by selectmen. The current members are elected.
Also recommended are quarterly meetings with selectmen, formal and informal meetings with other town committees, and annual meetings with the personnel board to go over staff policies and salary increases, said John Ryan, chairman of the Hingham Light Plant Strategic Planning Committee.
The suggested changes are designed to provide the board with more technical expertise at a time when deregulation is prompting changes in the utility business, members of the committee said.
The suggestions also reflect tension between the Lighting Plant and town officials.
Hingham's Lighting Plant provides electricity to about 8,700 residences and 1,200 businesses.
Five other municipal plants operate in the region -- in Braintree, Hull, Mansfield, Middleborough, and Norwood. Statewide, there are 40 local departments that provide electricity, which otherwise comes from big utilities such as NStar.
Unease between ''munis," as municipal light departments are called, and their towns have often centered on the departments' unusual degree of independence.
Even though they are part of town government, state law allows the departments to operate with a large degree of autonomy -- and they generally do.
Most of the state's municipal light departments are run by independently elected boards, which are free to set salaries and policies. Town officials can suggest how they would like to see a light department run, but department officials are free to ignore the suggestions.
In Hingham, tensions between the department and the town have existed for years, said officials at the plant and in the town.
A big part of the problem, they agree, is the degree of independence for the light department, especially in light of its sizable cash flow. It collected $18 million from resident customers in 2004.
The utility pays the town more than $500,000 in lieu of taxes and services, according to the department. But some officials wonder whether that amount could be increased if the light department were run more efficiently.
''A number of people feel because the light department and the town are in the same building, they should be able to take advantage of a combined infrastructure," said William S. Reardon, chairman of the Advisory Committee, which reviews town financial issues. ''Both sides should be seeing how they can help each other out here."
For instance, perhaps one legal counsel could serve both, or there could be more sharing of expensive software, he said.
The light department spent more on legal bills last year than the town and the schools combined -- $270,676 to $211,447, according to town figures.
The higher-than-average salaries that are paid to light department employees has also helped fuel some tensions between the department and the rest of Hingham's town government.
Five of the top 10 highest-paid town employees are in the light department; their pay ranges from $115,000 to $137,000, according to payroll figures provided by the town. The average salaries, including overtime, for 28 light department employees in 2004 was more than $75,000 -- far more than the typical town employee makes.
The $75,000 figure is also at the upper end of what other area municipal light departments pay their employees. Braintree and Mansfield averaged about that amount, but neighboring Hull paid, on average, far less -- $48,000. And Middleborough and Norwood averages came in well below $75,000.
The Light Plant general manager, John G. Tzimorangas, defended the salaries paid employees, saying most went to linemen, who have been working extended overtime because of dramatic growth in town.
He pointed to work at the Derby Street Shoppes just off Route 3, the new Blue Cross and Blue Shield building on Commerce Road, and the massive Linden Ponds retirement community off Route 53.
Tzimorangas also said that about three-quarters of the overtime was paid for by the developers, and that some of the cost of the legal bills was recoverable.
The department needs its own lawyer because much of the legal work is specific to the industry, he said. The payment in lieu of taxes to the town was more than generous, he said, because if it were a business, its taxes would amount to about $310,000.
Officials in the light department brag that the electric rates paid by its residential customers are substantially lower than the rates in nearby communities, which use for-profit utilities. The cost for an average-sized house that used 500 kilowatt hours a month would be $58.27 in Hingham. By comparison, rates charged by NStar ranged from $65.63 to $72.16. The state average was $53.28.
Municipal light departments in other towns offer even lower rates. Hingham residents paid 11.3 cents per kilowatt hour in 2004, while those in Hull paid 11.2 cents, and those in Norwood were charged 7.8 cents.
Hingham Municipal Lighting Plant officials acknowledged previous problems, but defended the department's operation, and its relationship with the town.
A board commissioner, Walter A. Foskett, said a decade ago that there was a deep communications gulf between the department and the town. The department even had its offices outside Town Hall.
The department gives as much money to the town as it can afford, Foskett said, noting that most revenue goes to buy electricity.
''We're not a cash cow," Foskett said.
Tzimorangas, who began work as light plant manager in 2004 , said he has worked hard to close the communications gap.
''Before I got here, there was a feeling . . . that the light plant was kind of closed off," he said. Selectmen created the Hingham Light Plant Strategic Planning Committee in August 2004, at the urging of the town's Advisory Committee.
Ryan, the committee chairman, said members felt increasing the board to five members would help broaden the board's experience. ''We feel you need a broader array of talent on the board."
Ryan and other officials said any changes are bound to be subjects of disagreement, and could require Town Meeting and legislative approval. ''It would be a huge change and I think there will be tremendous resistance. I don't think anyone in the light department wants it."
Matt Carroll can be reached at email@example.com. Globe correspondent Megan McKee contributed to this report.