State audit proposed for Birmingham Water Works after controversial contracts from old board
The Birmingham Water Works BoardJoseph D. Bryant
The new regional Birmingham Water Works Board could invite state auditors to examine the final contracts made by the previous board following questions over the millions those contracts will cost.
That possibility was raised during a board work session Thursday evening. Blount County appointee, State Rep. David Standridge asked the seven-member board to invite the State Board of Examiners to evaluate the old BWWB’s contracts and recent actions.
Standridge said recent news reports regarding the actions of the now-defunct board have raised questions among the public that should be addressed by an independent agency.
“I really want us to have as clean a slate as we can have,” he said. “There’s a public perception issue that hopefully we can alleviate.”
The old water works board for years was criticized for spending millions on outside lawyers, including longtime politically connected firms, in addition to lobbyists and marketing firms.
A majority of the board spoke in favor of getting auditors involved. An official vote is expected during the next regular board meeting on Monday.
“That way we’ll know from somebody who’s completely independent that they’ve reviewed our records and finances,” Standridge said.
The former water works board was ousted earlier this month under a new state law that changed the utility’s leadership.
In one of their final acts, the old board approved employment contracts for the four current assistant general managers and an executive assistant, in addition to creating a new full-time position for longtime attorney Mark Parnell.
The five-year contract made Parnell the utility’s deputy general manager and general counsel, a post that pays him a base of $660,000 a year plus lucrative benefits. The value of the package exceeds $3 million.
Parnell’s contract and its generous provisions garnered the attention of observers, new members of the water works board and retirees.
Parnell, as an employee of the water works, will collect about as much as he earned as a contractor when factoring in his benefits.
Parnell and his firm, Parnell and Thompson, were paid $728,358 during the last fiscal year. The water works spent $1.7 million in total legal fees last year to several attorneys and firms.
The provisions of the new contract give Parnell immediate participation in the utility’s retirement plan without having paid into the system.
Parnell, who had defended his compensation, by Thursday evening offered some conciliation by agreeing not to participate in the pension system.
“In doing that I didn’t realize what kind of backlash there would be from the employees or the retirees,” Parnell told the board. “I don’t want that to be a distraction from what we’re trying to do here.”
Parnell said he talked to employees and retirees before the meeting.
“I’m trying to do what’s best for the water system, the employees and the retirees, so I’m willing to make that change.”
Those provisions had created resentment among some employees and retirees, some of whom were ready to speak Thursday evening. Their tone was more measured after Parnell acquiesced on joining the pension plan.
“The retirement system must not be touched at Birmingham Water Works, because the people who built it are the same people receiving those checks,” said John Dansby, who retired after 25 years at the utility. “I am an advocate of doing the right thing all the time.”
Dansby was joined by Rhonda Lewis, who retired after 31 years. Both she and Dansby said the issue came down to fairness.
“Nobody can jailbreak the Birmingham water works retirement plan,” Dansby said. “If you want to be in, serve your time.”