6 Investigates questionable spending by Morristown Utility Syste

6 Investigates questionable spending by Morristown Utility Systems

Days after we mailed a public records request to Morristown Utilities System, or MUS, several people reached out to us, asking us to look into excessive spending there. Days after we mailed a public records request to Morristown Utilities System, or MUS, several people reached out to us, asking us to look into excessive spending there.
“The more you tell me, the more I’m shocked,” Mayor Danny Thomas said. “If the Morristown Utility Systems can afford to spend that kind of money then surely we can afford to reduce our rates.” “The more you tell me, the more I’m shocked,” Mayor Danny Thomas said. “If the Morristown Utility Systems can afford to spend that kind of money then surely we can afford to reduce our rates.”

MORRISTOWN (WATE) - “That just blows my mind,” said Mitchell Long, after he looked at a $420 dinner receipt from Morristown Utility Systems. We spoke to him Friday as he walked out of MUS, which serves about 15,000 customers. He had just paid the $118.94 bill for his two bedroom apartment, on the cutoff date, and he said he does the same nearly every month.

We showed him more documents from a months-long 6 News investigation, showing how employees use their utility-issued credit cards when they travel across the country.

“They think you have to have the service. You have no options, so whatever they say, that’s what you’re going to do,” said Long. He said he typically pays almost $200 per month. But after seeing statements and receipts obtained by the 6 News I-Team, Long believes the utility should lower rates.

“I do good to have a $5 dinner.”

Over the course of two months, the 6 News I-Team read through 26 months of credit card statements and receipts from Morristown Utility Systems. We typically sat in the utility’s boardroom, where someone always sat with us; sometimes watching us, sometimes taking notes.

We flagged receipts and took notes. We took our copies and showed MUS customers, the people paying for every credit card charge.

“I’m in the wrong business,” Sherry Eason said. We met her outside of a shop, a few blocks from the utility’s office in the downtown area. She rents a booth inside and says her income is about $12,000 every year. She said she pays $200 per month for utilities, which works out to 20 percent of her income.

We showed her a receipt from Brumley’s Restaurant & Lounge in Greeneville, Tenn., which included a $31 charge for king filet and $21 for seafood risotto. We found four charges for drinks, three for tea and one for wine, which was later reimbursed. Assuming the $174.29 bill was for four people, each person ate and drank for about $44.

“You can eat for $10, $20 at the most,” Eason said. “That’s way too much.”

She said it’s been hard to pay her bill at times and had to get assistance before. “They could help the people that need the money,” said Eason. “They could lower our bills.”

Dorris Bolden works in a wood factory and said she spent $225 on her utility bill last month. “I work hard for what I make,” she said.

Not even her bill could cover the $420.69 dinner at McCormick and Schmick’s in Seattle, Washington.

“I want to cry, but I ain’t going to,” she said as she looked away from the receipt.

Charges included $33.95 for filet mignon, $26.95 for shrimp trilogy, and two orders of filet and stuffed shrimp for $38.95 each. Bolden said, “I do good to have a $5 dinner.”

We found several charges for alcohol on the bill, including $11 for an apple martini and two shots of Grey Goose vodka at $11.25 each. All alcohol charges appear to have been reimbursed by employees.

Just hours earlier, Jody Wigington, the utility’s CEO and general manager, charged $435.92 on the same card for lunch at SkyCity Restaurant, inside Seattle’s iconic space needle. The bill, time-stamped at 11:25 a.m., included more alcohol charges, which appear to have been reimbursed. The 6 News I-Team also found the bill included $27.00 for fish and chips and $58.00 for two orders of crab toast, among other charges.

We found similarly priced restaurant charges in Nashville. We discovered a receipt from Old Hickory, where the table of four charged $288.08, or about $72 per person. Everyone ate filet mignon.

A utility credit card was also used last February for a $122.62 per person meal at The Stock-Yard Restaurant. Each of the four people at dinner ordered an $89 steak and salad costing as much as $22. The grand total was $490.50.

A few weeks later, utility customers paid for dinner for two at Morton’s, another steakhouse in Nashville. The grand total was $163.07. But Wigington appears to have reimbursed MUS $13.00 for a glass of wine, bringing the cost down to about $75 per person.

Wigington told us in an email the price of the meals depend on the city. "These types of meals are very much the exception," he said.

Read more: Morristown Utility Systems records [PDF]

Our review of credit statements in 2013 also revealed $8,779.86 in restaurant charges in Morristown. Each’s customer’s share was about $0.59.  Employees charged $7,346.46 in 2012. The explanation for some charges was the restaurant and employee names, such as “Applebees-Chris Hammer, Doug Minor” for a $24.87 charge.

Another said “Ruby Tuesdays-Doug M, Chris H., George Benjamin,” for a $47.63 bill. Other popular restaurants include Little Dutch, Jersey Girl, Pizza Inn, IHOP, Applebees, and O’Charleys.

The explanation for some meals appeared to be employees were working, such as a Chick-fil-A receipt for $68.59. A note on the top said “Fibernet Lunch.” Similar explanations were used for a $127.32 and $23.05 charge at Papa Johns. A meal at McDonald’s for $5.81 appeared to be for one person. The explanation listed a location and what looks like an account number.

On other receipts, we didn’t find an explanation. An employee charged $18.11 for a dozen cupcakes at Yummy Cakes. Utility cards were used at Dunkin' Donuts at least three times at the end of 2012, buying three dozen donuts for about $32 each time. Someone notes “no detail” on a credit card statement for a $70.14 charge at Little Dutch, just a few blocks from the utility’s office.

“Those trips are depending on the location.”

Utility employees charged $91,784, about $6.12 per MUS customer, for travel and conferences last year. Employees charged $83,184, or about $5.55 per customer, in 2012.

We asked city councilman Bob Garrett whether he knew about the travel expenses. “Not to this extent,” he said. “I don’t quite understand the volume of what’s going on right now.”

Garrett worked at the utility for 42 years before he retired. He’s served on the city council for five years.

Destinations included Seattle, San Diego, Denver, Orlando, Orange Beach in Alabama, Memphis, Nashville, Chattanooga, Gatlinburg, and others.

“Those trips are depending on the location, nice locations, nice cities, nice parks,” Garrett said. “They could go to not a single damn one of those and the system would do just as well.” He told us most utility business could be taken care of in Nashville.

Wigington said in an email, "We feel these conferences are important and essential to operations and management. We evaluate the meetings and conferences and select the few that best help us improve our services."

Wigington, the utility’s general manager, had the most travel and conference charges in 2013 at $24,530.67, accounting for about 27 percent of the charges. Each customer’s share was about $1.64. “Jody doesn’t want to do a damn thing,” Garrett said. “He just wants to play.” Wigington’s charges more than double the amount of the next employee. George Benjamin’s charges were $10,116.39, followed by Mike Howard at $9,660.12.

After employees ate and drank at high-end restaurants, we found movies and valet parking charged to their utility credit cards. A hotel invoice from the Hilton in Portland, Oregon listed a $16.99 movie charge and four charges for valet service at $32 each. Charles Southerland acknowledged the movie charge on an expense report, which was approved. His explanation was “in room movie=$16.99.”

George McGuffin, a utility board member, also submitted a $14.50 hotel movie charge during a $10,798.25 trip to Denver, Colo. for an American Water Works Association conference. The explanation typed onto the expense report said “Hotel Movie.” The report was approved. A receipt from The Peabody, a four-star hotel in Memphis, also included a $19.65 movie charge to a different credit card.

On many of these trips, employees and board members appeared to bring family along, too. We found several instances where family flights and meals were charged to utility credit cards and later reimbursed. Charles Southerland reimbursed the utility $431.62 after he charged his wife’s airfare and a meal from a trip to Portland, Ore. Employees and board members repaid $2,869.22 to the utility after the June 2013 trip to Denver. Charges repaid included $495.46 for alcohol, $574.46 for food, and $1,799.20 for airfare.

The I-Team found utility employees also decided to stay overnight during conferences in Gatlinburg and Pigeon Forge, about an hour in travel from Morristown. Four employees stayed at The Park Vista for four nights, charging at least $2,696.05 to the utility. $13.16 of that charge included another in-room movie.

Web Extra: Gifts and other purchases
  • $174.56 – Benton’s Smoky Mtn – “Christmas gifts for board”
  • $10.96 – Apple iTunes Store
  • $8.77 – Apple iTunes Store
  • $743.40 – Eastern Business Forms Inc. – Logo’d Golf Balls
  • $675 – Clock Peddler of Gatlinburg – Clock
  • $261.90 – Walgreens – Two $125 Visa gift cards – Receipt said “Donation – Em. Management Agency,” but we didn’t find any proof of a donation.
  • $500 – whatdoyouneed.com – 200 custom candy-filled hardhats
  • $94.80 – Mildred’s Florist
  • $24.65 – Levenger – Personalized Notebook Annotation RL Skyline Letter
  • $50 – Food City – Cracker Barrel Gift Card
  • $364.37 – Identity Links – Promotional Water Shaped Beanies
  • $25 – Food City – O’Charley’s Gift Card
  • $20 – Food City – Subway Gift Card
  • $262.51 – 4imprint – Mini Plastic Football
  • $228.33 – Levenger – Bomber Jacket Expandable Briefolio
  • $79 – Office Supply Independent – Personal Coat Rack
  • $52.44 – Levenger – Circa Silver Foldover Notebook
  • $226.44 – Hickory Farms – Deluxe Smokehouse Collection Gift Box
  • $65.97 – Hickory Farms – Beef Summer Sausage
  • $28.95 – Food City - $25 Visa Gift Card
  • $53.50 – The Flower Shoppe – “Jim Belcher’s mother”
  • $59.68 – Hobby Lobby – “Board christmas boxes”
  • $40.98 – ftd.com (flowers) – “Wish you a speedy recovery."
  •  $146.43 – Lillian Vernon – Wine stoppers for the board
  • $238.32 – Brennan’s Market – Cheese
  • $91.51 – Walmart – Bows and a tarp
  • $82.31 – The Home Depot – Poinsettia
  • $235.92 – costumeexpress.com – Dr. Seuss costumes for Christmas parade
  • $98.30 – Walmart – bows, rope, and other charges
“They just have a blank check.”

We took our investigation to city leaders, including Councilman Garrett. “They’re following the rules,” he said. “They just have a blank check.”

He said utility employees traveled when he worked there, but never to this extent.

“I know what they’re doing. They’re playing,” Garrett said. “They violated the public trust, in my opinion, big time.”

“It’s management down there,” he replied when we asked for his response to citizens. “They are as incompetent as you can get,” Garrett said about Jody Wigington, the utility’s general manager, and Clark Rucker, the utility’s assistant general manager.

He said Wigington “just wants to play” and hands off the day-to-day decisions to Rucker.  He said the situation will only get better with a responsible manager. 

We asked Garrett who concerned citizens should turn to for answers. “The city council and mayor are accountable,” he said.

When we pointed out he is a council member, he said he didn't have the votes. “I have to get three votes to replace a commissioner, and I don’t believe that’s going to happen.”

Mayor Danny Thomas said he had heard speculation about spending, but added, “you’ll hear that a lot as mayor.” Then, we showed him the findings from our investigation.

“The more you tell me, the more I’m shocked,” he said. “If the Morristown Utility Systems can afford to spend that kind of money then surely we can afford to reduce our rates.”

He said the utility should have credit card policies similar to the city. “We’re very protective of them,” said Thomas. City employees can check out one of ten credit cards and each purchase has to be approved by a supervisor, finance department, and city administrator. He said the city would never allow an employee to charge flights for family and reimburse the cost later. “It’s hard to track if you have a lot of that going on.”

We also asked Thomas who should hold the utility accountable. He characterized his relationship with MUS as “rocky” and like Garrett, said he doesn’t have much control over the utility. Much of that responsibility lies with the utility’s board, who we found going on trips with employees.

“It would seem too difficult to regulate your own activities,” he said.

The mayor called the board’s role unusual. “The board is also the same people that give you the names to appoint to the board,” said Thomas. “That’s not something that you give names and they go through them. They give you names. So it’s a self-appointing board. So it does seem to be a little bit one-sided.”

Thomas said most things have to be taken care of through the state legislature.

“Excessive is an incorrect term.”

We reached out to the utility’s management for comment. They refused to talk on camera, but Wigington responded to our findings by email.
  • “National conferences for power and water provide employees & board members a learning experience on latest technologies and business practices. Through these conferences we were introduced to carbon contactor water filtrations (one of the first in the country), chlorine processes to more safely treat drinking water, and Smart Grid technologies for efficient delivery of electricity.”
  • “Travel expenses are audited annually. MUS has 135 employees and over $107M revenues with the acquisition of the wastewater system. That is 8 one hundredths of one percent (0.08%) of revenues. We do not consider this excessive.  Training employees with new skills in a constantly changing business climate has resulted in $800K in annual operations and maintenance  savings and $3.3M in grants.  The investment in employee training for new skills is clearly a valuable use of resources.”
  • “When our crews work more than two hours past normal quitting time or they are out in the middle of the night working non-stop to repair our systems, we provide them a meal.   MUS hosts meetings for various types of  training, TVA distributors, chamber of commerce and other business related entities.  As a leader in telecommunications and Smart Grid development, MUS hosts visiting utilities and communities seeking to learn from our success and we provide them a local meal as they travelled to us on their own expense.”
  • “Excessive is an incorrect term. Business trips are certainly not a waste of money.  MUS received over $3.3M in grant money from TVA for Smart Grid development for demand response to assist TVA in controlling loads and improving reliability.  A condition of  the grant was our willingness to share our technology and learning experiences with TVA and other utilities in the valley & nation.  MUS is proud to host others and occasionally travel to share our acquired knowledge.  We also strategically arrange legislative and legal meetings with key people who can protect our interests and are in position to save our company significant dollars.”
  • “We strive to maintain the lowest rates possible in an environment with ever increasing costs and shrinking usage.  Our investments in technologies have allowed us to avoid rate increases. Our rates remain among the lowest in the state and well below national average.  We operate with a slim margin and the greatest opportunity for rate reduction will occur when wholesale costs decrease."
  • “We constantly strive to provide the highest level of service at the lowest cost possible.  The City has placed great responsibilities on MUS to provide services that provide critical infrastructure, support economic development and improve quality of life.  Our employees work hard and responsibly to achieve these goals. “
Web Extra: “I was a little disturbed by the amount they want to charge you.”

The 6 News I-Team requested records under the Tennessee Open Records Act from more than two dozen public utilities in March 2014. We asked for expense reports and documentation submitted in 2012 and compensation from 2009 to 2013. Days after we mailed a public records request to Morristown Utilities System, or MUS, several people reached out to us, asking us to look into excessive spending there.

Sources asked us to watch for several cross-country trips, costing thousands of dollars, but when we visited MUS for the first time in early April, we found those trips were missing from our request. A utility worker acknowledged the existence of at least one of those trips, but said they were not covered by our request.

We had addressed our records request to Morristown Power Systems rather than Morristown Utility Systems.  Although we apparently received compensation records for the entire utility, the stack of expense reports were for the power system only. The water, sewer, and telecom expenses had been excluded.

6 News decided to take a closer look at MUS. We corrected the address so we would get records from the entire utility.  We also sent a second records request, expanding to all expenses and documentation from January 2012 to 2014, all payment cards (including credit, debit, and charge) statements and documentation, meeting minutes, bank statements, and more.

A few hours later, Clark Rucker, the Chief Financial Officer of MUS, sent us a $524.29 invoice for the first records request. For 196 copies, that amounted to about $2.67 per page. We challenged the invoice, which included legally questionable charges for someone to watch us while we inspected records. Rucker dropped the invoice amount to $165.55, or about $0.84 per page.

“I was a little disturbed by the amount they wanted to charge you,” said Mayor Danny Thomas. “I think it tells a story about how they’re not open to the general public and particular to the press as to how they’re conducting business.”  We told him about the original $524.29 invoice for our first request and an $801.44 invoice for our second request, or about $3.89 per page.

“This certainly doesn’t make us look good as a city, whenever we try and make it almost impossible for you to obtain information,” said Thomas.

After we challenged several invoice charges related to all of our requests, the utility charged a total of about $900 for roughly 700 pages of documents, or about $1.29 per page.

Our investigation continues Tuesday:

  • Tuesday on 6 News at 6:00: “No, I can’t imagine getting a $12,000 raise when that’s what I make in a year,” said a woman after we showed her compensation reports from the utility. We’ll break down the numbers.

  • Tuesday on 6 News at 11:00: How much did Morristown Utility Systems spend on their end of the year parties?
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