YELLOW SHEET Office of the State Auditor of Missouri Claire McCaskill

A major change in the normal operations of the Carrollton Municipal Utilities during the summer of 2000 was not formally approved by the town�s Board of Public Works.� During the summer of 2000, the town generated almost all of its own electricity instead of purchasing it as is normally done.� This change appears to have been a cause of a 59 percent increase in customers� electricity bills during the summer of 2000 compared to summer 1999.� While the base rate for kilowatt hour usage did not increase during this period, fuel adjustments, which are added to customers� electricity bills when the town generates its own electricity, increased substantially causing the overall increase in electric bills. 

Our review noted the following concerns with the town�s decision to generate all of its electricity: 

�        This decision was not formally approved by the Board of Public Works.� Officials and employees indicated the matter was informally discussed by the board, but the board did not document formal approval. 

�        The town did not perform a formal cost benefit analysis to compare the costs of generating electricity to the costs of purchasing electricity. 

The audit also includes some matters related to utility bidding and payroll procedures, fuel card and vehicle policies, and budgeting upon which the city should consider and take appropriate corrective action.�

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