TVA explains e-mail
A boardroom discussion of the reason for the Tennessee Valley Authority sending an e-mail to aldermen requesting an on-site visit at the Holly Springs Utility Department was clarified by Julia Wise, senior communications consultant with the authority.
Wise said the request to send in a consultant to look over the accounts with HSUD’s accounts manager was made to ensure TVA has accurate data it received from HSUD.
The need for the visit was due, at least in part, to the delinquency of the fiscal year 2023 annual financial report that was due from HSUD Aug. 15, 2023, Wise said.
The monthly financial data has been entered in the Financial Regulatory System Tool for the months of June, July, August and September 2023, but are not accurate and cannot be validated due to the delinquency of the FY23 annual financial report, Wise said.
“With inaccurate and late data, we are not able to see HSUD’s current financial situation,” Wise said.
“TVA has hired a financial consultant to perform the work necessary to collect and process financial information that should have been furnished by Holly Springs,” Wise said. “To do this work, TVA previously requested that the Mayor (Sharon Gipson) approve access to the financial system for our regulatory team so that we can assist in correcting accounting errors and complete a financial analysis of HSUD. The Mayor’s initial response is that she is unwilling to grant access. It is imperative that the city act on TVA’s request so that we can assist HSUD with accurate and timely financial reporting.”
Wise said given TVA’s lack of visibility into HSUD’s current financial condition and the continued complaints made by HSUD customers about late or no bills, the authority is concerned about HSUD’s ability to operate in a self-supporting and financially sound manner.
“In its current state, we question whether HSUD has sufficient revenue to support electric system operations, which includes payment of the wholesale power bill to TVA,” Wise said.
Wise said TVA would send in staff, including a financial consultant, to work with HSUD.
Wise cited regulatory authority TVA has in its wholesale power contract with Holly Springs.
“Pursuant to section 1(c) of the Terms and Conditions of the Wholesale Power Contract between TVA and Holly Springs, TVA has the right to perform all work necessary to collect and process information that should have been furnished by Holly Springs,” Wise said. “Additionally, under section 1(b) of the Terms and Conditions to the Wholesale Power Contract, Holly Springs is required to allow TVA free access, at all reasonable times, to all books and records related to the system operations. To do this work, TVA previously requested that the Mayor approve access to the financial system for our regulatory team so that we can assist in correcting accounting errors and complete a financial analysis of HSUD.
“On a regular basis TVA requires supporting documentation from local power companies to ensure accuracy of financial statements: however, we are not aware of TVA needing to hire staff to perform work to produce financial information that should have been provided to TVA in the past.
“We remain committed to working with city leaders to find the best path forward for HSUD. Our number one goal is to ensure that HSUD delivers safe and reliable power to the community they serve.”