LRCC Weighs in on LBWL Leadership Change and Business Impact



The LBWL is a publicly owned, municipal utility that provides electricity and water to the residents of the cities of Lansing and East Lansing and the surrounding townships of Delta, Delhi, Meridian and DeWitt. The LBWL also provides steam and chilled water services within the City of Lansing.

In a recent statement, the LRCC reiterated the need for LBWL board of commissioners to re-evaluate all areas of LBWL functions and called for “greater transparency and accountability”. It also voiced their concern about a recent LBWL electric rate increase and its impact on the community and its businesses.

“We can’t overstate the importance of affordable energy in our region, especially from an economic development and job creation standpoint,” said Tim Daman, LRCC president and chief
executive officer.

Peter Lark fell under scrutiny regarding his leadership and handling of the 2013 ice storm power outage over one year ago. On July 22, 2014, Lark was reappointed as the general manager of LBWL by a 7-1 vote. Six months later, on January 13, 2015, the LBWL board voted to terminate Lark “for cause” in a 5-3 vote. Dick Peffley, a member of the current leadership team, was named interim general manager. Peffley held the interim position in 2006 after General Manager Sanford Novick submitted his resignation.

Timeline:
  • December 2013 — Ice storm
  • January 2014 — Frustration mounts from perceived lack of leadership during power outage.
  • February 2014 — Internal review doesn’t go deep enough.
  • May 2014 — Community review team reveals its recommendations in a 75-page report to deal with slow power outage response and communication issues.
  • July 2014 — Lark is reappointed by commissioners.
  • May through December 2014 — The LBWL work toward implementing tactics to ensure a proper response time, communication tools and improve customer confidence.
  • January 2015 — Lark was released as general manager.

Based on a year of wavering confidence, Daman also stated that it’s time for all parties involved, including the LBWL administration and commissioners, ratepayers and the City of Lansing leadership to think about the future of LBWL and explore all options for a secure future. One of the options the Chamber suggested was the potential sale of LBWL, which they contend would financially benefit the City of Lansing as well as the entire region.

“My view remains that the Board of Water and Light provides great value to the city as an economic development tool, and provides equity payments to the city that would cease if we accepted a one-time windfall,” Mayor Virg Bernero said. “I continue to believe we are better off retaining the asset, while addressing the issues of accountability and effective governance.”

Lark’s attorney, George Brookover, stated for the record that Lark would be contesting the dismissal, believing it not to have cause. If Lark is found to have been released “with cause”, LBWL could payout as little as six month’s pay ($129,251). If it is determined that he was fired without cause, LBWL is responsible for the full amount of his remaining five-year contract, which totals out
to $900,000.

Since the LBWL is an asset owned by the City of Lansing residents and taxpayers, money used to compensate Lark will come from tax dollars, including commercial businesses that are currently LBWL customers. The LRCC contends this will have an impact on the business community.


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