EES Board approves audit; hopes to avoid rate hike

By Bob Robinson
Star Staff

   The Elizabethton Electric System (EES) Board of Directors, at their regular meeting last night, approved the EES audit for the years ended June 30, 2000 and June 30, 2001.
   EES has 25,000 customers, 17 miles of transmission lines and 750 miles of cable and poles. On June 30, 2001, EES assets totaled $37.2 million.
   The audit, conducted by Margaret W. Moses, CPA, P.C., 318 East Elk Ave., Elizabethton, "noted no matters involving the internal control over financial reporting and its operation that we consider to be material weaknesses.
   "However, we noted other matters involving the internal control over financial reporting, which we have reported to management in a separate letter dated Sept. 17, 2001," the audit stated.
   After Phil Isaacs, EES general manager, distributed copies of the audit to board members and to news media representatives in attendance, he said the "financial statements were black and white and that it was a good report."
   Elizabethton City Councilman Richard Sammons, a certified public accountant and member of the EES board, agreed, saying, "It was a good, clean audit."
   Several members of the board discussed the need to hold workshops to allow board members to learn more about EES operational expenses.
   In the past several months, EES operational and maintenance expenses have outpaced revenue. Uncollectables have also increased 46 percent year to date, board member Shirley Hughes pointed out.
   "We want to avoid having to raise rates to offset increased operational expenses, if at all possible," Ms. Hughes said.
   Isaacs assured the board that EES capital projects would be reduced if expenses continued to exceed revenue over the long term.
   However, the approaching winter months are expected to cause an increased demand for electricity, Isaacs said. In turn, this should bring EES revenue more in line with operating expenses, he added.
   Before adjournment, EES chairman Nave pointed out the EES was not in debt, compared to the Johnson City Power Board which refinanced $23 million in bonds, recently.
   "Phil (Isaacs) is running a good show and has been for some time," Nave said.
   Other members of the board are Howard Matherly, vice-chairman, and Elizabethton City Councilwoman Janie McKinney.
   The board's next meeting, scheduled Dec. 25, Christmas Day, was canceled.