Imagine if they had left the AC on.
The city of Sacramento has nearly $1 million in unpaid electric bills because a meter at a water treatment plant went haywire at least three years ago and no one noticed, officials said.
It could've been worse.
By the city's own admission, the meter in question has probably been busted for more than 10 years. Luckily, the Sacramento Municipal Utility District has a three-year statute of limitations on undercharged bills.
At the rate the city was under-billed, Sacramento could have been on the hook for more than $3 million if it were billed for the full period, officials said.
As it stands, city officials are asking the City Council to approve a resolution next Tuesday that would allow them to pay off the $916,000 SMUD bill over three years.
While Sacramento utilities officials say they already have set aside most of the money in their budget, the bill is landing on the city's desk as it faces mass cutbacks and an estimated budget chasm of $200 million over the next five years.
"As soon as we heard that SMUD was undercharging us, we immediately put provisions aside from the utilities budget fund to cover the anticipated charge," City Manager Ray Kerridge said Thursday in an e-mailed statement. "In addition, we have been working with SMUD to negotiate the repayment."
The proposed repayment plan includes an additional amount the city would use to buy energy-saving solar panels for at least one city utilities facility, according to a city staff report.
"It is good news for the city (that the bill only goes back three years) and obviously we never like to see errors like this, but this is highly unusual," said Paul Lau, director of customer services for SMUD.
A SMUD crew discovered the faulty meter in 2006 while updating the E.A. Fairbairn Water Treatment Plant near California State University, Sacramento, for daylight savings, Lau said. After an investigation, SMUD found that a "wiring connection error" was leaving the city's electric bill short about $25,000 a month.
The plant's two meters account for about $1.6 million each year in electrical charges out of the city's total annual bill of about $14 million, Lau said.
No one seems to know exactly when the meter started to malfunction. Lau said city officials reported a fire at the facility several years ago, but since SMUD is only interested in collecting on the three years worth of charges, they're not going to dig further.
While SMUD lost thousands – maybe millions – in the mix-up, the unpaid bills haven't hurt the average ratepayer: Lau noted SMUD's annual revenue is around $1.2 billion.
"It doesn't serve either one of us any good to point fingers," Lau said. "We identified the problem; now let's fix it and move forward."
Call The Bee's Ryan Lillis, (916) 321-1085.
