Agenda Report
Fullerton City Council
MEETING DATE: JULY 5, 2022
TO: CITY COUNCIL / SUCCESSOR AGENCY
SUBMITTED BY: ERIC LEVITT, CITY MANAGER
PREPARED BY: RICHARD D. JONES, CITY ATTORNEY
BARON J. BETTENHAUSEN, DEPUTY CITY ATTORNEY
SUBJECT: ORANGE COUNTY POWER AUTHORITY DISCUSSION
SUMMARY
Concerns raised by members of the public, media and others regarding the Orange County Power Authority (OCPA) have prompted member agencies to discuss and take appropriate action relating to participation in OCPA.
RECOMMENDATION
The City Manager recommends that City Council support the retention of an independent auditor by Irvine and direct the City Manager to maintain communication with Irvine during the audit.
Additional options, should City Council desire:
Consider making a public statement concerning management of the Orange County Power Authority.
Take other action as directed by City Council.
PRIORITY POLICY STATEMENT
This item matches the following Priority Policy Statements:
City Infrastructure and Assets
Fiscal and Organizational Stability.
FISCAL IMPACT
None.
DISCUSSION
The Orange County Power Authority formed in 2019 to deliver cleaner electricity generated from non-fossil fuel sources and less expensive electricity through the introduction of competitive choice into the local energy market. The City of Irvine provided the initial startup capital with the City of Fullerton joining in November 2020, along with the cities of Buena Park, Huntington Beach and the County of Orange. A Board of Directors governs OCPA, comprised of one director from each member agency, except for Irvine which has two board positions until OCPA has repaid their initial capital investment in full.
Recently, several OCPA Board members have raised concerns over financial and operational transparency citing concerns that OCPA has not satisfied requests for information from board members. In particular, members have requested a financial analysis of the original revenue and projections in comparison to current revenue and projections, identification of OCPA staff, contractors and subcontractors with compensation obligations, copies of credit facility agreements and power purchase agreements and information related to the impact of a $1.96 million fine imposed by the California Public Utility Commission on the OCPA.
The Irvine City Council directed their City Manager on June 14, 2022 to retain an independent auditor to conduct a forensic audit of the OCPA under the authority provided to them in the Capital Loan Agreement.
Orange County Power Authority Discussion - Page PAGE \* MERGEFORMAT 4