Did officials unduly press consultants for iProvo?

Deseret News (Salt Lake City), Apr 5, 2008 by Jens Dana Deseret Morning News

PROVO -- Critics of iProvo say recently released correspondences indicate city officials pressured consultants to focus on allocating iProvo's debt among city departments rather than on developing the system's profitability.

Provo spokeswoman Helen Anderson disputed their assertion Friday, saying city officials weren't putting any kind of pressure on consultants to tell them only what they wanted to hear.

Last year, the city called on CCG Consulting and Franklin Court Partners to analyze its fiber-optic telecommunication network. In 2004, the city issued $39.5 million in bonds to finance construction of iProvo, which provides Internet, phone, television and video services. During 2007, the network experienced churn rates and posted deficits despite receiving a monthly $100,000 transfer from the city's general fund.

The consultants were supposed to have their final reports submitted six weeks after they were hired, Provo spokeswoman Helen Anderson said, but their reports are being revised based on new information.

City Councilmanr Steve Turley filed a GRAMA, or Government Records Access and Management Act, request to obtain copies of the reports. His request was denied based on the claim the reports are still in draft form, but Turley received copies of numerous communications between the iProvo consultants and city officials.

One particular e-mail sent Jan. 14 from CCG Consulting President Doug Dawson to acting telecom manager Kevin Garlick came as a "little kick in the old head" when Turley read it.

In the e-mail, Dawson states he would be extremely uncomfortable only recommending chargebacks -- billing other city departments for their use of iProvo -- to the council as "the only fix the company needs."

Dawson also said he recommended other ideas, including cutting expenses, shifting functions to retailers and adding new retailers to make iProvo profitable and self-sustaining.

"To talk about only the chargebacks gets my reputation, and by association, the company's, shredded," he wrote.

While Turley thinks Provo's departments should pay for piggybacking on the iProvo system, he doesn't think "reshuffling a dollar from one (budget) column to another" will solve the deficit.

"It's a Band-aid," he said.

Royce Van Tassell, vice president of Utah Taxpayer Association, said chargebacks would just be another way of making Provo taxpayers foot the bill for a "bad idea." Now city officials are cajoling the consultants to tell them what they want to hear, he said.

"Now that is hardly what you spend $40,000 for consultants to do," Tassell said. "They're trying to manipulate the consultants to say what Mayor Lewis Billings wants them to say."

Anderson said critics base their assertions on just one side of a conversation. She said city officials wanted to break down their goals between allocation of deficit and profitability. In this case, she said, they asked CCG Consulting to focus on allocation.

"The city was not putting any kind of pressure on the consultant," Anderson said.

Anderson said it's only fair to contemplate charging city departments for their use of iProvo as if they were paying an independent service provider.

"It's really just a way of acknowledging the city benefits, and it should pay as well," she said.

She also said Dawson's recommendations for profitability are included in the draft reports.

Turley said they've been waiting four months to see the consultant reports. Each passing day costs the city about $5,800, he said, based on iProvo losses last year in subsidies and deficits.

Turley also said he's frustrated his colleagues on the council didn't support his motion to request the consultant reports.

"We know the mayor isn't acting, but why isn't the council reacting?" he said.

Council Chairwoman Cindy Richards said they didn't request the reports from the mayor because they want the reports to be finished before they are released.

"I don't see how leaning on an incomplete report ... is going to help solve anything," she said.

Turley said he's contemplating an appeal on his denied GRAMA request for copies of the consultant reports.

"I'm not satisfied," he said. "We're talking about hundreds and hundreds of thousands of dollars slipping through our fingers while we're waiting for a draft."

E-mail: jdana@desnews.com