BPU Relocation Plans Questioned
The Board of Public Utilities proposed move from Newark to Trenton runs into stiff opposition.
The administration’s plan to shift the Board of Public Utilities from Newark to Trenton, a step proponents say would save ratepayers more than $1 million annually, is coming under fire from unionized workers and some lawmakers.
The proposed move, first raised in an administration transition report and backed by the new president of the regulatory agency, would move the board’s 250-plus employees from the state’s largest city -- where it has been located since its founding 99 years ago -- to state-leased offices in the capital, next to the Trenton rail station.
Besides the cost savings achieved by moving out of more expensive leased office space in Newark, the move would afford greater access to the agency for all ratepayers. It also would promote greater efficiency by having staff closer to other state agencies and the legislature, according to administration officials.
A Prior Commitment
The plan came under scrutiny yesterday when the Assembly Telecommunications and Utilities Committee invited administration officials to justify the move. But BPU President Lee Solomon, citing a prior commitment, sent a senior manager to read a statement defending the shift.
That left lawmakers unable to get detailed answers to questions about lease costs and potential savings, a result that led the chairman of the committee, Assemblyman Upendra Chivukula (D-Middlesex) to ask: “If President Solomon lived in Bergen County, would this move ever have happened?" Solomon lives in Haddonfield in Camden County.
Disputed Cost Savings
Union representatives from the Communications Workers of America Local 1037, which represents 177 workers at the agency, denounced the proposal, saying any cost savings would be far more offset by rate increases customers would incur by losing experienced utility regulators.
Rene Demuynck, chief steward of the union and an electric rate analyst, also disputed the projected cost savings, noting a big chunk of the money would come from an expected 22 percent reduction in staff anticipated in an administration memo outlining benefits of the move. “These savings come from eviscerating the work force of BPU,” he said.
Demuynck also tried to disparage potential efficiencies that would be gained from relocating the offices in Newark to Trenton. While BPU would be moved, PSE&G, the state’s largest utility, the New Jersey Ratepayer Advocate and the Administrative Office of Law judges, which hear utility rate cases, all would continue to reside in Newark, he said.
If the state really wanted to achieve some savings to reduce the cost of regulation, Demynuck suggested the panel look at the cost of private contractors hired to administer the agency’s BPU Clean Energy programs. In fiscal year 2010, the contracts totaled over $53 million to three contractors, nearly double the $32 million budget of the agency, he said.