Consultant defends PUD charges

By Scott North

Herald Writer

A California management consultant charged the Snohomish County PUD more than $190,000 it says it should not have paid, according to documents obtained by The Herald.

The district is threatening legal action, including going to the police, to get the money back.

But consultant Laurence Akiyoshi maintains he’s done nothing wrong and that PUD officials previously approved all his expenses. They are now "back-tracking and back-pedaling" in the wake of controversy, he said Sunday.

"What has changed in their own political environment to cause this to be such a huge issue for them?" Akiyoshi asked. "It seems to me that they are looking for somebody to blame for their own decisions."

Much of the criticism about Akiyoshi’s billings has centered around the PUD paying $63,000 for work he acknowledges that he mistakenly double billed and the consultant’s practice of passing along costs of pricey meals and nights spent in the Seattle’s luxurious Alexis Hotel.

The PUD since mid-March has been embroiled in controversy over the $750,000 in bills Akiyoshi submitted for work he did over a two-year period on projects to improve customer service and address problems with employee morale. So far, the PUD has paid the consultant more than $622,000 — compensation that was greater than the salary paid PUD General Manager Paul Elias during the same period.

PUD customers, many of whom have seen their power bills soar in the wake of rate hikes, have expressed outrage over the expenses. Elias has spent much of the last month on vacation and paid leave, pending the results of an audit on consultant spending.

Results could be announced Tuesday, PUD spokesman Neil Neroutsos said.

At the same time, the PUD has been scrutinizing Akiyoshi’s billings and what was actually purchased when its managers and elected commissioners approved nine payments averaging $69,000, between September 2000 and February 2002.

In a March 29 letter to Akiyoshi, acting PUD general counsel Kristin Hall acknowledged that some of Akiyoshi’s charges have been previously approved, but the district now believes the consultant improperly charged the utility for a host of expenses, ranging from first-class air travel, to the way he used rental cars, to where he slept and ate his meals.

The letter, which Akiyoshi said he received last week, contends there are more than $193,000 in expenses the PUD believes are invalid or were double-billed. Factoring in about $42,000 the PUD acknowledges that it still owes Akiyoshi for some work, the utility is now demanding more than $150,350 in refunds, no later than April 15.

"Be advised that the district will not hesitate to exercise any and all necessary and appropriate legal rights and remedies in this matter," Hall wrote. "This includes civil litigation and referral of this matter to appropriate law enforcement officials to determine if you have violated any state laws through your billing practices."

Akiyoshi denies owing the PUD the money it now demands, and says that many of the utility’s conclusions are in error. He said he’s particularly troubled because many PUD officials were aware of his travel, lodging and consulting fees, and never raised an eyebrow.

"I don’t feel I’ve been unreasonable at any point in time," he said. "I didn’t put a gun to anybody’s head. I didn’t force them to hire me."

Akiyoshi said the PUD isn’t really interested in his explanations. An auditor hired by the utility to examine its consultant hiring practices never contacted him, he said.

PUD watchdog and former employee Dave Aldrich said he’s convinced there wouldn’t be any concern at the utility over Akiyoshi’s billings if it weren’t for the public outcry.

"The PUD is now crying foul," he said. "But it wasn’t until this information was released to the press and the press reported it that flags were raised."

PUD officials have previously said that they had reached an agreement with Akiyoshi to repay $63,000 that he has acknowledged over-charging the PUD in a double billing. The March 29 letter, however, contends that Akiyoshi has refused "repeated requests to return this money to the district."

Akiyoshi said he has consulted with his accountants and an attorney, and he has offered to credit the $63,000 against the money he maintains the PUD still owes him for unpaid work.

Neroutsos said PUD officials believed that Akiyoshi was going to send a check to cover the funds the consultant agrees he mistakenly double-billed, but that never happened.

"We will not pay him a penny of what is not legitimately owed," he said. "We will work very hard to make sure that our customers are not impacted by this."

You can call Herald Writer Scott North at 425-339-3431

or send e-mail to north@heraldnet.com.

Here are some of the expenses the Snohomish County PUD disputes with consultant Laurence Akiyoshi. Akiyoshi says the PUD either previously approved these expenses or is wrong in its conclusions.