History of headaches triggers Issue 16

October 25, 2010

City Council Monday night asked the city’s director of public service, Rick Merolla, to explain why the city wants to lease the recycle energy system. He responded with a history lesson that includes millions of dollars in losses, a bankruptcy and a lawsuit.

“The recycle energy system has had problems since it opened in 1979,” Merolla told Council.

The system has always been run by a private operator, the most notorious being Akron Thermal. It failed to pay millions of dollars in bills to First Energy and the city for water and sewer; its poor service resulted in the loss of its two largest customers, Children’s Hospital and The University of Akron; and it filed for bankruptcy and abandoned the facility.

Akron Energy Systems now operates the steam plant, and the city wants to lease the system to the company. Creating a well-run energy system will require capital, and Akron Energy System can secure funding for improvements if it is a lessee, Merolla said.

“Akron is the only city in Ohio that owns its own steam plant. City governments should focus on core competencies, and steam production is not one of them,” Merolla said.

If passed, Issue 16 will allow the city to lease the steam system to Akron Energy Systems.