Written by the reviewer from the ASR + docket; [verbatim-ASR] = quoted machine transcript; [paraphrase] = reviewer's wording, not a quote.
0:00 All right, we will call Committee of the Whole to order.
0:17 So first I will move to approve the minutes
0:19 of the June 15th Committee of the Whole
0:21 without the necessity of a reading.
0:23 Motion's been made and seconded.
0:26 Hearing none, all those in favor?
0:29 And that motion passes.
0:31 We have one item on the docket tonight,
0:34 which is the communication
0:38 that I submitted outlining the timeline
0:42 of litigation with First Energy
0:45 and also setting us up for tonight's discussion
0:48 with the law department to provide us an overview
0:51 of those legal matters, the First Energy's failure
0:57 to provide reliable electricity
1:00 and accurate and timely communication.
1:04 And then, so tonight as you,
1:07 thank you all for being here, members of the public as well.
1:11 Tonight you'll hear some of the steps
1:13 that have already been taken.
1:15 So those are a little bit complicated.
1:17 I think sometimes they're almost set up
1:20 to be intentionally complicated to make it harder
1:22 for us to hold the utility companies accountable.
1:26 So we'll be hearing about those
1:28 as well as askingtalking our law department some questions
1:32 about potential next steps.
1:34 Some of those questions,
1:35 I intend to have as much of the conversation
1:37 as possible in the public
1:38 because part of the whole reason for doing this
1:41 is to help all of us understand
1:44 and help all of our neighbors understand
1:46 the legal process that we've taken and what we can do.
1:50 Some of that we will have to have an executive session
1:53 to preserve the public interest
1:55 because it will be with our legal counsel.
1:58 So as much as possible though,
1:59 we'll have in front of all of you.
2:02 We're also joined tonight by members
2:04 of the Office of Ohio Consumers Council.
2:06 So thank you for being here with us,
2:09 JP Blackwood and Tom Brodbeck.
2:11 We'll be hearing from them
2:12 after we hear from the law department.
2:14 And I just wanna point out before we get started
2:19 that this is an ongoing effort.
2:22 It's been over a year since Mayor George and I
2:26 and Rep. Rader and Councilman Casey
2:27 met with First Energy representatives
2:30 about what steps they were going to be taking.
2:33 And were it not for the legal action
2:37 that the city has taken,
2:38 we wouldn't be seeing any progress.
2:41 And I know that most of us
2:42 aren't experiencing a lot of progress.
2:45 Today hear back from our First Energy Rep
2:48 about some of the improvements
2:50 that have been taking place that they are working on.
2:55 Of course, everything right now
2:58 instead of trust but verify,
3:00 it's a little bit more in the just verify stages.
3:03 So, but we, they are being asked to make these changes
3:08 ordered to by the Public Utilities Commission of Ohio.
3:11 And then we also wanna be diligent in our duty
3:15 to making sure that we are following up on them as well.
3:19 So that's the plan for tonight.
3:20 We'll have the presentation.
3:22 Council members will be asking questions, I'm sure,
3:26 and then we will take public comments.
3:29 So if you haven't already signed in for public comment
3:31 and you would like to,
3:32 you may do so any time before then.
3:35 I'll also call for anyone else
3:37 who would like to make public comment
3:38 who hasn't yet signed in.
3:40 Oh, oh yeah, they already pulled it up
3:45 but we'll put it back.
3:50 Thank you, a little, our clerks are very efficient,
3:52 sometimes too efficient.
3:54 All right, so you can go ahead and sign in on that.
3:58 And with that, I'm gonna turn it over to Mayor Dirksch.
4:02 Do you wanna make some preliminary remarks?
4:03 Yeah, thank you, thank you, Council President.
4:06 We appreciate the opportunity to provide
4:08 some ongoing updates on our efforts
4:10 to hold first energy accountable
4:13 and to do everything we can
4:14 to push for safe, reliable power in Lakewood.
4:18 We appreciate the partnership of City Council
4:21 on this very important issue.
4:24 I also wanna emphasize that we all appreciate
4:26 the voices of our residents
4:28 and the people who showed up here today.
4:31 This is an all hands on deck effort
4:34 and we continue to work together
4:35 to hold first energy accountable
4:37 for their failing infrastructure.
4:40 This is a statewide issue
4:41 that we are being forced to confront here locally.
4:45 We are fighting a multi-billion dollar corporation
4:48 -that rather than put money
4:49 into the aging infrastructure in Lakewood
4:52 and across the state,
4:53 instead put its dollars into bribing
4:55 the Speaker of the House and other public officials.
4:59 Lakewood has been pursuing an aggressive,
5:02 multi-faceted, and creative approach
5:04 to apply pressure to first energy.
5:10 Over the past two years,
5:11 the City of Lakewood has been the leading municipal actor
5:15 pushing first energy.
5:17 We're actually getting calls from other municipalities
5:20 asking for our playbook on this issue.
5:24 we've had meaningful upgrades required of first energy.
5:28 We have gotten PUCCO to order first energy
5:31 to make significant investments
5:33 in Lakewood's power infrastructure.
5:35 First energy is required to install
5:37 new large transformers at the Athens substation.
5:41 They are required to inspect every pole
5:43 in line within the city
5:45 and are required to improve communications
5:48 as well as install smart meters citywide.
5:51 We also formally intervened
5:53 in first energy's reliability case
5:56 and had PUCCO side with the city
5:57 in denial of those relaxed standards.
6:01 We continue to press things with first energy
6:03 and have filed a new complaint
6:05 to investigate this summer's outages.
6:08 We are demanding financial penalties for first energy
6:12 as part of our new complaint,
6:14 which includes significant direct fines to first energy,
6:18 refunds of payments to rate payers,
6:21 and other creative options
6:22 such as the creation of an escrow system
6:25 that would withhold all rate payers' utility payments
6:28 until the issues in Lakewood are fully resolved.
6:31 But we know we need to keep fighting.
6:34 This is a life or death issue for thousands in Lakewood
6:37 and a quality of life issue for us all.
6:40 People with health challenges,
6:42 those that need oxygen, medications,
6:45 and in-home support,
6:47 they all need safe, reliable power.
6:50 Many have lost hundreds of dollars in spoiled food
6:53 when our refrigerators lack power for days on end.
6:57 Many of our small businesses have suffered major losses
7:00 when forced to close their doors for days
7:02 and lost tens of thousands in sales.
7:06 The list goes on and on,
7:07 and many of you here today have stories to tell as well.
7:12 Given the chronic failures of first energy,
7:14 we are looking at creative and alternative options.
7:18 We've had multiple conversations with Cuyahoga County
7:21 about the potential for microgrids,
7:24 and we've reached out to other regional partners
7:26 to gather insights on possible paths forward.
7:30 We believe we have a good action plan,
7:33 but we are still listening
7:34 and welcome all ideas from our partners
7:37 here on City Council, from our trusted experts,
7:39 and from you in the community.
7:41 Now I wanna turn things over to Law Director Vargo,
7:45 who's gonna go over things in detail
7:47 and answer specifics.
7:49 Thank you, Mayor George, President Keppel,
7:52 and members of council.
7:53 With me is Jen Swallow and Jeff Crossman
7:56 of the Law Department.
7:57 All three of us have been working closely together
8:00 for the better part of a year
8:02 to pursue a legal strategy against first energy
8:06 to address the deficient infrastructure in Lakewood.
8:10 We started with meetings with the mayor.
8:11 The mayor convened meetings with the Law Department,
8:14 instructing the department to do research
8:17 and to develop a legal strategy to confront first energy.
8:23 This followed the summer outages last year in June,
8:26 the unacceptable outages.
8:29 Yes, okay, can everybody hear me okay?
8:39 Those outages of last summer
8:40 affected over 13,000 residents in the city,
8:44 and it led to aggressive thoughts and strategies
8:49 from the Law Department.
8:50 We met with every department head
8:53 and individuals in the departments
8:55 to understand the impact of these outages
8:59 But even more importantly,
9:00 to understand the impact on our residents
9:03 and our small businesses.
9:05 We collected data on the impact
9:06 and we set a legal strategy.
9:09 That strategy centered on assuring the city
9:13 that we get improved infrastructure,
9:17 equipment upgrades from first energy.
9:20 That was the strategy, that was the remedy sought.
9:28 We went before PUCO.
9:32 PUCO is a regulatory body that you go in front of
9:35 when you want to seek equipment upgrades
9:39 from a regulated utility.
9:42 You do that because by statute,
9:47 utility companies are required
9:50 to provide safe, reliable services.
9:54 There's a statutory requirement on this business
9:55 to do that because of their natural monopoly status.
9:59 And because of that statute,
10:01 it gives PUCO the authority
10:03 to order the remedy of improved equipment.
10:07 And that's why we pursued this with PUCO
10:11 and we continue to do so.
10:16 As part of the strategy,
10:17 the comprehensive strategy on June 27 of last year,
10:21 the mayor filed a petition with PUCO
10:25 demanding a formal investigation
10:27 into the chronic infrastructure failures.
10:30 Mayor demanded enforcement of the statutory duty
10:33 of reliable energy for the people of Lakewood.
10:37 And again, the focus was always on
10:40 mandating equipment upgrades.
10:44 Within one week, the commission,
10:46 the regulatory commission responded to the mayor's petition
10:50 indicated that the PUCO staff
10:53 has opened an investigation into the outages.
10:57 That investigation occurred
10:59 and it was not a run-of-the-mill investigation.
11:01 It was done by technical people staffed at PUCO.
11:06 And the investigation was quite thorough,
11:09 very technical, engineering-based.
11:15 As a result of that investigation,
11:17 four weeks later, four weeks after the complaint
11:20 filed by the city of Lakewood,
11:23 PUCO issued a notice of probable noncompliance
11:27 And again, that's the regulatory commission
11:30 telling First Energy,
11:31 you are not complying with your statutory duty
11:34 to provide reliable energy to the people of Lakewood.
11:40 The commission made some key findings
11:42 after or based on its investigation.
11:46 First of all, the commission determined
11:48 that the outages were caused by failed equipment
11:51 and lines, not necessarily storms.
11:57 and this is the most disturbing for everybody in Lakewood,
12:01 that Lakewood has significantly older infrastructure
12:06 than most of the areas in the service area
12:12 How that came to be, we don't know.
12:15 By statute, First Energy has to file with PUCO
12:19 the performance of its circuits
12:21 throughout its performance area.
12:24 Lakewood consistently, over a period of years,
12:27 was identified as having the worst performing circuits.
12:33 Some of our circuits were in the worst 8%
12:35 performing circuits of First Energy.
12:38 Under the reports, First Energy was required
12:43 PUCO also found that there were
12:45 substantial communication failures by First Energy,
12:49 as all of us know too well.
12:52 PUCO cited the statutory violations in its notice.
13:00 Most importantly, First Energy, or PUCO,
13:04 compelled corrective measures by First Energy.
13:08 This is the equivalent of affirmative injunctive relief.
13:14 The city of Lakewood filed a petition with PUCO
13:19 in the form of the mayor's petition
13:22 and achieved in one month,
13:25 or in two months from the notice,
13:27 or from the petition, this affirmative injunctive relief.
13:30 And here's what it was.
13:31 Number one, as the mayor indicated,
13:35 First Energy is required to install
13:37 two new transformers in the Lakewood substation.
13:40 The first was delivered in June, just last month.
13:44 The second one, we understand,
13:45 is due to be delivered in September.
13:48 They will be installed, and under the order of PUCO,
13:51 they have to be up and running smoothly
13:53 by the second quarter of 2027.
13:56 These transformers cost several million dollars each.
14:00 First Energy has plenty of money,
14:03 but but for this order from PUCO,
14:07 these important transformer upgrades
14:10 would never have occurred.
14:12 Number two, PUCO required First Energy
14:16 to investigate the root causes
14:18 of the failures of those transformers,
14:21 to make sure it was not system-wide
14:23 or something in the system that caused them to fail,
14:26 but to make sure the transformers had unique defects
14:30 that could be remedied simply
14:31 by bringing new transformers in.
14:35 Next, the commission required First Energy
14:38 to perform inspections on all the pole equipment
14:41 throughout the city of Lakewood,
14:43 just like the mayor referenced earlier.
14:46 Also, First Energy was required
14:49 to complete their smart meter application
14:51 throughout the city by the end of this year.
14:54 The smart meters are important
14:56 because it gives instantaneous notice
14:58 to First Energy of an outage.
15:02 And again, First Energy was required to overhaul,
15:06 do a complete overhaul of their notification system
15:09 to consumers in Lakewood.
15:13 Most importantly, none of this equipment investment upgrade
15:19 was planned by First Energy.
15:23 The commission made that clear in its findings
15:26 in its notice of non-compliance,
15:29 that whatever First Energy would tell the commission,
15:31 not once did First Energy say
15:33 it had planned any of these equipment upgrades.
15:37 These equipment upgrades were mandated of First Energy
15:41 based on a complaint by the city of Lakewood
15:44 and the finding and the order by the regulatory commission.
15:59 The legal strategy to confront First Energy
16:05 We talked about the probable,
16:08 the notice of probable non-compliance.
16:21 Right there, thank you, Holly.
16:25 The city also, or the mayor sat with the law department
16:28 and asked us to investigate and research
16:32 the viability of intervening in the reliability case,
16:36 the reliability application filed by First Energy
16:39 before the commission.
16:42 In that application, as many of you know,
16:46 First Energy sought to lower the standards
16:49 by which the PUCCO judges the performance of First Energy.
16:55 And it did, it tried to do so,
16:57 attempted to do so for many reasons,
17:00 but the important reason they might try to do that
17:04 and the implication of it is
17:06 if First Energy is meeting its reliability standards,
17:10 it is in a much better position to resist mandates
17:14 by the commission to upgrade equipment.
17:19 So First Energy could say we don't need all of this
17:22 expensive equipment upgrade look commission,
17:26 we are meeting our reliability standards.
17:29 So the law department researched that
17:32 and as part of that research and analysis,
17:35 we met and spoke with lawyers
17:37 of the Ohio Consumers Council,
17:39 whom you'll hear from later on.
17:42 I worked very closely with Mr. Brogbeck.
17:46 He's been very patient with me
17:48 and I've learned a lot from him
17:50 and I wanna thank Councilman Bullock
17:52 for the introduction.
17:53 You introduced us to the OCC very early
17:57 and has been very helpful.
17:58 So thank you for that.
18:02 Our opposition in our intervention,
18:05 well we did, we intervened,
18:06 we filed a motion to intervene in October of 2025.
18:09 We were grateful that the commission
18:13 granted our motion to intervene.
18:17 In December, Mayor George filed an affidavit with PUCCO
18:22 in opposition to First Energy's application
18:24 to reduce the reliability standards.
18:27 As part of that affidavit,
18:30 we put together a series of pieces of evidence
18:34 so PUCCO can analyze them.
18:36 The first piece of evidence
18:37 was the resolution from this council
18:40 supporting the intervention
18:42 and we thank council for that support
18:45 and President Keppel, you're right
18:47 to emphasize the importance of public support
18:50 and public comment before PUCCO.
18:52 PUCCO mentioned the value of that in their ruling.
18:57 The second piece of evidence that we put before PUCCO
19:01 was the impact on our seniors.
19:03 We got real-time, contemporaneous reports
19:07 by our first responders
19:10 of how they had to rescue seniors
19:13 who were trapped in elevators during power outages.
19:17 We got those days, we overlapped them
19:19 with the power outage days of First Energy
19:22 and we produced the actual documents
19:25 with appropriate redactions
19:27 to put a human face for the commission
19:30 as to the cost of these outages.
19:34 the law department worked with human services.
19:39 Director Berry, as human services,
19:44 worked diligently to help individuals
19:47 who could not afford the loss of food,
19:49 those who least could afford it
19:51 would come to human services.
19:53 We worked with Director Berry
19:54 to understand those types of services
19:57 and we put that evidence before PUCCO as well.
20:01 Finally, one of the most important pieces of evidence
20:05 we were able to obtain
20:06 was through public records requests of First Energy
20:11 to understand how many outages there were
20:13 in the summer of 2025 and the causes.
20:18 Throughout the briefing filed by First Energy
20:21 in the reliability case,
20:23 First Energy referenced broad,
20:26 tried to keep things broad as possible
20:29 and First Energy's position was
20:32 climate change is causing these power outages.
20:35 The increase of rain is loosening up
20:38 the roots of these trees in Lakewood
20:41 and these trees are falling over
20:43 and causing these outages.
20:45 So nothing to see here from First Energy's standpoint
20:49 and coincidentally, all the trees,
20:53 most of the treestalking to First Energy
20:55 were on the private side of the property,
20:58 meaning First Energy did not have access.
21:00 They were not on the public right away, the tree lawns.
21:07 Well, the evidence we were able to obtain
21:10 from First Energy dispelled that allegation.
21:14 That was false as it related to Lakewood.
21:18 We have no idea whether it's true
21:19 for the entire service area of First Energy
21:23 or throughout the state or throughout the country,
21:25 but we know from the evidence
21:27 that was false as it came to the city of Lakewood.
21:30 Most of the outages in 2025
21:35 by First Energy's own documents
21:39 were the result of equipment failure or employee error.
21:44 The commission cited that evidence in their ruling.
21:49 Now we did go down,
21:51 the hearing was probably six or seven hours long
21:56 Mr. Brodbeck did a lot of examination,
22:00 did an excellent job.
22:02 The mayor's office attended with me,
22:05 director or chief story went down there
22:08 and we did engage in cross-examination
22:11 of First Energy's engineering witness,
22:15 the cross-examination focused on two areas.
22:18 Number one, how did Lakewood get so lucky
22:20 that our circuits were consistently failing
22:23 compared to the entire area,
22:25 service area of First Energy?
22:28 So we focused on that equipment,
22:30 the necessary equipment update,
22:34 upgrades that Lakewood needed and was entitled to.
22:39 The second area dealt with the consumer survey
22:42 filed by First Energy as part of its application.
22:46 By law, First Energy had to do a consumer survey
22:49 and they relied on that survey
22:51 to tell the commission that the consumers
22:56 are generally satisfied
22:57 with the performance of First Energy.
23:01 Interestingly, we were able to understand
23:05 and determine that that survey time conveniently
23:08 ended in 2024, did not include the 2025 time period.
23:14 First Energy hid behind the technical language
23:17 of the rules that allowed them to do that
23:20 but Pucco was not impressed
23:22 because that survey is nothing more
23:24 than a surrogate for consumer sentiment.
23:27 And if consumer sentiment in 2025,
23:31 when there's a hearing in February of 2026,
23:33 if that sentiment is overwhelmingly negative,
23:36 that's what's relevant to the commission
23:38 and that's what the commission found as relevant.
23:42 Ultimately, just last month,
23:44 the commission did issue its order
23:46 and we were gratified
23:48 that First Energy's application was denied.
23:55 Our strategy continues.
23:57 Of course, right after that ruling by Pucco,
24:03 we had significant outages in the city in July.
24:08 As a result, again, the multifaceted legal approach
24:14 led to Mayor George's formal complaint to Pucco,
24:18 a second complaint, first one of 2026.
24:22 The mayor demanded that Pucco reopen
24:27 its investigation of First Energy
24:29 to determine whether First Energy
24:31 is continuing its noncompliance with its statutory duties.
24:37 The mayor pushed for financial penalties, as she described.
24:40 I won't repeat those,
24:41 but the mayor laid them out in her presentation earlier.
24:50 Pucco in four days responded to the mayor's petition
24:56 and indicated that the investigation will be opened.
25:02 An active investigation will be opened,
25:04 a second investigation of the Lakewood equipment.
25:07 Now they're gonna look at the Lauderdale substation.
25:11 If you recall, the transformer updates increases
25:15 applied to the Lakewood substation.
25:19 This will now apply to Lauderdale,
25:21 and if there's more equipment
25:22 that needs to be upgraded or invested in,
25:25 we're confident Pucco will require it.
25:31 Can you just pause and note
25:32 that it was the Lauderdale substation primarily
25:36 that affected the customers that were without electricity
25:39 since the 4th of July?
25:42 That's what First Energy has told us.
25:43 Anyway, is that correct?
25:45 That is correct, and that is why the focus
25:49 is on the Lauderdale substation in this July Pucco
25:54 Thank you, Madam President.
25:57 Continuing with our strategy,
25:58 the law department will monitor the compliance
26:01 of First Energy, their compliance with the July 25,
26:07 2025 notice of non-compliance by the commission.
26:12 The city has requested documents from Pucco
26:15 under public records.
26:17 We don't have them yet, but we've been in contact.
26:19 We have no reason to believe
26:21 they will not be forthcoming.
26:23 We will monitor when those investments occur.
26:26 Do they get in on time?
26:28 Are those transformers put in on time?
26:31 We'll make sure they are.
26:33 All the poll equipment that needs to be updated
26:37 by the end of this year, we'll find out
26:39 when that has occurred, what has occurred,
26:41 and we'll monitor it.
26:45 The next part of our legal strategy
26:48 is to consider intervention in the rate case.
26:51 Excuse me, Director Reiter,
26:52 just before you move on there,
26:53 I just want to mention in the public records request,
26:55 we're also requesting, because First Energy
26:58 was required to file a plan
27:01 to improve their communications, right?
27:03 So we've requested a copy of that plan,
27:05 as well as the infrastructure plan and the reports.
27:08 Is that all accurate?
27:09 That is correct, Madam President.
27:12 We have requested every document
27:14 that First Energy has submitted to Pucco
27:18 to evidence First Energy's compliance
27:20 with the July notice of non-compliance.
27:24 So everything that First Energy is submitting to Pucco,
27:28 that's our request,
27:29 and it covers all of those areas of investment
27:31 that I spoke of earlier,
27:32 including a complete overhaul of the communications.
27:36 I bring that up because, well, one,
27:39 I think anyone who lives in Lakewood
27:41 would probably say that they don't believe
27:44 that First Energy could possibly be beaming
27:46 their communication responsibilities,
27:50 as well as infrastructure.
27:51 So that's something, I think,
27:53 for all of us as council members,
27:55 we're often the ones folks are reaching out to,
27:58 and we're trying to get folks' answers,
28:00 which is difficult for us to get from First Energy as well.
28:03 So that's something, the communication improvement
28:06 is something that I think is very important
28:10 for us to keep an eye on and to push for.
28:12 And then another piece of that
28:14 is that once these items are submitted to Pucco,
28:17 they are public records, correct,
28:20 so they are public records once Pucco has them.
28:23 So would any member of the public
28:25 also be able to request them from Pucco
28:32 There are some confidential documents
28:35 dealing with the engineering of equipment
28:39 that is protected, but by and large,
28:41 that's accurate, President.
28:43 And so the same thing is, so if we were,
28:47 you know, I tend to invite First Energy
28:49 to come before council and speak with us
28:51 about what they have done and intend to do.
28:55 And sometimes in the past,
28:56 they've been hesitant to do that on the public record,
28:59 but anything that is within these documents
29:01 that are considered public record,
29:03 they would probably not really have much of a stance
29:07 to say that they couldn't speak about it.
29:09 Would you consider that to be true?
29:10 I consider that to be very true, yes.
29:13 Thank you, Director Carter.
29:17 The next part of the legal strategy
29:19 involves the rate case filed by First Energy,
29:26 First Energy has filed an application
29:28 with the regulatory body to increase its rates
29:32 charged to consumers.
29:34 Now, we are likely to intervene and oppose that.
29:39 We are doing the legal research.
29:40 That's something that as we get
29:42 our mental impressions together,
29:45 our legal impressions together,
29:47 we would be glad to report to council,
29:50 most likely an executive session,
29:53 because it remains to be done.
29:55 But again, we'll work with Mr. Brodbeck.
29:57 He's very helpful in that situation.
30:01 We as lawyers cannot get emotional.
30:06 We try to keep it level-headed,
30:10 but after all of this,
30:12 the First Energy to seek a rate increase
30:14 from our residents and businesses is quite insulting.
30:19 So we'll try to keep it objective,
30:21 but we're gonna oppose that.
30:22 The mayor's instructed us to oppose it.
30:24 We're just working on the form of opposition.
30:28 Finally, I wanna set forth the goals of all of our work.
30:34 As we set these on,
30:36 we set the goal about the equipment upgrade,
30:39 but the equipment upgrade is a means to the end.
30:44 In the end has to be fewer outages
30:49 of lower, shorter duration.
30:53 First Energy is measured by the frequency
30:55 and duration of its outages.
30:58 We need far fewer outages in Lakewood,
31:03 and the outages that occur
31:04 have to be much shorter in duration.
31:08 And those outages cannot be equipment related
31:11 or employee air going forward.
31:16 We understand weather issues,
31:18 but those are the goals.
31:20 These equipment upgrades are happening as we speak.
31:23 There may be more as a result
31:25 of the mayor's second complaint to Pucco
31:28 that we'll monitor that.
31:29 Those large transformers will be fully operational
31:34 by the second quarter of 2027.
31:41 We will get reports on outages.
31:43 We'll compare those outages
31:45 and make darn sure we're seeing some results
31:48 for the residents and businesses.
31:50 And if we aren't, we will keep at the legal strategy.
31:54 We put a lot of information on the webpage
31:59 for our residents and businesses.
32:03 They can check in on it periodically.
32:05 I just want to remind everybody of that.
32:09 We've left plenty of time for questions.
32:11 I know we've addressed some already,
32:13 and I know the OCC graciously has come up from Columbus
32:17 and they will speak as well.
32:20 Thank you very much, Dr. Vargo.
32:21 And I just want to express our appreciation
32:25 for the partnership with Mayor George
32:26 and your work within the law department on this.
32:31 I know it's been a lot of labor
32:33 that is very meaningful and impactful,
32:36 as well as the work of our other departments,
32:38 our human services, our first responders.
32:40 One of the things that I'm often asked about the toll
32:44 that the electrical outages take on our community,
32:47 and one of those pieces is the resources
32:51 that our city expends in trying to respond on the back end
32:57 to needs that wouldn't exist
32:58 should First Energy have taken care
33:00 of their infrastructure in a timely manner.
33:03 So it's both the human toll and the financial toll,
33:07 as well as taking our city employees away
33:09 from other labor that they would probably rather be doing
33:14 than trying to take on First Energy in court.
33:16 So we appreciate your efforts tremendously on that.
33:21 I do wanna just, if we could go back
33:23 to the slide with the timeline.
33:25 I think it's one before this.
33:28 I just wanna point out,
33:30 Director Vargo went through this very well,
33:34 but just to emphasize a little bit here again,
33:37 that we look at this timeline,
33:40 I'm sure many of us, many of you who are here tonight
33:44 also attended the public meeting
33:46 that First Energy offered last summer,
33:50 I believe it was after those outages
33:52 when they promised that they would do better.
33:55 But then if we look at this timeline,
33:57 that was they were also seeking
34:00 to lower reliability standards at the same time.
34:03 So it is important that we stay on this,
34:06 all as Director Vargo pointed out,
34:08 none of these orders with PUCO would have happened
34:12 without this intervention.
34:14 So this work is making a difference.
34:16 It's not as fast as we want,
34:19 but we are seeing as the transformer was delivered
34:22 to the Lakewood station,
34:25 which is the one in Birdtown area.
34:27 And then I had reports that another transformer
34:31 is delivered to Lauderdale today,
34:33 potentially maybe getting ahead
34:34 of PUCO's next investigation,
34:37 which would be a step in the right direction.
34:40 So we'll see, we'll see how those,
34:43 when things actually get hooked up.
34:45 But just thinking about that,
34:46 that we are a little bit,
34:49 I saw an article newspaper
34:51 that compared this to David versus Goliath.
34:54 We're a municipal, we're a city
34:58 taking on a multimillion dollar corporation
35:00 and it takes all of us working together.
35:02 And I just wanna emphasize once again
35:05 that point that First Energy tried to cite
35:09 that customer service survey,
35:12 and it was the complaints of over 800 residents
35:18 speaking out directly,
35:19 submitting those complaints to PUCO
35:22 that your voices are powerful.
35:25 And even when we don't have electricity,
35:27 you still have power.
35:28 So we wanna make sure we continue to do that
35:31 as people experience outages,
35:32 hopefully never again.
35:35 we have to keep filing those complaints
35:39 because it is, although we're all tired of doing it,
35:41 it's an important tool
35:42 and we have to use every tool
35:44 in our tool belt to tackle this issue.
35:49 I will open up for questions.
35:56 I'll turn first Council Member Stubig.
36:02 I appreciate all the work that's gone into this,
36:04 President, coupled by yourself and by Mayor George
36:07 and the law department.
36:08 And I'm wondering if you could give us a quick overview.
36:12 And I see that Director Gordon isn't here tonight,
36:17 but Mayor George, maybe you could tell us
36:19 about the number of transformers in the city
36:22 or if anybody can shed light on that.
36:24 And if Athens failed first and Lauderdale failed second,
36:29 are we expecting a third and a fourth
36:30 to fail someplace else?
36:33 And also, if you could also address the question
36:37 from several of people that have reached out to me
36:40 is with the new developments
36:42 that are being put in across the city,
36:44 will this also be a drain on their electric?
36:48 And I'm quite sure that we addressed that
36:51 when we talked about the Lakewood Commons going in.
36:54 And it didn't seem to be even a second thought,
36:57 like, oh, that'll absolutely be fine.
37:00 And now I'm starting to question that as well.
37:02 Do we need to go back
37:03 and look at what kind of drain
37:07 these new developments are putting on our system?
37:13 And I'll just mention,
37:15 some of these questions may be better suited
37:19 when we have first energy here or once we get the report.
37:22 So some of the things Director Vargo referenced
37:25 was one of the things that first energy was required
37:31 to file with PUCO a plan for the infrastructure
37:35 of how they were going to bring their infrastructure
37:38 up to where it needs to be,
37:39 as well as the communication plan.
37:41 And so we have requested that plan
37:44 so we can see in detail some of,
37:45 we know some of the things like the transformers,
37:48 but some of that we need that detailed plan.
37:50 And if I'm misspeaking, correct me Mayor George,
37:53 but, and so some of those things
37:56 in terms of the number of transformers
37:59 and where they are and those sorts of things,
38:02 the experts we have before us tonight
38:05 may or may not have those answers.
38:06 So I just want to put that out there.
38:07 I don't want to put pressure on the law department
38:09 to be able to answer engineering questions.
38:13 But just to put that in mind.
38:17 and I forget the other question is great.
38:29 Yeah, so thank you.
38:30 A couple of things.
38:31 So regarding the new construction,
38:34 the developer will work directly with FirstEnergy
38:38 to identify the power load for each development.
38:42 And speaking with FirstEnergy,
38:44 they have told me they do do a thorough audit.
38:47 So that's the details of that
38:49 and the engineering behind that
38:50 is definitely a FirstEnergy question.
38:51 But I know that does happen
38:53 every time there is a large development.
38:56 Regarding the transformers,
38:57 again, FirstEnergy is going to have
38:59 a lot of the detailed information and the substations,
39:02 but the city of Lakewood
39:04 does have a handful of substations.
39:06 One at Athens, one at Lauderdale.
39:11 to summarize some of the issues of the past couple years,
39:15 it seems to be that the initial issues
39:17 were at the Athens substation,
39:20 which I would assume that's why Pucco has identified
39:24 for them to get new substations.
39:26 The last big outage around the holiday
39:30 was related to the Lauderdale substation.
39:37 Yes, thank you, President Keppel.
39:39 Just, I'll add in response
39:42 to Councilperson Striebig's question.
39:45 The Ohio revised code requires FirstEnergy,
39:49 the utility, to understand new development
39:53 and to provide energy for that new development.
39:56 It's not, oh, we may not have this development,
39:59 this housing development if you can't service it.
40:02 They are mandated to get their act together
40:05 and to provide, put them on the grid
40:07 and make sure they have all the upgrades in place.
40:10 So we want the city to move forward.
40:15 It's not on the city to put the brakes
40:18 on new housing in the city.
40:21 It is on FirstEnergy.
40:24 Thank you, Director Vargo.
40:24 And just also add something you mentioned
40:27 in another interview I heard too is
40:28 it's kind of strange to have a for-profit entity
40:32 not want more customers,
40:33 so they would certainly want to service
40:36 a large development, one would think.
40:38 Council Member Evans.
40:40 Yeah, no question for me,
40:43 but I just wanna take a moment to say,
40:47 this is, I think this is an unprecedented situation.
40:50 We're in 2026 and these are conversations
40:52 we should be having in like the 1930s
40:54 about reliable power grid.
40:59 And I'm really proud of my colleagues here in the DACE
41:03 and the administration for tackling this,
41:05 which is just something that shouldn't be happening
41:07 where we are right now.
41:08 And for all the hard work that everybody's done,
41:10 and I really want folks, this community to know
41:15 we are as frustrated as you are
41:17 with every one of these things.
41:18 And I feel confident that all the folks up here
41:22 and the administration have done
41:24 every single thing we can to fight this.
41:28 And again, I'm proud of that,
41:29 extraordinarily proud of that.
41:31 That doesn't make this any easier for all of us,
41:35 but this is just one of those things
41:36 that it's actually mind blowing.
41:40 So thank you for all the cooperation in this room.
41:42 I mean, I do have lots of questions,
41:43 but I'm gonna yield to my colleagues on that.
41:45 But I just want everybody to know
41:47 that this is something that is absolutely top of mind.
41:50 This is life and death,
41:52 and we're dealing withch an absolutely,
41:54 I mean, just basically a corrupt corporation
41:58 that's almost holding us ransom.
42:00 And it's just, it's so frustrating.
42:06 So I appreciate so much of the community
42:12 that understands that we're doing what we can.
42:14 And I appreciate the folks that are really frustrated
42:17 that we're not, think we can do more
42:20 or we aren't doing more.
42:22 So I just wanted to put that out there.
42:24 Thank you to everybody.
42:25 I'm really happy to be a part of this fight,
42:29 and I'm proud of this community in this,
42:31 I think, which is a dark moment
42:33 through no fault of our own.
42:37 Councilman Bullock.
42:38 Thanks, Madam President.
42:39 Thanks for the hearing.
42:40 Thanks to the administration for being here.
42:41 I'll save my comments still
42:42 after Ohio Consumers Council,
42:44 but I did have one answer,
42:46 at least the beginning of an answer
42:47 to the question raised by Councilman Schriebig,
42:50 because a couple of residents have asked that.
42:52 So the public works director
42:54 and the building director kind of shared this.
42:57 They said, well, first of all, let's contact First Energy.
42:59 First Energy got back to the public works director,
43:02 and this is what he said.
43:02 First Energy explained that they have a team
43:04 who evaluates all new proposed developments
43:07 within their service territory,
43:08 and this team conducts detailed load analyses
43:10 to ensure new projects do not create adverse impacts
43:16 Developments must have approval before proceeding,
43:19 including accounting for power needs
43:21 and any changes needing to be made
43:24 to the system before proceeding.
43:25 Therefore, the new developments should not have any impact
43:28 on reliability throughout the city,
43:29 which is consistent with what the law director said.
43:33 The inference is that we're experiencing breakdowns
43:36 in equipment that serves both new and old buildings.
43:41 Also on the grid on a typical day,
43:43 there's plenty of capacity,
43:45 there's plenty of electricity.
43:47 What we're experiencing is in the worst rush hours
43:50 on the peak usage days,
43:52 in two summers in a row now, the heat waves,
43:55 when people are using air conditioners
43:57 for what they're for,
43:59 and that should be predictable.
44:01 So there's strain to our grid
44:05 that's beyond new developments.
44:09 In fact, only one of three new developments
44:12 is actually up and running,
44:13 and we had outages last summer,
44:16 and the other two are not activated yet.
44:19 So it's bigger than just the new development question.
44:27 And I think it's important too.
44:28 I think it can be easy to,
44:31 just like it can be easy to blame the newest immigrants,
44:33 we don't wanna blame our newest residents.
44:36 So, and as we're trying
44:38 to solve the affordable housing crisis,
44:40 one of the ways we do that
44:41 is adding more housing units.
44:43 So we try to solve one problem,
44:46 and it's important to note that, again,
44:50 we're not pointing fingers at each other,
44:52 but remembering that the engineers at Pucco
44:57 told us that these failures are caused primarily,
45:01 almost entirely, by equipment failures
45:04 and employee error and lack of proper investment.
45:08 It's the same thing with even the excuse
45:10 about climate change.
45:13 Again, that's not something that should be a surprise
45:16 to a multimillion dollar corporation
45:20 when it's not a surprise to most of us,
45:22 and it's their responsibility to plan for it.
45:25 I was saying to some folks in the audience earlier
45:31 last summer when we had,
45:33 Mayor and I had that meeting with First Energy,
45:36 and they talked about how long,
45:38 we asked about how long
45:39 should a typical transformer last,
45:42 or circuits or some of the other equipment pieces,
45:45 and because some of them in the report,
45:48 I think, are at least over 20 years old
45:50 or almost 20 years old,
45:51 and that might have been true
45:55 in between 1960 and 1980
45:58 that 20 years is gonna be sufficient,
46:02 but the change in our electrical needs is much greater,
46:08 and a power company should know that
46:11 and anticipate that when it's their job,
46:13 and that's how they make money.
46:15 All right, Council Member Hamilton-Steiner.
46:18 Thank you, President Keppel.
46:19 So I believe, so this is,
46:22 my question is directed towards Director Vargo,
46:25 and I believe you may have answered it,
46:26 but just to clarify,
46:28 in what we're doing and the actions that we're taking
46:30 would also include our,
46:36 that also includes our business and corridors,
46:38 so our commercial and small businesses as well
46:42 are included in this?
46:46 Oh, absolutely, Council Person, absolutely.
46:48 These equipment upgrades need to improve
46:52 the reliability of the energy for everybody in Lakewood.
46:57 That's the goal, that's what we're fighting for.
46:59 Okay, thank you so much,
47:00 because I just, I had a meeting with the Chamber,
47:05 and that was one of the things,
47:07 is that there were some businesses
47:08 that they have had their insurance claims denied
47:12 for some of these instances,
47:14 and even if they try to apply and are approved,
47:17 then their rates increase as well,
47:19 so I just wanna make sure that they're also included
47:23 in whatever action that we're taking
47:25 so that they can benefit from this as well.
47:28 And so going back to the goals of our legal strategy,
47:32 so we want less frequent outages,
47:35 shorter duration, new equipment-related outages,
47:37 and then equipment upgrade solution.
47:40 Has there been any thought of restitution
47:44 included as part of, I guess,
47:46 part of that strategy and eventual outcome?
47:51 Yes, Council Person, the mayor indicated
47:54 in her second complaint to Pucco,
47:57 she has requested financial compensation for residents,
48:03 financial fines to be imposed on First Energy as well.
48:06 Okay, great, thank you.
48:13 Vice President Baker.
48:15 Thank you, President Keppel,
48:16 and thank you, Director Vargo.
48:21 My day job being a member
48:22 of a smaller legal department for a public entity,
48:24 I know it's hard to go a mile deep on issues
48:28 that your old law firm would charge a lot of money
48:31 to represent the city of Lakewood on this,
48:33 so I just wanna say that to the entire law department
48:36 and then the OCC, I think we got a lot of bang
48:39 for our buck for the work that you guys have done,
48:42 and I certainly really appreciate it,
48:43 and other residents do as well, and my colleagues.
48:47 On the new development piece
48:48 with downtown development in particular,
48:50 let's not forget there used to be a hospital there,
48:51 that hospital used to pull a lot of power as well,
48:54 and to Director Vargo and some of my colleagues' points,
48:58 we shouldn't slow growth in our community
49:01 because the billion dollar company
49:04 that's supposed to provide safe and liable power
49:06 to us can't, and also the irony,
49:09 and when we get First Energy here,
49:11 I think they'll say is that with new development
49:14 comes upgraded service from them as well,
49:16 because they typically invest in outlying areas
49:18 that are developing faster,
49:21 and so to the law department, to the administration,
49:24 totally on board with everything,
49:27 council will do whatever we can
49:29 to help further those legal strategies
49:33 with PUCCO, with the rate case, with everything.
49:36 The question I have is more fundamental,
49:40 and going back to the 1930s,
49:43 our state constitution does give municipalities
49:47 the ability at least to explore municipalization,
49:50 essentially the acquisition of power infrastructure.
49:56 Right now, that is a scary concept
49:58 in the sense that it's likely very expensive,
50:03 but the problem that I think we have
50:05 is that we don't know how expensive,
50:08 and so without good information
50:10 or at least a consultant to help us understand it,
50:13 it's a pathway with which
50:16 we don't even know if it's possible,
50:18 and so I'd like to ask if the administration
50:22 has considered this, and then if not,
50:25 I'd certainly be committed to work
50:26 with the administration to think about it,
50:28 and for members of the public or folks listening,
50:30 essentially every power pole in Lakewood,
50:33 where our streetlights are on,
50:35 every transformer we've talked about,
50:37 every substation we've talked about
50:39 is owned by a private company.
50:41 That private company is First Energy.
50:45 The U.S. Constitution and the state constitution
50:47 says you can't take private property
50:49 without just compensation,
50:52 and so the Ohio Constitution
50:55 gives municipal corporations, cities like Lakewood,
50:58 the ability to appropriate that property,
51:00 essentially take it from a private party
51:03 and use it for our own public purpose.
51:05 Now, I am under no illusion that that is cheap or easy.
51:11 My problem is that I don't know how expensive
51:13 or how hard it is until we at least explore it
51:16 a little bit, because not only do you have to appraise
51:20 every single light pole, every single light,
51:22 every single transformer on a pole,
51:25 every single substation,
51:27 and we just got them to invest multiple million dollars
51:30 in new transformers that are coming to town,
51:32 so that increases the value of those things.
51:36 So I guess I'm asking the administration,
51:38 is there even an RFQ or an RFP
51:40 to see if there are third-party companies
51:42 that help advise cities on this or municipalities on this?
51:45 Because I could envision something where
51:48 there's essentially a bond offering,
51:52 and the city of Lakewood already runs water,
51:53 already runs sewer,
51:56 at least explore what it would look like,
51:58 how it would be structured.
52:01 And if nothing else, I think that's a bit of leverage
52:04 on issues with first energy.
52:07 Private corporations typically
52:12 respond and respond better
52:16 when there are more areas of weakness
52:17 in which we can exploit.
52:19 And I don't wanna get too much into legal strategy,
52:21 but I think that what we're doing on the PUCO side
52:23 on the rate case and the reliability standards
52:25 is excellent, and I commend the law department's work,
52:27 and I commend the administration for doing that.
52:30 What I'm curious about is if we can go
52:31 on another front and make them defend us
52:33 on two fronts or at least consider it.
52:35 And so that's my question to the administration.
52:37 And folks here might not be able to answer it,
52:39 but know that I'd be willing to appropriate funds
52:42 to help do that or at least study it.
52:46 Yeah, thank you, Councilman.
52:49 We have begun initial efforts to determine
52:51 if formal exploration of municipalization makes sense.
52:57 As you know, this would be immensely costly
53:05 As you know, we would be inheriting
53:08 the crumbling infrastructure that is there today.
53:13 And initial just off the cuff estimates
53:16 are from hundreds of millions of dollars
53:18 to upwards of a billion.
53:21 But we are evaluating, we are looking at it
53:23 if it's worthwhile, but we would not wanna bank
53:27 for up the city to move forward with it.
53:31 But all options are on the table.
53:35 Where are we getting those estimates?
53:38 I've had some initial conversations
53:40 with Cuyahoga County on this.
53:43 And that's what we're kind of the estimated numbers
53:47 we're talking about.
53:48 No formal study has gone into this yet.
53:51 These are just high-level conversations we're having
53:53 about what options the city has.
53:57 Vice President Baker.
53:58 Yes, and Mayor, I certainly agree with you
54:01 that it will be expensive.
54:01 I do think that there are financing options
54:05 similar to how we upgrade our sewer infrastructure
54:07 where you basically bond out and pay over time.
54:13 And so the public can understand.
54:14 I mean, we'd have to either contract with a third party
54:19 to have laborers and people that would go up on polls
54:22 and fix things and respond to things all the time.
54:24 So it's not a small undertaking,
54:29 but I think at least,
54:32 I guess what I'm saying is as one of seven council members,
54:34 I'm willing to put some resources in
54:35 to understand what it looks like,
54:38 how much it might cost,
54:39 and what financing options may be available.
54:41 Because the private market may be willing to come in
54:43 and essentially help fund it,
54:46 and then we have a different operator.
54:47 But I'm going with about 10% of the knowledge on this.
54:53 And so I guess what I'm saying is I'm willing
54:54 to work with the administration and my colleagues
54:57 to give us maybe 30 to 40% of the knowledge
55:00 so we can make informed decisions and have leverage.
55:03 Yeah, I, you know, the former librarian,
55:07 and like to have that information as well.
55:10 I'd be interested in that.
55:11 I'd also be interested,
55:12 I would love to have, you know,
55:16 maybe have the county come into
55:18 and talk about some of the work
55:19 that they've been doing with the microgrids
55:22 Because, you know, I think that there's opportunities
55:25 for us to have a yes and strategy
55:29 of the more we reduce our reliability,
55:33 or dependency, not reliability.
55:36 We don't want to reduce our reliability.
55:38 It's already bad enough.
55:39 Reduce our dependency on first energy
55:41 and increase our sustainability.
55:44 That's a win-win for our community.
55:46 So that's also on the to-do list
55:49 of things to be talking about
55:51 in an all of the above strategy.
55:53 All right, Councilman Bixenstein.
55:55 Thank you, President Keppel.
55:57 Thank you to council colleagues
55:58 and the administration for all of your due diligence
56:00 on this very serious matter.
56:02 My council colleagues actually covered
56:04 my main two questions.
56:06 The question I hear, I feel most often from constituents
56:09 is about the potential to municipalize.
56:11 So I appreciate you broaching that topic,
56:14 Council Vice President Baker.
56:16 And then with regards to the transformers
56:18 and the substations,
56:19 I'd like to see first energy provide us
56:21 with a substation map
56:24 where we can see each substation
56:26 and the coverage area it provides.
56:27 So we all have a clearer picture
56:29 beyond infrastructure upgrades
56:31 to the Athens substation and the Lauderdale substation,
56:35 what else needs to be targeted.
56:37 But anyways, the other comment I wanted to make
56:40 is thank you for humanizing this issue
56:44 in your legal strategy.
56:46 I think that's really important to remember
56:49 that at the end of the day,
56:51 this has been unscathed by this.
56:54 It's the most vulnerable members of our population
56:57 who have truly suffered
56:59 and for them it really is a life or death situation.
57:02 So your example of elderly folks
57:04 being caught in elevators
57:06 or my observation when I was out in the field
57:11 on those first couple days of July
57:13 and the 110 degree heat index
57:15 was walking around neighborhoods
57:18 and seeing how many people had resorted
57:21 to being out in their car,
57:24 oftentimes with young children and or with pets
57:29 because at that point they were on multiple days
57:32 of no power in a record setting heat wave
57:35 and this was the best strategy they knew to stay safe.
57:39 And so, I share in the frustration.
57:43 I certainly agree with the sentiment
57:45 this is unacceptable
57:46 and that we as council will do whatever we can to support
57:50 fixing this life or death issue
57:53 but I really appreciate the ongoing effort
57:55 to remember that you're all humans.
57:59 We need to humanize this
58:00 and remember that our most vulnerable members
58:01 of our population are suffering more than anybody.
58:08 Other questions from council members?
58:13 With that, I'm gonna ask,
58:15 I'm gonna invite Tom Broadbeck
58:18 from the Ohio Consumers Council to speak.
58:21 Tom, if you wanna come up to this mic here,
58:23 if you push the button, it'll turn green
58:25 and then we'll be able to hear you.
58:37 Good evening President Keppel, council members,
58:40 Mayor George, city staff and members of the public.
58:44 My name is Tom Broadbeck.
58:45 I'm an assistant consumers council
58:47 of the office of the Ohio Consumers Council
58:50 and I'm just here tonight to be present
58:53 and to go over some of our,
58:57 the current rate case as well as what we consider
58:59 the big hits of the history
59:02 of the first energy investment into the grid.
59:06 Can you scoot a little closer to the mic, please?
59:09 I know you're tall and it's short
59:10 but I'm getting some signs from folks in the back
59:12 that they're having trouble hearing you.
59:13 Yes, I hope everybody can hear me now.
59:16 For anybody wondering,
59:17 there are some copies of this document
59:20 up on the signup sheet over there.
59:23 Council members, you also have one in front of you.
59:26 As Mr. Vargo said, the OCC with the law department
59:34 in first energy's reliability performance standards case
59:36 before the PUCO, that did ultimately end in a victory
59:42 where the application was denied
59:44 and the standards were kept the same
59:49 rather than weakened as first energy sought.
59:52 However, partially based on
59:55 what we're gonna share tonight,
59:57 our office has filed an application
59:59 for rehearing on that order.
1:00:01 Our application's core basis is that
1:00:06 the hundreds of millions of dollars invested,
1:00:09 consumers should be able to expect
1:00:14 They should expect more reliability,
1:00:16 certainly not less, but the investment's been made.
1:00:23 I'm sorry, Tom, which you said to reopen, which?
1:00:26 That is the reliability standards case.
1:00:29 And an application for rehearing is a procedural mechanism.
1:00:32 It's more than we need to discuss right here.
1:00:38 OCC has also intervened in first energy's rate case.
1:00:43 In that rate case, we represent all of first energy's
1:00:47 residential consumers, including Lakewood.
1:00:50 The first page here in front of you on this packet,
1:00:54 front and back, is our consumer alert
1:00:56 related to the first energy rate case.
1:01:00 There it provides some background and context
1:01:03 about the case, why rates are going up,
1:01:09 That is based on the average household use.
1:01:13 And at first blush, it might not seem
1:01:16 like a large number to an individual household,
1:01:21 in the aggregate of the consumers,
1:01:23 and it still largely impacts our most at-risk neighbors,
1:01:29 sometimes for whom every dollar counts.
1:01:33 On the back page of that consumer alert
1:01:37 is a short explanation of how to make your voice heard
1:01:40 at the PUCO, as well as a brief timeline
1:01:45 on the bottom of the page there of the rate case.
1:01:48 I believe this document is also available
1:01:50 on our website at www.occ.ohio.gov.
1:02:00 And although the rate increase is our primary concern
1:02:03 in regards to the rate case,
1:02:06 particularly in this concerns of affordability,
1:02:09 we believe it is also an opportune time to review
1:02:12 and discuss FE's reliability performance issues.
1:02:15 And for that reason, we look forward to working closely
1:02:17 with the city law department and Mayor George
1:02:20 and all of first energy's consumers are heard.
1:02:26 some background on our role as an office.
1:02:30 The Office of the Ohio Consumers Council
1:02:32 advocates and educates to secure for Ohioans
1:02:34 affordable, reliable, and equitable
1:02:37 residential utility services
1:02:38 that are essential to their well-being.
1:02:41 Basically, we represent all residential consumers
1:02:44 to make sure they are getting
1:02:46 the service that the law mandates.
1:02:49 Our advocacy includes representing consumers
1:02:52 of the PUCO, education and outreach,
1:02:55 including advising legislators on issues and policy.
1:03:02 Turning the page, we get what is the first step
1:03:06 of the grid modernization investment
1:03:10 that first energy has made.
1:03:12 That is called the distribution modernization rider.
1:03:16 This rider was in effect from 2017 to 2019
1:03:21 and through this rider, $457.7 million were collected.
1:03:26 The Ohio Supreme Court ultimately halted
1:03:29 that DMR rider in response to an appeal.
1:03:33 And there are some links available there
1:03:35 with more information on that.
1:03:37 However, if you do some simple Googling,
1:03:40 you may be able to find some more in-depth
1:03:43 breakdowns of that case history.
1:03:46 Moving on, first energy implemented in 2019,
1:03:51 it was approved by the PUCO, grid modernization phase one.
1:03:57 In grid modernization phase one,
1:04:00 first energy was authorized to invest
1:04:01 up to $516 million in capital improvements
1:04:05 to modernize their energy grid.
1:04:08 Through 2022, first energy collected $369.6 million
1:04:13 from consumers under grid mod phase one alone.
1:04:18 Turning the page, in 2024, first energy grid modernization
1:04:23 phase two was approved by the PUCO.
1:04:26 First energy initially requested $626 million
1:04:30 over four years for grid mod two.
1:04:32 However, there was a settlement reached
1:04:34 and that number was reduced to $421 million
1:04:38 over the same amount of time.
1:04:42 These investments were made for a variety of reasons,
1:04:48 but particularly, and the PUCO went back to this
1:04:51 a few times, as well, as the parties,
1:04:53 reliability was a focus of these modernization efforts.
1:04:58 And again, we should be seeing with these
1:05:00 hundreds of millions of dollars invested,
1:05:02 more reliability and not less.
1:05:07 If you turn the page, you can see
1:05:09 what first energy consumers paid for out of pocket
1:05:14 Through 2017 to 2019, the average consumer paid $108.54
1:05:21 over a three-year period for DMR.
1:05:24 That charge was ended after the Supreme Court appeal.
1:05:27 From 2017 to 2025, grid mod one and two,
1:05:34 That is a fixed charge based on an estimate
1:05:36 and that is still being collected from consumers.
1:05:39 As Mr. Vargo and Mayor George made very clear this evening,
1:05:44 the PUCO does take heed when citizens speak up,
1:05:52 and especially when the cities speak up.
1:05:54 They cited not just the city of Lakewood's involvement,
1:05:57 but also numerous resolutions passed by various cities
1:06:02 and villages in the service territories of First Energy.
1:06:08 The next page pretty much is just how citizens can engage.
1:06:13 More voices do make a difference.
1:06:16 You can share and pass along OCC's consumer alerts.
1:06:19 We do have these for all rate cases.
1:06:21 You can file public comments in rate cases
1:06:26 You can stay informed through our OCC resources
1:06:30 encourage your friends and neighbors to speak out,
1:06:32 and contact your local officials
1:06:34 such as the city council members,
1:06:36 Mayor George and Mr. Vargo.
1:06:42 Finally, on the back of that last page
1:06:43 is a QR code as well as our web address.
1:06:47 We invite everybody to visit our website and stay informed
1:06:51 because as we've learned in these cases,
1:06:54 there's power in letting our voices be heard.
1:06:57 OCC looks forward to working closely with the city
1:07:00 and Mayor George to make sure that Lakewood
1:07:02 and all of First Energy's consumers are heard
1:07:07 And I will be around to answer questions
1:07:09 and I believe participate in the executive session
1:07:16 So if folks wanted to submit public comment
1:07:19 to the PUCO about the rate case,
1:07:23 I know it has the link here
1:07:24 but I think they're usually asked to enter a case number.
1:07:28 Would they give that 24-04168 ELIAR?
1:07:36 That would be the up in the top right corner
1:07:48 And if you have any other questions about that number,
1:07:50 I'm sure Mr. Vargo would gladly share the case number
1:07:53 with any citizens looking to make a comment.
1:07:55 Is that a different one than,
1:07:58 I thought we had a different one in our slide deck
1:08:05 Do we get a two-five number there?
1:08:10 Clerks, can you go back on the slide
1:08:13 to the slide that has the rate case number?
1:08:26 We can get that strained out.
1:08:28 but it's the 26 would indicate
1:08:29 that it's this year's case.
1:08:32 It was filed in December 25, but it is ongoing.
1:08:36 So it should be a two-five.
1:08:39 Mr. Vargo, I believe yours is more accurate.
1:08:43 Yes, thank you, President Keppel.
1:08:45 There are a series of applications pending
1:08:48 from FirstEnergy, and we might have put
1:08:54 the non-rate case number up there,
1:08:57 and Tom's number is accurate on the rate case.
1:09:00 Okay, so folks who want to comment on that,
1:09:04 I suppose council members can help share that out,
1:09:07 and maybe we can also put it on the city website
1:09:10 where we have the ongoing strategy with that case number.
1:09:13 So folks who wanna comment on the rate case
1:09:15 can make sure to comment on the correct case number.
1:09:19 Yes, and again, we have information available
1:09:21 on our website, and we're always happy to interface
1:09:24 and help people get involved.
1:09:28 Council Member Hamilton-Steiner.
1:09:30 Thank you, President Keppel.
1:09:31 Actually, if folks type in exactly
1:09:33 that little submit a comment online,
1:09:37 the case number pops up automatically.
1:09:39 So I'll send you to the destination link.
1:09:41 You click on that, and it pulls it in automatically.
1:09:45 Thank you so much, Council Member.
1:09:48 All right, any other, yep, go ahead.
1:09:53 Mr. Brodbeck, thanks for being here,
1:09:57 And this is a very helpful summary.
1:10:01 So 108, $108 plus $146 in change together is,
1:10:06 well, that's above $250 per customer
1:10:12 That's probably bigger than just the Cleveland area,
1:10:14 but all the way to Toledo as well, I'm guessing.
1:10:18 But can you tell us which of these
1:10:21 was the funds lost by First Energy
1:10:24 and that the auditors found
1:10:26 that they were not properly accounted for,
1:10:28 I believe, as a distribution modernization rider?
1:10:33 That, I believe, was a reference to a rider,
1:10:38 you are correct, under one of the DMR programs.
1:10:43 I believe it is an accounting auditor
1:10:47 who noted that either descriptions of accounts
1:10:51 or something of that nature were mislabeled,
1:10:55 which made spending hard to track.
1:10:58 I'm speaking without any specifics here,
1:11:02 but that is my recollection as far as I can think of
1:11:07 as far as missing and counting issues.
1:11:10 Yeah, and the Ohio Supreme Court, I believe,
1:11:12 has ordered some penalties, actually the PUCO,
1:11:17 and I believe Ohio Supreme Court
1:11:18 has ordered some penalties from some of these funds
1:11:20 to be delivered, I think, soon back to the consumer.
1:11:24 But the bigger picture is a very valid one,
1:11:28 which is, essentially, consumers, customers,
1:11:31 Lakewood residents have already paid for the grid
1:11:33 that we have installed, and the funds for repairs
1:11:37 and upgrades haven't properly been used.
1:11:40 And so now we're experiencing repeat chronic outages
1:11:45 of long duration and high frequency
1:11:49 that sometimes are so severe
1:11:52 that the trees next to the poles get caught on fire
1:11:56 and Lakewood Fire Department has to go
1:11:57 and put out a tree that was ignited
1:11:59 by an overheated utility pole.
1:12:02 Things, you know, and then that's just
1:12:04 the beginning of the problem.
1:12:06 So I guess what occurs to me is,
1:12:11 Lakewood, we have a system for absentee landlords
1:12:15 to be required to maintain their properties.
1:12:18 We have 100-year-old homes.
1:12:20 There's a lot of maintenance to take care of,
1:12:22 plumbing, electricity, insulation, your roof, and more.
1:12:27 And we've got a system in our housing department
1:12:29 to stay on top of these things
1:12:32 and hold accountable property owners
1:12:33 who are behind on their deferred maintenance.
1:12:36 And sometimes it happens, but every homeowner,
1:12:39 every business owner, eventually,
1:12:40 has to be held accountable.
1:12:42 And so it seems as if we've got this problem
1:12:45 on a grand scale, even though we've already paid
1:12:50 So a couple thoughts to share with my colleague.
1:12:54 To me, probably the fastest
1:12:55 and least expensive solution will be
1:12:58 to get the grid that's in place
1:13:00 that we've already paid for
1:13:01 to function like it's supposed to.
1:13:03 We've also got a cop on the beat, PUCO,
1:13:06 whose job it is to focus on this,
1:13:09 impose financial penalties, order corrections.
1:13:14 The challenge is that the repairs
1:13:18 for last summer's power outages
1:13:20 seem like they're taking three years.
1:13:23 Here we are in this summer's power outages,
1:13:27 So it seems as if we got whack-a-mole
1:13:30 on our grid maintenance and equipment failure problems.
1:13:34 And that's probably because
1:13:36 for the last 10 or 15 years,
1:13:38 the company hasn't been making
1:13:41 appropriate use of these funds that we've been paying.
1:13:44 I do wanna say I appreciate the linemen
1:13:46 who are working out in the heat,
1:13:50 I appreciate a lot of the people today
1:13:54 soldiering on in First Energy.
1:13:56 Their headquarters has not given them
1:14:00 the tools and the budget to be successful.
1:14:03 But just as some of my colleagues noted,
1:14:07 headquarters wasn't even trying to be successful.
1:14:09 They were playing games with politics in the State House.
1:14:13 So we've got a lot of catch up to do with utility.
1:14:20 I think the point of this hearing
1:14:22 and thank you to the administration
1:14:23 is that we can't have another summer of this.
1:14:25 We're gonna have to be on top of it.
1:14:28 I too wanna consider municipalization or microgrid.
1:14:32 Those are probably five, 10, 15 year solutions.
1:14:37 where we consider a big long-term change.
1:14:41 But I'm trying to help this summer, next summer also.
1:14:48 And Council Member Bullock,
1:14:49 I could respond to that very briefly.
1:14:53 You are correct that the cases that authorize
1:14:57 the spending for the grid as it stands today
1:15:04 That spending has been determined,
1:15:05 revenue requirement, all the charges.
1:15:08 Problems occurring now, such as the 2026 outage
1:15:13 would need to occur in the ongoing case,
1:15:17 which is why Lakewood's involvement
1:15:20 as well as all the citizens' comments in the rate case
1:15:24 would be, are so important.
1:15:27 Because due to this regulatory lag,
1:15:29 which is within the nature of all regulation,
1:15:34 the problem, the time to face the problem is now.
1:15:37 So reliability, OCC believes is a core part
1:15:43 of the conversation in this rate case,
1:15:44 and we believe that Lakewood plays a part in that.
1:15:52 Any other questions from Mr. Broadbuck
1:15:58 Thank you so much, we appreciate you.
1:16:18 That was for anyone watching at home,
1:16:20 just because you probably couldn't hear that.
1:16:22 So that was another member of the Consumer Office Council,
1:16:26 Mr. Blackwood, was giving us the correct number,
1:16:29 which is the 260347 number, thank you.
1:16:33 Okay, so any other questions from Council Members?
1:16:38 I did think of one other thing that I wanted to ask.
1:16:42 In regards to financial penalties, Director Vargo,
1:16:46 is there a statutory limit to how much
1:16:52 and if so, can you talk about that?
1:16:57 Yes, thank you, President Keppel.
1:17:02 The statute allows the commission to issue a penalty
1:17:08 on first energy of $10,000 per violation, or per incident.
1:17:16 And again, I know we spoke about this,
1:17:20 you could fight forever as to what an incident is.
1:17:23 So there's plenty of flexibility for Pucco
1:17:28 to levy a meaningful fine on first energy
1:17:38 And then some members of the public
1:17:41 have asked about pursuing a class action lawsuit,
1:17:48 and I know you talked about how
1:17:51 the Pucco is the proper authority,
1:17:54 but I just wondered if you had any thoughts
1:17:56 you could share about that idea,
1:18:00 and if it's better not to do that on the public record.
1:18:04 Yeah, I don't want to give legal advice to consumers.
1:18:09 I can tell you that regardless
1:18:11 of whether there's a viable class action to be filed,
1:18:16 that would be an extended process.
1:18:19 It would be financial compensation,
1:18:23 not affirmative injunctive relief,
1:18:31 So that would be a two, three year litigation item
1:18:39 be limited to financial compensation,
1:18:43 that we desperately need yesterday.
1:18:47 And for those who aren't attorneys,
1:18:49 can you define affirmative injunction really?
1:18:53 I think I understand what you mean,
1:18:54 but I just give you could maybe explain that.
1:18:58 most of the times you hear injunction,
1:19:01 a party is enjoined from doing something.
1:19:04 They have to stop a conduct.
1:19:05 So somebody's doing something,
1:19:07 you sue for an injunction to stop it,
1:19:09 stop a development, stop this, stop this.
1:19:13 But when a court or regulatory body
1:19:18 affirmatively requires conduct,
1:19:21 that is simply called an affirmative injunctive relief.
1:19:27 They have to supply us with reliable power, essentially.
1:19:32 the affirmative injunctive relief in this case
1:19:35 was new transformers, new equipment,
1:19:38 review the equipment, and upgrade the equipment.
1:19:53 So on this topic, it's a good line of question.
1:19:57 And I do have a OCC question again.
1:20:01 We've been talking about getting at the root cause,
1:20:05 which is the preventing or correcting
1:20:06 the breakdown of equipment.
1:20:08 There's a whole separate conversation
1:20:09 we haven't gotten into tonight,
1:20:10 which would be to attempt to facilitate
1:20:13 at least some partial reimbursement
1:20:15 by lake of residence of damages.
1:20:20 and everything I've heard over the years
1:20:21 is that the state law does not require
1:20:25 or obligate the utility for any damages
1:20:30 when there's power outages,
1:20:31 which seems pretty outrageous
1:20:32 because I don't remember getting a discount on my bill
1:20:39 and all this inconvenience comes.
1:20:41 And I haven't had the chance.
1:20:43 Council members, I've shared a survey of residents
1:20:46 that 297 different residents
1:20:48 reported their actual experiences this July,
1:20:51 and many had to spend on hotels or meals out
1:20:56 or scrambling by generators.
1:20:57 And all those costs are beyond
1:21:01 what their normal family budgets would afford.
1:21:05 So even if it's not dollar for dollar,
1:21:07 there could be, and I think there are ways
1:21:10 that the city might facilitate a variety of strategies
1:21:15 to get some partial reimbursement.
1:21:18 are you aware if the illuminating company,
1:21:22 even though it's not required,
1:21:24 may nevertheless offer a partial reimbursement
1:21:29 for spoiled food if the consumer documents it, et cetera?
1:21:34 I know that some utilities do that,
1:21:36 but I can't find a clear answer right now.
1:21:39 I haven't sat on the 800 number for a long, long time
1:21:45 Unfortunately, I don't have an answer
1:21:46 specific to First Energy if they have a line
1:21:48 or a program for reimbursement of consumer goods.
1:21:52 However, that is something that we often comment on
1:21:56 in cases is to make that more widely available
1:22:05 So yes, on an individual basis,
1:22:07 I am not aware of sitting here
1:22:08 whether or not First Energy has that type of program.
1:22:10 Okay, so it's probably difficult,
1:22:11 if possible at all, direct to the utility.
1:22:14 There may be other workarounds
1:22:15 which probably is subject for a different discussion,
1:22:21 I'll just add that this is something that we,
1:22:23 the city, Mayor George and I both asked First Energy to do.
1:22:27 Mayor George, you wanna talk about that?
1:22:28 Yeah, I was just gonna add,
1:22:29 this has been requested of First Energy directly.
1:22:32 They have informed us that their tariff prevents that.
1:22:37 They could change their tariff to allow that.
1:22:40 But also in the recent formal complaint to PUCO,
1:22:46 we did request for refunds or credits to rate payers.
1:22:50 So we're anxious to hear back on that request.
1:22:54 I'll just note that their tariff prevents them
1:22:56 from giving our residents money back
1:22:59 for spoiled food, but they can put their name
1:23:00 on the Brown Stadium apparently.
1:23:02 So that's an interesting choice.
1:23:05 And we did also ask them this recent,
1:23:09 previous ones this time and this last time
1:23:12 during the outages during the sweltering heat
1:23:17 leading up to the 4th of July.
1:23:18 After it was pretty much over,
1:23:20 they offered one case of water per customer.
1:23:25 So the likelihood of them doing it
1:23:31 out of the goodness of the heart, I think is low.
1:23:33 Yeah, just to add some commentary to that,
1:23:34 I also asked if they could at least deliver the water
1:23:37 to Cove so we could get it to residents in need
1:23:40 and they denied that request as well.
1:23:48 Okay, so any further questions from council members
1:23:53 for on the record questions for OCC or law department?
1:24:00 And Director Vargo, if we enter executive session,
1:24:03 is it appropriate for Mr. Broadback to join us
1:24:07 since they've been working with us on this case or no?
1:24:11 President Keppel, I would request
1:24:12 that we have an executive session in the future
1:24:16 because we are still developing our legal strategy
1:24:21 We've determined to intervene.
1:24:23 We have bases, but we're gonna set forth the strategy,
1:24:25 the three of us, based on research,
1:24:28 based on conversations with OCC.
1:24:30 And it would be far more meaningful to council,
1:24:33 I believe, after recess to hear from us
1:24:38 Okay, but I guess the question though
1:24:40 is if we do choose to have one tonight,
1:24:42 would it be appropriate to include Mr. Broadback or not?
1:24:47 It would, President Keppel, it'd be fine
1:24:52 because we have a joint agreement with the OCC
1:24:56 to maintain the attorney-client privilege among us.
1:25:00 We have common interests in our cases
1:25:04 against Earth's energy, and therefore,
1:25:06 we would not breach any attorney-client privilege
1:25:09 by speaking in front of Mr. Broadback.
1:25:15 I'll ask Ms. Swallow to confirm that.
1:25:22 All right, so with that though,
1:25:24 I want to make sure we have time for public comment
1:25:26 since we've spent a lot of time tonight
1:25:28 talking about how powerful your voices are.
1:25:30 We wanna make sure we have time to hear them
1:25:37 if you come up to the microphone, it's already on.
1:25:39 So the one Mr. Broadback was speaking at,
1:25:42 you'll just state your name for the record
1:25:44 and your address if you're comfortable,
1:25:47 and you'll have up to five minutes to speak.
1:25:49 You can address the chair, that's me,
1:25:51 and avoid personalities, and I think that's it.
1:25:56 All right, so with that, first up,
1:25:59 Mr. Blackwood, did you still wanna speak?
1:26:08 Apologize if I didn't say that correctly.
1:26:11 No, you got that right, thank you.
1:26:14 I wanna start my comment and just start
1:26:17 with a statement of gratitude, right?
1:26:21 I've lived in Lakewood the last eight years.
1:26:23 It's very clear and obvious that everyone in this room
1:26:26 is frustrated by the same problem
1:26:28 and seemingly working really hard
1:26:30 to try to get creative with ways to solve it.
1:26:33 We're all aligned here that if we come out of this
1:26:37 in a year or two and the outages are far fewer
1:26:41 and I'm really refreshed to hear that.
1:26:44 I'm also really refreshed to hear
1:26:46 that we're taking creative measures
1:26:49 to try to maximize our leverage with first energy
1:26:53 in trying to bring them to the table,
1:26:55 and it's to that comment that I'm here speaking today,
1:27:00 it's very clear that first energy,
1:27:04 they don't have a meaningful deterrent
1:27:08 from performing this type of behavior,
1:27:10 especially with the cities of Lakewood
1:27:13 and cities similar to Lakewood.
1:27:14 The example came from the mayor's table earlier
1:27:17 where we are one of the oldest,
1:27:20 if not the oldest infrastructure
1:27:21 with one of the poorest grids in the state,
1:27:26 we are among the most population dense.
1:27:30 if this wasn't a regulated monopoly,
1:27:32 we'd be their ideal residential customer,
1:27:37 this would be the perfect case to churn as that customer,
1:27:43 there's no viable deterrent,
1:27:44 at least from first energy's perspective for them to care,
1:27:48 and otherwise they would be here tonight to answer for it.
1:27:51 And so I've worked as a consultant
1:27:55 for some of the largest governments in the world,
1:27:59 some of the largest energy providers and public utilities,
1:28:04 and there's an asymmetry in their thinking
1:28:09 and how this room is dealing
1:28:11 with the problem and the rules to the game
1:28:15 And that asymmetry stems from the fact
1:28:17 that this room is operating within the set of rules
1:28:22 to try to hold them accountable,
1:28:24 and first energy's doing the same thing
1:28:26 except they're involving another player,
1:28:28 and that's the state house in Columbus.
1:28:30 We've alluded to at the mayor's table
1:28:32 that they're all too frequent
1:28:34 in the pockets of that state house,
1:28:36 and my fear is that by imposing
1:28:40 some of these reactive measures
1:28:41 we've discussed today in responses
1:28:46 that even if the judges in Ohio get in alignment,
1:28:51 all the municipalities in Ohio get in alignment,
1:28:55 and the maximum penalty per incident
1:28:59 is levied as maybe a credible deterrent,
1:29:02 that same influence in the state house
1:29:05 and that's what first energy,
1:29:07 if I were them, they'd be banking on.
1:29:11 going to maybe Councilman Baker's point earlier
1:29:14 as he alluded to the state constitution,
1:29:17 the one thing that those folks in Columbus
1:29:20 who's another party that needs to be at this table
1:29:23 that they don't get to seem to intervene with as much
1:29:29 And I know that there's plenty of laws on the books
1:29:32 around what municipalities can do
1:29:34 to bring citizen-led ballot initiatives
1:29:37 to the state voters of Ohio,
1:29:40 but it's that very clear definition
1:29:42 that gives us great area to then operate again
1:29:45 to try to maximize that leverage.
1:29:48 And if any opportunity that the city has
1:29:52 to partner with other like-minded municipalities
1:29:54 to perhaps bring a state ballot initiative
1:29:58 in attempts to hold companies
1:30:01 like First Energy accountable,
1:30:02 I admit it's probably not the intended use case
1:30:07 but this is the rules of the game
1:30:10 and this is the asymmetry that companies like First Energy
1:30:13 with $30 billion market caps are playing with
1:30:16 versus perhaps maybe what's going on in this room
1:30:19 and other municipalities like us.
1:30:22 So I would just ask that in the spirit
1:30:24 of being creative with how we employ the law,
1:30:27 that we investigate anything we can do
1:30:30 from driving or at least helping to foment
1:30:32 even in unofficial capacities,
1:30:35 state laws and ballot initiatives
1:30:37 that could put pressure on First Energy
1:30:39 to be accountable to rate payers
1:30:40 because even if at nothing worse it doesn't pass,
1:30:43 every dollar they have to spend fighting
1:30:45 ballot initiatives might be cheaper
1:30:50 So thank you for letting me speak today.
1:30:54 I live at 1421 Cordova Avenue.
1:31:00 Thank you, and I appreciate that.
1:31:02 I'll also, would you want to give a shout out
1:31:08 that represent us here in Lakewood,
1:31:10 both State Representative Tristan Rader
1:31:12 and State Senator Nikki Antonio,
1:31:14 who've both been supportive in this matter,
1:31:17 but of course they're in the minority at the State House
1:31:19 and the party that did not take bribes from First Energy.
1:31:24 So, but to your point also about the ballot initiatives,
1:31:28 you know, the State House is aware
1:31:32 of the power of ballot initiatives
1:31:33 and you see that because they have tried
1:31:37 citizen led ballot initiatives as well.
1:31:39 So you're not wrong about the power
1:31:42 and that they recognize it as well
1:31:44 or they wouldn't be trying to stop it.
1:31:46 So thank you for bringing that up.
1:31:49 All right, next up is Karen Pesento.
1:32:02 I live on Lake between Cove and 117.
1:32:06 And when we had a power outage in June 16th,
1:32:10 most residents, their power was restored within eight hours,
1:32:13 which of course is much too long.
1:32:15 But my building for some reason was 13 hours,
1:32:18 even though the building on either side of me
1:32:23 I'm also one of the seniors
1:32:24 that was stuck in an elevator
1:32:28 And I wanna commend the fire department
1:32:30 for coming within half an hour to liberate me.
1:32:35 I want to say about what Councilman Bullock
1:32:38 and a few others have brought up,
1:32:40 which is like reimbursements to consumers
1:32:43 for lack of power, lost food,
1:32:47 medical emergencies, and so on.
1:32:51 I moved here from New York State four years ago.
1:32:55 And I can tell you in New York
1:32:57 that if the power is off more than four hours,
1:33:00 which is the FDA standard for refrigerated goods
1:33:04 beginning to deteriorate without refrigeration,
1:33:07 the utility is required to give consumers $250
1:33:12 as reimbursement for lost food.
1:33:14 Now, I don't expect First Energy to give everybody $250.
1:33:19 But I think it really would be something,
1:33:21 at least as part of a settlement for Lakewood,
1:33:23 that everyone should get $100 per incident.
1:33:28 I've had to spend more than that six times this year.
1:33:33 I happen to still be working
1:33:35 so I can accommodate this expense.
1:33:37 But as you know, we have many seniors that are retired.
1:33:40 They either have very small pensions
1:33:43 This is a significant loss for them.
1:33:47 I also want to say the idea of having an escrow fund
1:33:50 is not a bad idea, in my opinion.
1:33:53 But I think it has to go further than that.
1:33:57 Mr. Bullock had a Facebook inquiry
1:34:01 and I read that people were saying
1:34:03 they end up in the hospital
1:34:04 because their medical equipment couldn't be powered.
1:34:07 I can tell you, I know someone individually
1:34:10 who is restricted to an electric wheelchair.
1:34:14 The power went out, she could not see anything.
1:34:16 Her aid had gone home for the day.
1:34:18 She couldn't recharge the wheelchair.
1:34:21 She was stuck in the chair for eight hours.
1:34:23 Now you can imagine the consequences of this
1:34:30 Another issue I want to bring up is
1:34:32 because we have so many senior congregate
1:34:34 living situations in Lakewood,
1:34:36 are they required to have a backup generator?
1:34:39 Because unfortunately, even if First Energy Tomorrow
1:34:42 suddenly developed an impetus
1:34:45 and start fixing everything,
1:34:47 this situation won't be resolved
1:34:48 for at least another year or two.
1:34:51 Now I know that would be an additional expense
1:34:56 but perhaps as part of the reimbursement,
1:34:59 First Energy could have a fund
1:35:01 so these locations can get backup generators
1:35:06 as part of an interim measure,
1:35:09 an action that would be a kind of reimbursement
1:35:11 without them direct payments.
1:35:15 I also just want to mention
1:35:16 that I'm now in a position to buy a house
1:35:20 or a condominium, but I've decided
1:35:23 I cannot do it in Lakewood,
1:35:26 because of this kind of thing.
1:35:33 Yeah, and that's tough to hear,
1:35:36 This is a life and death issue
1:35:38 We've all heard from literally
1:35:43 hundreds, thousands of residents about this.
1:35:51 It's not just an inconvenience.
1:35:53 It's really truly life or death
1:35:59 And to the point about the high rises,
1:36:02 some of the buildings are grandfathered
1:36:05 in so that the code does not require them
1:36:10 and Mary, you can correct me
1:36:12 if I'm wrong about that one,
1:36:14 unfortunately, because this happens so often,
1:36:17 we have these conversations a lot,
1:36:20 but to that point about the,
1:36:23 as we've talked about with microgrids,
1:36:26 especially some of the high rise buildings
1:36:32 and some other sustainable solutions
1:36:34 that reduces their reliance on first energy
1:36:39 as well as provides those emergency solutions,
1:36:43 I think it's yes and all of the above
1:36:45 is that we keep fighting on this front
1:36:47 and we also look for creative
1:36:49 and sustainable solutions on all levels,
1:36:51 so thank you for those good ideas.
1:36:56 The last couple of comments
1:36:58 have been about what the state laws allow
1:37:02 I was having a conversation
1:37:03 with somebody in the administration today
1:37:04 pointing out that something you touched on,
1:37:08 I think, that we have a state delegation.
1:37:10 They could propose some changes to Ohio Revised Code
1:37:15 that exempt the utilities from all damages
1:37:18 or would implement a standard
1:37:22 closer to what New York State has.
1:37:24 Thank you, ma'am, for sharing that,
1:37:26 because today we're at the other end of the spectrum.
1:37:28 Now, easier said than done,
1:37:30 but kind of like Councilman Baker is saying,
1:37:32 maybe you study the municipalization option,
1:37:39 I think there is some bipartisan frustration in Columbus
1:37:42 with this kind of indefensible experience
1:37:46 so it may be that we have more to work with than not.
1:37:53 to follow up with one of our legislators.
1:37:58 I think Representative Rader has a bill right now
1:38:04 that I will have to come back to,
1:38:06 but it's related to this issue
1:38:09 all right, next up is Gary Federle.
1:38:23 for taking the time to listen to me,
1:38:25 particularly the council and the administration.
1:38:31 I attended the last meeting,
1:38:33 the meetings last year at Lakewood Public Auditorium,
1:38:37 and I heard First Energy tell us
1:38:41 that it takes five years to get a transformer
1:38:44 and that I won't say it humored me,
1:38:48 but I lost all credibility for what they had to say.
1:38:53 That's a ridiculous statement
1:38:55 and they never, one member of the audience said
1:38:58 that at no time did they ever apologize
1:39:01 to any members of the community
1:39:03 or the community as a whole,
1:39:05 and I think that deserves repeating.
1:39:07 At this point, I don't have a lot of faith
1:39:14 There was a issue that I had
1:39:16 that I don't think that anyone had mentioned
1:39:20 and that was my air conditioner condenser browned out
1:39:24 and made terrible noises and I turned it off,
1:39:27 and those conditions take years of life
1:39:31 off of your utility, particularly refrigerators,
1:39:34 and so there's an unknown cost
1:39:36 to everyone in this community with their utility,
1:39:39 and I do know my power has gone off intermittently
1:39:43 for short periods of time and the lights have blinked,
1:39:46 and I live on Leedale and I'm not sure how the grid works.
1:39:53 I make no pretense to being an electrical engineer,
1:39:59 but I think that's an issue that might be looked into.
1:40:05 I'd like to say that I support the administration
1:40:08 extremely in all their efforts,
1:40:11 and Consul, particularly Consul Baker, in your comments,
1:40:16 anything you can do to put pressure on First Energy
1:40:20 I think would be conducive to resolving the situation.
1:40:24 I think we'll be lucky to get much out of them.
1:40:27 They obviously have a lot of resources,
1:40:31 and I really appreciate all your efforts,
1:40:36 and I support Consul and the administration,
1:40:39 and I wanted to let you know that.
1:40:41 So thank you for your time again.
1:40:44 Thank you, I appreciate that very much.
1:40:48 And to your point about the brownouts,
1:40:49 I did hear from another resident too
1:40:52 who was suggesting looking at whole home surge protectors,
1:40:59 and of course that also costs people money to install,
1:41:03 and it's one of those things
1:41:04 is when we also talk about generators for folks.
1:41:07 We're all thinking about how we survive
1:41:12 and respond to these ongoing conditions,
1:41:15 so which we unfortunately have to do
1:41:18 while also trying to stop them from continuing to happen.
1:41:46 Thank you, and I think that's something
1:41:50 I probably won't come up in the rate case as much,
1:41:55 it's those kind of preference things,
1:41:58 and for anyone listening at home
1:41:59 who maybe couldn't hear that,
1:42:00 the comment was about losing power to the brownouts
1:42:06 and I'll just note too is that similarly
1:42:12 we have repeatedly asked First Energy
1:42:15 not to send communications with an estimated time
1:42:19 of restoration that isn't based on any facts,
1:42:24 and they have told us in some of the previous ones,
1:42:28 oh, as we're desperately trying to,
1:42:31 I'm contacting our council members,
1:42:35 we're all trying to put it out to the community,
1:42:37 okay, can you give us any information,
1:42:38 can you find out that those ETRs
1:42:41 are often just automatically generated,
1:42:44 it's two or three hours later,
1:42:47 your estimated time of restoration is
1:42:49 before they've even arrived on the scene to check it out,
1:42:53 and so that having misinformation
1:42:55 is worse than no information,
1:42:57 we would much prefer that they just tell us it's out,
1:43:00 we'll let you know when we know why
1:43:02 and when it's gonna be back on,
1:43:04 because it's really harmful
1:43:06 if people think it's only a couple hours
1:43:12 to make decisions accordingly.
1:43:19 Thank you, President Keppel,
1:43:21 and I'm sure the law department is on this,
1:43:22 but if not, I'd just be reluctant not to mention it.
1:43:27 We've discussed the tariff a little bit,
1:43:29 and for folks that are uninitiated,
1:43:31 essentially it's kind of like the contract of adhesion
1:43:35 that all utility customers have to apply by
1:43:37 to get power from First Energy,
1:43:40 and First Energy regularly,
1:43:42 I'm not sure how often OCC can probably help us here,
1:43:45 but they have to go before PUCO
1:43:46 and get that tariff reaffirmed or updated
1:43:49 every, some period of time.
1:43:53 And so I guess what I'm saying is,
1:43:55 what First Energy often does is they propose this tariff
1:43:57 and they say, hey, PUCO, approve this,
1:44:00 and in that tariff it says,
1:44:01 we don't have to pay any damages to anyone
1:44:02 if they lose their groceries.
1:44:04 We don't have to pay anything
1:44:05 if someone's air conditioner goes out.
1:44:07 We don't have to pay anything if this happens.
1:44:10 And it sounds like what New York State did is said,
1:44:13 every time power goes out for more than four hours
1:44:14 for non-weather-related issues, 250 bucks.
1:44:18 And so I think there's something that we can also do
1:44:21 as a litigation strategy or a legal strategy
1:44:22 is like, when that tariff is up,
1:44:25 we have a concerted effort as a city
1:44:27 letting our residents know to put common into PUCO
1:44:30 to have them change that tariff.
1:44:31 Now, I may have described it incorrectly
1:44:33 and I asked the member of OCC to correct me
1:44:40 At home, so they have to have the microphone on to here?
1:44:44 Rate cases as of a recent law change
1:44:47 are now forecasted every three years.
1:44:50 It's a regular rate case situation.
1:44:53 Historically, it was when utilities wanted to.
1:44:58 The reliability law for reliability performance standards
1:45:01 is currently still written that way,
1:45:03 that it is just stated when a utility
1:45:06 wants to apply effectively.
1:45:10 So a lot of it was just by the utility's
1:45:15 But now we do have regular rate cases
1:45:17 and that would impact the tariff language
1:45:26 And then last up is Don Nottage.
1:45:36 I live at 2159 Morrison in Lakewood.
1:45:40 A lot of speakers, previous speakers
1:45:42 have stolen some of my thunder
1:45:43 because a lot of the points that I was going to make
1:45:45 have been very eloquently covered
1:45:48 and that's great because it saved me some time.
1:45:52 So to Madam Mayor, to Madam Council President,
1:45:56 Thank you for this amount of time.
1:45:58 I'll start out with the good news.
1:46:01 The good news is that I was very encouraged
1:46:04 by what I read tonight and what was put forth tonight.
1:46:09 it was shortly after my respiratory event
1:46:13 that ended up me being in the Lakewood emergency room
1:46:17 because of the heat and humidity
1:46:20 and the failure of power, et cetera, et cetera,
1:46:22 and I kind of held people to task
1:46:25 and I was very encouraged by, Madam Mayor,
1:46:31 and I am very encouraged by what I saw tonight
1:46:38 Actually Councilman Bullock, this survey,
1:46:42 and I grabbed this because I wanted to mention this
1:46:45 and enter this into record,
1:46:47 this was very, very valuable
1:46:49 because it puts a human face and human experience
1:46:53 onto what occurred due to first energies.
1:46:58 How do we want to define it?
1:47:00 Not negligence, but lack of,
1:47:03 well, let's just leave it at that.
1:47:04 Let me read a couple of things.
1:47:06 66% of respondents lost food
1:47:10 because of power outages, myself included.
1:47:13 We went to Whole Foods a couple days before,
1:47:16 spent 200 and some bucks on foods,
1:47:19 on food items and thought that they would keep.
1:47:24 So 62% made unplanned purchases.
1:47:28 56% lost vital communications, myself included.
1:47:32 38% lost work hours, wages, or customers.
1:47:37 28% reported adverse health effects
1:47:41 with many unable to operate medical equipment.
1:47:44 70% said they had to replace spoiled food
1:47:49 or spend money on restaurant meals
1:47:51 while almost half purchased coolers
1:47:54 or ice to protect food and medications, hello.
1:47:59 One in six respondents reported buying generators
1:48:04 Health concerns were a recurring theme
1:48:09 This can't be mentioned enough during this whole process.
1:48:16 And that's why it is important
1:48:18 for this side of the aisle, so to speak,
1:48:20 and this side to come together
1:48:22 and put aside everything else.
1:48:26 We have a common, I don't want to say enemy,
1:48:32 that hasn't been really square with us.
1:48:36 Let me point out, okay, let's jump to this.
1:48:44 On August 19th, Brian Tierney, CEO of First Energy,
1:48:47 is holding at the Union Club an informational luncheon
1:48:52 that you have to pay to go to.
1:48:54 We shouldn't have to do that.
1:48:56 We need this information offered freely
1:48:58 and encouragingly to all of us,
1:49:00 to the citizens of Lakewood and the region.
1:49:03 I find that kind of ironic and humorous.
1:49:08 And then all of a sudden, this was July 18th.
1:49:12 1,172 customers lost power.
1:49:15 Now this wasn't during the period of extreme heat.
1:49:20 It was prior to the storms hitting
1:49:22 and this whole region, Edgewater Hill,
1:49:26 Lakefield Detroit, this whole region lost power.
1:49:29 Now they haven't been straight with us
1:49:31 and they haven't been encouraging us
1:49:33 to engender them with confidence,
1:49:37 to have confidence in them.
1:49:42 I just have to go back to the beginning,
1:49:45 I am glad that we're working together,
1:49:47 that our government is working
1:49:49 towards holding them accountable.
1:49:53 And let me just add, today, just today,
1:49:55 in North Royalton, where my wife works,
1:49:58 her company, a major construction firm, lost power.
1:50:03 That's outside of Lakewood, I know.
1:50:04 But still, it just happened
1:50:07 and it's happening in other regions as well.
1:50:10 And the more this is discussed by the public,
1:50:14 by the citizenry, by residents,
1:50:17 by those involved with this situation,
1:50:20 the more, I think, the more awareness that will be,
1:50:23 well obviously the more awareness that will be developed
1:50:26 and the more tools that we can offer,
1:50:31 by tools I mean direct experiences
1:50:33 of people that have been impacted.
1:50:36 So let us be involved with helping you
1:50:40 do the things that you need to do.
1:50:43 Thank you very much for your time.
1:50:49 A couple weeks ago, my article in The Observer
1:50:53 was called Power to the People
1:50:55 because we keep talking about this point
1:50:58 about the importance of not just the public comment,
1:51:02 We are seven of us up here, one mayor.
1:51:06 There's a small law department
1:51:08 where we have only so many levers.
1:51:13 But when we act together as a citizenry
1:51:17 of almost 50,000 people here in Lakewood
1:51:20 speaking out and taking action,
1:51:22 it really does have more power.
1:51:26 We have more accountability.
1:51:27 So in addition to your points of we continue to speak out
1:51:32 with the Public Utilities Commission of Ohio,
1:51:35 as well as there's other actions
1:51:37 that I put in the article that we can all take,
1:51:39 all of us, whether elected office or not,
1:51:42 is signing the petition to limit the expansion
1:51:46 of large scale data centers,
1:51:47 which is also a potential drain on our resources.
1:51:51 There was just a case before the Ohio EPA too
1:51:53 where they reversed the decision to let them dump
1:51:57 wastewater from those centers
1:51:59 into our public water streams
1:52:02 as we're updating our sewer system here to not pollute.
1:52:09 So that's one action people can take,
1:52:14 who is elected to statewide office.
1:52:16 And I won't speak to those particular candidates,
1:52:20 but just encourage folks to look up people's stances
1:52:24 on statewide candidates this November
1:52:26 and how they might impact this fight that we are in.
1:52:31 So just some of those things,
1:52:32 but another component is I do appreciate
1:52:35 the administration putting up this page on the website.
1:52:38 I think part of this is that we are all busy,
1:52:41 so busy trying to respond to individual constituents,
1:52:47 work to fight first energy,
1:52:49 work to help residents that sometimes it's difficult
1:52:53 to get the communication out
1:52:56 of all the things that we're doing,
1:52:58 especially those of us who are part-time up here.
1:53:01 So it's helpful to have this resource.
1:53:06 both the mayor and I keep pushing First Energy
1:53:08 to communicate themselves directly with you
1:53:12 so that we don't have to keep intervening,
1:53:15 but it's important what we are gonna keep communicating
1:53:19 with the actions that we're taking
1:53:20 and encourage everyone to stay engaged
1:53:22 because we are gonna need you with us
1:53:26 All right, that's everyone I have signed in
1:53:29 Did anyone else wish to speak
1:53:30 who didn't get a chance to sign in?
1:53:36 All right, council members,
1:53:39 we have the option of going into executive session.
1:53:44 If you have questions that you feel like
1:53:47 would be better answered in executive session this time,
1:53:51 we can do so or we can schedule that.
1:53:58 a few more Committee of the Wholes.
1:53:59 One, I will be inviting First Energy
1:54:07 and I also anticipate having some discussion
1:54:11 about some other solutions.
1:54:14 So there would be an opportunity
1:54:15 at either of those as well.
1:54:17 The thoughts from council members.
1:54:19 Are there questions you'd like to ask at this time
1:54:21 in executive, Councilman Evans?
1:54:23 Yeah, thank you, President Capel.
1:54:24 I agree with Law Director Vargo.
1:54:27 It might be better use of our time after the break
1:54:29 once they've had a better chance
1:54:30 to align their strategies for continuing litigation
1:54:35 just to make it more efficient for all of us.
1:54:39 I also think it's gonna be important
1:54:40 once we get those documents that we've requested.
1:54:43 One of the questions that I asked is,
1:54:47 again, both is for the law department's interpretation
1:54:50 of is First Energy, so not just the rate case,
1:54:53 but is First Energy in compliance
1:54:55 with what they stated in their plan
1:54:58 that they would be doing as ordered by PUCO
1:55:02 for both the infrastructure and communication.
1:55:05 It's hard to imagine that when they cut off
1:55:08 communication with council members
1:55:10 during the July 4th outages
1:55:12 that they are in compliance with the communication plan,
1:55:14 but I could be wrong about what it states
1:55:17 and I think it's gonna be interesting.
1:55:20 Thank you, Council President.
1:55:21 And yes, I agree that, you know,
1:55:24 waiting until we have a little bit more information
1:55:25 in the law department to go into executive session
1:55:27 I also think that, you know,
1:55:29 a reason to go into executive session
1:55:31 is talk about initiating litigation,
1:55:33 but also the acquisition of real property,
1:55:36 as far as acquiring First Energy's assets
1:55:38 So I I'll say that that's another reason
1:55:41 to go into executive session and discuss those things.
1:55:43 And I would happy to work with law department
1:55:45 to figure out how we might find out a way
1:55:48 to at least get our hands around what it is.
1:55:58 So with that, then I'll just ask members of the public,
1:56:02 We will be having more meetings, I'm sure,
1:56:04 on this topic and we'll keep going on the fight.
1:56:09 So with that, then no further business