TAUD UTILITY LEADERSHIP CONFERENCE

The Law for Commissioners: Ignorance Is No Excuse

UTILITY DISTRICT COMMISSIONERS SELECTION STATUTE

-TENNESSEE CODE § 7-82-307

Three Primary Methods:

• Appointment By County Mayor

•Election By Members of Utility District Board

•Elections By Customers of Utility District

BEWARE! VARIATIONS EXIST

Potential Pitfalls in Filling Potential Pitfalls in Filling VacanciesVacancies

Using the Wrong Selection ProcessUsing the Wrong Selection Process

Failure To Certify To County Mayor ThreeFailure To Certify To County Mayor Three Nominees At Least 30 Days In AdvanceNominees At Least 30 Days In Advance

Not Properly Certifying The List “Under Seal Of Board Not Properly Certifying The List “Under Seal Of Board of Commissioners”of Commissioners”

Not Involving All County Mayors In A Multi-County Not Involving All County Mayors In A Multi-County Utility DistrictUtility District

Failing To Strictly Follow Notice, Deadline And Other Failing To Strictly Follow Notice, Deadline And Other Provisions In Customer ElectionsProvisions In Customer Elections

UTILITY DISTRICT COMMISSIONER UTILITY DISTRICT COMMISSIONER COMPENSATIONCOMPENSATION

Compensation Authorized By Statute Compensation Authorized By Statute OnlyOnly

TENNESSEE CODE § 7-82-308 AND 309TENNESSEE CODE § 7-82-308 AND 309

Per Diem PaymentsPer Diem Payments- $300.00 For Water and Sewer Districts- $300.00 For Water and Sewer Districts- $500.00 For Gas Utility Districts- $500.00 For Gas Utility Districts

Group Medical and Life InsuranceGroup Medical and Life Insurance

Reimbursement of Actual Expenses IncurredReimbursement of Actual Expenses Incurred

RECEIPT OF OTHER COMPENSATION

• Demand to Repay the District

• Possible Ouster From Office

• Possible Criminal Prosecution – Tennessee Code § 39-16- 402

TAKING AND FILING OATH OF TAKING AND FILING OATH OF OFFICEOFFICE

• Article 10, Section 1 Of Tennessee Constitution

• Tennessee Code § 8-18-107 to 114

• Take Oath Before Undertaking Duties

• File With County Clerk

• Penalty For Failure to Do So?

Commissioner’s Authority To Act Commissioner’s Authority To Act On Behalf Of Utility DistrictOn Behalf Of Utility District

Power Vested In CommissionersPower Vested In Commissioners Tennessee Code § 7-82-301Tennessee Code § 7-82-301

Commissioners Must Act In Open Commissioners Must Act In Open MeetingsMeetings

Tennessee Code § 8-44-101 – 201Tennessee Code § 8-44-101 – 201

Participation By Electronic MeansParticipation By Electronic Means Can Participate If Requirements Of Can Participate If Requirements Of

Tennessee Tennessee Code § 8-44-108 Followed Code § 8-44-108 Followed

LEGAL DUTIES IMPOSED ON LEGAL DUTIES IMPOSED ON COMMISSIONERSCOMMISSIONERS

Annual ReportingAnnual Reporting

o Publication Of Information IncludingPublication Of Information Including

1.1. Financial Condition Of DistrictFinancial Condition Of District

2.2. Earnings Of DistrictEarnings Of District

3.3. Water Rates ChargedWater Rates Charged

4.4. Methodology of Determining RatesMethodology of Determining Rates

o Filing of Annual Audit with County MayorFiling of Annual Audit with County Mayor

o Notification To Customers Of UMRB And Notification To Customers Of UMRB And Method Of Filling Vacancies On Board of Method Of Filling Vacancies On Board of CommissionersCommissioners

LEGAL DUTIES IMPOSED ON LEGAL DUTIES IMPOSED ON COMMISSIONERSCOMMISSIONERS

Fraud ReportingFraud Reporting

Local Government Instances Of FraudLocal Government Instances Of Fraud Reporting ActReporting Act

Tennessee Code § 8-4-501 – Tennessee Code § 8-4-501 – 505505

Affirmative Duty To Report Fraud to Affirmative Duty To Report Fraud to ComptrollerComptroller

LEGAL DUTIES IMPOSED ON LEGAL DUTIES IMPOSED ON COMMISSIONERSCOMMISSIONERS

Code of EthicsCode of Ethics

Comprehensive Governmental Ethics Comprehensive Governmental Ethics Reform Act of 2006Reform Act of 2006

Know How To Handle Ethics ComplaintKnow How To Handle Ethics Complaint

LEGAL DUTIES IMPOSED ON LEGAL DUTIES IMPOSED ON COMMISSIONERSCOMMISSIONERS

Conflict Of InterestConflict Of Interest

No Direct Interest In Contract With No Direct Interest In Contract With DistrictDistrict

No Indirect Interest Unless No Indirect Interest Unless AcknowledgedAcknowledged

LEGAL DUTIES IMPOSED ON LEGAL DUTIES IMPOSED ON COMMISSIONERSCOMMISSIONERS

Approval Of Bill AdjustmentsApproval Of Bill Adjustments

Uniform Accounting Manual For Tennessee Uniform Accounting Manual For Tennessee Utility DistrictsUtility Districts

- only legitimate adjustments- only legitimate adjustments - adjustments documented- adjustments documented

Monitor Employee Pay and PayrollMonitor Employee Pay and Payroll

Adopt Payroll PolicyAdopt Payroll Policy Adopt Pay PlanAdopt Pay Plan Review Benefits Packages To Ensure Review Benefits Packages To Ensure

Compliance With Board ActionCompliance With Board Action

LEGAL DUTIES IMPOSED ON LEGAL DUTIES IMPOSED ON COMMISSIONERSCOMMISSIONERS

Ensure Adequate Separation Of Ensure Adequate Separation Of Employee DutiesEmployee Duties No Complete Control Over TransactionsNo Complete Control Over Transactions Board Involvement?Board Involvement?

Competitive Bidding RequirementsCompetitive Bidding Requirements Utility Districts Subject To Competitive BiddingUtility Districts Subject To Competitive Bidding Document Purchases And Any ExceptionsDocument Purchases And Any Exceptions

LEGAL DUTIES IMPOSED ON LEGAL DUTIES IMPOSED ON COMMISSIONERSCOMMISSIONERS

Use Of Licensed ContractorsUse Of Licensed Contractors

Maintenance Of MinutesMaintenance Of Minutes

Use Of Utility Facilities For Personal Use Of Utility Facilities For Personal GainGain

QUESTIONS, COMMENTS & OTHER OBSERVATIONS