WRAL Investigates

UNC engineer claims university wasted taxpayer money

Posted November 10, 2010

WRAL Investigates

— A state worker who claimed that the University of North Carolina at Chapel Hill wasted millions in taxpayer dollars on electricity said he is standing by his assertion, even though school leaders disagree.

UNC-Chapel Hill engineer Pat Andrews filed a whistle-blower lawsuit against the school in 2007 after he was demoted. He has since dropped the suit, he said, because he could not afford his attorney’s fees. However, he is not backing down from his claims.

Andrews clashed with UNC’s management over a long-term deal university leaders made with Duke Energy to upgrade the power distribution system on campus. University leaders have defended the deal, but Andrews argues the contract will waste millions of tax dollars.

“It’s absolutely waste,” he said. “This was a bad deal.”

Andrews once managed the system when the university first considered capacity and reliability improvements, and said he pushed for a $10 million plan in which the university would own and operate the substations.

“Everything about electricity on that campus is critical,” he said. “If the taxpayers were asked to pay for the property, to pay for these improvements, they should own them."

Instead, Andrews said UNC management wanted an even more comprehensive upgrade that would pay Duke Energy to do and own everything. In the midst of the debate, he said he was suddenly demoted and taken off the project. He filed a grievance, but later dropped it in a written agreement to keep a job at UNC.

“I was told point-blank that we had the $23 million approved and we were going to spend it,” he said.

Through bonds, the university eventually paid more than $27 million, plus, according to the contract, more than $1 million per year for perpetuity.

UNC engineer claims university wasted taxpayer money UNC engineer claims university wasted taxpayer money

One e-mail provided by Andrews shows that Campus Services Associate Vice Chancellor Carolyn Elfland wanted the Duke option to work or "die trying." In another e-mail, energy consultant Nick Travis hinted that someone makes ownership look less attractive by increasing operation and maintenance costs. He called that "not intellectually honest."

Yet, two years later, Travis defends the Duke deal in his report in which he writes that a lease arrangement makes more sense. Travis contends ownership puts risk on UNC and would cost about $35 million, at least $10 million higher than any estimate Andrews ever saw.

“They inflated the cost of UNC owning it,” Andrews said.

UNC leaders declined an interview with WRAL News, but in a statement, Vice Chancellor Richard Mann said: "All of these allegations by Mr. Andrews have been investigated numerous times over several years by parties inside and outside the University, including the North Carolina State Auditor's office … these allegations have been repeatedly and consistently found to be without merit."

“They simply want to do what they want to do,” Andrews said. “It was a bad deal, badly made by people (who) should have known better.”

Duke Energy declined to talk about the UNC contract, other than to say the company offered viable and fair options for campus power.

As for other universities, they vary in their electricity deals. Some, like UNC, choose to contract the entire system to private companies. Others, like North Carolina State University, own their own substations. An N.C. State spokesman told WRAL that ownership provides the most cost savings.

48 Comments

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  • pbjbeach Nov 12, 10:30 a.m.

    Bendal1:

    It is a matter of personal an professional intgerity an ehtical behavior an of doing the jobs dutys that the taxpayers of north carolina are funding your salary to do an carry out in their best instrest to protcet the taxpayers that are footing the bills for the construction of these state highway projects. thank you

  • pbjbeach Nov 12, 10:20 a.m.

    Bendal1

    Having something written into a contract an the contracting enity actually being forced to comply with what they are supposley to be contracting to do / to perform under these contractual obgliations are two entirely differet animals. question have you ever gotten out of your little office space an into the field an actualy observed what is an has taken place with regards to the current situation of total deregulation that is an has been being allowed to take place for srtictly political reasons to the point that state inspectors arent being allowed to enforce the ncdot state speceficiaiton for roadways an bridges. i'll bet that you havent . just as this engineer is talking about here in this article there is outright fraud ,waste an abuse, an it appears to me to be extremly prevelent with in the ncdot thank you

  • pbjbeach Nov 12, 10:11 a.m.

    Bendial1

    You are 100% incorrect as that i have no axe to grind i am only instrested in the stoping of the waste, fraud an abuse, of the taxpayers funding that is an has been taking place within the ncdot for many many years an i got tired of personal witinessing it hapen time after time an project after project an it is time for someone to actual speak up an tell the truth about the internal working of an the political situation that take place within the ncdot with there vendors an contracting enity being allowed to get away with taking the general public taxpayers of this state to the cleaner so to speak with their allowed corruption thank you

  • Dreadnaught Nov 11, 6:00 p.m.

    GOHEELS69, you are old enough to be beyond blind loyalty to a school. The man works directly with this part of the facilities department. Whether he is a PE, or works for one does not change what he observes and knows first hand.

    I just looked on the capstat database I told you all about and UNC Chapel Hill spent over 5 million dollars not long ago on electrical distribution upgrades. Looks like to me that they are handing over the nice brand new car to Duke Power. Are they doing the same thing with their big co-gen plant? You know it generates steam and electricity - this could fit nicely into Duke's grid. That would be a sweet deal wouldn't it. UNC (read taxpayers) pays Duke to run this state owned plant, and then Duke sells what power is left over as well as billing UNC for the power it uses. I'm sure that's the next little business deal on the agenda for Ms. Efland to consider.

    Wake up man/woman. If you love your school, demand some accountability. I agree with the

  • GoHeels1969 Nov 11, 5:24 p.m.

    I know someone who knows someone about this situation...

    You might want to investigate whether he is a "licensed" engineer or whether he has just worked in engineering. In addition, his superiors and consuiltants are on the project ARE licensed engineers.

    Also, his "demotion" occurred after HE suggested it. He didn't like his boss and didn't want to report to that boss anymore so he suggested an open position be placed above him, that all his supervisory responsibilities be taken away, but that he keep his old salary. LOL

    And, yes, this is not a "technical decision" but an administrative/ownership decision. UNC decided it was not worth the risk to own the equipment, assume responsibility for replacement or maintenance, or hire and train more personnel to own the system.

    I'm shocked that wral did such little research into the actual issues and just listened to his version. Now, were this Steve Daniels at WTVD, I would understand.

  • Bendal1 Nov 11, 4:47 p.m.

    pbjbeach is a disgruntled ex-DOT employee with an axe to grind against his specific employer (Materials and Tests IIRC).

    Every project I've worked on (and I've got 25+ years experience in DOT in design) had written in the contract that the contractor would be required to fix any work not performed to specifications, at his cost. Every time I saw this happen, the contractor fixed the work and ate the cost. There are times when it is difficult to determine just who's at fault, and in those situations the costs are often split between the state and contractor(s), but the contractor almost always fixes non-spec work on his own dime.

    In no way am I saying DOT is squeaky clean; far, far from it. But every time pbjbeach says anything, it's always about how corrupt DOT is and he really doesn't know what he's talking about.

  • Dreadnaught Nov 11, 3:59 p.m.

    One last tidbit of information for WRAL or anyone who wants to investigate it. Here is the website address showing all of the data on construction that is in progress or has been completed in the UNC system. Go to this and find out how much UNC CH has already spent upgrading the electrical distribution system. Just use the search tools and you can find it by searching completed projects.

    So, why would they now contract this out, given that so much state money was already spent? Let's fix the issue, and then give our friends a contract to maintain something that doesn't need to be maintained.

    Here it is https://capstat.northcarolina.edu/

    I don't know who got the payola on this one (unlike the management of the bond projects debacle), but it stinks to high heaven.

  • Dreadnaught Nov 11, 3:52 p.m.

    DLNORRI is correct. In the 80s UNC CH built a so called state of the art steam and electricity generating plant (that never worked properly, but still is in operation nevertheless). I agree totally that it makes zero sense to contract out distribution. Its like you own the house and stove, but rent the dishes and utensils to eat with. I wish I could sign my name, as I am a registered engineer, but I can't - I have to feed my family and my job would be gone tomorrow.

    Keep up the fight Pat! We are behind you!

  • Mark G Nov 11, 3:19 p.m.

    Here is just one of hundreds of stories illustrating why we have a so-called "budget crisis" in the state. ALL state agencies waste millions of tax dollars. In most cases, when state employees complain, they are told, "It's just a small percentaage of the overall state budget."

    Well, so-called "educators", do you remember basic math? Two percent of $10 is no big deal. Two percent of a billion dollars is a heck of a lot of money to the taxpayer from whom you steal that money to waste!

  • dlnorri Nov 11, 3:10 p.m.

    Money is wasted in piles in the education system. Primary, secondary, and college. Most due to ridiculous mandates and incompetent adminstration. This one smells very bad, if for no other reason than the party can not provide clear (transparent) analysis of where the decision was made. It is much cheaper for a large user of electricy to support and maintain themselves, even generate thier own electricity. this is proven again and again throughout the USA and has been documented on WRAL in stories past. UNC built thier own generation plant in the 80's, but then contract out distibution?? Smells....

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