Youngstown Thermal CEO says customers owe money
By Kalea Hall
Youngstown Thermal issued a new statement Wednesday alleging debt from four major downtown customers has led the company to short-term financial difficulty.
Carl Avers, chief executive of Youngstown Thermal, told The Vindicator the four customers owe the company a combined $1,095,309.
This was revealed after The Vindicator exclusively reported that the steam company’s finances are under investigation by the Public Utilities Commission of Ohio.
Youngstown Thermal told the commission about its financial struggle June 14, Avers said.
“It’s created some short-term problems,” Avers said. “[PUCO] supervises us so we had to tell them what’s going on and why.”
Though Avers would not identify the customers he said owe for service, The Vindicator learned that the city is one of the customers Youngstown Thermal has billed for unpaid steam service.
In a March report sent to the city and obtained by The Vindicator, Youngstown Thermal explains that a broken meter – owned by the company – has led to four-plus years of underbilling.
“The amount of steam that City Hall has been using has been deteriorating since 2012,” the report says.
Youngstown Thermal prepared a report to explain the cost of the damage in support of the invoice it sent to the city, detailing $141,570 in unpaid steam service to City Hall, Youngstown Thermal says.
The city disagrees.
“We question the amount,” said Martin Hume, city law director. “We honestly don’t believe that the meter was off by that much.”
The city is investigating meter usage, Hume said.
“We aren’t contesting that there is some amount,” Hume said. “We are contesting his calculation of the amount due.”
Meanwhile, Youngstown Thermal owes the city for its usage of water, which it uses to make steam. After July 10, Youngstown Thermal will owe $58,833 on its water bill.
“We are not going to pay our water bill if they are not going to pay their steam bill,” Avers said.
Youngstown Thermal is willing to deduct the money it owes the city for water from the city’s steam bill, Avers told The Vindicator.
Youngstown Thermal acquired the steam system from Ohio Edison in 1980, Avers said, and until now the company has not had a problem collecting revenue from steam customers.
The financial difficulty the company faces will not affect service, Avers said.
“We are a public utility, and public utilities are required to operate because it’s in the best interest of the community,” Avers said.
Earlier this week, Avers began the chain of stories about Youngstown Thermal’s financial situation after announcing that company assets are for sale and two “major suitors” are French companies with steam operations.
Youngstown Thermal’s steam-utility service is a district energy network. On the network are about 50 heating customers and four cooling customers downtown. Youngstown Thermal recently lost a major client in Youngstown State University. It nearly lost the city last year, but the city postponed the move to another energy provider.