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PSEG eyes spending capital budget funds

A PSEG Long Island internal memo in June

A PSEG Long Island internal memo in June 2014 proposes a $50,000 "refresh" to an employee gym, and another $500,000 to redesign a customer walk-in center. These trucks are in Hicksville on Jan. 1, 2013. Credit: Newsday / J. Conrad Williams Jr.

PSEG Long Island, in an internal memo exploring ways to spend unallocated funds in its $404 million capital budget this year, proposed a $50,000 "refresh" to an employee gym, and another $500,000 to redesign a customer walk-in center.

In a memo to company directors in May, Daniel Eichhorn, vice president of customer services, solicited opinions on a list of five possible budget expenses, noting, "We want to spend all of our capital dollars." PSEG took over operating the Long Island Power Authority grid in January.

PSEG spokesman Jeff Weir, acknowledging the memo obtained by Newsday, said all the expenses were "appropriate" toward the new utility's aim of stabilizing rates and providing better service. In all, the proposals in the memo amounted to $1.8 million of the $404 million budget, and PSEG spokeswoman Kathleen Fitzgerald noted, "Rates for distribution are not going up and $1.8 million will not bring them down."

But utility watchdog Peter Schlussler, a former member of the Suffolk Legislature's LIPA Oversight Committee, called the memo "bothersome on many levels," and asked, "Why max out your credit card if you don't have to?"

Among five items listed in the memo is a refresh to a gym at a PSEG employee call-center office in Melville, which Eichhorn noted would be eligible for the work "as long as it's capital money." Generally, capital budgets fund longer-term infrastructure projects, compared with utilities' operating budgets, which cover costs to run the day-to-day operations.

Weir noted the office has 400 employees and said upgrading the gym would allow the company to actually lower expenses. "We will have better-performing workers, lower absenteeism and [lower] health-care costs," he said.

The memo also notes that $500,000 is available for a customer office "refresh," and asks, "Is there an office that we would want to redesign and update prior to the end of the year?"

Weir said many of the 11 customer walk-in centers "have not been updated in years." Upgrades, such as to computers for better productivity, will make the unspecified location "more conducive to doing business," Weir said.

The memo also said PSEG is considering "offering to take over the road debris clearing process" during and after storms, a plan that would be enhanced if workers had Apple iPads. "I'm guessing they [workers] already have cell phones which we could do the same with, but just throwing it out there to generate ideas," Eichhorn wrote.

The memo also discusses spending $1 million for new meter-reading devices that are "out of date," and a new computer system designed to give 6,000 big customers hour-by-hour usage and costs data.

Schlussler said he was surprised PSEG didn't just lower the budget. "I thought we were going to have a tighter, leaner model than we had in the past," he said.

Weir said the proposed expense items "would allow us to operate in an environment that keeps rates stable and would actually reduce costs over the long term."

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