City OKs up to $100,000 for an independent look at Click’s books

The Tacoma City Council has approved spending up to $100,000 on an independent audit of Click Cable TV’s finances — but the study won’t prevent the council from moving forward on spending millions of dollars to expand the system.

Councilman Conor McCarthy had originally proposed waiting for the audit before the council acted on an “all-in” plan for Click that would have the city begin offering internet and telephone service in addition to cable. But under an amendment offered by Councilman Anders Ibsen, the council could approve a funding plan for Click’s expansion before the audit is complete.

“I think that it’s really clear that we should be able to walk and chew gum at the same time,” Ibsen said after introducing his amendment.

Mayor Marilyn Strickland, who has championed Click’s expansion, had hoped to get the council to sign off on the funding plan last month, but now says that the council won’t have to take a separate vote on funding Click’s expansion since that money is already included in the budget the council will approve this month.

Two weeks ago, McCarthy called for the city to hire an independent consultant to review the system’s books and to evaluate whether an expansion was a smart move. He had support from Ibsen as well as Councilwoman Victoria Woodards and Councilman Keith Blocker.

The independent audit will look at the actual value of Click’s coaxial and fiber network to Tacoma Power, whether the current cost-sharing method between Click and Tacoma Power is fair, and whether it’s legal for electric ratepayers to fund Click’s projected losses as it moves to an all-in business model. The city will be reimbursed for whatever is spent on the audit by Tacoma Power, according to the resolution.

Tacoma Public Utilities management has said Click is losing millions of dollars a year, but many council members have said the facts surrounding Click’s finances remain hazy.

A 2015 analysis recommended Click shoulder 94 percent of the costs associated with its commercial operations and that 6 percent be allocated to Tacoma Power for services such as linking the city’s power substations. Prior to that, 76 percent of the costs to operate and maintain Click’s network were borne by the cable system. Some have argued that the new cost allocation plan made Click’s financial situation look worse than it is. .

Councilman Marty Campbell expressed concern about moving forward with Click’s expansion before the audit is in.

“Yes, we can walk and chew gum at the same time, but I’d like to know what the flavor of that gum is going to be, because I’d hate to find out that it’s watermelon,” Campbell said, to laughs. “If we’re going to make an informed decision, it’s going to be informed before we make a decision.”

Ultimately, though, the council voted unanimously to give itself the freedom to approve the Click expansion plan before the audit results are in. Councilman Robert Thoms was absent.

This story was originally published November 2, 2016 at 7:00 AM with the headline "City OKs up to $100,000 for an independent look at Click’s books."