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Board members of Nome Joint Utility System (NJUS) met last Wednesday for an emergency meeting to discuss overdue payments to Crowley Fuels Alaska. The utility company’s General Manager, John Handeland, said as of last November it owed over $6.2 million.
He said the utility has made progress on its debt, starting with a payment of $1 million last December. Handeland said NJUS then made monthly payments of $750,000 until May when the utility company hit a snag.
“We were still waiting for half a million bucks that has been stuck in the federal clearing house here, and that had been targeted, or is targeted to go against fuel, but it had not resolved,” Handeland said.
Handeland said in May, the utility made an interest-only payment of $133,000 to Crowley. Then on the day of the emergency meeting, NJUS made an extra payment of $600,000 while waiting on the additional funds.
“We are expecting, like I said, this other money to come from the feds here, hopefully in the next seven, eight days. So we'll put that immediately towards them as well,” Handeland said.
Handeland reported to the board that’ll leave NJUS with just $1.1 million owed to Crowley.
Audits on the way
Complicating NJUS’ financial recovery is its missing audits, which haven’t been completed since 2020. Handeland said NJUS is seeking federal grants to pay back its debts, which don’t require up-to-date audits. He said that’s unlike grants from the state or loans from banks, which do require audits.
The utility’s chair, Carl Emmons, blamed inconsistent inventory practices for the delayed audits.
“I know that the State of Alaska is going to want them if they're going to give us a DEC grant or anything,” Emmons said. “Probably not going to go anywhere with grant money without audits.”
Emmons said Joy Merriner from financial services firm BDO has been contacted for help with finishing the overdue audits. He said Merriner was familiar with NJUS’ books and was hopeful to complete the audits by October or November.
