Berke cancels deal with Global Green Lighting - WRCBtv.com | Chattanooga News, Weather & Sports

Berke cancels deal with Global Green Lighting

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CHATTANOOGA, TN (WRCB) -
UPDATE: Chattanooga Mayor Andy Berke says he's backing out of a multi-million dollar contract with a local company, to replace the city's street lights with more energy-efficient LED's.

'Global Green' moved its facility from china to produce the lights locally and hired 60 Chattanoogans to do the work.

While Berke says his team uncovered hidden costs in the project, Global Green says Berke needs to take another look at the numbers.

The $18,000,000 light replacement deal was struck with Ron Littlefield's administration, it was supposed to save the city $36,000,000 in energy savings over the next 15 years.

When Berke was elected, he had a team take a closer look.

He says part of his reasoning for backing out of the deal included higher installation costs.

Global Green says part of that had to do with EPB over-billing for installation and maintenance of the lights.

In the meantime, the company's CEO says he's insulted.

The grand opening of global green lighting was met with much fanfare, complete with a visit by the governor in august.

"This is another, I think, symbol of how Chattanooga's leading, really our country in manufacturing," said Gov. Bill Haslam.

Global Green was in the process of completing the first phase of a $6,000,000 install, when Mayor Berke axed the deal.

"The cost of this for street lights is extremely expensive. And you wouldn't go out and buy a new refrigerator, finance it, then a get a new one the next year. That's essentially what we've been doing," said Chattanooga Mayor Andy Berke.

He says instead of fulfilling the full order of 27,000 lights, the city wants to find a new vendor to replace the old lights as they burn out.     

"What we want to do is be the most responsible we can be with tax payer dollars. A one-to-one replacement is the best way to do that. When a light goes out, you get a new one. That's what you would do in your home, and that's what we want to do in our city," said Berke.  

"He keeps talking about wanting to protect the citizens and do what's right for his constituents. We just laid off 60 people that are his constituents," said Don Lepard, Global Green CEO.

CEO Don Lepard is now sitting on $5,000,000 worth of already-manufactured inventory.

He says even with what he calls EPB's 'inflated costs' the city would still save more than $28,000,000 over the next 15 years, the project would still be the only bond-initiative in the history of Chattanooga that would pay for itself before it's due.

"I don't think they teach economics in law school. And i don't think they actually have a clear understanding on how to teach a lawyer how to run a city," said Lepard.

We asked Mayor Berke if he could blame Lepard for being upset.

"We know that as a business, people want to be our vendor, that's not different with street lights as it is for everything else. At the end of the day, I have to do what's best for the taxpayers in the city," said Berke.

Lepard says replacing the lights one by one will actually cost the city more money in lost revenue than it would be if they put up all the lights today.

He says they requested the city auditor to take a look at the numbers and we'll have more on that in just a moment.
PREVIOUS STORY: Chattanooga Mayor Andy Berke has thrown out a contract with a local business.

Only to start the hiring process all over again. The multi-million dollar debate has been going on for months.       

The city has broken its deal with the owner of Global Green Lighting, the company that has already made thousands of lights to line city streets.  

The previous administration, Ron Littlefield's office, struck a deal with Global Green  to purchase up to 27,000 LED lights at a cost of $18,000,000.
When Berke came in to office he formed a team to take a closer look at the deal.

In the  meantime, Global Green had already installed close to 3,000 lights.

Berke's team claims by the time the lights are installed "taxpayers are paying for two lights to exist on one light pole." and they say part of that comes from higher installation costs and the city no longer wants to honor the contract with global green and instead find a company to replace existing lights as they burn out.

Global Green CEO Don Lepard says the new lights would save the city $36,000,000 and he has already manufactured lights as a part of the deal.  

We asked Mayor Berke his thoughts on the  $5,000,000 worth of inventory that he's already created and if he had response for him. 

"Well, as we go forward, if global green would like to be our vendor to the one-for-one replacement, we'd love to have them bid on it," said Chattanooga Mayor Andy Berke.  

"You won't save $36,000,000 until you put all the lights up. This thing about 700 lights a year? It's not going to work. The numbers won't work. It will actually cost the city more money in lost revenue than it would be if they put up all the lights today," said Don Lepard, CEO, Global Green.  
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