Newport council removes ban on aldermen serving on utilities board after debate over late audits and potential penalties

Newport — The Newport Board of Mayor and Aldermen voted to amend charter language on Feb. 10, 2026, removing a sentence that had prohibited members of the board of mayor and aldermen from serving on the Newport Utilities board. The motion passed 3–2 after more than an hour of discussion about audit timing, accountability and public communications.

City Administrator James Finchem framed the proposed change as a narrow correction to the document drafted by the Municipal Technical Advisory Service and emphasized the timing: this is an amended first reading, not a final vote. He told the council the charter must next go through the private‑act process in Nashville before a second vote and a public hearing could occur later in the year.

Why it mattered: Finchem warned of concrete fiscal risks tied to repeated late audits, saying the state law carries three penalties for two consecutive late audits: a 15% sales‑tax penalty, a one‑year ban on borrowing and a year of ineligibility for community development block grants. “15% of that’s $870,000,” he said when describing the potential sales‑tax penalty, and characterized the combination of consequences as something that could “cripple” the city.

Supporters argued mayoral or council membership on the utility board would strengthen oversight. Mayor Roland Dykes defended the effort as accountability, saying he had discussed the change with multiple people and that “nobody has expressed any interest to me, none of these people, about taking control of Newport Utilities.” Opponents and some residents worried about politicizing a regional utility and urged stronger communication from utility leadership.

Public comment underscored the stakes for customers: Michelle Lane, speaking during public comment, said many utility customers had no voice in past decisions and pointed to prior customer costs related to board actions; she urged a cooperative approach but emphasized the need for accountability.

Board action and next steps: The council removed the prohibition by roll call (motion carried 3–2). Council members and staff said the amendment will be forwarded to Nashville as an amended first reading; if approved there it will return to Newport for a public hearing and a second vote, currently expected in June. Several aldermen also recommended a joint workshop between the city council and the Newport Utilities board so both bodies can “hash out” concerns and improve communication.

The council’s action changes only the charter language at the first‑reading stage; no immediate personnel changes at Newport Utilities were made at the meeting.