Friday, May 14, 2010

Utilities Ownership Swap Explained

Paul K. Ogden explains the water company sale to the gas company in his blog today.

"Folks, we are selling the water and sewer utilities to ourselves, a paper transaction used to generate up front cash for a tax increasing, corporate welfare loving administration that is recklessly spending our tax dollars."

Even this Indianapolis Observer understands that. What is inexplicable is why we're going along with this obvious sham: "the pretend sale of the utilities that is nothing more than a last ditch effort by an unpopular Mayor to save himself by handing out election year, pork barrel projects."

UPDATE (15 May):
There's much, much more explanation (historic, legal, political) on Gary R. Welsh's Advance Indiana blog here.
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1 comment:

Indy Student said...

I was at the meeting Ogden attended, along with Gary Welsh, Chris Spangle, and a number of other bloggers. It seems that Welsh, Ogden, and I are all in agreement that Citizens is worthy of running the utilities, but what stops us from supporting this proposal is the cash being exchanged.

If Ballard wants to repair streets, he needs to either cut city budgets elsewhere and re-allocate it, or raise taxes. Recent township referendums and (arguably) Wishard have shown that taxpayers are willing to deal with tax increases if the case is made that it's going to a good cause. I think most would approve a tax increase via referendum for sidewalks and city-streets.

I actually was able to ask the first question, and I asked how are $262 million in efficiencies going to be found, because that's a huge number. They had some graphs that I was able to view but didn't get a copy of, and they're really relying on business expenses (software licenses, IT support, legal and accounting services, etc...) to save 40% of that chunk.

40% of 262 million works out to 104,800,000. That's a huge chunk of change, and I'd like to see the math that backs that up.