Friday, November 20, 2009

Yes, City Should Blow Up Veolia's Sweetheart Deal

"Why shouldn't (the council) just blow this whole thing up?" the Star quotes City-County Councilor Ben Hunter, chairman of the Public Works Committee as saying during yesterday's meeting on the subject of the water company's 35% rate increase request. "You keep coming back and asking for more rate increases. Come back to me and tell me the efficiencies." The answer to Hunter's question is "yes." You should blow this whole deal up and stop the payoffs to the political cronies who cooked it up in the first place.

Candidate Greg Ballard promised to get to the bottom of the one-sided privatization agreement that allows Veolia to pocket about $50 million annually for operating the water company. That deal was brokered by the administration of Bart Peterson. City residents were told the water company purchase was necessary to prevent the company from falling into the hands of a foreign owner and to protect the pay and benefits of the utility's employees. After paying more than double what the company was actually worth, Peterson handed over control of the utility to the French company, which then cut benefits to the long-time employees of the utility. The one-sided deal has proven very costly to ratepayers, but it has financially rewarded lobbyists and cronies of Mayor Peterson who cooked up the deal. In another scheme, Mayor Peterson put more money in his cronies' pockets by exchanging the utility's fixed rate bonds with risky variable rate bonds from which it cost about $50 million in penalties to extricate itself.

Instead of renegotiating the one-sided deal after taking office and calling for a top-to-bottom investigation of what transpired under Peterson, Mayor Ballard took up where Peterson left off and hopped in bed with the contractors and lobbyists, even enhancing payments to Veolia at the same time we've seen water rates nearly double. Ballard is now looking for a way to sell the utility to a public benefit corporation like Citizens Gas & Coke. His plan, however, calls for jacking rates even higher to ensure higher profits to the potential buyer. Ballard then wants to use the proceeds from the sale to finance a bunch of capital projects being pushed by city contractors who have put close to $2 million in his campaign war chest. It would be nice if there was at least one actor in this process who acted in the interests of the City's residents and not themselves and their political cronies. This is Indianapolis though. What else should be expect, right?

3 comments:

Paul K. Ogden said...

You say:

"Instead of renegotiating the one-sided deal after taking office and calling for a top-to-bottom investigation of what transpired under Peterson, Mayor Ballard took up where Peterson left off and hopped in bed with the contractors and lobbyists, even enhancing payments to Veolia at the same time we've seen water rates nearly double. Ballard is now looking for a way to sell the utility to a public benefit corporation like Citizens Gas & Coke."

That is the story of Ballard's administration. He time after time again falls on the sword for the sins of the Peterson administration. He takes a bad situation and makes it worse.

HOOSIERS FOR FAIR TAX said...

Don't you guys remember? Ballard was shipped off immediately to Goldsmith's school of mayoring.

It sure seems like all those guys play out of the same handbook.

james said...

I read your article on Advance Indiana this morning " city should blow up veolia's sweatheart deal" I say privatization equals trouble.

I am a wastewater professional with over 25 years experience, both with a major municipality and with the private sector. And the main thing I learned was that privatization is nothing but a scam.

As a soon to be ex employee of veolia water I can only feel sympathy for a city that considers a company like veolia to tend to their water.

First thing they will do is whack two thirds of the work force and then instead of hiring state certified operators, they will hire so called utilities workers called O&M techs(with minimal certification)instead of bonified operators to tend to the plant. Then when things start to break down, good luck getting them fixed. veolia ran a plant without a grit chamber for almost a year if you can even imagine that, because of finger pointing and playing the blame game with the client. What a joke. And you don't even know what short staffing is until you work for veolia. One operator will be doing the work of 3. They even bring in people that are not even certified in California to run their projects.

Cheap (Veolia) is not the way to go. Best bet for any city is to run their own plant and instead of giving the 15% profit to veolia, reinvest the 15% back into the plant instead of sending it to france.

The business of water needs to remain in the public sector, then, management of these private companies can return to the business of selling womans shoes because thats all they are really good for.

Vote NO on any kind of privatization of water.

jim k