Sunday, July 4, 2010

Tully Goes Down Swinging on City Utility "Sale"

In a column which appears in today's paper, but apparently not yet on-line, Indianapolis Star columnist Matthew Tully comes out in favor of the "sale" of the city's water and sewer utilities to Citizen's Energy. In the column, he expresses confidence in Citizen's Energy's track record of running utilities and points out that the money is greatly needed for infrastructure improvements. In particular, he points out that some of the money will be used to tear down abandoned houses. He also suggests Democrats' criticism is about Mayor Ballard finding an issue that he thinks will help him win re-election.

In the column, Tully completely fails to address more legitimate criticisms of the deal, focusing instead on the low hanging fruit offered by some partisan Democrats.

Let me start by saying that I am in favor of the transfer of the utilities to Citizen's, which I agree with Tully does have a good track record. I say "transfer" though because the public will own the utilities before and after the so-called sale. A slightly different public, but the public nonetheless. The problem is the "sale" from the public to the public. Citizen's doesn't have the cash up front to pay for the cost of the utilities, so the company will borrow the money over 30 years which will be paid for with increased sewer and water rates. It's little more than a thinly disguised tax increase by the Ballard administration.

Tully points out, correctly that the city needs to make infrastructure improvements. But then he ignores the biggest criticism to the proposal. The Ballard administration is proposing to pay for improvements that have a life span of 5-10 years with 30 year borrowing, not only with the utility deal but also the 30 year bond taken out paid for with PILOT funds. Sidewalks and repaved roads don't last 30 years. Like Tully, I'm all for tearing down abandoned houses, but do we really want to take out a 30 year loan to do that?

Oh, and off the subject slightly, what happened to the federal money the Ballard administration received to tear down abandoned houses? Unlike in other cities which have effective programs where abandoned houses are torn down, the Ballard administration merely distributed it to local non-profits, which undoubtedly have used the money for nice salaries, new cars, cell phones, etc.. I don't see a lot of houses being torn down. Now there's a story for Tully to pursue - how these local non-profits continue to misspend taxpayer money without any oversight by the City.

I have no problem with taking out a bond to pay for infrastructure improvements. But the improvements should last as long as the bond. You don't take out a 30 year loan to buy a car because cars have a 6-10 year life span. Taking out a 30 year bond to install stormwater drains or fix the problem with sewer overflows makes sense. Borrowing money for 30 years to repave Illinois Street is fiscal irresponsibility at its worst.

Tully praises the transparency of the Ballard administration, but fails to mention that city property such as Geist Reservoir and the Central Canal were to be included in the "sale" was not even mentioned until the most recent draft of the proposal. How is that transparency?

Although Tully chides the Democrats for focusing on Ballard's use of this deal to boost his re-election bid (which almost certainly will prove unsuccessful), the Democrats are on solid footing when they point out that Candidate Ballard campaigned as a fiscal conservative and populist and has done little in office but raise taxes and fees and spend taxpayer money like a drunken sailor (or, given the Mayor's military background, should I say "Marine?"). Ballard has turned his back on the very things he campaigned on including his pledge to bring an end to elitist, country club politics. I haven't seen a Republican more unpopular in his or her own party since Virginia Blankenbaker represented the northside in the Indiana State Senate.

Tully sometimes hits the ball out of the park with his columns. On this column though he went down swinging. Didn't even foul one off.


Rick Wilkerson said...

Either the Star told him he couldn't deal with the $ issues that have been clearly laid out by you, Brian Williams and others, or he's not tuned in to the facts.

Either way, an embarrassment. Thanks for holding him accountable.

Citizen Kane said...

It amazes me that no one seems to understand the concept of user fee. Extracting money from a designated user fee for some other purpose (and particularly obligating those users to long-term debt) is nothing less than theft. Yet, the fraudsters and their paid "consultants" and a sycophantic media blissfully discuss it as if it was nothing more than standard operating procedure.

Oh, yeah, I guess it is pretty standard for government officials, i.e., "public servants" to steal from those they pretend to serve!

Unigov said...

The official appraisal of Geist Reservoir places its value at $3.95 million.

I am not making this up.

Tully is a disgrace.

Cato said...

Tully doesn't believe in the sale. Tully doesn't believe in anything. He's the establishment's man at the Star. He plugs leaks and shoots at targets, as directed by his bosses.

Just what is he? He's not a reporter, and he's not on the editorial page. He's position advocacy masquerading as news.

The Star is only useful to see what issues the establishment is pushing.