Ballard / Vaughn Reneging On Promise

An abrupt reversal has been announced on the fate of ladder truck 21 that currently services Councillor Christine Scales' district.  Lame duck Director of Public Safety, Frank Straub, is the nominal decision-maker on this matter, but it seems more likely that Mayor Ballard and/or new Chief of Staff Ryan Vaughn are the ones actually at the center of this change of policy.  Paul Ogden over at Ogden On Politics has blogged on this recent development (see "Councilor Scales Calls Mayor Ballard Out on Failure to Live Up to Commitment Regarding Keeping Ladder Truck 21 at Northside Station")

Last year it was announced that Washington Township IFD Station 21would lose its ladder truck.  Many residents became concerned and involved their Councillor in the effort to keep their ladder truck and the protection it afforded their families, homes and businesses.  Scales led the charge by immersing herself in national fire protection protocols, best practices, and best standards.

The combined effort worked out well and Mayor Ballard, personally and through his then Chief of Staff, Chris Cotterill, promised that funding for ladder truck 21 would be provided at least through the end of 2012. Vaughn knows all about it, having gotten Cotterill to reduce the promise to writing.  Knowing that their word did not include any funding beyond 2012, Scales continued to ramp up her information base regarding fire equipment placement, response times, and more.

The June 20 announcement that the ladder truck would not be left at Station 21, but removed on July 1, left little time for the community to mount an effective and vigorous campaign to reverse the reversal.   That was probably deliberate.  The way our City budgets work, there is nothing special about July 1.

Scales shot back, sending out three documents that review the importance of keeping ladder truck 21 in place.  I have uploaded them to Google docs ("What do ladder trucks do", "The decision last year to remove ladder truck 21 was fought by firefighters", and "Councillor Scales statement").

Scales notes that Washington Township has more tall buildings than anywhere outside of Center Township, there are only two White River crossings which limits response times, and the current construction on the Allisonville Bridge with its attendant super-congestion makes this an ill chosen time to remove the ladder truck 21.  She also mentions that she had many private conversations with knowledgeable firefighters who side with her on the need for this truck in this location.  And, she asserts that the City could be opening itself up to a lawsuit should it make good on this latest threat and actually remove the truck.

From the public perspective, this looks bad for Ballard and Vaughn.  Even if you find yourself in positions of power, your word is still your honor.  The commitment made to residents and firefighters should be followed through to completion.  If there is any entertainment of not funding this truck at Station 21 in 2013, then it should be thoroughly discussed with the affected community prior to a final decision.  AND the reasons for that decision should be fully explained to the community.

Mayor Ballard still likes to say his is an open and transparent administration.  Yet, there is little evidence of that.  It is instances like this one that makes a running joke of using Ballard and 'transparency' in the same sentence.  Hopefully, the Mayor will follow through on his word, leave the ladder truck where it is, and pursue real dialogue and real transparency with the residents and firefighters affected by Station 21.

The Utilities Sale Is a Mixed Bag

Anything as complex as the sale of Indianapolis' water and sewer utilities will garner mixed reactions. Not exactly a shocking statement. So, here is my take on several aspects of the deal as it is pending before the Indianapolis-Marion County City-County Council in the form of Prop 197 (see here for supporting documents and here for background documents). By the way, the Utility Transfer Oversight Committee of the Council is scheduled to meet again on July 19 - presumably in the Public Assembly Room, where they will again take public comments. That meeting will begin at 5:30 pm.

The basic outline of the deal is that the City of Indianapolis is transferring the water utility it owns to Citizens Energy for no cash, just the assumption of existing debt, and, it is selling the sewer utility it owns to Citizens Energy for $262.6 million in cash and the assumption of existing debt. Clearly, the sewer utility is the cash cow in this situation.

There have been some key players in crafting the sale, notably Chris Cotterill, the Mayor's Chief of Staff, and Dave Sherman, head of DPW, who I find to be genuinely interested in listening to ideas that can make this deal better in pretty much any aspect, except the core idea of the sale itself and the use of the proceeds for primarily infrastructure improvements. I am pleased to find this sort of openness in government, and I wish there were more folks like them. Now, that doesn't mean I think others who are involved give a hoot what the public thinks or how to improve the deal. Certainly there are some who are only looking to prod the deal in any direction that will send money to companies and outfits with which they are associated. And also certainly, there are those who are only motivated by the resulting humongous slush fund for Republican candidates for Mayor and Council in 2011.

Among the tinkered edges improved by public input, is the inclusion in the sales documents, of a prohibition on Citizens Energy ever selling these two utilities to a for-profit company. Additionally, a strong part of the deal is the first right of refusal if Citizens ever sells the water and sewer utility to a not-for-profit company or entity. Access to properties that is now enjoyed by the public, such as to Geist Reservoir, is to be preserved as well - although perhaps not to the full extent some members of the public would prefer.

Strong arguments that I have heard put forth, that have failed to materialize in the final documents, are water quality standards beyond baseline standards set by the EPA, any oversight on water quality or quantity by local authorities, or any instances of gross negligence under which the City would be able to take back these utilities without the consent of Citizens Energy. One I feel especially fervently about, and which will not see the dark of ink, is a dedication of the money to infrastructure improvements - making legal and binding, all the promises that are being made to the public in order to 'sell the sale'.

Now lets talk about the forbotten topic - should the City sell these utilities? Much is made of the nearly $1 billion in debt owed by the City for the water utility. Many believe that this utility is not managed and operated nearly as well as it should be. This is used to promote a sale. Also used to promote a sale, is some desire to remove 'partisan political governance'. Personally, I don't find any of these issues compelling. The debt is huge - but the ratepayers will still be on the hook for repaying it, regardless of who owns title to the utility. The sales agreement calls for Citizens Energy to honor the existing operating contract with Veolia that are now obligations of the City - so again no change. And lastly, one person's 'partisan political governance' is another person's 'accountability'. You say potato, I say potato. We move the water and sewer utility from services contracted by the City of Indianapolis and its elected officials, to services contracted by Citizens Energy with its self-perpetuating Board accountable to nobody else - not even shareholders.

Nobody talks about mismanagement or onerous debt encumbered by the sewer utility. By all accounts, the City has done a pretty fair, and lately a darned good, job of owning and running the wastewater system. It is under a consent decree with the EPA to make about $2.5 billion worth of improvements to keep sewage from overflowing into our rivers and streams every time it rains (Combined Sewer Overflow remediation). This represents a reduction of $1 billion from an earlier arrangement with the EPA. Everyone I know attributes this reduction in projected cost to the stewardship of Dave Sherman as head of DPW.

It is this reduction in projected cost for CSO remediation that gets garbled up in all the numbers - and I think this garbling is deliberate and unfortunate. The City's PR team wants to sell the public on the idea that Citizens Energy can pay the City $262.6 million in cash for the sewer utility and still keep rates lower than they would have been prior to the $1 billion reduction in projected cost of remediating the CSO problem. I think it is more fulsome to say that the $1 billion in reduction in the projected cost of remediating the CSO problem is fantastic - thank you Dave Sherman. But, the fact that Citizens Energy will have to float a 30 year bond to raise the cash to pay the City, will cause sewer rates to go up in order to repay the principle and interest on the bonds.

This is where the folks who support a simple transfer have a very good point. But, the water company 'sale' pretty much IS a simple transfer of that utility from the City to Citizens Energy. And all the poor management and onerous debt sound like supportive arguments making a case for the transfer. It is the sewer utility sale that is not a transfer, and without any real compelling arguments for the sale - except there is cash to be pulled out of the sewers that will result in higher than absolutely necessary rates for sewer customers. Make no mistake about it, the value of the sewer utility is not in any hard equity built into that system, but is totally contingent upon the fact that Dave Sherman brought projected rates lower than they would have otherwise gone, and the illusion that we somehow can spend that difference like it was equity.

So, now we're on to the topic of cash being obtained from the sewer utility. Just last month the City-County Council approved an increased PILOT from the sewer utility, most of which would be used to secure a 30 year bond to bring roughly $140 million immediately to the City for infrastructure improvements. I attended the Council committee hearing on this matter and something that Councillor Brian Mahern said still rings in my ears. He called it 'monetizing the PILOT payments'. Only, its 'monetizing money'. What they did was to basically take out a loan for $140 million, to spend over the next 2-4 years, and repay more than twice that amount when interest and fees are calculated -- when they could get the same $140 million from the PILOT payments in less than 10 years and have over 20 years of gravy after that. This leads me directly to the conclusion that a major purpose of generating this money is to fund the re-election campaign of Greg Ballard and Republican members of the Council. Otherwise, why be so impatient? Remember, the sewer ratepayers will be paying for 30 years to make infrastructure improvements that will last 10-15 years (and some say even fewer years than that). Why be impatient for the money?

This is the same situation that sewer ratepayers will face when Citizens Energy floats a 30 year bond for the $262.6 million sales price. That $262.6 million may be spent by the City on infrastructure improvements that last 10 -15 years -- but the rates will be elevated for 30 years to repay that money plus interest and fees.

Ratepayers will pay back at least twice the principle of both bonds, and easily more, when interest and fees are considered. So, $800 million to be paid by ratepayers over 30 years for street repairs costing $400 million that will last half that time. This money also eats up any rate savings that Dave Sherman's CSO remediation plan affords the community. Its not savings if you spend it. It is just an expense column adjustment.

On top of all this, there is no guarantee the money will be spent on infrastructure improvements. It is my understanding that the Mayor's office was willing to look at how to dedicate the proceeds of the PILOT and the sewer utility sale, but the Council blocked it. That's not good, in my book. If a Councillor is knee deep in 'selling the sale', then they have an obligation to ink down the promises being made - to protect the community from a bait and switch deal.

This deal is awash in politics - even as anti-politics is said to be a motive for selling the water and sewer utilities. This deal is clearly bad financing (monetizing money) - even as it is being touted as 'clever' financing. And, this deal will leave the sewer ratepayer with around $800,000,000 to pay off, long after the streets that do get repaved are crumbling once again.

I like very much the fact that at least some in City government have been honestly listening to the public. I'm not sure if I could be in favor if the deal was a straight transfer of the water utility only - but quite possibly. But, floating 30 year bonds for $400 million, to be spent on promised infrastructure improvements that will last half that time and leave the ratepayer on the hook for $800 million, strikes me as a generational ponzi scheme that is fiscally irresponsible.

I'mmmm Baaaacccckkkk !!!!!

Hope the holiday season has been good to you and your family. My hiatus was much longer than I anticipated - but fun and refreshing.

I do have a couple of comments on items that caught my attention in the paper and elsewhere this past month. No links to IndyStar will be possible, as those articles are now in the archives.

First and foremost, I sit in admiration of Paul Ogden and his efforts to see that folks accused of a crime are treated properly in our jails and also the latest lawsuit he filed to challenge the traffic court's practice of threatening higher traffic ticket penalties if you want your case heard by the judge. Both of Paul's efforts have seen others, Democratic Party blog "Indianapolis Times" and the Indianapolis Star's editorial board, respectively, try to diminish him with snipes. Their pettiness has only diminished themselves, in my eyes.

The traffic court judge is acting like a Boss Hog - and he needs to either clean up his act or be gone. Traffic fines are already too high - approximating a week's worth of groceries. For the judge to threaten to up the already too high fine just because an American wants his or her due process is an abuse of his authority. I'm not a lawyer, and I hope the judge's actions are not in accordance with legal tenets. But, I am a citizen and when anyone diminishes the rights of others, they diminish my rights as well. Good luck Paul Ogden !!! Keep fighting the good fight.

Prop 418 went down along party lines in committee. 418 was the Council Resolution asking the State Legislature to give Indianapolis-Marion County City-County Council the authority to review abatement decisions. Ours is the only County in Indiana where that authority does not reside with the Council. Mayor Ballard must have been throwing his weight around behind closed doors again. The Republican Councillors abandoned any commitment they have to being actual members of the Council and voted against strengthening the Council's position. Even Councillor Plowman - who championed the issue at the Legislature just last year - and Councillor Smith - who co-sponsored the Council Resolution - voted against the Proposal. Its a shame. I hope it is brought up again and again until the authority to review is granted our Council. Councillor Brian Mahern has shown himself to be an outstanding Councillor this year. We are all better off because he at least tried to make a real difference on the Council. My hat is off to him.

A huge victory was won, at least temporarily, by Charlie Goodman and Jerry Baker and others at the Indiana Tree Alliance. The Indiana Utility Regulatory Commission has set aside a key operational rule regarding the authority IPL has to trim trees on private property. The final decision on the permanence of this rule awaits a final decision on IPL's tree trimming practices, due sometime in late spring, if I understand the timing correctly. Goodman and Baker are hoping that the State Legislature takes up the issue and returns property rights to property owners this session. For more information about the issues, to find out how you can help, and to get the Alliance's newsletter, visit their new website : www.indianatreealliance.com

Mayor Ballard's new Chief of Staff, Chris Cotterill, continues to impress me. After the new head of the Animal Care and Control Board pulled another Boss Hog move, barring Channel 16 from covering his Board meetings, Cotterill stated on behalf of the Mayor, that he'd bring a video camera to the meetings himself, if that is what it took to re-open them to the viewing public. I don't know who the new AC&C Board Chairman is, but his appointment should be reviewed. How out of touch can you be? To pull the Channel 16 access when AC&C has seen one upheaval after another? That agency needs to prove itself and the more citizens who can see for themselves, the better. Cotterill is making the 25th floor a much more interesting place.

And bringing things closer to up to date - let me just say that the Colts organization should refund the ticket price to everyone who paid their hard earned money for a seat to yesterday's game - with the exception of season ticket holders. Those tickets are not cheap and those folks deserved a real attempt to win. They got bupkiss.

Hope your family is healthy and close as we finish up the holiday season. 2010 is just around the corner now. Wow ! 2010 ! Just think, ten years ago we were worried about the end of civilization as we know it because computers only had two digits to denote the year ! Now we have YouTube and Twitter !!!! And I-phones !!!! Wow ! What an incredible time to be alive !