Mar 15, 2013

Commissioners Poison The Water

The Lehigh County Commissioners have tried to chop the Lehigh County Authority at the knees, by not extending its charter the full term required to lease the Allentown water system. That bid currently requires a 50 year proposal, while the LCA's charter will expire in 36 years. Although residents of Allentown and Lehigh County would best be served by an Allentown Water Authority, issuing its own revenue anticipation bonds, that alternative was never on the table. The Commissioner vote strengthens the hands of the private company bidders, which will offer residents no local accountability. The LCA would become a middleman, between an Aqua America type company and the residents of Lehigh County. In reality, the longevity of LCA, at 36 years, is more assured by public charter than any private company, susceptible to business failures throughout its national network.


Bill said...

It seems like the perfect political dynamic at both the city and county level is in place to lead the entire region into the highest cost, lowest public accountability for the local water supply.

michael molovinsky said...

bill at 5:05, it pained me to write this post. individually, i support all the commissioners who voted against extending LCA's charter, but i don't support anybody blindly. the commissioners question the legality of the allentown lease, but they have not authorized or funded a legal challenge against it. today's Morning Call says that the LCA will attempt to submit a proposal amortized over 36 years. that in effect will just raise the consumer cost. never the less, i still support the LCA as bidder; a private company will be a disaster for all water users.

Waterboy said...

MM, it's obvious now the route the city will go, a for profit company. Have you read the rfp and the sop? The city pretty much gives the concessioner insurance that they will make there money back. It will be a sad thing if this lease goes through, the city will pay 3x's as much as the original lease cost.

Let's just hope king Edwin doesn't get what he wants

ironpigpen said...

When was the last time Pawlowski did NOT get what he wanted?

The General Secretary winning his Water War was a done deal long before anybody even thought about firing a shot.

The All-Star Rubber Council of Apparatchiks had their chance to demonstrate some "Checks and Balances" but, once again, decided against pursuing such a RADICAL and EXTREME policy.

People chose to lie in Pawlowski's bed a long, long time ago. If these very same people cannot figure out how to cope with the monsters thriving underneath ... then some might call that poetic justice.

At least the people could console themselves by spending lots of their hard-earned money (whatever is left over now that all the Bush 'tax cuts' have expired and all the new Obamacare taxes have only just started to kick in, that is) at the $ 177.1 million dollar Palace of Sport.

So, I guess ALL is not lost.



Rob Hamill said...

I can't believe all you folks think that an unaccountable unionized governmental entity like LCA, who would overpay for the Allentown system hugely, would do a better job than a private company who has to live in the world of real economics. Take a cold shower and rethink this. LCA was the middleman who would execute a sham transaction to spread the costs of the Allentown public pensions onto the rest of the Valley--illegally except for the machinations of the G^$##dam lawyers.

michael molovinsky said...

rob, you've had a personal bone to pick with the lca for years. unfortunately, the commissioners have now sacrificed the good, in a futile hunt for the perfect. in the world of real economics infrastructure will be neglected to increase profit for a private company.

Rob Hamill said...

My main bone to pick is that LCA is systematically destroying the Little Lehigh Creek like mindless zombies, you know, just doing the job maam. Their new wells directly take 4 million gallons per day from the banks of the Little Lehigh. Water from anywhere else would not drain the creek as much in the drought summer days when a dryup would ecologically sterilize the creek, possibly forever.The second bone to pick is that LCA is mindlessly pushing the hypergrowth of development in Lower Macungie, and now Western Lehigh County. Their charter from 1966 is so outdated, but like any monopolized unionized bureaucracy, they exist to grow their bureaucracy at whatever cost to anyone else, and that won't be changed, ever by them. If you call that a "personal bone", call it that but know what you call my "personal bone". It's not like I am gettting paid to stand up against evil, you know.

michael molovinsky said...

rob, i think as an explanation of your emotional involvement it should be disclosed that you live on the creek, and consider it your lawn and viewshed. but more to the point is that if lca is permitted to bid or not, it will never the less continue to operate those wells and supply water to lower macungie; either way lca is not going away. so now what's best for the citizens of allentown and the other citizens of lehigh county? will aqua america or another private company serve their interests better than lca? will it benefit the citizens of lehigh county to have two water companies between the filtration plant in allentown and their kitchen spigot. obviously not!

ironpigpen said...

I just really DO NOT understand why the same Government Entity that issued the junk bonds to pay for the $ 177.1 million dollar Palace of Sport just does not go ahead and issue MORE bonds and buy Allentown's water.

If Government can be trusted to finance a minor league hockey rink ... why can it not be trusted to finance a major city asset???

If not, why --- ice hockey is more of a core function or what?


Rob Hamill said...

When you have seen how LCA has operated over the last 50 years, and the fact that it is now fully unionized and too big to fail, how can you think that they have any incentive to operate economically? Aurel Arndt in argueing the point said that all its customers are the bosses, making my point that they are responsible to nobody. The competitive profit motive og the private sector with 5 bidders creates the perfect system for the lowest prices and best service. Government monopolies that don't even have a political accountability like Lca is a recipe for past disasters, and a perfect predictor of a wasteful future "Quasi governmental" entity that will consume the public, just like all government bureaucracies. Any private company that destroys the Little Lehigh can be sued and that company will learn to avoid the problems, LCA says "sue us, we have unlimited public money for our lawyers and we have no incentive to care what we spend on our hyperactive lawyers". Just ask any landowner in LMT who isn't a developer.

Rob Hamill said...

Also, LCA was looking at buying the Allentown plants a year ago for $35,000,000, now the price is $200,000,000, why???. so that the users of the system can pay the public union pension debt. With LCA not bidding, I'll bet that the Allentown assets don't sell for more than $50,000,000. Now that is in the best interests of Lehigh County, as long as allentown goes the bankruptcy route to shed itself of the pension albatross, and decommits to the highest paid public pensioners in the state.

michael molovinsky said...

rob, your scenario of 6:03, will, to quote pawlowski, "not happen on my watch" there will be no municipal bankruptcy. the system will be leased at about the $150 million price point. the operator will increase the water rates to recoup the bid. under that reality, the rate payers are better off with local LCA

Anonymous said...

Published on Monday, November 19, 2012 by Common Dreams
Water Industry Outlook: 'The Time Is Ripe' for Water Privatization