Category Archives: Asset.Sale/Lease

Latimer: Airport privatization in the legislature’s hands

Source: Matt Coyne, Rockland/Westchester Journal News, August 13, 2018
 
The county announced a slew of new initiatives at the airport today, but the status of privatization is unclear.  County Executive George Latimer said Westchester would, among other steps, improve the noise complaint system, but would only say there is a dialogue going on with the Board of Legislators as to whether the county-owned airport would be leased to a private operator long-term. He would not say if the $1.1 billion offer from Macquarie Infrastructure Corp. is still on offer. … Latimer, a Democrat, campaigned against former Republican County Executive Rob Astorino’s controversial plan to lease Westchester County Airport for 40 years, first in a $140 million deal with Oaktree Capital Management in fall 2016, then last fall in a $1.1 billion deal with Macquarie. …

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Rob Astorino Westchester privatization deals under review by George Latimer
Source: David McKay Wilson, Lohud, March 29, 2018
 
Rob Astorino’s Westchester privatization legacy hangs in limbo. Three months into County Executive George Latimer’s tenure, a list of Astorino’s ambitious privatization plans is teetering on collapse. Proposals for Westchester County Airport, Playland amusement park and the county’s deteriorating WestHELP affordable housing complex are all under reconsideration. Astorino’s airport privatization deal stands as Latimer’s biggest challenge in this arena. Latimer has huge revenue needs, such as the long overdue Civil Service Employee Association contract, which could cost as much as $60 million to settle. There’s the temptation to pursue Astorino’s 40-year lease proposal with Macquarie Infrastructure Corp., which Astorino announced the day after Latimer vanquished him in the November election. … The Playland privatization deal, one of Astorino’s major legislative victories in 2016, remains in flux, two years after the county and Standard Amusements agreed on a 30-year deal. … Legislators also wants committees to review the 2016 contract to determine if extensions granted by Astorino were valid. … At WestHELP in Greenburgh, Latimer’s pledge to promote affordable housing in stands its first test at the deteriorating 108-unit complex. He’s up against the town of Greenburgh, and Supervisor Paul Feiner, who has failed to rent out the apartments since the town took over management of the complex for 20 years in 2011. The Latimer administration wants to expand the plan proposed by Astorino in late October 2017, which would give Marathon Development Group a 65-year lease….

More about Westchester airport privatization.

More about Playland privatization.

Baltimore Set To Ban Privatization of Water System

Source: Ayana Byrd, Color Lines, August 8, 2018
 
Legislators in Baltimore have taken historic steps to ban water privatization in the city—a move that will benefit lower-income earning communities in the majority Black city.  On Monday (August 6), members of the Baltimore City Council approved a resolution that will ban water privatization via a nearly unanimous vote. … Baltimore, a city of approximately 611,000 people, is 63 percent Black. Twenty-one percent of its residents live below the federal poverty line, according to the latest Census information. Glen Middleton, the executive director of American Federation of State, County and Municipal Employees (AFSCME) Maryland Council 67, said, “Not only will water privatization increase water rates across the city, but it will also deprive low-income communities and communities of color access to clean and safe water…. Keep water privatization away from our communities.” …

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Responding to activists, Mayor Pugh, DPW director assure they don’t want to privatize Baltimore’s water system
Source: Ethan McLeod, Baltimore Fishbowl, June 13, 2018
 
Fear not, Mayor Catherine Pugh and Baltimore City Department of Public Works Director Rudy Chow say: Baltimore’s water system will remain in public control, despite any charter amendments that activists worry could open up a pathway for privatization.   In a joint statement issued Wednesday morning, Pugh and Chow assured they’re not looking to let companies like Suez Environment in on managing Baltimore’s drinking water supply or any of its resources.  “Baltimore City’s drinking water system is a jewel that must be maintained in the public trust,” Pugh and Chow said. “From the reservoirs in Baltimore and Carroll counties, to our filtration plants in the Ashburton and Montebello communities, we share the commitment of prior generations of civic leaders to keep this life-sustaining resource in public hands.” …

Baltimore’s Water Crisis: Can It Get Worse?
Source: Food & Water Watch, May 8, 2018

In Baltimore, water issues have become the norm. People have been dealing with unaffordable water and incorrect water bills for years, and now the Mayor might be looking to privatize the water system. … Water privatization companies have been circling around Baltimore like sharks for decades. It’s nothing new. But this time, one company is getting more heavy-handed. Since last fall, Suez has been pitching Baltimore officials on a plan to take over the city’s water system. It’s pitching a scheme, in partnership with a Wall Street firm KKR (which should immediately set off your alarm bells), that is an especially harmful form of water privatization called a long-term concession lease. …

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With CEO’s resignation, Massena council will push hospital to privatization, affiliation

Source: Bob Beckstead, Watertown Daily Times, June 19, 2018
 
With Monday night’s surprise resignation of Massena Memorial Hospital’s CEO, town officials will seek a contract with another hospital to run Massena Memorial Hospital and complete the privatization work already underway. Ann Gilpin was hired as interim chief executive officer following Monday’s immediate resignation by Robert G. Wolleben, but it will be a temporary position, Town Supervisor Steven D. O’Shaughnessy said. … Last month, Assemblywoman Addie A.E. Jenne, D-Theresa, introduced a bill that would move the hospital into a public benefit corporation rather than privatizing, which would shift financial responsibility away from the town while keeping the hospital from going private. But Mr. O’Shaughnessy said that was off the table. …

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Jenne introduces bill to create public benefit corporation for Massena Hospital
Source: Abraham Kenmore, Watertown Daily Times, June 1, 2018
 
A bill introduced by Assemblywoman Addie A.E. Jenne, D-Theresa, on Tuesday would move the publicly owned Massena Memorial Hospital into a public benefit corporation, shifting financial responsibility away from the town while keeping the hospital from going private. … The Massena Memorial Hospital has been looking to find a private hospital to affiliate with for several years now, as the hospital continually operates at a loss. At the end of 2017, the hospital reported it had a net annual loss of $5.6 million — an improvement over the prior year when it had lost $6.8 million. … The bill is supported by the state Civil Service Employees Association, whose Local 887 represents hospital employees.  “This is supported, we have supported in the past and continue to support,” said Mark Kotzin, spokesman for CSEA. “CSEA has always been opposed to privatizing the hospital.”  Mr. Kotzin said the union had been working with Ms. Jenne for some time. …

Massena Memorial Hospital sees big financial improvement, but still finishes January in the red
Source: Andy Gardner, North Country Now, February 28, 2018
 
Massena Memorial Hospital finished January in the red but saw a significantly lower net loss than in previous months, where they were bleeding huge sums of money. The hospital lost $61,556 in January, which is down sharply from the $1.8 million loss they booked for December. … At the December meeting, Kerrie French, the president of MMH’s CSEA chapter, expressed concern over the hospital’s leasing a Da Vinci robotic surgery tool. She questioned the hospital for paying the lease at a time when she says staff are being cut. MMH CEO Robert Wolleben said the tool is being used elsewhere in the region and is bringing in patients who would have gone to other facilities. A statement given to the press at the close of the meeting says the tool “offers patients less blood loss, less pain, shorter hospital stay, and small incisions for minimal scarring.” …

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Bill to Privatize Providence Water Raises Objections

Source: Tim Faulkner, Eco RI News, June 11, 2018
 
Drawing comparisons to Flint, Mich., and other cities that have suffered from privatizing public water systems, environmentalists oppose the latest legislative effort to monetize the Providence Water Supply Board and its source, the Scituate Reservoir.  The Conservation Law Foundation, The Nature Conservancy, the Rhode Island Land Trust Council and Audubon Society of Rhode Island all raised doubts about changing ownership of the state’s largest public water source. Without protection, the move threatens open-space land buffers and risks polluting the watershed and public drinking water, according to opponents of the idea.  Mayor Jorge Elorza recently made the annual mayoral Statehouse plea to monetize the city’s public water system and real estate worth some $400 million — all to pay down Providence’s unfunded pension liability. …

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Providence to look at sale of water system
Source: By Daniel Barbarisi, Providence Journal (RI), Tuesday, March 25, 2008

The city is considering selling the Providence Water Supply Board and the network of reservoirs and treatment plants it controls in order to pay down the huge debt in the city’s pension system.

…… The money from a sale would be used to pay off the debt to the city’s pension system, which is owed roughly $700 million.

Unions try to thwart $250M Southampton hospital project

Source: Aidan Gardiner, The Real Deal, June 12, 2018
 
Three unions — the Civil Service Employees Association, New York State United Teachers and the Public Employees Federation — are trying to block state legislation necessary to build a $250 million hospital on Stony Brook’s Southampton’s campus, 27 East reported. The unions don’t like the plan for operating the hospital once it’s built, saying that the majority of the employees would not be subject to civil service laws. The legislation, which needs to be voted on before the legislature closes on June 20, would allow Stony Brook to lease the property to the nonprofit Southampton Hospital Association, which would then raise the money to build the hospital. …

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State Unions Throw Up Roadblock To Key Bill Clearing The Way For New Hospital In Southampton
Source: Joseph P. Shaw, 27 East, June 8, 2018
 
State unions are working to block legislation to clear the way for Stony Brook Southampton Hospital to begin raising money for a new facility on the college campus, apparently concerned about the potential future impact on the workers they represent. … But a trio of state unions representing workers at hospitals like Stony Brook University Hospital, which is owned and operated by the State University of New York system, have formally opposed the legislation, worried that it might be an attempt to move jobs from the public sector to the private sector. At issue is the unusual arrangement at the heart of plans for the new hospital, a key to the affiliation agreement between the former Southampton Hospital and the Stony Brook system that was finalized less than a year ago, according to Mr. Chaloner. … Three state unions—the Civil Service Employees Association, New York State United Teachers and the Public Employees Federation—issued a memo strongly opposing the legislation. Their concerns, Mr. Chaloner said, are rooted in the fact that Southampton Hospital was a private entity, and its workers remain represented by a different union focusing on the private sector, 1199SEIU United Healthcare Workers East. …

Parking meter deal keeps getting worse for city as meter revenues rise

Source: Fran Spielman, Chicago Sun Times, May 14, 2018

Chicago’s parking meter system raked in $134.2 million last year, putting private investors on pace to recoup their entire $1.16 billion investment by 2021 with 62 years to go in the lease, the latest annual audit shows. Four underground, city-owned parking garages took in $34 million in 2017, while the privatized Chicago Skyway generated $99.9 million in cash, separate audits of those assets show. Not a penny of those revenues, once a mainstay for city government, went to ease the avalanche of tax increases imposed by Mayor Rahm Emanuel to solve the city’s $36 billion pension crisis. That’s because all three of those assets were unloaded by former Mayor Richard M. Daley, who used the money to avoid raising property taxes while city employee pension funds sunk deeper in the hole. …

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Parking meters, garages took in $156M — but city won’t see a cent
Source: Mick Dumke and Chris Fusco, Chicago Sun-Times, February 13, 2017

Chicago’s parking-meter system took in $121.7 million last year, while four underground city-owned garages reaped another $34.7 million — with not a penny of that money going to the cash-strapped city government. Instead, the $156.3 million pot of parking cash went to private investors who control the meters and garages under deals cut by former Mayor Richard M. Daley and rubber-stamped by the City Council. … Chicago Parking Meters — formed by banking giant Morgan Stanley and other financial partners — paid the city $1.15 billion to manage the meter system and pocket the money fed into it for the next 75 years. The city took in $23.8 million from the meters in 2008, the last year before CPM took over the system. In the seven years since, the meter company has reported a total of $778.6 million in revenues. It’s on pace to make back what it paid the city by 2020, with more than 60 years of meter money still to come. … The garage agreement has also sent a stream of money into the coffers of private investors. … Over the nine years of the deal, the facilities have generated $292.6 million in revenue for their private operators. … Last week, the rights to the garages were sold to a group of foreign investors.

A Tale of Two P3s
Source: Yvette Shields, Bond Buyer, July 7, 2016

Chicago’s first mistake in its much-maligned parking meter lease was its choice of asset. That’s one conclusion of a report released Thursday by the Manhattan Institute for Policy Research that looks at public-private partnerships and compares the details of two deals – Chicago’s nearly $1.2 billion 75-year meter system lease and Indiana’s $3.9 billion 75-year lease of the Indiana Toll Road. The Indiana deal is held up as a model while the Chicago parking lease offers a roadmap of pitfalls to avoid. …

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Mayor Curry ‘will not submit JEA privatization plan to Council’

Source: Jim Piggott, News4Jax, April 26, 2018
 
Months into a political firestorm over the prospect of the city selling the JEA, Jacksonville Mayor Lenny Curry issued a statement Thursday morning, writing, “I am choosing to state unequivocally that I will not submit any JEA privatization plan to the City Council.” … While Curry has been consistent in his public statements that he is not pushing the agenda, members of City Council and the council auditor believe that his administration was working behind the scenes to valuate the electric/water/sewer utility for possible sale. …

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JEA names private investor, a utility newcomer, interim CEO 
Source: David Bauerlein and Nate Monroe, Florida Times-Union, April 17, 2018

The JEA board of directors named a 38-year-old private investor with little experience managing a large utility the agency’s interim chief executive officer Tuesday, rejecting a bid by the finance chief to remain in the top spot, and marking a major departure from the kind of leaders JEA courted in the past. Aaron Zahn immediately assumed the interim CEO role and refused to take questions after the board meeting. The move to hire Zahn was contingent upon making a push to retain Melissa Dykes, the agency’s chief financial officer, as a high-level executive to run the day-to-day operations of the agency. Dykes, whose own bid to remain the interim CEO only garnered two votes from the five-member board, said she was open to staying but it’s not clear whether she will. …

Opinion: JEA union leaders explain opposition to sale
Source: Kathleen Crowe, Valerie Guiterrez, Rick Lehman, Ronnie Burris, Randy Hilton, April 15, 2018

Question: Would a private utility better serve the city of Jacksonville and the JEA ratepayers of Northeast Florida better than JEA? Answer: It is the official position of the JEA union leadership that a privatization of JEA would have severe, harmful and long-term detrimental economic impacts on all stakeholders. … While we have attempted to counter much of the noise regarding the privatization of JEA, there is a very simple reason for not selling JEA that overcomes all the noise. Any company or entity willing to buy JEA, whether it is $1 billion or $20 billion, must have the resources to ensure the price it pays will definitely be paid back in full with interest. This is not like selling your house for a premium and walking away with no further commitment to that house. The customers of JEA will still be on the hook for the premium paid in the initial purchase price, as well as the interest or earnings above and beyond that premium paid to the city. …

Jacksonville utility unions pan potential JEA sale as ‘harmful’
Source: A.G. Gancarski, Florida Politics, April 6, 2018
 
Even as well-connected lobbyists for major utility companies hover over Jacksonville’s JEA ahead of a potential sale, five utility unions combined in opposition to any moves Friday. Per a statement from the five unions: “It is the official position of the JEA Union Leadership that a privatization of JEA would have severe, harmful, and long term detrimental economic impacts on all stakeholders.” … Signatories include American Federation of State, County & Municipal Employees, International Brotherhood of Electrical Workers. Jacksonville Supervisor Association, Labors International Union of North America, and the Professional Employees Association. …

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Even discussing selling a nursing home leads to staff turnover, lower quality of care

Source: Rick Lee, York Daily Record, February 28, 2018
 
From Sweden to Taiwan to the United States, decades of international research has established that privatizing nursing homes results in increased staff turnover and decreased quality of care. Even discussing taking a nursing home out of government hands and putting it into the private sector causes staff turnover to begin, according to sociologist Steven Lopez, now an associate professor at Ohio State University. Twenty years ago, Lopez examined three Pennsylvania nursing homes – one that considered privatization; one that was taken over by a for-profit management company; and a privately owned nursing home documented as having low wages, high employee turnover and poor quality of care. Currently, the York County commissioners are exploring the possibility of selling the county-owned nursing home – Pleasant Acres Nursing and Rehabilitation Center. …

… Russ McDaid, the president and CEO of the Pennsylvania Health Care Association, an advocacy organization for many of the commonwealth’s nursing homes, said that is a problem facing many county-owned homes. … There are some people, McDaid said, who believe they can make a nursing home profitable through enhancing revenues and/or decreasing costs. The obvious places to cut costs is with staff numbers and wages, he said. … Both Adams and Lancaster counties sold their county nursing homes for similar financial reasons that are facing York County. …

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Results mixed for other counties that sold nursing homes
Source: David Weissman, York Dispatch, February 28, 2018

As York County Commissioners consider selling the Pleasant Acres Nursing and Rehabilitation Center, they can look for guidance from plenty of other Pennsylvania counties that have recently sold their nursing homes. A York Dispatch review of state Department of Health records and local news reports from across the state found that at least 18 counties have sold their nursing homes, primarily to for-profit companies, since 2005. York County is one of 18 counties that still owns their own nursing homes, according to the review. … Selling Pleasant Acres, which taxpayers have subsidized to the tune of about $75 million during the past 10 years, has been discussed for many years because of its rising costs. The county has contracted the assistance of Susquehanna Group Advisors to solicit bids for Pleasant Acres, though commissioners insist they haven’t made a final determination to sell the 375-bed facility. Andrisano said she has seen counties reverse course after expressing an interest in selling their nursing homes because of constituent feedback, though it’s rare and she couldn’t recall any specific example. York County administrator Mark Derr said he’s been told 15 companies have expressed some form of interest in the nursing home, and final bid submissions are due March 15. …

Kansas Senate bills expand reach of lobbyist registration, oppose private management of state prisons

Source: Tim Carpenter, Topeka Capital-Journal, February 20, 2018
 
Motivation for sweeping change in lobbying registration centered on behind-the-scenes activity to influence the administration of Gov. Sam Brownback when considering a controversial 20-year, $360 million contract with CoreCivic to build and maintain a new state prison in Lansing.  Opponents of the lease-to-own pact, approved in January, said they were concerned about being blindsided by CoreCivic’s strategy to privatize the state’s prison system.  Meanwhile, the Senate advanced to final action Senate Bill 328, which would block privatization by the executive branch of security operations and personnel management at state correctional facilities. The Kansas Department of Corrections would still be able to contract for food, medical and other support services.  Senate Majority Leader Jim Denning, R-Overland Park, said the bill declared the corrections system wouldn’t be open to privatization without approval of the Legislature. …

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Editorial: Bill against privatized prisons right move
Source: Topeka Capital-Journal, February 11, 2018
 
A bipartisan bill co-sponsored by majority and minority leaders of the Kansas Senate would limit privatization at state prisons and maintain the role the Kansas Department of Corrections fulfills regarding day-to-day operations of those facilities.  The legislation was authored after a 20-year, $362 million lease-to-own contract for a new state prison in Lansing was approved by the State Finance Council.  CoreCivic, which is based in Tennessee, was contracted to build the new prison. However, under measures outlined in the bill, which was endorsed by the Senate Federal and State Affairs Committee, CoreCivic would not be granted authority to oversee personnel operations at Kansas adult and juvenile facilities. …

Kansas Senate GOP, Democrats embrace bill limiting privatization at state prisons
Source: Tim Carpenter, Topeka Capital-Journal, February 7, 2018
 
A rare exhibition of Senate bipartisanship Wednesday led to a committee’s prompt approval of a bill to prohibit outsourcing of personnel management operations at state prison facilities.  Motivation for the change reflected apprehension about approval of a $362 million contract with CoreCivic, a Tennessee company that builds and operates private prisons, to construct and maintain for 20 years a new Lansing Correctional Facility.  Under the contract, the Kansas Department of Corrections would retain supervision of corrections officers, wardens and other personnel. … Robert Choromanski, executive director of the Kansas Organization of State Employees, said the union supported the Senate bill because it would clearly prohibit outsourcing or privatization of management operations at state corrections facilities.  He said KOSE had many officers, counselors, maintenance specialists and administrative assistants who “do a fine job of making the state prison facilities run in a professional manner under trying circumstances working long hours for little pay.” …

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St. Louis aldermen call for transparency as city considers privatization of Lambert

Source: Celeste Bott, St. Louis Post-Dispatch, January 19, 2018

A committee tasked with picking a team of consultants to advise the city on whether to privatize St. Louis Lambert International Airport has met several times but has yet to choose advisers to lead the process. There were 11 submissions for consulting services, Deputy Mayor for Development Linda Martinez told the Post-Dispatch. Only three covered all services sought in the city’s request for proposals, she said, and the others only covered part of the services. The identity of the winning bidder won’t be revealed until a contract is agreed upon. … No vote was taken when the committee met Wednesday. Instead, much of the session was devoted to providing information to several city aldermen, amid growing concern from members of the board that the process, which was greenlighted by the Federal Aviation Administration in April, hasn’t been transparent. … Critics have questioned the need for privatizing Lambert, citing its recent growth, including a 10 percent spike in passengers in 2016, and a strong credit rating. … The effort to explore the benefits and risks of privatization has been a slow one. …

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Lambert director has mixed feelings on privatization, pushes Congress on higher fees
Source: Adam Aton, St. Louis Post-Dispatch, March 23, 2017

The director of St. Louis Lambert International Airport said Thursday she’s keeping an open mind about a proposal to privatize its management. Rhonda Hamm-Niebruegge also said she has reservations about the shift’s potential to steer more money from the airport to the city. Mayor Francis Slay traveled to Washington this week to ask for St. Louis’ inclusion in a Federal Aviation Administration pilot program to study leasing airport operations to a private business. St. Louis County Executive Steve Stenger and Lyda Krewson, the Democratic nominee for mayor, have said the idea deserves examination, and political mega-donor Rex Sinquefield has made a six-figure commitment to help pay for the application. The FAA could decide this month whether to include Lambert in the program, starting a decision-making process that could take at least a year. If the change were made, the city still would own the airport and land while a private company leases it. … The city draws about $6 million annually from the airport, and a public-private partnership could bring an “immediate” infusion of more funds, according to the city. … Congress is considering how infrastructure projects might fit into the FAA’s reauthorization legislation. …