Category Archives: Utilities

Ohio State plans to privatize energy with largest investment in university history

Source: Owen Daugherty and Summer Cartwright, The Lantern, March 30, 2017
 
Ohio State has proposed a plan to receive its largest investment in the university’s history by selling its energy to the highest bidder. In accepting the unprecedented proposal, OSU will move forward in a public-private partnership with ENGIE, a French global energy producer and operator, who would control the energy used on campus for the next 50 years. The agreement, which is the first of its stature, includes the largest upfront payment — to the tune of $1.015 billion — between an American university and a global energy partner, OSU officials said. University officials said they ultimately chose the proposal from ENGIE-Axium because it offered the largest upfront payment of the three competitors, in turn committing the most money to the University’s endowment. This continues the trend of OSU privatizing its resources, which began with its CampusParc deal in 2012. The 50-year, $483 million deal was also the largest of its kind. …

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Ohio State CFO will recuse himself from decision in energy privatization plan
Source: Tom Knox, Columbus Business First, March 9, 2017

The chief financial officer at Ohio State University will recuse himself from deciding who will privatize the university’s energy operations. Geoff Chatas will help analyze the financial aspects of the deal but won’t know who the final candidates are – they’ll be masked to avoid the appearance of conflict of interest, said Ohio State President Michael Drake. … The CFO won’t have a say in who will run the university’s energy operations for 50 years because of a choice he made in 2015 when he accepted a job at the parent company of CampusParc, which in 2012 had negotiated a deal with university officials, including Chatas, to privatize OSU’s parking operations. The move raised questions of quid pro quo, which Chatas vehemently denied, but he soon reversed course and stayed at the university. … Ohio State expects to make a choice on energy privatization before the end of the school year. It’s a unique arrangement for a public university: a group of companies would for 50 years operate utility assets that make Ohio State run, including natural gas and chilled and heated water facilities. The winning bidder would have to meet sustainability goals sought by Ohio State. …

OSU moving toward privatizing its power system
Source: Laura A. Bischoff, Dayton Daily News, February 11, 2017

Ohio State University says it is taking the next step toward becoming the largest institution nationwide to hire private companies to manage its energy systems for decades to come. OSU Provost Bruce McPheron gave notice to staff and students on Thursday that the university will formally ask finalists to submit proposals for the massive project. The finalists in the running have not been disclosed. Ohio State administrators will determine by the end of the current semester whether to ask trustees to pull the trigger on it. The university is weighing whether to hire private contractors to take control of critical assets: the utility system that heats, cools and powers more than 400 buildings on main campus. OSU would receive an undetermined amoung of upfront cash and then agree to buy its energy from the vendor. The contractor would be responsible for making energy efficiency upgrades to cut OSU consumption by 25 percent within a decade. …

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Private water system in Haughton faces audit over billing complaints

Source: Melody Brumble, KTBS 3, March 17, 2017

A private water system in Haughton is in hot water over widespread billing complaints. Auditors will comb the books of Country Place Utilities after the Louisiana Public Service Commission decided to investigate the company. Country Place Utilities serves about 300 homes in Country Place subdivision in Haughton. The company provides water directly to residents and has a contract with the Bossier Parish Police Jury to bill for sewer service. … The PSC ordered the audit after residents complained that bills weren’t mailed for months at a time. Customers also complained of irregularities and discrepancies in usage and charges on bills; and the failure of the system’s staff to communicate with customers. Foster Campbell, the public service commissioner for north Louisiana, said the PSC also tried — without success — to resolve the situation by talking to the system’s operators. … The company could even lose the right to operate the water system, Campbell says. Country Place Utilities also is in hot water with the Bossier Parish Police Jury. In October, the police jury sued, claiming the company owes at least $60,000 in unpaid sewer fees. …

McComb Mayor Won’t Try to Privatize Public Works

Source: Associated Press, February 20, 2017

Pike County’s largest city won’t try to privatize its public works department. McComb Mayor Whitney Rawlings tells the Enterprise-Journal that he felt department heads weren’t ready to take the move. … An Alabama company, ClearWater solutions, pitched the idea to the city in January. The company runs public works departments and government utilities in several southern states. Some McComb officials said they were worried about whether employees would see cuts to retirement and other benefits if they became employees of ClearWater. …

Lake Station floats water plant sale plan

Source: Carole Carlson, Post-Tribune, February 10, 2017

Crippled by debt that threatens its future, the city of Lake Station is considering the sale of its water treatment plant to Indiana America Water for $20.7 million. The sale, if approved by the Indiana Utility Regulatory Commission, would enable the city to pay off its debts and provide about a $9.5 million profit, Mayor Christopher Anderson said. The city has been in talks with Indiana American Water for about 14 months. The city council must approve the sale ordinance before the deal can move forward. … The sale would mean the approximate 2,900 residents, whose water comes from wells operated by the city’s utility plant, would begin receiving Lake Michigan water provided by Indiana American through its plant in Gary. … Anderson hopes the deal goes through so the city can begin to rebound from a $1.8 million general fund shortfall his administration inherited. Anderson said the city is staying afloat with temporary loans that are depleting other funds for general fund bills. …

Federal Barriers to Private Capital Investment in U.S. Infrastructure

Source: Robert Poole and Austill Stuart, Reason Foundation, January 26, 2017

The incoming Trump administration has proposed a $1 trillion program to foster private investment in aging public-sector infrastructure. Eligible projects would involve infrastructure that has, or could have, robust user-fee revenue streams. Large-scale public-private partnerships (P3s) would finance, redesign, rebuild and modernize, operate and maintain aging and/or under-sized airport, highway, seaport, water-supply and waste-treatment facilities. These projects would be financed via equity investment (20% to 30%) and long- term revenue bond financing (70% to 80%). Global infrastructure investment funds, U.S investment banks and large pension funds are eager to invest in such P3 projects in the United States. But to date, the opportunities to do such projects have been far greater in Asia, Australia, Canada, Europe and Latin America than here in the land of free enterprise. Part of this is due to the institutional inertia of many state and local governments that are slow to adopt new ways of doing business. But another major factor is federal obstacles to this kind of private capital investment in state and local infrastructure. … There is no lack of candidate projects. … This report identifies the principal federal barriers. …

The Perils of Privatization (Podcast)

Source: Building Local Power, Institute for Local Self-Reliance, January 12, 2017

In this episode, Chris Mitchell, the director of our Community Broadband Networks initiative, interviews David Morris, a co-founder of the Institute for Local Self-Reliance and the director of the Public Good initiative. The two discuss the climate surrounding privatization in our economy and how the incoming Trump administration will bolster these efforts nationwide. Morris delves deep into the history of public infrastructure including explanations of how our language around the subject has changed over the years, privatization in other countries, and hope for the future.

[Ed. Note: A full transcript of the audio is also available from the source.]

Oklahoma proposes privatizing power plants to pay for budget gap

Source: Jonathan Baker, HPPR, December 22, 2016

Oklahoma’s budget gap next year could amount to well over half a billion dollars. To plug the hole, lawmakers in Oklahoma City are discussing selling some of the state’s power plants. … Lawmakers plan to soon introduce a plan to sell the Dam Authority. If the plan is approved, the power plants would be given over to private enterprises. The GRDA’s sale could be worth more than a billion dollars. The Grand River Dam Authority is currently a state-owned, non-appropriated, non-profit utility. This isn’t the first time the sale of the GRDA has been floated, but the bills always failed in the past.

Push Grows to Privatize Municipal Power Boards in TN

Source: Public News Service, August 11, 2016

There are 60 municipal power companies in Tennessee, but that number could decrease as power boards look to survive in a changing marketplace. This month the Johnson City Power Board presented at a public meeting reasons for separating from the city. Jeff Dykes, the JCPB’s executive director, cites changing rate structures from the Tennessee Valley Authority and the inability to form public and private partnerships because of state laws as reasons for the change. … If the Johnson City Power Board becomes its own entity, Dykes says it then could pursue solar farm partnerships, and even look at offering Internet and other services to customers. If approved, the Power Board would remain publicly owned. Opponents of privatization say it could raise electric rates and limit public access to information. Consultant Joel Yudken, who has studied the ramifications of privatizing utilities, says it’s important for any city to understand the full picture of what separating from a utility will mean for customers. …

City to privatize 3 departments with ClearWater

Source: Mary Alford, Delta Democrat-Times, August 9, 2016

City Council has decided to go forward with privatizing three city departments with ClearWater Solutions.  After hearing presentations since July from two operations and maintenance companies, ClearWater Solutions and Optech Monette, both of which offered to manage the public works, water utility and fleet departments at the start of the 2017 fiscal year, City Council members opted to hear more from ClearWater Solutions.

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DEATH INVESTIGATION; INDIANOLA SHOOTING; GREENVILLE SURPLUSE; CITY AGREES TO PRIVATIZE
Source: WXVT 15, August 8, 2016

After several weeks of deliberations, the Greenville City Council has come to a decision regarding the privatization of three departments. … With a five-to-one vote, the council agreed to privatize the city’s water, public works and fleet departments. … Ward 6 Councilman James Wilson voted against privatization, saying he was unhappy with the previous council’s lack of action. … Mayor Errick Simmons said bringing in Clearwater Solutions should have a positive impact on the Greenville community.             “The contract between our city attorney and Clearwater makes sure every employee would still be employed,” he said. “Every employee will receive a 5 percent pay increase. The health insurance will be less out of pocket for the employee. City residents will see better services.” …

City Set To Go Forward With Outsourcing Utilities Billing, New Meters

Source: Lynette Sowell, Cove Leader-Press, May 17, 2016

Copperas Cove utility customers could have new water meters and new ways to access their bills via a company that will take care of utility customer service, by October 1. At tonight’s Copperas Cove city council meeting, city manager Andrea Gardner is presenting a request to the city council for authorization of a Software As A Service Agreement with Fathom Water Management, Inc. The implementation fee is $7 million, $5,910,139 of which would be used to replace all water meters for city residents and businesses, along with installing a computerized account management system and advanced metering infrastructure. Fathom would also institute a software as service fee to the city of $1.75 per managed utility account per month along with a managed services monthly fee of $2.57 per account. Those fees to the city could be increased annually each October 1, with the earliest being Oct. 1, 2017. … At the city council planning session on April 7, Gardner told the council part of the reasoning for this system is to help ease the workload at the city’s utilities administration office, which can receive hundreds of phone calls per day in addition to walk-in customers. However, several utilities employees would also need to be reassigned to other positions in other city departments, as the plan with Fathom would reduce the need for employees in the utilities department. There would still be a brick-and-mortar office for utility services. …