Remedial Economics

05Sep15
Mayoral Office Equipment

Mayoral Office Equipment

We must admit even we grow weary of going over the same material time and again. But apparently we must.

“The mayor has maintained, however, that this “Vote No” assessment of the issue is simplistic — and that the Greater New Haven Water Pollution Control Authority would be assuming the cost of the 17 employees of the waste treatment plant at the foot of Birdseye Street, as well as the high cost of maintaining more than 200 miles of sewer pipes and 13 pumping stations. The sale would also reduce the town’s bonded debt, Harkins said. And, he has said, if the sale is scuttled, the town’s bond rating will suffer because the the current and previous town budgets were predicated on the sale taking place.This has resulted in the town’s reserve fund to drop precipitously — a key factor that bond rating agencies look at.” http://www.ctpost.com/news/article/In-Stratford-Vote-Yes-event-an-opportunity-6486204.php

Sound reasonable? It might if any of it were true. In fact, the only true part was “the town’s bond rating will suffer because the current and previous town budgets were predicated on the sale taking place.”  Let’s go all the way back to Home Economics. What do they call it now? “Domestic Science”? You don’t count as actual money the things you haven’t sold yet. But that is exactly what this mayor and his weak and stupid Council did! And then they spent the imaginary money as if it were real money!

If this deal wasn’t so bad and the mayor didn’t lie about it so much,  maybe so many thousands of registered voters wouldn’t be so mad. On the other hand, if your grandmother had…..never mind.

It’s still a horrible deal and no amount of $100 party tickets will change that.

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19 Responses to “Remedial Economics”

  1. 1 jezebel282

    And let’s not forget Gavin Forrester who bent over backwards in a letter to the editor to avoid saying that he has already voted several times in favor of selling the WPCA. Did he think no one would notice?

  2. 2 jezebel282

    “Wiltsie said. “Now, why would an elected council approve something that would be bad for their own constituents?”
    http://www.ctpost.com/news/article/Dist-2-primary-race-turns-toxic-over-Contract-6485909.php

    Now we simply must ask. Mr. Wiltsie, have you ever been to a council meeting, met the Economic Development Director or John Harkins?

    As a follow up question, Mr. Wiltsie, are you familiar at all with Stratford’s WPCA?

  3. 3 jezebel282

    Just in case there is anyone left that reads this blog that doesn’t understand why the sale of the WPCA is such a bad idea, we have provided this remedial session below.

    Let’s say you own a house worth $100 million with an additional $5 million in cash in an escrow account. You have $37 million remaining on the mortgage. For some reason, you feel you shouldn’t own a home. You think renting it from someone else is a better deal. So what do you do?

    A: Sell it for $105 million
    B: Pay off the mortgage.
    C: Rent it out for $10 million/year.

    You sell the home for $11 million of course. You only lose $68 million in equity.
    Such a deal!

    But wait! There’s more! There are rumors abounding that after the little “fund raiser” at Two Roads Brewery for Harkins/Decilio’s boys (We wonder how many tickets GNHWPCA will buy? All of them?), there will be lawn signs that say “Vote yes, Pay less” or something equally silly.

    One of the things that make politicians so much fun is that they will never, ever admit they were wrong. Instead they emphasize how wrong their decision was. In the media, this is called “doubling down”.

    Harkins/Decilio will tell anyone who will listen that if we don’t sell the WPCA that our taxes will go up. Actually the opposite is true. Although it is clearly illegal, Harkins and the weak and stupid Council have been siphoning funds from the WPCA for at least 5 years now. This year they reached a new high of over $2 million. Why the State won’t do anything about this is a mystery. But, it is what it is.

    Once the the theft of our sewer fees are no longer possible because we sold the sewer plant, our taxes will go up. It is unrealistic to expect this mayor or his weak and stupid Council to reign in spending whether it is on whopping raises, unnecessary capital equipment, unlimited billable attorneys fees or uncontrolled overtime.

    And let’s not forget Harkins claim of lower sewer fees. Once the WPCA is sold to New Haven, we have no control over what they determine our sewer fess will be. Unless you consider that a 9-2 vote is “control”. To be clear, Harkins has absolutely no idea what the sewer fees will be and has no right to make such a claim. When you hear any of his supporters or Decilio’s hand-picked candidates make that claim, you’ll know they are now lying to you and you can stop listening.

    And then there is our personal favorite; “Regionalization makes sense.” We love that one! It’s sounds so…cooperative and progressive, doesn’t it? As usual nothing could be further from the truth. Nothing gets “regionalized”. Nothing. Not a single drop of sewage will travel under or over the Housatonic River. Our WPCA will never be physically connected to Greater New Haven WPCA. The only things that will be connected are our checks and their Accounts Receivable.

    So the next time you read a letter in the paper from a “citizen” in favor of “regionalization” remember that there is no such thing. Only employees of John Harkins, members of commissions controlled by the RTC and,of course, candidates pick by Lou Decilio would say this. And that is because no reasonable person would think that this was a good deal.

  4. I disagree with your model. If you have a house worth $100 million and it has a $37 million mortgage and you sell it for $11 million, then you have lost $52 million in equity. I assume the $5 million in escrow can be used for expensive cars, salary increases, and attorney fees. The problem is that you still have to live somewhere so you have no alternative but the rent the house you just sold. That gets expensive because the buyer had to borrow the $11 million paid for your house and needed to re-finance the $37 million in mortgage amount. So now, you have no alternative and you will pay the rent, pay back the mortgage and pay back the price you sold the house for.

  5. 5 jezebel282

    Left Right,

    You are correct. We forgot to subtract $11 million from $105 million. The $5 million in cash (part of the amount we are overcharged every year) would be kicked back at the closing.

    You have to remember that Harkins has been stealing from the WPCA for years now. Helps with the new cars he hands out.

    In all this time not a single citizen who wasn’t a member of the RTC, beholden to Harkins for their position or income has stated any reason for supporting this horrible deal. Once again, that is because no reasonable person would.

  6. 6 jezebel282

    Update:

    And then we have those who stick to the party line no matter what. Like Gavin Forrester III who was appointed by the RTC to the Council.

    “Forrester said that “regionalization is the way to go,” and that the move will mean better economies of scale and lower costs in the long run.”
    “Bottom like is that when you flush your commode, your waste will properly be taken of, and at lower cost,” he said. “It’s great that we have a top-rated plant, but now we’ll have to deal with the older pipes we have in the ground. Being a part of a bigger region offers more solutions than trying to go it alone here in Stratford. And we will have representation on New Haven’s board.” http://www.ctpost.com/news/article/Stratford-primary-Plenty-of-issues-6498838.php

    We understand that we have debunked these statements over and over again..but we have to admit that it is just so much fun!
    So here we go;

    “Forrester said that “regionalization is the way to go,”

    Well, that depends upon where you are going. If it means taking on the debt of a poorly run organization and paying for their underfunded infrastructure, penalties, fines, salaries for their executives and profit margin for their shareholders then, yes, it is definitely the way to go. If it is for any Stratford resident or business then he is just wrong.

    “your waste will properly be taken of, and at lower cost,”

    As we stated above, this is how you know you are being lied to. Neither Mr. Forrester nor anyone promoting this horrible deal can say this truthfully. Once we sell this property, we’ve sold it. That’s it. We’re done. The rates are set by someone else. Mr. Forrester, like the rest of the people who want to sell the sewer plant, have no way of knowing or controlling what a new owner would do.

    In fact, we can go further. Not only will GNHWPCA assume our measly $37 million debt (We will still be paying for every penny of it through our new fees.), but we will be liable for their hundreds of millions of dollars of debt, fines, penalties and infrastructure costs.

    “And we will have representation on New Haven’s board.”

    To listen to Mr. Forrester or any of Harkins gang, the 2 votes we have out of 11 will win the day for us. AYFKM? This is a benefit?

    “Being a part of a bigger region offers more solutions than trying to go it alone here in Stratford.”

    Now this might actually be true if we were really “regionalizing” by combining with Shelton, Trumbull or even Monroe. But alas, we are not. Once more; not a single drop of sewage will go under or over the Housatonic River to or from our plant. The only things that will make that trip are our checks into the Accounts Receivable of GNHWPCA.

    We are a bit surprised that Mr. Forrester chose to double down on his support for the sale of our WPCA in the CT Post right before he’s going to lose to Marianne Antezzo. You’d think he’d want people to forget that he voted multiple times as a councilman in favor of this horrible deal. But we suppose that’s what politicians do nowadays when they are wrong.

  7. 7 hornrims

    The letters written by “citizens” in favor of the sale are the sole creation of the ‘sneaky scheme mavericks’ in the RTC, with the signature line filled in by one of any number of willing and mindless minions to their collective and utterly misguided cause.

  8. 8 jezebel282

    Horn,

    What we find is what we already knew. The only people in Stratford that support this awful sale are those who either work for Harkins or depend upon him for revenue/position. And something else we already know; Harkins is very comfortable spending other people’s money.

    The lawn sign war is a perfect example. The Vote Yes (we’ll have more on this later) signs are everywhere…that people don’t live. The Vote No signs are $5 each and are only on private property. That means that lots of someone’s laid out actual cash and placed Vote No signs on their own property. If you remember, we call these types of people “voters”.

    Luckily, empty lots and streets don’t vote. But can you imagine the lack of conscience it would have taken for someone to put so many Vote Yes signs in the trunk of his car and then drive around placing them like graffiti? Aside from being a horrible deal for residents, that many signs strewn about really makes Stratford look awful. Oh well, we suppose that if you support the sale you don’t have a conscience anyway.

  9. 9 jezebel282

    It is important that voters understand what is before them.

    Harkins and the RTC have been touting this horrible deal as a way to lower the sewer fees that Harkins has been artificially raising for five years. One might ask the reasonable question, “How much lower will they be, Mayor Harkins?”

    You will not get an answer to that one. Mostly because Harkins has no idea what the Greater New Haven Water Pollution Control Authority will charge Stratford residents and businesses. And once he signed the deal he would have no input into rates at all. Because we won’t own it anymore.

    But we can make a fact-based guess. What do they charge their current customers? We can probably expect to be charged to same thing.
    http://www.gnhwpca.com/index.php/customer-service/sewer-rates
    The current charge is $108.28 per quarter or $433.12/year. And that is for minimum usage.

    Wait. What? $16.88 per year less? That’s it? Apparently so.

    Now, of course, there are some variables. For example, we do not know what the assumption of $37 million of our debt would do to GNHWPCA rates. Nor do we know what payments in lieu of taxes would do either. But this is mostly because Harkins has no idea what they would be either. But certainly, whatever they are would be added to our rates.

    So when you see your RTC Council candidates you should ask them about those “Vote Yes Pay Less” signs. See if they know how much “less” we would be paying. And get it in writing.

    Until then, vote “No!”.

  10. 10 jezebel282

    Update:

    Now Harkins is saying “sewer rates would go up less than if the town maintained full ownership.”
    http://tablet.olivesoftware.com/Olive/Tablet/ConnecticutPost/SharedArticle.aspx?href=TCP%2F2015%2F09%2F14&id=Ar00503

    Wait a minute! Didn’t he say sewer rates would go down? You know, “economies of scale” and the other lies? Now it’s only going up “less”? How much “less”? $17?

    “The mayor bristles at the suggestion that the town has been raising sewer fees to pay for town operations.
    “That’s something that we simply cannot do,” he said.”

    Has this guy even seen his own budget? $300k to the General Fund, $600k for rent to ourselves, $600k to Public Works, $1 million to pension fund…

  11. 11 mikereynolds

    “Has this guy even seen his own budget? $300k to the General Fund, $600k for rent to ourselves, $600k to Public Works, $1 million to pension fund…”

    Would it be possible for you to post an image of the town budget where it shows that? I’m not doubting you but it would go along way to debunking his claim that the town doesn’t get money from the WPCA.

  12. 13 mikereynolds

    So the budget shows that the WPCA operates at a break even. But if you take out the $600k in rent and $300k in transfers to the general fund, they operate at least at a $900K surplus. By the way aren’t transfers to the general fund from a WPCA against state law?

  13. 14 jezebel282

    Well…yeah.

    Amazing, isn’t it?

  14. 15 mikereynolds

    So they charge the WPCA and EMS rent. Aren’t those town owned properties? Why do they have to pay rent and Short Beach Golf Course doesn’t? Is it because WPCA and EMS generate surpluses for the town to use? And 250k for “in kind services” from the Railroad Fund?

  15. 16 jezebel282

    Maybe it’s because they can take it and nobody does anything about it? You know, like tearing down an entire school but buying trailers (portable classrooms) because there aren’t enough classrooms?

    This is what happens when you have a weak and stupid Council that lets Harkins do anything.

  16. 17 mikereynolds

    Towns and/or states run by a single party, either Democrat or Republican, are doomed to failure.

  17. 18 jezebel282

    Update:

    Stratford Chamber endorses sale of WPCA
    Voters will decide if plant will be sold on Election Day
    By Melvin Mason on September 15, 2015
    http://www.stratfordstar.com/40579/stratford-chamber-endorses-sale-of-wpca/

    We are struck by the lack of balance and actual information contained in this article. We are unsure if it is the publisher or author of this article that is applying for the position of Public Relations Manager for John Harkins. Either way, it is simply a reprint of Harkins press releases and contains no new information.

    We are truly disappointed in the Star. The smallest amount of research will yield a trove of information against the sale of the sewer plant. Even Harkins’ own budget numbers would suffice.

    Instead, the author chose to twist the narrative beyond recognition. The most egregious example being:

    “The proposed sale of the plant to the Greater New Haven authority was approved in April, but held up after five petitioners with the group WPCA Stratford-Get Answers challenged the vote in court, saying residents should decide if the sale goes through.
    Outgoing 2nd District Councilman Matt Catalano is one of the five petitioners who challenged the sale. Three others, Marianne Antezzo, Philip Young and Tina Marie Manus, are running for seats on the Town Council in November.”

    Seriously? 5 petitioners? One is outgoing and three are in it for votes? Those were the only ones against the sale of the plant?

    No mention of the dozens of volunteers and the petitions with 7,000+ signatures of registered voters? No mention of Harkins attempts to block a referendum by the voters of Stratford? No mention of Harkins forbidding the Town Clerk from even accepting the petitions (is this Kentucky?).

    Not only is Mr. Mason untruthful, he is insulting as well. Opposition to this horrible deal has taken a lot of effort, cooperation, time and money by a lot of people both Republican and Democratic. Mr. Mason chooses to ignore them completely and throw his lot in with the Good Ole Boys.

    (And yes, we know Henry Bruce was gratuitously included at the end after a lot of angry communication.)

    Harkins needn’t have thrown a fund raiser for this horrible deal. He has Melvin Mason and the Star doing it for him for free.

  18. 19 stfdprofessor1

    AAAaaaahhhhhhhhemmmm…If I recall correctly, isn’t it the esteemed “Chamber of Commerce” who pushed for the adoption of a Mayor in Stratford too…look how that one turned out.

    Let us not forget if our “friends” in the Chamber were that intelligent they would be actively involved in making money in private industry as opposed to just talking about it.


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