For want of a nail the shoe was lost.
For want of a shoe the horse was lost.
For want of a horse the rider was lost.
For want of a rider the battle was lost.
For want of a battle the kingdom was lost.
And all for the want of a horseshoe nail.
We all remember how for want of insurance, the failed incinerator retrofit cost Harrisburg millions.
This evening, Harrisburg City Council is poised to make an equally disastrous oversight as it considers a bill to borrow working capital for the incinerator. The consequences of this oversight are massive. Yet, a simple amendment can avoid this “missing nail” and mean millions of income for Harrisburg.
HERE’S THE MISSING NAIL:
The Long-term Operating Agreement for the Incinerator, negotiated by Fred Clark and the old Authority board, is (surprise!) flawed. Going against free-market principles (and common sense), that agreement gives Covanta two years of exclusive rights to purchase the incinerator (2008-2009) and then three years right of first refusal to match any other offers (2010-2012).
This evening (a day before Thanksgiving, a day after a public meeting to discuss the matter was cancelled, at the convenient time of 5:05 p.m., downtown, during rush hour), City Council will meet in a Special Legislative Session to approve Bill 40-2007, providing $43 million in short-term working capital and ratifying the flawed long-term operating agreement.
When they do, Fred Clark’s flawed agreement will go into effect and Harrisburg will lose millions as a result.
Here’s how:
The right-of-first-refusal clause means that other companies will not bid to purchase the incinerator, because their best deal is automatically handed to Covanta.
Imagine if on eBay there was another bidder guaranteed to get the best bid once all the bidding was done. Would you bother to bid?
Already, another company, Wheelabrator Technologies (Waste Management Company, the folks with the big WM logos you see all over the east coast), has indicated that it would like the opportunity for competitive bidding. They have indicated that if Covanta balks at the short-term operating agreement over this clause, WM is ready and eager to handle that. Many companies would like the opportunity to bid. And more bidders means a better deal for Harrisburg.
The following FAIR DEAL AMENDMENT, can make it all OK:
“contingent on the removal from the operating agreement with Covanta of all language concerning exclusivity and the right of first refusal with regard to the future sale of the resource recovery facility.”
When we borrowed for the retrofit, the insurance oversight made it through Council. But this time, Council is well aware of this oversight. Why not make a simple amendment and fix the problem? This is a good question to ask Councilwoman Linda Thompson, chair of the Public Works Committee.
Thompson has continually cut off discussion on this point. And a public meeting to discuss the agreement scheduled for last evening was also cancelled, an affront to principals of open government and fair public process.
It is no secret that there may be multiple candidates for Mayor in the next election, and that Linda Thompson, Dan Miller, and others may vie for the position. The short-term borrowing plan will push the incinerator issue out three years, just past the next mayoral election. Seeing this issue settled without Dan Miller’s involvement and keeping the issue dead through the election may be politically advantageous to Councilwoman Thompson.
Yet that is no excuse for Thompson to cut off discussion on this matter when her colleague, a CPA, raises it. Thompson has been a bold champion for the people in the past. But so far, not on this crucial issue.
Please encourage Council to include the FAIR DEAL AMENDMENT in Bill 40-2007 this evening. And please forward this message to anyone you feel may be interested.
Thank you very much for your consideration,
–Jason N. Smith, Concerned City Resident
