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Saturday, June 15, 2024

All wet! No pool for Wes Montgomery Park; Citizens Energy’s leaky deal!

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It began as a fight over vacant land.

It was post-1968. Indy’s African Americans were slowly breaking out of the Center Township ghetto. In the northwest corner of Warren Township, African-American and white residents of a newly integrated neighborhood of single family homes learned that a developer wanted to place mobile homes on a large 37-acre lot.

Back then, block clubs called civic associations or civic leagues were strong in Indianapolis. Those groups fiercely lobbied then Mayor Richard Lugar arguing that mobile homes, trailer parks in the popular vernacular, would go against the neighborhood’s character.

Lugar finally agreed with them and had the city acquire the land under eminent domain; turning it into not a regional, but a neighborhood park in 1970, the city/county’s fifth largest.

And because a few years earlier Indianapolis had lost one of its giants – Wes Montgomery – the decision was made to name the new park, which included a swimming pool, after him.

Today the park, born of neighborhood determination to control their destiny, stands as a monument to Indianapolis’ systemic neglect of its parks. Especially “neighborhood parks” that are supposed to improve neighborhood quality of life.

Touring Wes Montgomery Park last Friday, it’s obvious there have not been meaningful upgrades in decades. The park’s last master plan, developed in 1994, recommended a measly $135,600 in improvements.

Today, the park has no formal signage proclaiming it’s name or the significance of its namesake.

The firestorm of protest over the Ballard administration’s refusal to repair the Wes Montgomery Park pool grows, in part because the insensitive bureaucrats at Indy Parks continue their crusade to ignore demographic and economic data, making decisions in a capricious, some would say vicious manner.

Some 25,147 people (2000 Census) live within 1.5 miles of Wes Montgomery. That’s almost as many as the 30,753 living 1.5 miles around Bethel Park. Yet, Bethel’s nearly 31,000 residents get their pool fixed, while Wes Montgomery’s 25,000 are demoted to a children’s spray pool. Why?

Trying to defuse the criticism, Mayor Ballard’s Deputy Chief of Staff, Robert Vane, appeared with Indy Parks’ functionaries last week on “Afternoons with Amos.” But, conspicuously absent was Indy Parks Director Stuart Lowry. Lowry’s failure to explain directly to our Black community a decision he approved is insulting and raises new questions of how African-American neighborhoods and employees have been marginalized during Lowry’s reign.

According to the mayor, Indy’s getting $425 million for infrastructure repair. The Parks Foundation is also raising cash for greenways and other parks frills.

There should be no new greenways, bike lanes, bike trailers or other park frills purchased until Wes Montgomery’s pool is restored!

A courageous Republican mayor stood with a neighborhood fighting to improve itself 40 years ago. Will the current Republican mayor do the same today and restore a neighborhood essential amenity?

What I’m Hearing

in the Streets

It was a simple question you ask the parties in a multi-billion dollar business deal. Two weeks ago, on Afternoons with Amos, in talking about the deal where Citizens (Gas) Energy would buy the Indianapolis Water Co. from the city for $1.9 billion, I turned to Citizens’ affable President/CEO Carey Lykins and asked “What’s the multiple on this deal? What’s the EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) of the water company?

It’s a question routinely asked by the Wall Street Journal, Indianapolis Business Journal and CNBC when discussing billion-dollar deals. Cash flow and EBITDA allows investors and stockholders to understand whether there’s sufficient cash flow to pay for a deal.

A surprised Lykins answered me with a stunned “I don’t know,” shocked I’d even ask such a basic business question.

And that’s the problem with the Citizens/Water Co. deal.

Citizens is paying $1.9 billion for the right to operate the water company and, for now, supervise the French-owned companies Veolia and United Water, operators of the freshwater and wastewater components.

But, included in the purchase price is Citizen’s assumption of $1.5 billion in debt (like a mortgage) that the water company has amassed the last few years.

So, if the deal closes, all the city of Indianapolis gets in cash is $170.6 million at closing, plus another $92 million conveniently arriving a month before the mayoral election in 2011.

There’s supposedly another $160-ish million in funds accruing to the city, but they have nothing to do with the purchase price.

Mayor Ballard is crowing that the city will gain some $425 million to spend on needed infrastructure projects, many starting during his re-election campaign.

Yet, the details of the deal provided to the public have been skimpy, at best.

If a real company doing a $1.9 billion deal provided the skimpiness of detail Citizens and the city are providing, stockholders would be screaming bloody murder, there’d be condemnatory editorials in the Wall Street Journal and Jim Cramer would have a stroke on CNBC.

Instead, even though there’s been no real analysis of the deal produced by either party, the mainstream media’s proclaiming this a great deal for Indianapolis residents and taxpayers.

The water company touches every Indianapolis household. This deal affects everyone. Citizens Gas is a Charitable Trust, operated for the good of all. Citizens brags they aren’t beholden to stockholders. That’s right. But they are beholden to every resident of this city/county.

So, Mr. Lykins, where’s the details of the deal?

This could be a great deal for the city, but right now I’m not yet convinced! I’m fearful that this deal will produce water rates far worse then they are today.

Lykins and Citizens have built an image as a responsive utility. “We’re Citizens, just like you” has been their mantra. So, on this deal they need to act like it.

Release the financials on Indianapolis Water. Release the pro-forma forward financials on the company that I know you’ve produced. Release the financial details, EBITDA, cash flow multiples and other data that you would provide if Citizens were owned by stockholders, not by us in trust.

If this is a good deal for all of us, the data will show it. If not, it’s not a deal worth doing.

How about it Carey, when can this “citizen” expect the financials released?

See ‘ya next week!

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