Friday, July 15, 2016

Obligation to the public

This is a new AZ post about the mayor's ongoing evaluation of a possible sale of the New Orleans Public Belt Railroad.  The issue came up again  last night at the District B community budget meeting but Mitch's response  (something along the lines of "we gotta think differently in the 21st century") wasn't very enlightening. Jason's story is more helpful.

One thing he tries to make clear,  for example,  is the NOPBR's function which is best understood as a regulatory agency for Port operations and not as a potential revenue generator for the city as the mayor's staff seem to suggest.

The key "stakeholders" then are shipping and warehousing concerns who have business with the port and who depend on a set, predictable cost of the publicly regulated rail facilities instead of whatever price may be set by a rent seeking private operator.
The main concern seems to be the market disruption that privatizing, or even partially privatizing, the NOPB would create.  As Jensen noted, it could give rise to a possible monopoly in the services industry surrounding the Port.  A future private owner of the NOPB could build their own warehouses along the line and undercut existing businesses like Kearney’s and Jensen’s, giving it an unfair advantage in the market.
So there's money at stake for the port businesses and potentially money to be made for whatever buyer potentially ends up running the railroad.  In other words, it's a big plum the mayor can still give away to someone before he leaves office. Predictably the commission doesn't want a sale. Just as predictably, the mayor's office wants to keep exploring the option.

Most predictably, though, and most disconcerting is the off-point public interest wording they use to describe their motivation.
Ryan Berni then stated that the City would move forward with the full evaluation, including the option for sale, in spite of any decision the Commission made to have it removed. I asked him about this after the meeting and he said the Mayor had “an obligation to the public” to assess the property’s value and consider a sale, irrespective of the Commission’s decision to exclude that option.
At the District B meeting last night, Mitch talked about the railroad in similar terms.  I'm paraphrasing here but what he told us was that he came into office immediately asking, "What does the city own?" and how much money do the things the city own make.  The railroad, he "learned," generates "zero revenue" or maybe he said, "zilch." Whatever. It was meant to impress us as a critical point. But public assets aren't held solely for either their revenue generating potential or for their sale value.

The city's "obligation to the public" here is to consider first the value of the service an public entity provides rather than simply its monetary worth in terms of recurring vs one time revenue. You'd think that public servants would understand their primary duty here. But, as Mitch told us last night, they think about these things differently in the 21st Century. And more often than not, what they're thinking is, "sell that sucker."

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