Tuesday, December 29, 2009

Chris Paige Is Not Fit For Any Office

In his latest blog post Chris Paige makes some outlandish claims that lack any merit whatsoever. His lack of evidence for what he writes points to a flawed thought process worth noting. Here is part of his post:

Barletta & the Water Authority

Lou Barletta's fans never tire of telling me how brilliant he is, which begs the following question: why is he mismanaging his proposed sale of Hazleton's Water Authority? Apparently, the Water Authority has not even prepared a bidder's packet, and it's impossible to find the Authority's budget figures online - which means fewer firms will bid, which means the City will receive less than it should. Since we have to assume that Lou Barletta is too smart to have done this by accident, we must ask why is he trying to steer the authority to his preferred bidders at a below market price? Quite simply, either Barletta's not very good at his job (which is maximizing the price he'll get for selling the Authority) or he's corrupt - so, Barletta fans, which is it?

Mr. Paige let's examine each allegation.

First, there is no Hazleton Water Authority. Get to know the district.

Mayor Barletta proposed the sale of the water department which is part of the Hazleton City Authority(HCA) as a possible solution to Hazleton's financial crisis. The Hazleton City Authority also has an industrial division.

There is no bidder's packet because no formal action was taken to seek that sale of the water department by the HCA board or Hazleton City Council which would be among the first steps in such an endeavour.

The City of Hazleton has not issued any RFP's for the exact same reason although, if the process of selling the water department of the HCA is approved, it will be among the steps taken by the City.

The Hazleton City Authority does not post its information online and that issue is a problem for its rate payers seeking information about its operations.

Tax exemption is only one parameter of an intricate business model. Since you are in the financial world it is a fair shot to say your thoughts online give pause to your experience in those matters.

Since there has been no formal action and no RFP's how can you, Mr. Paige, make the accusation that Barletta is "steering" the authority to preferred bidders? There is no bid package, there is no RFP, THERE ARE NO BIDDERS. No one is steering anyone to anybody.

Who will respond to an RFP, if and when it happens, is anyone's guess at this point. How can one mismanage something when it hasn't happened yet?

The corruption question borders on defamation. If this treatise is your best shot you need to regroup. You seem to be better at writing fiction that speaking about the facts.


Chris Paige said...

Dear Sir,

Your allegations are too absurd for words.

Although technically the Water Authority is part of the Hazleton City Authority, Mayor Barletta and the newspapers refer to the Water Authority as the Water Authority; consequently, I used the same terminology to avoid unnecessary confusion.

The fact that Mr. O'Brien may or may not have been a lawyer in DC at the same time that I lived in DC does not even rise to the level of a coincidence. (The best available evidence is that I was living in CT when Mr. O'Brien lived in DC; besides, the DC metropolitan area is enormous, so the fact that two people might have lived in DC at the same time no more implies that those two people met than the fact that two people lived in PA at the same time implies that they have met.)

Similarly, if I wanted to advance the interests of hedge funds in general or my hedge fund in particular, I would not attack the Congressman who supervises our regulators. Thus, my motives would run in the other direction - if you're going to accuse me of something, you should at least bother to make the accusation superficially plausible.

You also claim that it's too early to judge Barletta's supervision of his proposed sale of the Water Authority - a point that would be better taken if Mr. Barletta had not claimed to have two bidders and a proposed price. Anyone with even superficial familiarity with business would recognize that announcing that you have bidders and announcing a proposed price NECESSARILY limits the effectiveness of subsequent attempts to attract other bidders and/or to get a better price. It costs money to bid, so no one will bid ONCE BARLETTA effectively announces that he's already picked the finalists. Likewise, no one will bid much more than $30 million ONCE BARLETTA effectively announces that he'd be pleased to sell at that price. Again, if you want to say I'm stupid, you should at least bother to learn the basics of an auction.

The point of my blog - and of this response - is to demonstrate that Lou Barletta can't manage anything, which is why he's raising taxes and why Hazleton is on the verge of bankruptcy.

McGruff said...

Mr. Paige, you are a misguided soul. I believe you to be a Rhino regardless of the connection.

Barletta NEVER claimed to have two BIDDERS. What he stated was that he was approached by entities who were interested in discussing the sale of the water department. I believe one of the firms gave a ballpark amount as to what the assets of the water department would be, definitely not a bid. The fact that the newspapers are misreporting is not Barletta's responsiblity.

Such an amount would not limit whatever process is put in place should the sale become a reality.

It is interesting that nobody is honing in on the fact that one of the companies managed the water department for 57 years. It is only the last two years that the Board has managed the water department as a result of refusing to renew the contract with American Water.

Present rates are based and include the management fee that was intact at the time of their ouster. Rates did not go down as a result of the contract cancellation. So, if you and the Board claims that rates will go up why don't they and you explain why rates didn't go down if there is a profit consideration?

The Board of the Hazleton City Authority no longer has a partner to look over its shoulder with respect to business practices and hirings. The Board is relegated back to the political persuasion, not the proper business management practices necessary to run such an operation.

As the story goes, employee negotiations led to a proposal for lifetime healthcare benefits for the water department workers. American Water needed a substantial increase in its fee to cover that proposal. For that reason it is alleged they were left go.

This Board saw nothing wrong with approving a $13 million contract for the management company while accepting free meals from them.

The Board has yet to meet or invite Mayor Barletta to a meeting. Instead individual board members are lobbying council members about the proposal.

McGruff said...

Mr. Paige,

When was the last time you visited Hazleton and when was the last time you visited City Hall to understand the finances to back your allegations of mismanagement? You don't want to be reckless, correct?

Chris Paige said...

Dear McGruff (or should I say Dear Mr. Mayor)?

In answer to your questions, I visited Hazleton today, and I went to the City Council's meeting on the budget.

In answer to your post, you claim the papers misreported Barletta's statements. Even assuming that's true, it certainly wouldn't reflect poorly on me because I do not manage the newspapers. The fact that Barletta is willing to sell for $30 million does not preclude a higher bid, but it does preclude a higher bid from any sentient being. (When's the last time you paid MORE than the seller said he would accept?)

The rest of your post makes various factual allegations that have no bearing whatsoever on my claim that Barletta is mismanaging the sale process.
(You're simply claiming that selling the Authority is a good idea, but that doesn't suggest or imply that the WAY he's selling it is a good idea.)

Ironically, you now claim that I am "misguided," whereas you previously claimed that I am corrupt, so I guess we're making progress.

In conclusion, I look forward to debating you, Mr. Mayor, whenever you work up the courage to meet me face-to-face.

Cheers and Happy New Year,