And the beat goes on.
Over the past several years, Indiana government has entered into a variety of deals in which public assets have generated or guaranteed private profits. The toll road lease probably received the most attention. Daniels’ ill-fated privatization of the welfare application process–and the ensuing lawsuits– was high profile for a time, but his Administration’s thirty-year agreement with Leucadia National Corporation to purchase the output from its Rockport coal gasification plant (coincidentally managed by a long-time political ally) received significantly less coverage.
Locally, of course, we’ve seen a number of dubious transactions, notably the 50-year parking meter contract.
The parkland surrounding Indiana’s towering dunes was intended to keep industry away from a geological marvel molded over thousands of years at the southern tip of Lake Michigan.
Yet five years after a politically connected developer suggested officials should hire a company to rehabilitate a dilapidated beachfront pavilion at the popular tourist destination, a small construction project has ballooned into a decades-long privatization deal with the state. It includes two beachfront restaurants, a rooftop bar, a glass-walled banquet hall promising “the best view in Indiana” — and there is potential for more development to come.
What’s more, the company ultimately picked to do the job was co-founded by Chuck Williams, the developer who pitched the initial idea. Williams, a regional chairman of the state Republican Party, worked behind the scenes for over a year with the administrations of two GOP governors, shaping and expanding the plans.
There are times when so-called “public-private partnerships” make sense. There are times they don’t. The problem is, these deals increasingly occur without the public vetting required to make that determination.
In the case of the Indiana Dunes, critics characterize the deal as a “usurping” of public land in the name of private development, and charge that the state Department of Natural Resources did not hold public meetings or seek out more competitive bids. Worse still,
Preliminary figures submitted to the DNR by Williams suggest the project will yield a handsome profit. In its first year, the development is expected to turn a $141,000 profit — a figure projected to climb to nearly $500,000 in a decade.
In return, the DNR will get 2 percent of the company’s annual revenues and $18,000 a year in rent for property that state parks Director Dan Bortner describes as having a “million dollar smile.”
The merits or flaws of this particular contract aside, Hoosier citizens need to demand a halt to the steady sell-off of public goods at both the state and local level until a full public debate can be held to consider the rules–and the ethical guidelines– that should govern privatization agreements.
In far too many cases, the risks are socialized and profits privatized–with We the People guaranteeing the revenues of politically-connected cronies.
And we wonder why citizens are cynical….