Monday, May 7, 2012

Spousal Bucket List

I suppose every married person has a list of things or experiences they want to share with their spouse before they die.  Unfortunately, one of the things on my wife's list was a trip to the Rock-&-Roll Hall of Fame in Cleveland, which we toured Sunday.  Because I care little and know even less about music, it was not time well spent for me.  However, during those agonizing 5 hours, I did learn that the beautiful I.M. Pei structure, housing the impressive museum on the lakefront, was a "public-private partnership."  I then spent the time wondering about such arrangements.

Virginia is a "Dillon-Rule" state, which means ALL power resides with the state legislature in Richmond, except whatever crumbs they delegate to the local areas.  Years ago, when we actually enjoyed forward-thinking legislators, they foresaw the approaching impotency of all things governmental and permitted something called public-private partnerships.  This allows progress to continue, by marginalizing any commitment by government -- but not eliminating it.

An example in my hometown of Virginia Beach is the immensely successful Town Center project.  The City issued bonds to pay for an essential infrastructure project, i.e., the central parking garage.  Of course, this requires a certain amount of debt service each year.  The City then increased the real estate taxes on other properties benefiting from a parking structure in their district.  Taxes were not raised on the rest of the city or its taxpayers.  Only the local property owners paid more in taxes.  That means there was no out-of-pocket cost to the City, as the increased tax revenue easily covered the increased debt service.

Suppose I lease a car for $300 monthly and then re-lease it to you for $400 monthly.  My obligations have increased but my revenue has increased even more.  My recollection is that the City of Virginia is actually making about $2 million yearly on this arrangement.  The trade-off is that the City used a small portion of its  finite capacity to sell bonds, a minor trade indeed.

Frankly, I have been struggling to understand the bitter vitriolic attacks on future public-private partnerships.  At first, I assumed people just didn't understand.  Now, I think some people are opposed to everything; whether it is called waste or progress -- it doesn't matter.  They're opposed to it!

Of course, a more recent public-private partnership to sell a local tunnel and greatly increase the tolls has met with great opposition.  Unfortunately, this has smeared the name of all public-private partnerships.

My wife wonders why some people don't like Rock & Roll music.  I wonder why some people are opposed to public-private partnerships.  Still, I'm glad I crossed-off one of those things from my wife's bucket list.  The bad news is that the next thing on her list is a visit to Kangaroo Island on the southern coast of Australia.  Fortunately, I go nowhere without access to the internet and the cloud.  Therefore, we're not going . . . whew . . . at least, not anytime soon!