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Happy Fourth of July Weekend, everyone! I wish I had a fun newsletter this week to celebrate, but unfortunately the big news this week is once again Kirkwood's utility troubles, which seem to have made the jump from a local story to a regional one.
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- The latest on Kirkwood Water:
- The big story in last week's Webster-Kirkwood Times was that approximately half of Kirkwood Water's staff have departed, requiring the city to hire a private company to provide emergency response services
- Former City Council Member Al Rheinnecker wrote a mailbag letter also arguing for the sale of the water utility. In addition to a complete non-sequitur targeting The James, a project that has been a financial boon to the city, he sets up a false dichotomy where Kirkwood either keeps it, and residents suffer, or we sell the thing and Kirkwood reaps a windfall and all of our financial problems are solved. The question is not whether to sell or don't sell, it's whether we sell now, from a position of weakness for sixty-cents on the dollar, or sell later for the full value of the thing. Rheinnecker is trying to crank up public pressure on the sell-now option because he's a hardcore ideological conservative who does not believe, at an ideological level, in the public sector.
- There's a great new post from Taylor on The Kirkwood Ledger substack evaluating the offer Kirkwood received from MAWC to purchase the utility. It's shorter and less technical than Taylor's previous pieces, and has recommendations for everyone from State Rep Mark Boyko to Kirkwood City Council, so I encourage you to read the whole thing, but in short, they find that:
- This is not a compelling price given the fair market value of Kirkwood Water
- And, I'll just quote this part directly: I think city leaders need the ability to deliberate before bringing a topic like this to the public. This is especially important for a topic like this where the intuitive response may conflict with what a careful analysis suggests. It’s intuitive to think “if we sell we can lower our rates and get $27.5 million for the city, so of course we should sell.” But a careful analysis would consider the opportunity cost of selling, the direction of MAWC rates, the direction of Kirkwood’s costs if it continues to own the system, and the option value of not selling. It took me 11,000 words to consider these factors – not at all intuitive!
- On the Kirkwood Electric front, the Post-Dispatch has a new story gesturing at a supposed Mark Petty (the former director of Kirkwood Electric) corruption scandal in Detroit twenty years ago. I still don't get what the motivation of Petty's supposed corruption is supposed to be. Absolutely investigate, but clearly the Jaksetic- Rheinnecker conservative block (with Council Member Schaefer as junior partner) is trying to capitalize on the utility crisis by launching a coordinated public propaganda campaign. The Post-Dispatch didn't find this story on their own.
- Still, the rest of the Council needs to get their shit together. Kirkwood is, seemingly, in a very bad spot due to a series of compounding mistakes and an unwillingness to grapple with tradeoffs. No one seems to be able to articulate a vision for how to move forward that isn't "sell off all our assets". Our two levers are spending or raising tax revenue. Those are our options. We should probably due a bit of both. We need to build the Grant's Trail extension, broadly upzone around the trail, and rake in additional tax revenue. We should develop city-owned surface parking lots on the most economically productive land in the city, not spend $75k to repave it so people can store their cars there for free. It's the simple stuff that gets you out of the vicious cycle and into the virtuous one, but it takes leadership.
- To end on a positive note, I was glad to see in tonight's Council Work Session minutes a plan to reform floodplain development regulations in an effort to bring down insurance premiums. We can do good things! But we need to replicate this sort of effort everywhere.
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That's all for this week! Thanks for allowing me to vent my frustration. You can check out all the details on Saturday's Freedom Festival here, but to offer some Park Notes: The food trucks will arrive at 5pm, music starts at 7, and fireworks will commence around 9:20. Have a great weekend, everyone!
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