The Virginian-Pilot
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CHESAPEAKE
The Southeastern Public Service Authority is about to get new leadership.
There also will be a new rule for the struggling trash authority's new board: No elected officials allowed.
A state delegate who championed the leadership change has routinely accused the current board - composed mostly of elected officials from localities SPSA serves - of mismanagement.
Now, Gov. Timothy M. Kaine must choose a new board, made up of people with extensive business knowledge. The board will take over on Jan. 1.
The changes in leadership will come at an important time for the authority. It is in the middle of a $150 million deal to sell a trash-burning power plant to help pay off $240 million in debt. SPSA is also considering another firm's offer to buy the agency outright.
The delegate who sponsored the bill mandating the change now wonders if the current board will speed through the power-plant deal before the new board takes over. No final deal has been completed. But if that happened before January, a new board could face financial penalties if it tried to switch gears.
"My concern is that the current board will rush through the deal to sell the power plant and basically tie the hands of the new board," said Del. John Cosgrove, R-Chesapeake. "They are the board, and they can do that if they want to."
If no decision is made on either offer by then, the new board also could go in a completely different direction.
Cosgrove's bill, which also requires greater state oversight of SPSA, was submitted as the agency faced the mound of debt and a $16 million budget shortfall.
The agency has since restructured that debt and sought to unload key assets, and officials now say it is in a much better financial situation. Still, Cosgrove said, he hopes a board made up of businesspeople will have better luck than the current board of mostly public officials.
"There have been so many problems, so many mismanagement snafus in the past," Cosgrove said.
SPSA has eight member localities - Virginia Beach, Norfolk, Chesapeake, Suffolk, Portsmouth, Franklin, Isle of Wight County and Southampton County - and each one was required to submit three nominees to Kaine by today.
The governor will appoint one person from each locality to a four-year term.
Some prominent businesspeople might end up on the SPSA board. Norfolk's nominations include Channing A. Pfeiffer, chief executive officer of the Tidewater Builders Association, and former Mayor Joseph A. Leafe.
Chesapeake's submissions include Doug Fuller, one of the developers behind Edinburgh, a large golf course and residential project in the city.
The board could face some hard decisions right off the bat. SPSA is moving forward on a $150 million deal to sell the Portsmouth power plant to Wheelabrator Technologies Inc., a Waste Management subsidiary based in New Hampshire.
But the agency is also reviewing a proposal from ReEnergy Holdings LLC, which wants to buy the agency outright for more than $240 million.
"It would be unfortunate for the communities if they decided to push a decision by the end of the year," said Vince Mastracco, a partner with the Norfolk law firm Kaufman & Canoles. The firm is representing ReEnergy. "A new board member would want to have more than the responsibility to close a transaction that they really had nothing to do with."
Mastracco suggested bringing the new board members together on a transitional team to sit in on SPSA meetings before Jan. 1.
Pilot writers Deirdre Fernandes, Dave Forster, Jen McCaffery and Harry Minium contributed to this report.
Mike Saewitz, (757) 222-5207, mike.saewitz@pilotonline.com
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Face it Guys, SPSA is still a mess
Hard choices? You guys haven't made any hard choices. Sure, you put a new guy in charge and supported his recommendations for the most part. He's done what he could given the mess he started with. But we've been screaming for years now that the only way to really fix SPSA was to take dramatic steps to cut costs or sell it all. This piece mean approach selling just the primary asset but not fully eliminating the debt is just kicking the can down the road again, the same way its always been done. As for the offer to buy it all being a little late in the game, ReEnergy submitted thier proposal over a year ago and had been talking about it 6 months prior to that trying to show you why a piecemeal sale was not the best option. Ultimately their proposal had to be submitted outside the rules you set up to try and rig the game. When you ignored it Delegate Cosgrove had to pass a law to force you to look at it. I think you need to take a breahter from the world wide web and spend the energy understnading the ReEnergy proposal and getting us the best deal.
Objective opinion?
Burt, not knowing who you are, and what your relationship to ReEnergy is, it is nevertheless clear that your acceptance of a proposal to do something ignores the fact that it is not yet an offer under the terms of the PPEA. The Wheelabrator offer of $150,000,000 is accompanied by surety of $5,000,000, and if SPSA decides to accept it, it is good to go subject to the few precedents. I expect to see the revised ReEnergy proposal and any other that comes in incident to that PPEA, and to have the benefit of an evaluation by our experts, the views of the CAO's, the opinions of the eight members, and to listen to the citizens as well. From my prespective, it is hard for me to read your unabased endorsement of a proposal that I have not yet seen. Perhaps you have seen it, but of course you have not had the considered opinions and evaluation to which I referred. That makes me think you have some unannounced connection to ReEnergy.
Specialforces
First, I came on the board in August a year ago. Second, it is clear that you are a knee-jerk reactor and not a fact man. The board has changed in its makeup prior to Cosgrove's bill, a fact he and evidently you had no knowledge nor interest in. Prior to the bill the decision to start selling the assets was made. This is again a fact missed by you and in the bill. This board has made hard dicisions to clean up the errors of our predecessors. For years. SPSA lived off of debt and kept tipping fees low. Now as we enter the eve pf our existence (2018 is right around the corner) we must begin to pay the debt off. The high tipping fee is to pay the debt off and to pay cash as we go forward. The sale of the assest has been looked at by 2 separate and independent financial consultants (one from SPSA and one by the City Managers), interestingly both came to the same conclusion.
Do not let this make you think for a minute that ReEnergy and anyone else proposing a bid to buy it all will not be reviewed extensivly because they will as long as there seems to be a serious betterment to the communities which entails more than tipping fees.
Again my problem with the article is the lopsided repo
Speaking of real reporting
Before I start I am a member of the Board of SPSA. This article is not worth the paper it is written on. Why notan interview of a board member or a representative of one of the communities. I find Cosgrove's comments of worrying this board may run it through (I guess he is just use to running things through in Richmond) complete nonsense. I would even bet he has no idea who is on the board, what they do for a living and how long they have been on the board. I will not talk about the bill that is as loosly put together as it can be. Under the bill those that have served on past boards that are no longer elected officials can serve again???
The other interview was with the attorney that represents a group that has offered (albeit late in the process) that has received comments from most of the entities involved.
I would think that the article would and should be less slanted. I know that the members currently on the board take their duty to SPSA very serious. I also know that the members are hard working and professionals.
Oh wait, that is what Cosgove asked for isn't it.
Serious
Barry I am sure that you and the other board members are serious...seriously inept. If what Barrett says is true (that he is the only one who voted for fiscal responsibility), then you must have voted to expand debt to its current unsustainable levels. Face it. You and the other board members are incompetent and unqualified to be on the Board of Directors of an operating company. You can blather all you want about Cosgrove...the truth is still the truth.
Get the Facts
Well specialforcersinvb, before you go insulting another elected public official, you really ought get some facts. Barry has been on the board for about two years, and that is the period of time that the board adopted necessary reforms, had the guts to stick to those reforms even though it meant higher tip fees, passed the short term fiscal plan, refinanced debt with VRA that saved rate/tax payers $10 M, set out a plan to sell assets to reduce debt, and actually carried out that plan as evidenced by the offer to purchase the waste to energy system for $150 M, as secured by a $5 M surety. So when you come on this forum, lacking basic knowledge, and hopped up on caffein and some absurd accusations made by regular posters who will not identify themselves nor name the firm they represent, sometimes those of us who have pledged to do the right thing get a bit edgy.
Listen tough guy
Listen tough guy, just because the guy came on the last two years does not mean that he and the rest of you are not inept. I remain anonymous because in some posts I say some things that could be seen as disparaging my commander-in-chief. Otherwise I would not hesitate, because I could care less about what you and some of the other politicos think of me. When you have my training, you fear very few people. But keep up you pontificating. It is entertaining.
Knowledge
I think you remain anonymous simply because you can try and sling mud by spouting off on information of which you have little to no knowledge. I am sure you are the real tough guy even with your training. Nice try to threaten someone but well you know nothing of my or Mike's background. Just puffy talk.
I applaud
you for defending our rights,it is commendable. Only problem is, I guess you think you are the first?? As far as my name goes, Yes it is a FINE name and one I am proud of (more than evidently you are of yours). Again you speak with very little knowledge. You are also assuming everyone is unable to defend oneself. For your benefit assume nothing in your line it doesn't pay to be completely reckless. By the way, I am elected to do what the people I represent and I have done that. I do not believe in any of my posts or Mikes's do you see that we think we are someone powerful, only servents of the people. Also, for the record I do not like Big Mac's or any fast food.
So please in the future research and understand what you are discussing then we can have a real conversation.
Broken Oath
Oh, that's classic. You took an oath, so to avoid the dishonor of breaking that oath, you post anonymously so no one will know you did it? Is that what you are saying? If so, let me assure you, you broke your oath, so now that I know the kind of person I am dealing with, I will simply ignore anything else you say.