The citizens of Jefferson County should buy the Jefferson County Sewer System for $1.2 billion. The sewer system generates $115 million in annual revenue. Being a governmental utility I am confident that there are some savings that could be realized by running the system as an independent profit oriented business. The Jefferson County Sewer System is not under the jurisdiction of The Alabama Public Service Commission so a small increase in rates of 10% would not be an obstacle. That $12 million would go directly to the bottom line. It looks to me like we would own a business generating us a 5.5% return on investment and own a business free and clear valued at $1.2 billion.
Mr. Bonner has a history of a 7.5% to 11% return on investment for the RSA, so I suspect that my projections are on the conservative side.
It looks like the marketers of the sewer bonds, J.P. Morgan, and several other Wall Street Banks will be forced to make the sewer bond holders whole as City Group, Merrill Lynch, UBS, and Wachovia are being forced to do by various states attorney general. This will leave only J. P. Morgan and the other Wall Street bankers as the counties creditors. Without a clean sale the Jefferson County Sewer System will be forced into default and a receiver will be appointed; the assets of the sewer system will be tied up in court for years. J.P. Morgan and the others don’t want that and they don’t want the Jefferson County Commissioners, everyone recognizes that they are in over their heads.
There are approximately one million of us in Jefferson County. The purchase of the Jefferson County Sewer System would require and investment of $1,200 apiece. We would own a “Cash Cow”, a “monopoly”. The sewer system has just been rebuilt; it is in compliance with the Federal Clean Water Act. This is an opportunity of a lifetime, let’s go after it, let’s keep it for ourselves, let’s don’t let Mr. Bonner steal it form us.
