Stimulating | Arkansas Blog

Wednesday, May 20, 2009

Stimulating

Posted By on Wed, May 20, 2009 at 6:38 AM

You perhaps saw a story in the Democrat-Gazette this morning about a plan hatched by NLR Mayor Pat Hays to get a group of local governments to apply for $5 million in federal stimulus money to convert vehicle fleets to run on compressed natural gas. At least a $5 million match would be required. Looks like it will fall through because key players, Little Rock and the Central Arkansas Transit Authority, aren't inclined to participate.

I asked the city of LR about this yesterday and was told the idea had been dropped on account of its cost. The D-G story never got to the full bottom line, but it would appear Central Arkansas Transit wouldn't have even been able to buy buses with the money after spending millions on facilities to handle the new equipment. CATA also has safety concerns about the vehicles. Here's what LR told me yesterday:

The City of Little Rock and other agencies (Game and Fish Commission, City of North Little Rock, North Little Rock School District, Pulaski County government, Central Arkansas Transit, Little Rock National Airport) have been reviewing the potential of a CNG grant.  After a careful review and consideration of the 50% matching cost requirements, the potential partners collectively decided not to pursue it.

Here's a hint at another interesting angle in the story, courtesy of an item on Argenta News, the feisty NLR news website. Argenta News says city of NLR e-mails it has obtained indicate local matching money perhaps would have been produced by a bond issue floated by Stephens Inc. New debt would, of course, have made the local match for the $5 million exponentially more expensive over time  (not to mention the cost of buying vehicles and building faclities to serve them beyond what the grant might cover). This is how municipal finance works, of course. But if this was the plan, it would have come with at least a tiny touch of irony. I refer to recent critical guest commentary in Arkansas Business by Stephens exec Curt Bradbury about the expanding socialism of the free-spending Obama administration, particularly in its equity stake in troubled financial institutions (thanks to elwood for finding the link). If you can't beat the socialists, that's no reason not to make a little profit off of them.

Argenta News' most trenchant comment is about the lack of transparency in NLR's efforts to obtain stimulus money. This deal came into sunlight only by virtue of the bus board's public decison to move ahead with purchase of conventional buses. Had the thing gone as planned, it would have been sprung as a done deal, with no time for public review of cost, benefits, complications.

Bradbury re Obama socialism, from AB:

I have been bemused by the discussion recently as to whether Obama is a socialist. By any definition I learned in getting a master’s degree in economics, there can be no doubt about it. He’s tried to tell us in many ways, both during the campaign and since the election. His “share the wealth” and coercive redistributionist philosophy is quickly turning into national policy. And when government becomes actively engaged in credit allocation, as it is now, the debate should be over.

To me, it’s not as shocking that Obama is showing his true socialist colors as it is how many people are so unconcerned or even supportive. Perhaps those are the ones whose hearts and minds he has captured by assuring them they will never pay federal income tax, now approaching a 50 percent voting majority of U.S. citizens.

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