Allco’s Last Minute Plea
“Hey Buddy, wanna sell your sewer plant?”
In their 11th Hour Appeal on 11/14/2003, Allco Finance and their investors consortium begged the City Council to sell tax ownership of your Waste Water Treatment Plant to a bank in Belgium and two beaches in the Cayman Islands. The city would have received 3.62% of the value of the $255 million Waste-Water Treatment plant, while the investors would have walked away with tens of millions of dollars–at the expense of the city, state and federal taxpayers.
The letter is worth reading, but one of the best statements is on page 8:
If Rapid City opts out on some “philosophical” basis, the market will not be affected; it is only the citizens of Rapid City who will suffer from the missed opportunity.
This was more than a philosophical issue. It was simply the wrong thing to do. Other cities agreed, including Duluth, MN.
Ironically, the letter refers to a transaction in Bergen County, New Jersey. However, officials there also defeated this transaction. So the one reference the investors were willing to cite realized this was a scam too.
Allco’s tactics were fundamentally dishonest, and as a result of their business practices, they eventually collapsed.