Another potential investment in a city’s utilities by Bernhard Capital, this time in New Jersey, is generating criticism.
The city of Pleasantville needs millions of dollars worth of repairs to its wastewater management system, The Press of Atlantic City reports. Bernhard has offered to pay the city $15 million to lease and operate the system for 39 years and $100,000 a year annually for every year after.
Bernhard would spend $57 million maintaining and renovating the system over the contract’s duration. Residents would pay Bernhard the same for service the first year and see a 4% increase the second year.
However, starting in the third year and continuing through the 15th, residents would pay a 5% increase each year, meaning they would pay about $980 a year for wastewater service, about double what they pay now.
The Press of Atlantic City questions whether this is the best deal available and if Pleasantville is following state law regarding the contract.
This recent utilities deal follows a similar offer by Bernhard that has sparked controversy in Fayetteville, North Carolina.
There, a city official resigned and alleged her colleagues had conflicts of interest regarding a deal with Bernhard. The deal was similar to the one in Pleasantville, and the company was offering Fayetteville $750 million to run its utilities for 30 years while retaining profits.