Newport News stands to gain $2 million a year in tax revenues, Norfolk would get an extra $14.5 million, and Portsmouth $3.2 million, if port operations in those cities are privatized, according to analysis by state transportation officials.
State transportation officials are virtually alone in predicting local tax windfalls. The Carlyle Group stated in their conceptual proposal that they'd "pay property taxes, or payment in lieu of taxes, similar to the current revenue stream they (Hampton Roads municipalities) currently receive from the Port Facilities."
Newport News city manager Neil Morgan said the analysis seems to adopt a rosier interpretation of state tax law as far as the city and other port cities are concerned.Carlyle's conceptual proposal lacks significant detail on any deal. The rush to privatize slowed a bit with state officials pushing back the timeline ever so slightly. A busy holiday season can divert citizens from a potentially contentious issue. PEU's and their purchased politicians often hide insider deals behind lofty language.
Morgan said Newport News had expected that port equipment and real estate currently shielded from taxes would remain so based on an analysis of the deals performed by city officials.
Virginia could privatize its port operations for 48 to 50 years. What will ships and docks look like in five decades? What currency will be in use? How many times will PEU's like Carlyle have flipped Virginia's Port Operations? At what point will the purchase price be too great and the Port default?
I expect none of these questions are in the state's analysis. Governor Bob McDonald needs a banner privatization deal to further his career, political and PEU. Virginia's Ports may be that deal.
