Representatives from Bernhard Capital Partners stopped by KATC after we published an internal report from a Lafayette Utilities System consultant about what a potential sale would mean for Lafayette.
KATC Investigates obtained the report through a public records request.
NewGen, the consultant for LUS, reported the sale of the public-owned utility company’s electric division could result in higher utility rates, workforce reductions and a loss of up to $800 million in government revenue over time.
Mayor-President Joel Robideaux requested the report, which NewGen created in July 2017, according to the report. That’s three months before Robideaux says he was first approached by Bernhard Capital, via The Picard Group, about potentially buying LUS electric.
Within an hour of KATC’s publication of that report, Jeff Jenkins, a Bernhard Capital partner, and Patrick Bernhard, another Bernhard representative — and son to the company’s founder, Jim Bernhard — stopped by the station.
Patrick Bernhard did not agree to interview on camera.
Jenkins said that if a deal went through, there would be no change to how LUS operates. He says Bernhard Capital would only manage LUS and expand the business.
He also said the company would still be regulated by the Lafayette Public Utilities Authority, the governing authority composed of majority-city council members.
“Rates would be frozen through 2021. There could be a significant increase in customer service and reliability.We would also look at the rates to see if they’re appropriate in terms of opportunity for rate reduction.
Cydra Wingerter, a spokesperson for Robideaux, says that “an outright sale of LUS was never considered” because of the revelations in the NewGen report.
Jenkins said he was unaware of the LUS consultant’s report.
KATC Investigates also obtained LCG emails that make any mention of LUS, Bernhard or the Picard Group dating back to October, when Robideaux said he first was approached by the company.
Those emails show the Picard Group helped arrange and hosted the meeting between Bernhard and Robideaux in November. A few months later, now-retired LUS Director Terry Huval forward Bernhard a copy of the NewGen report.
NewGen followed up with specific questions about the value of LUS, including rate forecasts, customer counts and their growth rate analyses.
LUS provided that information, showing that the company’s revenues are expected to increase from more than $198 million this year to more than $260 million in 2026.
On Feb. 1, Jenkins wrote to Robideaux about a potential cooperative endeavor to manage and operate LUS electric. In that letter, he included a memo from Bernhard’s lawyer, Hank Perret, about the legality of an agreement.
Perret said that the agreement should be validated by the courts, the city-parish council and the LPUA, but that a public vote is not required by law and “unnecessary.”
Jenkins had a different opinion when talking with KATC on Wednesday.
“It’s the right of the people of Lafayette to make a decision if they want to consider this,”he said, adding that any measure should go to the council and LPUA “and ultimately go to a vote of the people for a decision.”
Jenkins said Bernhard will release its own report about LUS within the coming weeks.
See all the documents and emails mentioned in this article below.