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A ‘bad’ deal that David Burt now wants to give Bermudians

By September 23, 2020September 25th, 2020No Comments

Statement from Pat Gordon-Pamplin addressing airport comments on the PLP platform

I need to address the airport statement in the Burt administration’s platform released last night.

After telling everyone that the airport is a bad deal, he suddenly wants Bermudians to own it.

That is a considerable about turn.

However, I am sure that David Burt is fully aware of the realities of the airport contract, but simply wants to continue his false narrative for political convenience.

He says he wants to put the ownership back into the hands of Bermudians.

Mr Burt, surely you know that the airport is already owned by the Bermuda Government, and thus Bermudians, via the Bermuda Airport Authority.

You can’t buy what you already own.

Secondly, what Aecon owns is a management contract, a so-called concession.

Aecon would probably be quite willing to sell that contract to the Government, but it would cost the Government at least $60 million, which is the equity that Aecon put in.

If Government bought this, they would have to borrow the money to do so.

The 16 percent return is earned by Aecon because they took most of the risks. Any buyer would have to pay Aecon for that.

And since interest rates have reduced since the deal was signed, it wouldn’t be unreasonable for Aecon to demand a premium for their original $60 million investment.

Lastly but importantly, currently the project debt of $235 million is not considered public debt.

If the government acquired the Aecon concession, then the borrower would be a Government entity thereby making that debt a public debt which will show on the Government’s balance sheet .