Since at least October of 2019, Alexandria Mayor Jeff Hall and members of his administration have been in discussions with John Kyte, a “crisis communications” consultant, and Adam Terry, a D.C. lobbyist who once worked as Chief of Staff for former U.S. Reps. Rodney Alexander and Vance McAllister, about formulating a multifaceted public persuasion campaign that anticipates privatizing the city’s 126-year-old nonprofit municipal utility system, according to records obtained by the Bayou Brief.
The extent of their efforts had not been previously disclosed to the press and key documents were withheld from the Alexandria City Council earlier this month, as the administration sought approval of a formal contract with the two men through Kyte’s Ruston-based consulting company. These documents contradict Hall’s recent public assertions that he has not yet discussed the “option” of selling the utility system.
In a “confidential” memo dated Oct. 28th of last year and subsequently sent, via email, from Kyte to Ken D. Nolley, the head of Mayor Hall’s newly-created “Internal Audit” department, the consultant outlines a communications strategy centered around the possibility of either “leasing the city’s electric utility assets to an operator, franchising the operations, or an outright sale of the assets.” Susan Broussard, Hall’s Chief of Staff, had been kept apprised of the proposed strategy, according to internal email records.
The documents were all obtained earlier today, following a public records request filed by the Bayou Brief two weeks ago. On Tuesday, the Alexandria City Council’s Finance Committee will discuss finalizing a contract with Kyte Consulting. Last week, I reached out to Kyte directly, after three individuals contacted me personally to express concerns about the proposed contract. Since then, we have exchanged multiple emails, and Kyte has repeatedly and adamantly denied the implication that the outcome of any potential “evaluation” of the city’s utility has been predetermined.443322603
However, the communications plan he provided to Hall and Nolley is essentially a playbook on how the City should approach selling the public on a potential deal. Indeed, privatization seems to be the only contingency being seriously contemplated.
Among other things, the plan discusses first considering any legal or regulatory obstacles, conducting surveys and focus groups, investing in paid advertising, reaching out to potential “influencers,” and addressing the possibility of job losses. According to Kyte, he was personally recruited for the work, which was never advertised through a competitive RFP or RFQ process, after an acquaintance had mentioned him to Mayor Hall, who then initiated discussions. Previously, Kyte told me his proposal had been based on those discussions.
The memo contains numerous inaccuracies, faulty assumptions, and misrepresentations about the city utility system, including the number of customers, the ways in which it purchases power, how many people it employs, the structure of its debt obligations, and the recent and planned investments in infrastructure upgrades. Although Kyte has been in discussions with Mayor Hall since at least October and had hoped to begin officially on Dec 15th, his contract wasn’t sent down to the City Council for approval until two days before the New Year. In the interim, at no point did anyone in the Hall administration issue written concerns or corrections to his initial plan; in fact, Kyte actually sent the same document back to the City more than a month later.
Prior to providing the City Council with a draft version of Kyte’s contract, Hall had agreed with his suggestion to also include a project description and biographical information as well, which Kyte decided to “intentionally” keep brief.
This week, on two separate occasions, Mayor Hall has inaccurately claimed the City’s most recent evaluation of its utility system did not consider anything after 2019, perhaps confusing a section of an engineering report by RDS Associates concerning revenue projections based on the price of natural gas as singularly significant. The study actually considered the City’s energy needs until the end of 2031.
This document, for example, is still accessible on the City’s own website:
Hall, Broussard, and Nolley all arrived at City Hall after previously working for Cleco, the privately-held utility giant headquartered in nearby Pineville. Hall had risen through the ranks to become a company Vice President and its first-ever Chief Diversity Officer; Broussard was its longtime spokesperson before eventually being promoted to General Manager of Human Resources, and Nolley was once listed as its Assistant Treasurer. Of the three, Nolley has been away from the company the longest, though, notably, his time with Cleco overlapped with Hall and Broussard.
15 years ago, the City of Alexandria filed suit against Cleco, alleging that it had systematically defrauded Alexandria customers from 1995 to 2005, a period in which time the City had spent a total of $107 million to purchase power from the utility giant. Alexandria alleged both that Cleco had passed on improper costs to Alexandria customers and used Alexandria capacity to defraud the City its portion of shared profits. The City accused Cleco of inflating the price it charged Alexandria ratepayers, entitling them to at least a partial refund.
However, a separate and ultimately unsuccessful class action case, in part led by now-Councilman Joe Fuller, prevented distributing rebates until 2017, a year before Hall took office.
Both Kyte and Terry are associated with Jim Davison, the mega-wealthy scion of the Ruston family who made its fortune by building a trucking, banking, and energy empire. The Davisons are reportedly the controlling shareholders of Genesis Energy, a $2.7 billion oil and gas company headquartered in Houston, and Jim Davison has a substantial stake in Origin Bank, which recently became Louisiana’s largest land-based banking business.
Kyte had been a registered federal lobbyist for Somid Resources, a company that purportedly is involved in renewable energy though the only publicly-available documentation concerning its activities are its ownership of a small private airplane and a pending claim in Bankruptcy Court it has against Approach Resources, an oil and gas operation that owns more than 800 wells in the Permian Basin.
Yesterday, in response to the first installment in this series, Kyte attempted to assert that he was merely hoping to help Mayor Hall follow through on the recommendations of a “transition” report that was released nine months after Hall took office, implying that it justified the work he is being asked to perform. However, while the report included a broadly-worded statement about the need to consider the utility system’s long-term infrastructure requirements and cost containment strategies, it did not promote the idea of funneling everything through a private PR firm or developing a concomitant “public information campaign.” Moreover, the report had specifically identified water and wastewater operations as infrastructure priorities; Kyte’s plan, on the other hand, emphasizes the city’s “electric utility assets.”
If the campaign does include a recommendation to dismantle the half-billion dollar nonprofit utility system, it would not be the first time the City has entertained the idea. In 1987, Cleco aggressively pursued buying the city’s utility for $158 million, and its effort also included a “public information campaign” that touted push polls the company had commissioned and industry-friendly talking points.
Ultimately, however, Cleco withdrew its offer only a few days before the Louisiana Bond Commission ruled against allowing the City to proceed.
Read Part Three: