"CERTIFICATES of PARTICIPATION - BE CONCERNED
Certificates of Participation should be everyone in Missouri and the USA's concern. (It's very possible it has already happened in your County and you missed it)
...actually felt a ray of hope when read, City Administrator (Washington,MO) Jim Briggs, said in two articles, that certain projects just could not be afforded. (Downtown TIF project & West Highway 100 proposal.) That ray of hope was quickly erased with his comment, "...the city will look into using Certificates of Participation to FINANCE the project (hwy 100). Mr. Briggs said, prefers pay back of loans over 10 years, well, Mr. Briggs take a look at the payback time on the 2005 COP. Looks like, Mr. Hillhouse, is teaching Cities to follow his unique technique of Franklin County INDEBTEDNESS WITHOUT "VOTER APPROVAL", with the HOPE that sales tax will cover his indiscreet decisions. (Even though unemployment is at all time high, foreclosures are 79% higher, his County Recorder already showing "last years" revenues are "down", but that won't be Commissioner Ed Hillhouse's problem, as he thinks he will "move on" to a state level, where he can teach State Representatives the deceitful ways of Certificates of Participation.
Now we have a huge 19.41-cent road and bridge property tax, why is that not enough to use with careful considerations?? Mr. Briggs, perhaps you should ask Mr. Hillhouse, about the 2007 Certificate of Participation, that allocates $11,245,000 for roads and bridges, perhaps he had you in mind, Mr. Briggs. Mr. Hillhouse does not disclose what roads and bridges he has in mind. This allocation is in addition to the 19.41-cent property tax.
NOTES on existing Certificates of Participation:
2005 $6,900,000 (loan) Total interest $4,829,992 (IF paid by year 2030, but the so called lease has until 6/1/2050 to be repaid, 42 YEARS!!!) This COP applies to capitol improvement projects: New Administration Center, Courthouse Annex, Juvenile Center,and Judicial Center. The Bank of Washington WAS the Trustee. (see COP 2007)
2007 $18,450,000 (loan)( had trouble finding total interest to be paid) This COP applies to $11,245,000 Roads & Bridges non-specific and $7,205,000 Judicial Center. In this COP, The Washington Bank is removed as Trustee from the original 2005 COP, and the amount of $6.9 million is added to this 2007, and The Bank of New York Trust Co, NA is assigned as Trustee for the entire amount of $25.35 million. There are now two payments due per year instead of one. (starting Mar 1, 2008 again in Sep. of each year. the amounts of each payment not found) Found no individual LOCAL Banks involved, just The Bank of New York Trust Co. NA.
This an interesting statement found within the 2005 COP: SEC.5, Assignments and subleases Trustee may assign this base lease and its rights hereunder or lease the leased property without the written consent of the County (i) if the lease is terminated for any reason or (ii) if an Event of Default has occurred. Sounds like, if sales taxes do not become strong in order to make payments with interest, Franklin County has a possibility of some unknown controlling our/your government buildings (and unknown roads & bridges.)
Now, we see musical chairs beginning with our elected officials, as for Mr. Hillhouse and his personal goals, he is leaving quite a footprint for someone else to inherit. That is just this writer’s opinion...........what's yours? (Let your representatives hear from you)
Explains Purpose of Lease Purchase Agreements
By Gregg Jones, Missourian Staff Writer
01/18/2008
Franklin County Presiding Commissioner Ed Hillhouse said issuing certificates of participation (COPs) is the most effective way for the county to build new facilities and renovate the historic courthouse.
Hillhouse said the county commission chose that method of financing as the most viable of three options. He, Hillhouse, one man, appears to chose the method of “financing” LOANS/NO VOTER APPROVAL.
He said other than COPs, commissioners had two options to expand county facilities."You pay for it all up front, which we are not able to do, or you raise taxes," said Hillhouse.
… or RAISE TAXES “WHICH OFCOURSE”THE VOTERS WOULD NOT APPROVE!!! AND WHAT “IS” GOING TO “PAY” THIS BACK “TAXES” …HE PUTS A LOT INTO THE HOPE OF STRONG SALES TAXES/INCLUDING ANY POSIBILITY OF REDUCING YOUR PROPERTY TAXES AS HE HAS ELUDED TO “PENDING STRONG SALES TAXES.” ISN’T HE HEARING THE WORDS RESESSION/WITH ALL THE FORECLOSURES HE WILL HAVE LESS TAXES/LESS SPENDING……..DOES HE INTEND TO LOWER YOUR PROPERTY TAXES BASED OF THE DECREASED VALUE OF YOUR HOMES.The county sold COPs to finance construction of the Franklin County administrative and judicial centers. The administration building is finished and work is progressing on the new courts building. Renovations also are planned for the Franklin County Courthouse which will house a veterans memorial and other county offices. KEY WORD HERE “SOLD”, YOUR GOVERNMENT BUILDINGS!!!Hillhouse said several years ago the commission was presented a petition by circuit judges asking them to go to the voters for a tax increase to fund the projects. He said a facility needs committee was established to ensure the county made "sound decisions" when planning for future growth. DENIED THE REQUEST OF CIRCUIT JUDGES ASKING FOR “VOTER” APPROVAL TO FUND THE PROJECTS. “SOUND DECISIONS”? "They looked at the needs, total cost and if we would be in better shape dragging projects out over the years - or are we better off getting it built now?" he said. "We asked the local banking community to come in and look at lease purchasing and not raising taxes." KEEPS SAYING NOT RAISING TAXES……….WELL, WHAT IS GOING TO MAKE THESES PAYMENTS!!! AND THE BANKS ARE NOT DOING IT INTEREST FREE…. Hillhouse explained that banks purchased certificates of participation, similar to bonds, and the county will pay off the COPs over a 25-year period. SIMILAR TO BONDS……. BONDS ARE VOTED ON BY THE PEOPLE……WHAT THE HECK IS SIMULAR????
The county received over $18 million for capitol improvement projects that will be repaid in annual installments until 2032. The annual payments range from over $800,000 until 2013 to $1.2 after 2013. The total payment will be $31,410,605. (AND ANOTHER 6.9 MILLION IN 2005, THAT’S A TOTAL OF $24.9 MILLION…….THESE FIGURES DO NOT REFLECT THIS.) AND DO THE MATH ON HIS FIGURES…31.4 LESS 18 = 13.4 MILLION IN INTEREST ON 18 MILLION. ON 3-4% LOANS………..?????????The county also will sell COPs to build new roads and renovate the Franklin County Sheriff's Department. YIPES…..NOW SOME OTHER ENTITY WILL “OWN”YOUR ROADS & BRIDGES? BY THE WAY FIND NO WHERE IN RS49 THAT HILLHOUSE COULD DO THAT?????COPs are a form of lease purchase transaction that allows one debt to be sold to multiple investors. In this case the debt is incurred by the county and sold to banks, mostly local, Hillhouse said. He compared the practice to a home mortgage. MOSTLY LOCAL THAT IS CONCERNING, AND HOW ABOUT HILLHOUSE LIST “ALL” THESE BANKS AND THE AMOUNTS!!!!! HAS HE SOLD US OUT TO MAYBE “FOREIGN” BANKS…….THAT DOES SEEM TO BE A NEW FORM OF GREED IN AMERICA, SELLING OUT TO OUR ENEMIES."It is how you decide to pay for it. Do you want to wait until you have enough cash - maybe 30 years to build a house - or do you build what you want now?" said Hillhouse. PLEASE, ED, THIS IN NO WAY CAN BE COMPARED TO AN “INDIVIDUAL” DECIDING TO PURCHASE A HOME. (for more than they can afford, the reason for so many foreclosures) WE IN NO WAY GAVE YOU, AS AN ELECTED OFFICIAL, THE “RIGHT” TO MAKE DECISIONS WITHOUT “VOTER APPROVAL”. (And this kind of got to have it NOW mentality is exactly what is wrong with America and its citizens)He added that the buildings themselves serve as the collateral against the loans. If the county fails to make payments on its debt, the banks that purchased the COPs could become part owners in the county buildings. THE CORRECT WORD IS WOULD OWN THE COUNTY BUILDINGS,NOT COULD ………….THEN WHAT, MR. HILLHOUSE????? WHAT IF YOUR SALES TAX CANT MAKE THE PAYMENTS, THEN WHAT???? Participating in this type of lease purchase, said Hillhouse, is advantageous for Franklin County due to its retail, industrial and population growth."It works for a growing community. If this was a county losing population, industries or retail, or going that way - especially from a sales tax standpoint - that is not the way we would want to go," said Hillhouse. MR. HILLHOUSE, YOU ARE LIVING BEHOND OUR MEANS. WE, THE PEOPLE, CAN NOT BANK ON THE FUTURE OF OUR JOBS MUCH LESS ANY INCREASE IN OUR PAY,.THE EQUIVELENT OF WHAT YOU ARE DOING, IS INDIVIDUALS USING CREDIT CARDS TO THE EXTREME AND BALLOON NOTES ON HOMES. WE ARE IN A CREDIT CRUNCH IN AMERICAN AND YOU WANT TO BANK ON THE UNKNOWN…OH, BUT OFCOURSE. IT ISN’T YOUR MONEY AND WHAT DO YOU HAVE TO LOOSE…ESPECIALLY WITH A CUSHIE $90K RETIREMENT FROM MVRIII…AND WHO KNOWS WHAT FROM FRANKLIN COUNTY.He added that in a few years, he believes new sales tax revenue retail growth in the county will cover the debt on the COPs. AND COWS CAN FLY!!!"I'm convinced that within three to five years you will see growth alone be able to pay for the buildings," he said. Hillhouse added that new facilities are key to more growth. "I believe this is an economic tool for the county," he said. "We show outside industries that the county is serious about truly providing the space necessary for a first-class county." SOUNDS LIKE KEEPING UP WITH THE JONES. AND WHEN THE “SALES TAXES” GO SOFT, HOW WILL THIS “DEBT” BE REPAID, AS WE DO NOT THINK MR. HILLHOUSE WILL BE AROUND TO “FIX” THE PROBLEM. (probably accessive reassessments “property taxes” )Hillhouse said he has heard questions raised about the legality of COPs, and stressed that lease purchasing agreements are authorized under state statute. Exactly, how can it be legal to go around taxpayers and put them in debt……WITHOUT VOTER APPROVAL. Even when the Circuit Judges tried to do it the right with bonds voted on BY THE PEOPLE.Hillhouse said the county is given the authority under Chapter 49 of the Revised Missouri Statutes, which states that a first-class county "may lease to any person any real property and other facilities under the control of the county commission owned by the county for a term not to exceed 50 years." Leasing to any person, usually means they move in and pay rent in this case to the county for space. Would like for Mr. Hillhouse to specify exactly which of the many sections in Chapter 49 that he is referring to!"It's as plain as can be," said Hillhouse. "A person can disagree with the methodology and I respect that - but there is no question if it is legal or illegal." Franklin County Attorney Mark Vincent agreed that there is no question to the legality of COPs."In my opinion these are absolutely 100 percent legal. Bond holders would not buy these bonds if they were illegal," he said. "I know it's legal and in the opinion of bond counsel they are legal - we did nothing wrong." NOW THIS IS CONFUSING, ARE THE INVESTORS “BOND HOLDERS”, NOT BANKS/MULTIPLE INVESTORS, WHO LOANED MONEY TO FRANKLIN COUNTY?
©Washington Missouri 2008
*** HAS COMMISSION DONE AN END-RUN AROUND THE VOTERS? 12-22-07 ***
Dear editor: With all the furor about concerning assessments, I thoughtthe citizens might wish to ask the Commission just what exactly is aCertificate of Participation. After all, there was a small notice in theWednesday 12 December Missourian that the 2007 budget was being amended toinclude $18.45 million in Certificates of Participation. I had never heardof such a thing so I did a google on same. I came to the Company who proudlyproclaims that they were the first company to offer these certificates., Iquote," lease financing has been among the most popular methods used tofinance capital improvements while complying with OR AVOIDING constitutional debt limits applicable.......". So theycan be used to avoid what? How about the vote of the people as intraditional bond issues which require either a 4/7ths or 2/3rds majoritybefore passage. As explained briefly by the Auditor, a certificate of Participation is alease/purchase agreement. Huh? Someone might wish to ask, "what are weleasing, and what are we purchasing?". A California Grand Jury investigation concluded that "voter reluctance toapprove bonds by the required 2/3 majority has no doubt contributed to theuse of COPs as the primary financing method for capital projects." So, arethese "certificates" used to bypass voters when our supposed "servants"decide that the County needs "improvements"?. And what are theseimprovements? The Judicial Center, courthouse renovations, and road andbridge improvements are what is listed in the budget notice. And since these are lease/purchase agreements, does this mean that we thetaxpayers are leasing the above "improvements"?. If we are, who owns themuntil we finish with the "rent to own" agreement? Also, $6.9 Million of these certificates were "issued" in 2005 to financethe Government Center. Does this mean that the County is leasing thisfacility from some entity? And who purchased these Certificates? Further research concludes that these Certificates of Participation aretreated as a "security" and not a "bond" because technicallythere is noobligation to pay by future Commissions. But if the leases are notappropriated each year, the County relinquishes the right to use thefacilities. So if future Commissions decide not to appropriate the leasepayments, wouldn't we lose the use of the Government Center, "Palace ofJustice" the courthouse and who knows what roads and bridges? One mustconclude that it would be folly to presume that future Commissions wouldn'tcontinue the lease. So the taxpayers are encumbered with future "lease"payments, but not "burdened with debt." You see, with clever words a "bonded indebtedness"[requiring voterapproval] becomes a "pledged revenue stream" requiring only the wave ofthemagic wand by our "public servants." And we think that reassessments are ourbig worry? EricReichert
puzzled nearVillaRidge
...actually felt a ray of hope when read, City Administrator (Washington,MO) Jim Briggs, said in two articles, that certain projects just could not be afforded. (Downtown TIF project & West Highway 100 proposal.) That ray of hope was quickly erased with his comment, "...the city will look into using Certificates of Participation to FINANCE the project (hwy 100). Mr. Briggs said, prefers pay back of loans over 10 years, well, Mr. Briggs take a look at the payback time on the 2005 COP. Looks like, Mr. Hillhouse, is teaching Cities to follow his unique technique of Franklin County INDEBTEDNESS WITHOUT "VOTER APPROVAL", with the HOPE that sales tax will cover his indiscreet decisions. (Even though unemployment is at all time high, foreclosures are 79% higher, his County Recorder already showing "last years" revenues are "down", but that won't be Commissioner Ed Hillhouse's problem, as he thinks he will "move on" to a state level, where he can teach State Representatives the deceitful ways of Certificates of Participation.
Now we have a huge 19.41-cent road and bridge property tax, why is that not enough to use with careful considerations?? Mr. Briggs, perhaps you should ask Mr. Hillhouse, about the 2007 Certificate of Participation, that allocates $11,245,000 for roads and bridges, perhaps he had you in mind, Mr. Briggs. Mr. Hillhouse does not disclose what roads and bridges he has in mind. This allocation is in addition to the 19.41-cent property tax.
NOTES on existing Certificates of Participation:
2005 $6,900,000 (loan) Total interest $4,829,992 (IF paid by year 2030, but the so called lease has until 6/1/2050 to be repaid, 42 YEARS!!!) This COP applies to capitol improvement projects: New Administration Center, Courthouse Annex, Juvenile Center,and Judicial Center. The Bank of Washington WAS the Trustee. (see COP 2007)
2007 $18,450,000 (loan)( had trouble finding total interest to be paid) This COP applies to $11,245,000 Roads & Bridges non-specific and $7,205,000 Judicial Center. In this COP, The Washington Bank is removed as Trustee from the original 2005 COP, and the amount of $6.9 million is added to this 2007, and The Bank of New York Trust Co, NA is assigned as Trustee for the entire amount of $25.35 million. There are now two payments due per year instead of one. (starting Mar 1, 2008 again in Sep. of each year. the amounts of each payment not found) Found no individual LOCAL Banks involved, just The Bank of New York Trust Co. NA.
This an interesting statement found within the 2005 COP: SEC.5, Assignments and subleases Trustee may assign this base lease and its rights hereunder or lease the leased property without the written consent of the County (i) if the lease is terminated for any reason or (ii) if an Event of Default has occurred. Sounds like, if sales taxes do not become strong in order to make payments with interest, Franklin County has a possibility of some unknown controlling our/your government buildings (and unknown roads & bridges.)
Now, we see musical chairs beginning with our elected officials, as for Mr. Hillhouse and his personal goals, he is leaving quite a footprint for someone else to inherit. That is just this writer’s opinion...........what's yours? (Let your representatives hear from you)
Explains Purpose of Lease Purchase Agreements
By Gregg Jones, Missourian Staff Writer
01/18/2008
Franklin County Presiding Commissioner Ed Hillhouse said issuing certificates of participation (COPs) is the most effective way for the county to build new facilities and renovate the historic courthouse.
Hillhouse said the county commission chose that method of financing as the most viable of three options. He, Hillhouse, one man, appears to chose the method of “financing” LOANS/NO VOTER APPROVAL.
He said other than COPs, commissioners had two options to expand county facilities."You pay for it all up front, which we are not able to do, or you raise taxes," said Hillhouse.
… or RAISE TAXES “WHICH OFCOURSE”THE VOTERS WOULD NOT APPROVE!!! AND WHAT “IS” GOING TO “PAY” THIS BACK “TAXES” …HE PUTS A LOT INTO THE HOPE OF STRONG SALES TAXES/INCLUDING ANY POSIBILITY OF REDUCING YOUR PROPERTY TAXES AS HE HAS ELUDED TO “PENDING STRONG SALES TAXES.” ISN’T HE HEARING THE WORDS RESESSION/WITH ALL THE FORECLOSURES HE WILL HAVE LESS TAXES/LESS SPENDING……..DOES HE INTEND TO LOWER YOUR PROPERTY TAXES BASED OF THE DECREASED VALUE OF YOUR HOMES.The county sold COPs to finance construction of the Franklin County administrative and judicial centers. The administration building is finished and work is progressing on the new courts building. Renovations also are planned for the Franklin County Courthouse which will house a veterans memorial and other county offices. KEY WORD HERE “SOLD”, YOUR GOVERNMENT BUILDINGS!!!Hillhouse said several years ago the commission was presented a petition by circuit judges asking them to go to the voters for a tax increase to fund the projects. He said a facility needs committee was established to ensure the county made "sound decisions" when planning for future growth. DENIED THE REQUEST OF CIRCUIT JUDGES ASKING FOR “VOTER” APPROVAL TO FUND THE PROJECTS. “SOUND DECISIONS”? "They looked at the needs, total cost and if we would be in better shape dragging projects out over the years - or are we better off getting it built now?" he said. "We asked the local banking community to come in and look at lease purchasing and not raising taxes." KEEPS SAYING NOT RAISING TAXES……….WELL, WHAT IS GOING TO MAKE THESES PAYMENTS!!! AND THE BANKS ARE NOT DOING IT INTEREST FREE…. Hillhouse explained that banks purchased certificates of participation, similar to bonds, and the county will pay off the COPs over a 25-year period. SIMILAR TO BONDS……. BONDS ARE VOTED ON BY THE PEOPLE……WHAT THE HECK IS SIMULAR????
The county received over $18 million for capitol improvement projects that will be repaid in annual installments until 2032. The annual payments range from over $800,000 until 2013 to $1.2 after 2013. The total payment will be $31,410,605. (AND ANOTHER 6.9 MILLION IN 2005, THAT’S A TOTAL OF $24.9 MILLION…….THESE FIGURES DO NOT REFLECT THIS.) AND DO THE MATH ON HIS FIGURES…31.4 LESS 18 = 13.4 MILLION IN INTEREST ON 18 MILLION. ON 3-4% LOANS………..?????????The county also will sell COPs to build new roads and renovate the Franklin County Sheriff's Department. YIPES…..NOW SOME OTHER ENTITY WILL “OWN”YOUR ROADS & BRIDGES? BY THE WAY FIND NO WHERE IN RS49 THAT HILLHOUSE COULD DO THAT?????COPs are a form of lease purchase transaction that allows one debt to be sold to multiple investors. In this case the debt is incurred by the county and sold to banks, mostly local, Hillhouse said. He compared the practice to a home mortgage. MOSTLY LOCAL THAT IS CONCERNING, AND HOW ABOUT HILLHOUSE LIST “ALL” THESE BANKS AND THE AMOUNTS!!!!! HAS HE SOLD US OUT TO MAYBE “FOREIGN” BANKS…….THAT DOES SEEM TO BE A NEW FORM OF GREED IN AMERICA, SELLING OUT TO OUR ENEMIES."It is how you decide to pay for it. Do you want to wait until you have enough cash - maybe 30 years to build a house - or do you build what you want now?" said Hillhouse. PLEASE, ED, THIS IN NO WAY CAN BE COMPARED TO AN “INDIVIDUAL” DECIDING TO PURCHASE A HOME. (for more than they can afford, the reason for so many foreclosures) WE IN NO WAY GAVE YOU, AS AN ELECTED OFFICIAL, THE “RIGHT” TO MAKE DECISIONS WITHOUT “VOTER APPROVAL”. (And this kind of got to have it NOW mentality is exactly what is wrong with America and its citizens)He added that the buildings themselves serve as the collateral against the loans. If the county fails to make payments on its debt, the banks that purchased the COPs could become part owners in the county buildings. THE CORRECT WORD IS WOULD OWN THE COUNTY BUILDINGS,NOT COULD ………….THEN WHAT, MR. HILLHOUSE????? WHAT IF YOUR SALES TAX CANT MAKE THE PAYMENTS, THEN WHAT???? Participating in this type of lease purchase, said Hillhouse, is advantageous for Franklin County due to its retail, industrial and population growth."It works for a growing community. If this was a county losing population, industries or retail, or going that way - especially from a sales tax standpoint - that is not the way we would want to go," said Hillhouse. MR. HILLHOUSE, YOU ARE LIVING BEHOND OUR MEANS. WE, THE PEOPLE, CAN NOT BANK ON THE FUTURE OF OUR JOBS MUCH LESS ANY INCREASE IN OUR PAY,.THE EQUIVELENT OF WHAT YOU ARE DOING, IS INDIVIDUALS USING CREDIT CARDS TO THE EXTREME AND BALLOON NOTES ON HOMES. WE ARE IN A CREDIT CRUNCH IN AMERICAN AND YOU WANT TO BANK ON THE UNKNOWN…OH, BUT OFCOURSE. IT ISN’T YOUR MONEY AND WHAT DO YOU HAVE TO LOOSE…ESPECIALLY WITH A CUSHIE $90K RETIREMENT FROM MVRIII…AND WHO KNOWS WHAT FROM FRANKLIN COUNTY.He added that in a few years, he believes new sales tax revenue retail growth in the county will cover the debt on the COPs. AND COWS CAN FLY!!!"I'm convinced that within three to five years you will see growth alone be able to pay for the buildings," he said. Hillhouse added that new facilities are key to more growth. "I believe this is an economic tool for the county," he said. "We show outside industries that the county is serious about truly providing the space necessary for a first-class county." SOUNDS LIKE KEEPING UP WITH THE JONES. AND WHEN THE “SALES TAXES” GO SOFT, HOW WILL THIS “DEBT” BE REPAID, AS WE DO NOT THINK MR. HILLHOUSE WILL BE AROUND TO “FIX” THE PROBLEM. (probably accessive reassessments “property taxes” )Hillhouse said he has heard questions raised about the legality of COPs, and stressed that lease purchasing agreements are authorized under state statute. Exactly, how can it be legal to go around taxpayers and put them in debt……WITHOUT VOTER APPROVAL. Even when the Circuit Judges tried to do it the right with bonds voted on BY THE PEOPLE.Hillhouse said the county is given the authority under Chapter 49 of the Revised Missouri Statutes, which states that a first-class county "may lease to any person any real property and other facilities under the control of the county commission owned by the county for a term not to exceed 50 years." Leasing to any person, usually means they move in and pay rent in this case to the county for space. Would like for Mr. Hillhouse to specify exactly which of the many sections in Chapter 49 that he is referring to!"It's as plain as can be," said Hillhouse. "A person can disagree with the methodology and I respect that - but there is no question if it is legal or illegal." Franklin County Attorney Mark Vincent agreed that there is no question to the legality of COPs."In my opinion these are absolutely 100 percent legal. Bond holders would not buy these bonds if they were illegal," he said. "I know it's legal and in the opinion of bond counsel they are legal - we did nothing wrong." NOW THIS IS CONFUSING, ARE THE INVESTORS “BOND HOLDERS”, NOT BANKS/MULTIPLE INVESTORS, WHO LOANED MONEY TO FRANKLIN COUNTY?
©Washington Missouri 2008
*** HAS COMMISSION DONE AN END-RUN AROUND THE VOTERS? 12-22-07 ***
Dear editor: With all the furor about concerning assessments, I thoughtthe citizens might wish to ask the Commission just what exactly is aCertificate of Participation. After all, there was a small notice in theWednesday 12 December Missourian that the 2007 budget was being amended toinclude $18.45 million in Certificates of Participation. I had never heardof such a thing so I did a google on same. I came to the Company who proudlyproclaims that they were the first company to offer these certificates., Iquote," lease financing has been among the most popular methods used tofinance capital improvements while complying with OR AVOIDING constitutional debt limits applicable.......". So theycan be used to avoid what? How about the vote of the people as intraditional bond issues which require either a 4/7ths or 2/3rds majoritybefore passage. As explained briefly by the Auditor, a certificate of Participation is alease/purchase agreement. Huh? Someone might wish to ask, "what are weleasing, and what are we purchasing?". A California Grand Jury investigation concluded that "voter reluctance toapprove bonds by the required 2/3 majority has no doubt contributed to theuse of COPs as the primary financing method for capital projects." So, arethese "certificates" used to bypass voters when our supposed "servants"decide that the County needs "improvements"?. And what are theseimprovements? The Judicial Center, courthouse renovations, and road andbridge improvements are what is listed in the budget notice. And since these are lease/purchase agreements, does this mean that we thetaxpayers are leasing the above "improvements"?. If we are, who owns themuntil we finish with the "rent to own" agreement? Also, $6.9 Million of these certificates were "issued" in 2005 to financethe Government Center. Does this mean that the County is leasing thisfacility from some entity? And who purchased these Certificates? Further research concludes that these Certificates of Participation aretreated as a "security" and not a "bond" because technicallythere is noobligation to pay by future Commissions. But if the leases are notappropriated each year, the County relinquishes the right to use thefacilities. So if future Commissions decide not to appropriate the leasepayments, wouldn't we lose the use of the Government Center, "Palace ofJustice" the courthouse and who knows what roads and bridges? One mustconclude that it would be folly to presume that future Commissions wouldn'tcontinue the lease. So the taxpayers are encumbered with future "lease"payments, but not "burdened with debt." You see, with clever words a "bonded indebtedness"[requiring voterapproval] becomes a "pledged revenue stream" requiring only the wave ofthemagic wand by our "public servants." And we think that reassessments are ourbig worry? EricReichert
puzzled nearVillaRidge
posted by ERIC REICHERT at 7:58 AM
