They Want to Spend $50 Million Dollars Without Your Approval

Posted: September 20, 2018 in Clay County Commission

I have spent some time trying to get up to speed on what is exactly going on with this $50 million dollars that Commissioners Ridgeway and Owen are wanting to spend. (Please note, Commissioner Nolte does not want to spend it.)

I assure you, this is something you need to know about and something you should consider doing something about.

I was originally told this was a bond, to be more exact, it’s what is termed a “certificate of participation (COP)”. It’s a form of a bond.

By using a COP the county is essentially going to lease-finance the projects. What happens is that certificates of participation are issued to participating investors. Investors then receive payment under the lease-purchase contract. Here’s a more in depth explanation on Investopedia.

The most important difference between a COP and a bond that you should know about is that they do not have to have any support from the public to do this. Right now as it stands, without a large public outcry about this, Ridgeway and Owen can vote on the final terms of the Certificates, and boom we’re $50 million in debt.

You have to marvel at the audacity of these two individuals.

They just had 7,925 citizens sign a petition demanding that the County be audited. It’s abundantly clear that they’ve lost the support of the people. But, hey, let’s just power through and put those same people on the hook for $50 million dollars worth of projects.

They are asking for a sum that is about 1/2 the size of the budget for the entire year. In typical Luann Ridgeway and Gene Owen fashion, they’re just going to do it.

Ridgeway Owen Nike Posters

Don’t you think we at least deserve to see a specific list of projects that are involved here?

All we get is one paragraph in Resolution 2018-298 that states the following: “(a) the construction of a new County Annex Building, (b) improvements to the County Administration Building and the Shrader Building, (c) improvements to the golf courses of the County, (d) improvements to the marinas of the County, (e) improvements of park properties, (f) improvements to historic sites, and (g) road and bridge improvements.

You’re going to spend $50 million on all this… I might not even disagree that some of it could be justified.

But what specifically are you going to do? Have you done your diligence in preparing these projects? Or, for that matter, do the projects even exist with cost estimates at all?

To make matters worse, you don’t even have a County Administrator right now because you got rid of the one you gave a 44% salary increase to and then later casted to the side.

Hell, even Kansas City at least had the decency to attempt to prepare a list of items they might address when they went to the voters and passed their GO bonds not too long back.

I get it, you guys think you’re experts about everything and you know best. Unfortunately, I’m part of the nearly eight thousand Clay Countians who think you’re dishonest and incompetent.

If I was a betting man, I’d say you have absolutely nothing detailed prepared, and you’re just taking a swing at how much money you want.

The thing that concerns me the most about all this is it’s a $50 million dollar liability with no funding mechanism dedicated to cover it. They’re going to pull the payments out of general revenue. When the economy rolls over again, we’re on the hook for paying this back somehow.

And if you think that the economy can’t and won’t roll over again in the next few years you’ve lost your mind. That would make you as ignorant as the same people who said everything was fine in 2007 before the economy exploded.

We are living in one of the biggest asset bubbles in human history. The next recession will see massive asset devaluations. (I may write a post soon explaining the economics behind what I’m talking about.)

When assets (businesses, homes, cars, you know, “real property” that we own but have to pay taxes on to continue to own) devalue, tax revenues reduce because they are a direct result of asset value. (Sidenote: This is what makes property taxes one of the WORST ways to fund government. Revenues fall almost a year after the economy contracts adding pain to local budgets because bureaucrats seem to think there’s no such thing as rainy day until their standing in a puddle.) When this happens, the county could easily be forced into a situation to increase property taxes just to be able to make the lease payment on the COPs, or to keep overpriced staff employed (don’t forget their pensions and health care plans. I know, I know, they’re public servants, never mind us pensionless serfs).

We all need to watch this one because I suspect what is going to happen is that the final approval of the COPs will be hoisted onto a meeting agenda at the last possible second. I’m being told it may be the middle of October, but I wouldn’t bet on it. I’ll do my best to keep an eye out for it. I get it. A lot of you are busy, I am too, but we had 3 dozen or so people show up to oppose the tax increase that wasn’t supposed to be a tax increase, it would be nice to see twice that crowd in the room.

 

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