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This page contains a single entry from the blog posted on August 7, 2012 7:47 AM. The previous post in this blog was Fill 'er up. The next post in this blog is New honchos for New Seasons. Many more can be found on the main index page or by looking through the archives.

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Tuesday, August 7, 2012

Portland ramps up line of credit borrowings

The City of Portland is going to the debt well once again this month, this time renewing its annual practice of borrowing nearly $22 million on a short-term basis to pay some of its massive police and fire pension and disability benefits bills. It's a lot like putting groceries on a credit card and never paying down the balance -- while paying an annual fee for the privilege.

In addition to issuing tens of millions in bonds over the last quarter, the city has been busy quietly borrowing money by drawing on its shadowy lines of credit. Between April 1 and June 30, the balance on the city's transportation line of credit jumped from $6.5 million to $18.5 million. One can only imagine what Mayor Creepy and his life-saving bike minions did with that money. The local improvement districts line of credit increased from $5.6 million to $12.4 million, and the park maintenance facility line of credit rose from $439,000 to $1.45 million. Combined, those three lines increased by nearly $20 million, or more than a 157% increase.

A couple of lines went down. Urban renewal dropped from $99 million to $69 million, but long-term urban renewal bonds rose by more than $40 million, and so there was no real decrease in debt there. The same was true of the line of credit for Little Lord Paulson's soccer field: The temporary $12 million line was replaced by the same amount of long-term debt.

Government at all levels is hooked on debt, and Portland, whose long-term obligations now top $11,000 per resident, is an egregious example. Do the city council members understand what they have gotten the taxpayers into? And to the extent they might grasp it, do they care? A yes answer to both of those questions doesn't seem a smart bet.

Comments (23)

A couple of council members make what seem to be offhand references to the debt. Other than that--crickets.

Sam and the rest of the council are addicted to debt. They can't stop borrowing even though a tiny voice in their head tells them to slow down.

Progressive politics = bankruptcy

I am almost certain at least $10 million was recently borrowed against blue sky for Milwaukie Light Rail.

I also believe Portland is using short term debt to make long term UR debt payments in SoWa because the Increment won't cover the payments.

The need for outside forensic auditing has never been greater.

The total disregard for any real means to pay the local light rail debt is a headline story no press will report.

The local match for PMLR has been a sham beyond belief.

Yet Adams et al can borrow millions without the means to pay for it but by raiding other higher needs.

Meanwhile, TriMet pushes to get construction underway in as many places as possible to make PMLR appear inevitable in it's entirety.

Never has there been a worse project with such shady financing against the public will and managed by charlatans.

The public officials involved will go down in infamy as the perps they are.

There are three kinds of politicians:

Those that are bad at math and those that are even worse...

I just need one more fix to get me through. Just one more, I swear, and then I'll stop!

Sam-Rand are locking in the changes they've mad: Bike infrastructure, street cars (that aren't running yet on eastside), urban renewal/condos and more. With debt maxed out in Portland far into the future incoming politicians will have zero money to make changes or real improvements.

Do the city council members understand what they have gotten the taxpayers into? And to the extent they might grasp it, do they care?

Something wrong with the whole group! If they don't understand, they don't want to and they don't care. They have been told at hearings by business executives and citizens to STOP the spending and debt. . and they turn right around and continue anyway! They are in such deep financial trouble that they have to continue so the house of cards will stay propped up somehow?? Or is it so they can continue to hand out perks while they can?
Do Sam/Rand etc. just think they can get their money and run leaving the rest of us with the mess?

http://www.rawstory.com/rs/2012/08/05/wall-street-lenders-want-bankrupt-city-to-pay-them-before-own-retirees/
The city of Stockton, California declared bankruptcy a month ago and is in the process of sorting out its financial affairs. Now it has been hit with a fresh indignity in the form of a threatened lawsuit from Assured Guaranty, a company based in Bermuda which provides insurance against defaults on municipal bonds.

A lot of this borrowed money goes to pay the salaries and benefits of current and new city employees. This compounds the pension liability for the city, so the true cost of all of this debt isn't really reported anywhere.

Even if the Commissioners themselves are fiscally illiterate, somewhere the City has actual budget people, who should have the education and background to understand how imprudent all this is.

This type of nonsense shows that these people in the budget office, rather than serving as a voice of reason and expertise to the Council, have actually been co-opted into engineering this system of three-card monte.

Sam and the rest of the council are addicted to debt. They can't stop borrowing even though a tiny voice in their head tells them to slow down.

With their ear-buds plugged in, I doubt that they can hear any voices.

"annual practice of borrowing nearly $22 million on a short-term basis to pay some of its massive police and fire pension and disability benefits bills."

That pales in comparison to the $1.1B extra the legislature throws into PERS contributions the last (and probably next 40 years worth) of biennial legislatures.

Still not much being done besides a whole lotta hand-wringing.

Snards -

Sure the City departments have staff members who are fiscally literate and good at budgets.

PBOT is a great example. Just a couple of months after Tom Miller was moved over from Adams chief of staff slot to be PBOT' Director, Miller canned the decades long tenured PBOT budget /operations guy, Ron Geason. Budget guy was giving answers which Miller didn't want to hear. Geason was forced out.

The Geason departure was a pointed message to staff budget folks all over the city about what happens when staff gives bureau directors and politicians on the Council answers they don't want to hear.

Then in November, 2011, the budget wheels fell off at PBOT.

Duh.

Whats even funnier is that PBOT had a "budget advisory committee" composed of fuzzy brained little neighborhood do gooders like Marianne Fitzgerald and Linda Nettekoven who were fed a steady diet of financial b*llsh*t by Miller and company and never had a clue about what was coming, and spent their time going "ooh" and "ahh" about every pipe dream of shiny new PBOT toys.

I was talking to friends Saturday, and said the next bubble will come from a wave of government bankruptcies. There didn't seem to be any disagreement.

Who stands in line to benefit from the government bankruptcies?
Why did our local council fall in line so readily to go there?

Nonny Mouse is on target. You need to have your next job lined up if you tell the truth. Civil Service protection is a joke. They write your position out of he budget, give the duties to someone else or create a new job title that sucks up the duties and put someone else in the slot. Over and over, not just budget.

They've gotten rid of everybody who would say "no" to them. Then when their chickens come home to roost, they say, "Nobody could have foreseen..." or, "Who could have known..." Not voting for a single one of them, for anything, ever again. Wouldn't trust a single one of them to even bring home a gallon of milk.

Nonny Mouse is on target. You need to have your next job lined up if you tell the truth.

Publically funded government agencies that require NDAs from its employees is another clue.

There is someone in City Hall who is fiscally literate/numerate. That would be City Auditor LaVonne Griffin-Valade. WRITE HER IN FOR MAYOR!!!

If the Occupy crowd had any brains they would be protesting the rape of the taxpayers by people like Sam Adams and the City Council.

Politicians such as Sam are systematically driving the city off the fiscal cliff. They have larded up City Hall with layers of staff working on silly issues while at the same time defunding the infrastructure.

It isn't going to be pretty when the wheels come off the streetcar. Take a look at the various cities which are in bankruptcy and you can see what Portland will be like. Police and Fire departments cut to the bone, huge staff reductions, shutdown of basic services, etc. Meanwhile, the banks and bondholders will be demanding payment for debts issued.

Sam and his gang of morons will be off raping some other city while the blue collar folks left in town will be paying the bills.

It isn't going to be pretty when the wheels come off the streetcar.

Unless... someone with an awful lot of $$$ is guaranteeing the eco-village construction project. Just a crazy thought...

The plan: City leaders are counting on other, larger cities going bankrupt in spectacular fashion before Portland does the same.

Media attention will be lighter than it might otherwise be, as focus falls upon the even larger perpetrators. Prosecution would be years away, plenty of time to sow doubt.

Also, the city will cut in line for any bailouts motivated by the too-big-to-fail municipalities. Because, yeah there will be plenty of money for Federal bailouts, right?

Get a handful from the stash. That is the plan. No need for a Plan B!

Unless...we are the example for others to follow,
or money to be made for some by the agenda,
so no doubt will continue to be propped up.
My concern is in exchange for what?
For the coal trains to meander through our community?
For a population behavioral experiment?
For the ownership of our pipes and water?
For a land grab including home ownership?
We may be bailed out, but it won't come cheap and
it won't have anything to do with the health of our community.

Odious debt is no longer a concept confined to tin-pan dictator-arranged debt offshore. We now have example after example on-shore, and if Matt Taibbi's description of Birmingham's experience is how it is going to go, the feds will see that local boys to to jail, while the bank boys may skate for a little longer. Here is an even-handed, I think description of odious debt.

https://docs.google.com/viewer?a=v&q=cache:0YCXqehJstcJ:www.jubileeusa.org/fileadmin/user_upload/Resources/Policy_Archive/408briefnoteodiousilldebt.pdf+&hl=en&gl=us&pid=bl&srcid=ADGEESjL-d-jV1QMzqHJqviXivotMeexa6t9oDiHMzxuYbfTNrp1prbQFnCmSSedhd2B2DdAaS7Bvqfaz5cVC06yGnjJMYeVKuOpFJ-xLTfAO73ga3A8DkgWiug7pPZfZ-w5LcOZiSgL&sig=AHIEtbTRJ6gD3y781_G6N30EBZmgANYOXA

Sorry for the long link. I tried to learn to tinyurl, but I didn't like it.

So, maybe eventually we will go after those double- or triple-pensions and also put some of these guys in jail. Maybe we can get a Taibbi-light journalist to interview them when they are in the clinker? Can we make them finance their own vacation in that vacant jail--isn't it called Sunderlund?


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