COSTS OF BEING TAKEN FOR A RIDE BY OUR POLITICS

Submitted by Roldo on Tue, 01/27/2009 - 14:06.

We keep paying and paying for projects that enrich multi-millionaires and their private businesses while all levels of our government cry out that they don’t have enough revenue for the essential of government operations and we need more taxes.

As government lays off workers, it pays stiff costs that result from bad decisions by its top leaders - people as County Commissioner Tim Hagan and former Mayor Michael White.

Here’s another 2008 bill for $9.9 million that taxpayers may not realize they are paying. However, they are.

And it is exactly the kind of bill you can expect if Cuyahoga County ever builds its Medical Mart and Convention Center. These bills are paid by County and City of Cleveland taxpayers. They result from “overruns” on construction.

The bill that came due at the end of 2008 was to pay to finance overruns on the Gateway project.

The cost totaled $9,943,303.91, according to documents from Cuyahoga County.

Some $6.2 million represents interest payments and only about $3.7 million reduces the bonded County debt.

It’s slow going paying off bond issues of $75 million and $45 million that the County Commission legislated with little public input in the 1990s. Sound familiar?

That’s $9.9 million of tax funds going to pay for Quicken Arena overruns when the arena was built. The payments will continue through 2023.

In total, the cost to taxpayers will be some $300 million. What a nice round figure.

With the latest County payment, taxpayers already have paid more than $100 million on decisions made by a former County Commission of Hagan, Mary Boyle and Jim Petro.

Cuyahoga County had to issue a check on Jan. 15 for $3,691,942.33 toward the $9.9 million. Another $2.9 million had already been paid via the County in previous years. (This results from payments based on what the interest cost could be in prior years. Sometimes they are lower.)

Not only was the County on the hook for the overrun costs. The City of Cleveland also promised to contribute.

So the City of Cleveland turned over admission taxes collected at Quicken (Gund) Arena from Cavalier games and other events to the tune of $3,571,355.15 to help pay bondholders. Otherwise, these funds would have gone into the city’s general fund.

(The raiding of the city admission tax is similar to the city’s raiding of its own parking revenue account to pay the $30 million shortfall for bonds to build the Gateway Garages. For details see a previous posting: http://realneo.us/content/cry-cleveland-or-have-i-asked-question)

The bond bill included payment to Wachovia Bank for fees that totaled $67,973.26. There was also a $30,000 remarketing fee and $8,500 in rating agent fees.

This makes for lucrative, on-going income for the financial agents that attach themselves to County business.

Indeed, that’s a great impetus for building these massive projects. So many people and interests can dip their hands in the public pocket – contractors, construction workers, lawyers, bond counsels, fiscal agents, architects, and many, many other businesses.

The profits go to the businesses that rely on taxpayer financing but the promises are always for jobs for the rest of us.

If there is so much business that results, why don’t those who benefit pay for these projects?

Why should they when they have such helpful politicians as Tim Hagan to shift the cost to us.

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Comm. P.L. JONES COMPLICIT THROUGH HIS ACQUIESCENCE/SILENCE

It is time for Commissioner Jones to speak out against the MEDCON idiocy.  Sure, he didn’t vote for the tax increase – he didn’t need to with Comm. Hagan and Dimora voting for it.  Convenient.   And the tax went ahead.

 

But then Mr. Jones did not take any enthusiastic steps to block the tax.   He did not campaign with putitontheballot.  He was silent. 

 

And Mr. Jones has made no effort to hold anyone’s feet to the fire – making no request for a competent business study showing that the MEDCON won’t be the bust that everyone knows it will be.   Fred Nance the Fixer holds pr sessions and Mr Jones doesn’t take him to task with hard questions.    Mr. Jones has become the “opponent” to the project who is now working to see that the project proceeds.  

 

Unless Mr. Jones is working behind the scenes with the FBI in a sting operation around MEDCON,  I encourage him to speak out now against this gargantuan financial folly.

 

If Mr. Jones speaks out now, and stops the MEDCON, he will save the County the future embarrassment of not being able to get bonding for the CON.   Because honestly, what investor would buy Cuyahoga MEDCON bonds? 

FBI please help

Jeff B says:

Unless Mr. Jones is working behind the scenes with the FBI in a sting operation around MEDCON,  I encourage him to speak out now against this gargantuan financial folly. 

Is everyone working under deep cover?  What happened to the investigation.  Please G-men and women--help US!