What Eyeonmiami has found, examining mortgages and foreclosures, is that bad lending practices and mortgages continued to be generated even after it was clear that the housing market was crashing. Apparently Miami Dade County has been behaving the same way; through 2008 spending like there was no tomorrow; or, at least postponing the day of reckoning to the indefinite future.According to "Miami Today" County Commissioner Carlos Gimenez said during the November 4th Budget and Finance Committee Meeting:
“Why are we pushing everything off into the future?” as he rattled off a list of other county investments whose principal has yet to be paid down.
Our County Manager is borrowing from Peter to pay Paul. The pattern during most of Carlos Alvarez’s term has been to create debt structures which don’t reduce principal for 10 years or more. Yes, they even have negative amortization debt with balloon payments that will be due during this bad economy! Sound familiar?
The county has developed an addiction to building projects without any money to back them up. Our future will be saddled with debt because principal payments are put off, for example:
"Special obligation bonds issued in 1998, whose $94,48 million principal has been reduced only to $94,36 million; and 2005 general obligation bonds with $250 million in outstanding principal and a final maturity date in July of 2035."
This can't go on! There needs to be full disclosure, in language we can understand, of the debt structure they are piling on taxpayers. The paper reported that County Commissioners Gimenez and Joe Martinez rejected a loan for $25 million for seaport improvements “insisting the administration draw up a restructured funding scheme that would not defer principal payments.” Finance Director, Rachel Baum said that the seaport "does not generate those kinds of revenues." If the seaport doesn't, what in the County does?
Rebeca Sosa and Pepe Diaz (the only other commissioners at the Budget Committee meeting) protested. Rebeca said: “We cannot sit here and stop progress.”
Gimenez warns, that County debts will exceed assets if we keep on our current road. Unlike the Federal Reserve, Miami-Dade County can't print money. What this means for our credit rating and for taxpayers needs to be fully disclosed now.
6 comments:
It is all going to come crashing down. Miami Dade County will not be the only government to go bankrupt.
What it means for our credit rating?
It means it will be in the sewer. Maybe the state will take over the county FINALLY.
Who wants this hot potato? Our full of hot air commissioners have come to believe they are Houdinis and will magically solve all our woes. But before they die they will build the Marlins stadium so that it can be demolished a few years later once the Marlins decide it no longer fits their needs.
I think the Marlin's Stadium is in trouble. Martinez is the swing vote. I don't think he is inclined to vote with the majority. They need 9 votes.
Gimenez seems to be the only one concerned with true fiscal responsibility. They need to make him budget chair, or even better, chair of the Commission.
George Burgess has been doing this kind of financing for decades, as county manager and before in the budget department. He is a master at smoke and mirror financing. The stadium/tunnel is a perfect example. His financial "abilities" directed the county commission long before Alvarez. The question is, why does Alvarez keep him? Perhaps to play footsie with his new best friends the county commission or because to do otherwise would bring down Burgess' house of cards. Either way Burgess has put us in a bad financial position. Gimenez seems to be the only commissioner who understands fiscal responsibility.
I agree, as one who is concerned with how our tax dollars are spent, I applaud Gimenez on his fiscal responsibility to us.
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