Bonds, Luzerne County bonds

Bond issue nets county $72.3 M

County closes on $87M+ bond deal

I know that you have to borrow money to pay for things you can't pay for today (house, car, appliances) but will be able to pay off in a reasonable period of time and government has to do the same thing. The trick is not to get in over your head and don't borrow for things you want instead of what you need. That's why I have a problem with this latest bond issue. The last time I checked Luzerne County was on the hook for over $300 million in principle and interest payments over the next 20 years. Remember that a bond is only a loan against future taxes. The list of projects in the TL doesn't have many details on what the money will spent on and the Luzerne County Commissioners in the past have had a bad habit of borrowing money for one purpose and spending it on another. Shall I remind you of one thing that is in the news:

In 2003 $9 million was borrowed to build a new for a new county-owned juvenile detention facility. It was never built because the Bond Brothers (Skrep and Vondy) decided to sign a 20 year $58 million lease with a private company, PA Child Care, that was owned by a business partner of a couple of local judges. Instead of returning the money or holding on to it to deal with a future emergency that eventually came they spent it on other projects.

Sam Diaz moves on

TL: Luzerne County Budget/Finance Chief Sam Diaz submitted his resignation Friday because he has accepted a job at the proposed medical school in Scranton.

The hard nosed number crunching guy has had a flair for fiction the last few years writing what is supposed to be the Luzerne County budget. He also is responsible for the generically written bond issues that are in contention now. I know he was limited by his political masters when he put together the last budget that was supposed to be balanced by more aggressive tax collection and revenue from land sales that didn't happen and I'm sure that he knew that wouldn't work out. The debit card mess that he was in the middle of has to be another incentive to get out of the public eye.

Let's hope the Commissioners hire a non-political CPA type to replace him.

Bonds, Luzerne County bonds

The Luzerne County Commissioners voted the other day to spend some left over bond money on things it wasn't originally borrowed for. I've been complaining about this sort of shell game as long as I have been blogging.


The bond money came from $32.5 million borrowed in November 2003 to fund Susquehanna River recreation improvements. The bond document did not earmark funding for particular projects, which means commissioners are free to spend the money as they see fit.

Tim (take your hat off) Grier has made the same objection and points out that that bonds are supposed to be used for long term capitol improvements not everyday operating expenses. County Budget/Finance Chief Sam Diaz, and noted debit card abuser, said there is no legal requirement to use the money on projects that will last as long as repayment. I think he is wrong on that point. Even if he isn't the county government shouldn't be borrowing money for one thing and spend it on another. A few years ago they borrowed $9 million to build a new juvi prison then gave a sweetheart lease to a Pittston facility that the state objected to and had to terminate the lease. Then last December they used that money as Christmas presents for all sorts of projects that had nothing to do with the reason for borrowing the money in the first place.

Diaz also detailed the shortfalls of the last piece of fiction that was passed off as the county budget.

In other business Thursday, Diaz released a report explaining how the county ended 2007 with a $13 million deficit.
The report blames the deficit on a $16.8 million revenue shortfall, predominantly due to the county’s failure to meet projections in the following areas: current-year tax collections, $5.3 million; prior-year tax collection, $4 million; sale of county-owned land, $4.5 million; securing of state probation grants, $637,700; and federal transportation grants, $503,000.

Now they want to use $2.5 million of the proposed new bond issue to buy some land from Louis DeNaples when they can't sell the land they were counting on the help balance this year's budget. WTF?

Grier has offered to drop his challenge to the latest $93.5 million Bond issue if the Commissioners would just explain in detail what the money will be spent on. To me that's a reasonable request but they won't do it. And even if they did spell out how the money will be spent the way the thing is worded lets them spend the money on other things. Am I just becoming an old cynical bastard that doesn't trust the government?

Wilkes-Barre attorney Pete Moses, who is handling the county’s bond borrowing legal matters, on Friday declined to say if the county will accept Grier’s offer. Moses said he finds it "curious" that Grier wants to settle at this stage and is surprised Grier went public with his interest in settling.

It should be noted that Peter Moses looks to make a pretty penny on the bond issue and is billing the county for his work on this challenge. He has the best of both worlds. It makes you wonder why the county would bring in a hired gun who has a financial interest in seeing the bond succeed when they have so many other solicitors on the payroll.

And Commissioner Greg Skrepenak said the debit card abuse is "not criminal." It may not be but if I used a company card to buy drinks at a strip club or a $800 dinner tab with a $300 booze bill or pay for my kids hotel bill I'm sure I would be on the business end of a bread line

Luzerne County bond update

Grier’s fight with county continues

Tim Grier has asked the Commonwealth Court to prevent Luzerne County from borrowing $93.5 million while he challenges it in court. The county also argued that public interest “will be harmed” by a delay in issuing the bonds because the proceeds will fund important projects.

Grier has a sensible response saying most of the bond proceeds have not yet been allocated to “identifiable projects.”

“A review of the ordinance in question proves this,” Grier’s response says. “If the projects have not yet been identified, let alone been subject to planning and cost estimates, how could the county be harmed by a stay in issuing the bonds to support these unidentified projects?”

Grier proposed the county use the delay to continue planning and producing cost estimates.

Go Tim.

HomeRule

Tim Grier has a website

Info re: Tim Grier v. Luzerne County

Hello,
First of all, thank you for stopping by and thank you for your support. There have been so many inquiries with folks asking, "What is going on?" and "How can I help?" that I set up this site.

roxburynews.com has a video of Tim explaining what is going on that was filmed at the Luzerne County Courthouse. It has a funny clip of him buying a dog license.

You can view the video here: Blip