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Another thing that could be mistaken for indigestion except that it doesn't go away with warm milk and a donut is the City appears to be attempting to marginalize Sierra Madre's $20 million dollars in toxic debt. Though it is being done in a rather subtle way. Here is how the present variation of that theme appears on a postcard currently found on the City of Sierra Madre's website:
August 14 @ 6:30 pm – City Hall Council Chambers, 232 W. Sierra Madre Blvd. – Water and Sewer Department’s Budget, Finances, and Bond Debt
Did you catch that? This suggests that Sierra Madre's debt crisis is the sole responsibility of the Water and Sewer Department. Which is hardly the truth. This is the City's debt problem, the one that you and I have been asked to pay off, often and in many different ways. It is the reason why the downtown doyens of debt need to ask you for more money, and have over and over again. You'd no more be able stuff all of that into one city department than you can hide an elephant in a Starbuck's.
Though City Hall is certainly going to try.
The City's $20 million dollars in old debt is the one overwhelming financial fact of life for this town's government agency. It is the one constant reason why practically every fee, rate, tax and service cost here has been raised in the last couple of years. Some of them more than just once. It is also why the City will demand a do-over ballot on the UUT extension next April. They have some big debts to pay, and your vote on that one cannot be allowed to stand. Democracy be damned.
Everything else you'll hear will likely be the same shuck and jive you heard last time, something designed to gainsay the actual impact of the debt problem. That vastly overpaid consultant might be new, but the message apparently is staying pretty much the same. And the real 411 is that the marketing pitch you heard a few years ago has being dusted off for yet another round. Pay more, and whatever you do, don't look at the man behind the curtain.
And so, as a service to you, our gentle reader, we here at The Tattler will review for you Sierra Madre's $20 million in aging debt. Item by item. All so that you can have it in one convenient place when you go to City Hall tomorrow evening for this year's version of the big water rate increase pitch.
A lot of what follows comes from a City document labeled "Debt Administration." It is tucked away in a larger document called the "Proposed Budget FY2013-2015 Section 7 Debt."
Here it is:
Former CRA Tax Increment Revenue Refunding Bonds, Series 1998A
Purpose: to refund the 1988 Community Redevelopment Agency Debt and to fund
improvements within the Agency Project area
Issue Date: May 1, 1998
Maturity Date: November 1, 2020
Original Principal Amount: $5,175,000
July 1, 2011 Principal Outstanding: $ 2,315,000
Interest Rate: 3.8% - 5.0%
Funding Source: property tax revenue from Community Redevelopment Project Area
Total amount due today with interest included: $2,741,875
$5,175,000 at inception becomes $8,517,563 once paid off in 2020.
Water Revenue Refunding Bonds, Series 1998A
Purpose: to refund the 1988 Water Enterprise Debt and to fund improvements and
betterments within the Water Infrastructure
Issue Date: May 1, 1998
Maturity Date: November 1, 2019
Original Principal Amount: $6,740,000
July 1, 2011Principal Outstanding: $2,635,000
Interest Rate: 3.65% - 5.0%
Funding Source: fees for water services
Total amount due today with interest included: $3,048,875
$6,740,000 at inception becomes $10,743,402 once paid off in 2019
Water Revenue Parity Bonds, Series 2003
Purpose: to fund improvements and betterments within the Water Infrastructure
Issue Date: September 1, 2003
Maturity Date: November 1, 2034
Original Principal Amount: $6,750,000
July 1, 2011 Principal Outstanding: $6,750,000
Interest Rate: 5.00% - 5.01%
Funding Source: fees for water services
Total amount due today with interest included: $11,654,578
$6,750,000 at inception becomes $14,925,486 once paid off in 2034
San Gabriel Valley Municipal Water District: Interest Free 10-year Note
Purpose: to fund improvements and betterments within the Water Infrastructure
Issue Date: December 1, 2009
Maturity Date: December 1, 2021
Original Principal Amount: $1,456,875
July 1, 2011 Principal Outstanding: $1,165,500
Interest Rate: 0%
Funding Source: fees for water service
Total amount due today (no interest): $1,165,500
Master Lease (Municipal Financing Corp):
Purpose: to fund equipment for the General Fund-Fire Safety, Sewer Fund, and
Fleet-Internal Services fund
Issue Date: March 1, 2010
Maturity Date: March 1, 2020
Original Principal Amount: $1,657,731.52
July 1, 2011 Principal Outstanding: $913,544.14
Interest Rate: 4.63%
Funding Source: General Fund, Sewer Fund, Fleet-Internal Services Fund
Total amount due today with interest included: $1,401,913.18
$1,657,731.52 at inception becomes $2,012,955.38 once paid off in 2020
So there you go. Add up all those red due today numbers and the total City of Sierra Madre debt load with interest comes to $20,012,741. Or about $2,000 for every man, woman and child in Sierra Madre.
Out of that $20 million figure, $6,212,000 is interest. Somewhere there are people who are doing quite well, and at our expense.
If you really want to have some fun, check out the total amount we will have paid (again, with interest) once all five of these have finally been retired. Ready? $37,364,906.
For what, you might ask? Well, that is the $37 million dollar question, isn't it?
Quite a lot of money for a little town of less than 11,000 people. And yes, it isn't just the Water & Sewer Department. Don't let anyone convince you otherwise. The City badly needs more of your money, and they are coming at you from many different directions.
Wednesday night is just one of them.
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