(no subject)

[arethinn]

Ok, I'm confused here. Election tomorrow. Measure B. City measure to issue $108 million of bonds to pay for a new library. Nothing unusual there. But then they want to levy a property tax in order to pay back the bond obligation. WTF not just do the tax, and use the proceeds directly? Since that would, you know, not also incur tons of interest? I mean, usually you see the bond alone, because people seem to think they can get something for nothing and issue bond after bond rather than doing the fiscally honest thing and just taxing themselves. But this is a pair of them. (I suppose I should at least be glad that they have provided some answer to the perpetual question of "but where is the money to pay back this bond going to come from?")

I'm supposing there's some legalese reason they can't, and it's not just that whoever drafted this measure is crazy, but it seems stupid. The impartial analysis doesn't say why it's this way, and there was no argument against the measure submitted, so no hints there either.

Comments

[silussa.livejournal.com]

You can retire a $108 million bond issue over 30 years (assuming 6%),with a collection of $12.6 million a year. Assuming NO increase in property tax value.

It's a lot easier to get approval of a 1 or 2 mil tax rate then a 10 or 15 mil tax rate. Even if it does cost a lot more in the long run.

As the line goes, "humans are the craziest animals".