Jim Folts Blount County Commissioner
“To stand in silence, when they should be
protesting, makes cowards out of men” - Abraham
Report on our County Schools
September 2013 Blount County Commission Report
News – County Clerk and Dedicated Employees
Save Taxpayers a Bundle
Several months ago, Crawford was notified the lease for the small space he used for his Foothills Mall branch office was being terminated. Crawford faced a choice between moving the branch back to the Courthouse or leasing expensive new space. The first alternative was not attractive because it would force citizens to make a special trip to the Courthouse, where they would have to deal with very limited parking. The second alternative would cost the taxpayers thousands in additional rent.
Crawford and his employees got creative. They analyzed the data and found that the office attracted more than 40,000 people each year. They put together a presentation that asked merchants what they would have to spend on advertising to attract 40,000 people. They pointed out how much cheaper it would be for the merchant to donate space for the new office and get those 40,000 visits. Several merchants quickly expressed interest. In the end, the good people who manage Foothills Mall, provided a new, larger space at no cost to the taxpayers. But this is not the end of the story.
The space needed to be fitted out for the new office. The employees of the County Clerk’s office volunteered their time and their spouses' time to construct the fine new office you see at the Mall. This saved you, the citizens, thousands of your hard earned tax money. Next time you visit the County Clerk’s office at the Mall, be sure to tell the fine people there, that you appreciate their efforts.
News - $170 million Bond Refinancing - Done in
a Big Rush
The administration’s claimed savings (which did not include the effect of the higher interest rate) are entirely based on a small reduction in the annual fees related to the debt.
The new deal also puts additional risk on the shoulders of the citizens. The deal requires the taxpayers to pay an increased interest rate to the bank, if Congress makes any law affecting the deductibility of the interest on municipal debt. Any changes by Congress, could eliminate the claimed savings on the deal in the blink of an eye. I introduced an amendment to require the deletion of this provision. Only Commissioner Hasty and myself supported the amendment.
Worst of all, the new deal is only good for three years. Then, the County will probably have to pay at least another $500,000 in fees to come up with another deal. The County has already spent more than $4.7 million in fees issuing, and reissuing, this debt. Most serious observers understand that big banks use variable rate debt deals to make millions in fees on the backs of the hard-working taxpayers. Apparently this fact has not sunk in with our County administration.
Several Commissioners and citizens, including myself, requested the Mayor and Finance Director to come up with an alternative which would convert this debt to low risk, fixed rate bonds. The slides shown to the Commission pretended to show a fixed rate alternative. Unfortunately, the comparisons shown between the fixed and variable rate alternatives were slanted in favor of the variable rate proposal. For example, they accelerated the principal repayments in the fixed rate example, and they pretended that the new three year deal would be renewed, on the same terms, for thirty years. The administration confirmed the fixed rate 'alternative' was a phony, when they admitted they did not even have a fixed rate resolution ready to present to the Commission.
The banks and lawyers who do these deals do not like fixed rate bonds, because they don't produce the gusher of fees needed to redo the deals every few years. For the most part once you do a fixed rate bond deal, it is good for 20 to 30 years. Good for the taxpayers, bad for the bankers and their friends.
The administration likes to say that PFM, the County’s financial advisor, recommended this variable rate deal. But, everyone should understand that PFM will also get paid a $170,000 fee on the transaction. Many would consider this a conflict of interest.
In the end, the variable rate deal was passed with only Commissioners Hasty, Murrell, and myself voting against it.
Human Resources Committee with Major Conflicts
Only YOU can change YOUR government
Please attend the Commission meeting on Oct. 17th at 7:00pm in Room430 of the Courthouse.