Why Coral Gables’ Refinancing and Capital Spending Decision Is Not Urgent–What Happened To Community Participation and Consultation?

The city manager of Coral Gables had a few cards up his sleeve, so to say, at the last meeting and he sold the commission on three bad ideas.

First, he said that it is urgent to refinance the city’s debt.  I take it that this is because he believes that interest rates will soon rise.  I guess he believes in that there is inflation at our doorsteps.

The economic facts don’t justify that view in the slightest.  Our economy is growing slower than thought, the Chinese are dampending their growth, Japan is stagnant and Europe, except for Germany, Europe is weak.  Inflation is a recent blip in energy and some materials caused pay political uncertainty in the Middle East.  The Fed has announced that it will continue with its low interest rate policy. There is at least one banker on the commission–he should have known better.

Conclusion:  It is not urgent to refinance without first thinking a bit more about the use of the monies and consulting with the citizenry.

Second, he sold the commission on the idea that the $22 million from the refinancing is free–but it will cost about $35 million.  He says we won’t spend more on debt financing than we are paying now.  That is wrong.  By refinancing existing debt we should spend less, not more.

Conclusion:  Refinancing of existing debt would reduce the amount we pay on the current debt and free up money for other purposes.

Third, the city manager has sold the commission on the idea that he has come up with a good list of capital projects.  But the city manager admitted that he had concocted this list pretty much on his own without community participation, and the new mayor and commissioner apparently did a sort of “shoe leather” test of what we need.  Shouldn’t a new, large spending program be consulted with the taxpayers.

Conclusion: What happened to open government, invited and active consultation and participation–on these terms, the new mayor’s and the commissioners’ campaign promises stand out as pure fiction.

Namon on Coral Gables’ $35 Million Increase in Spending

I reproduce the comments by Mr. Richard Namon on the first meeting of the Cason Commission.

On Tuesday April 26, Coral Gables had its first official Commission Meeting.  It’s clear who was in charge of the City Commission – City Manager Salerno.  He was decisive and dominating.  By restructuring the City’s current debts and increasing the years of debt obligation, the City Manager said he would raise about $22,155,000 of “new” money.

That money will be used for his vision of a Neighborhood Renaissance.  Using a tactic commonly used by conmen he urged: If you don’t act now, you will lose this once in a lifetime opportunity.   He pushed his vision for the City’s most important needs through the Commission.  The only other participant on the dais wearing pants was Commissioner Ralph Cabrera who voted NO on the proposal.  Ralph felt a Vision for The City Beautiful should come from resident meetings that would guide the Commission – not from the City Manager.  No one else dissented.  The City Manager keep pushing saying this was only an approval to go forward, not a final approval.

In his presentation Salerno droned away, making his $28 million Vision sound boring.  I wondered how much we would save in taxes if he only refinanced the existing debt.  No one on the dais asked.  After the meeting I asked Don Nelson, the head of the Finance Dept. how much this $22 million of found money would cost the taxpayers when it was paid off?  He estimated $35 million!

Our new Commission, at its first public meeting, has agreed in principal with the City Manager’s vision that costs $35 million over the next 20 years.  During the pre election campaigns, the main talking points were fiscal conservatism and dealing with City debt.  As a start this is not only ominous, it is disappointing.

Richard Namon, Sr.

via Home Page.

A Test For Democracy: Will City of Coral Gables Start Spending Again?

Seems like there is certain pressure from businesses and a willing disposition of the city manager and some commissioners to start spending big on city projects.  It is said that we can do that because interest rates are low–not a good financial reason.

There is pressure from Chamber of Commerce, Miracle Mile businesses and the IBD to undertake the Miracle Mile and Giralda Streetscape Project.  This is (and I underline) estimated to cost $16 million.  You can bet that the project will cost more after government and businesses get their hands on the “vision” project.  Why is this called the Miracle Mile Streetscape anyway, when it includes Giralda.  Why include Giralda?  Are you sure that this project will “pay for itself?”

One commissioner has already talked about spending money on parks and a senior center and speaks fondly of the free (subsidized) trolley and the Ponce street upgrading.  Good projects, but can we afford more of them now?  I think not.  Why should the taxpayers subsidize the trolley. (By the way, subsidizing the trolley takes business away from the city parking lots, so the real subsidies are much larger than the operating and maintenance costs of the trolley).

Let’s hear from the mayor and commissioners just three goals: we need to fix pensions and hold salaries down for several years, freeze or reduce taxes and fix the Biltmore lease, and freeze and reduce salaries.  Please, no more studies are needed–just decisions and actions by the commissioners.

Failure to do any of these will mean failure for the city’s finances and more taxes for us all in Coral Gables.

Please, Mr. Kerdyk, No More Spending

I sincerely wish that Mr. Kerdyk at his investiture this morning had not listed his spending priorities, including purchasing more green space.  While green space is a highly laudable and good priority with which I agree, we should start by fixing our financial problems, avoiding more taxes, fixing pensions, etc. (we know the list), before we start spending money on green space or even Miracle Mile.  Borrowing money, even at a low rate, still has to be repaid by future generations of taxpayers.

City of Coral Gables: Check Your Reserves For Hurricane Response

EXTENDED RANGE FORECAST OF ATLANTIC SEASONAL HURRICANE ACTIVITY AND LANDFALL STRIKE PROBABILITY FOR 2011

(Philip J. Klotzbach & William M. Gray: http://hurricane.atmos.colostate.edu/Forecasts/2011/april2011/apr2011.pdf )

ABSTRACT:

As of 6 April 2011, it is foreseen a well above-average activity for the 2011 Atlantic-Caribbean cyclonic season. The seasonal forecast has been reduced slightly from early December, since there is a little uncertainty about ENSO and the maintenance of an anomalously warm tropical Atlantic SST conditions. It is possible to continue to anticipate an above-average probability of United States and Caribbean major hurricane landfall.

Information obtained through March 2011 indicates that the 2011 Atlantic hurricane season will have significantly more activity than the average 1950-2000 season. We estimate that 2011 will have about 9 hurricanes (average is 5.9), 16 named storms (average is 9.6), 80 named storm days (average is 49.1), 35 hurricane days (average is 24.5), 5 major (Category 3-4-5) hurricanes (average is 2.3) and 10 major hurricane days (average is 5.0). The probability of U.S. major hurricane landfall is estimated to be about 140 percent of the long-period average. We expect Atlantic basin Net Tropical Cyclone (NTC) activity in 2011 to be approximately 175 percent of the long-term average. We have decreased our seasonal forecast slightly from early December, due to anomalous warming in the eastern and central tropical Pacific and cooling in the tropical Atlantic. This forecast is based on a new extended-range early April statistical prediction scheme that utilizes 29 years of past data. Analog predictors are also utilized. We expect current La Niña conditions to transition to near-neutral conditions during the heart of the hurricane season. Overall, conditions remain conducive for a very active hurricane season.

For Whom I Would NOT Vote In The Coral Gables Election

Following a process of elimination, I would not vote for the following:

I would not vote for Mr. Slesnick.  He has had 10 years in government and has led to city to its present state.  We lived with a corrupt and unethical city manager, we had taxes increased even in bad times, we saw the virtual collapse of the Country Club and, of course, we have the still secret audit of the Biltmore lease, and unrestrained support for city unions and pensions.  Add to this a poorly run IT Department and EDEN software, a weak Finance Department and a widely criticized Building and Zoning Department.  You have  here a good number of reasons to end the Slesnick Era.

I would not vote for Mr. Rosenblatt.  His program is to continue more of the same with lots of sponding on rehabilitating Miracle Mile (where he has a business), settle the Biltmore lease and keeping taxes low.  I am glad to know that taxes are low and, presumably, potentially could be raised just a little more in the future.

I would not vote for Mr. Sanabria.  He is supported by the Fraternity of Police who are completely and virgorously defending the benefits of good salaries and even better pensions that they have acquired over the years with the acquiescence of the mayor and city commission.   I don’t believe that Mr. Sanabria can be counted on to defend the voters against more taxes and fees.

We need three strong votes against more taxes for the future–we will not get them from Commissioners Anderson, Kerdyk and candidate Sanabria, so electing Mr. Sanabria would be budgetary lethal for the taxpayers of Coral Gables.

I might not vote for Mr. Kedyk.  I don’t see that he has contributed any heroic measures to the city (I know that many don’t agree with that view), and he has clearly voted for taxes, but not as many taxes as Mr. Slesnick might desire, nor more than Mr. Cabrera would have wanted.  The facts are that he has consistently voted for taxes.  He never raised a voice against the former city manager, had no problem to approve the UM Grid and he has been relatively quiet about the Biltmore, the Country Club and similar issues.  He is not a reformer and we need real reforms in the organization and financial management of the city of Coral Gables.  Almost certainly he will be elected so one should be careful about the other candidates that you vote for, if you want real reform and to reduce your taxes.

I might not vote for Mr. Quesada.  He appears to be a nice enough fellow, but he is a totally unknown quantity in the city.  He seems like the continuation of the Slesnick-Kerdick-Withers coalition and  the business-led support for the unbridled commercial growth of the city, which sucks in police, fire protection and other resources away from the residents and taxpayers who are having a hard time paying their taxes and fees.

Jeb has the Solution for Coral Gables: Wake Up Unions!

Dear Commissioners, Unions and Mayor of Coral Gables:  Please read this quote from Jeb Bush.

Jeb is ahead of the others on what to do, and this will be the final result if unions continue with their hardline positions.

There must be found an intermediate solution if the unions will just work with the city and that the public security employees give up making wild claims about there special and indispensable role in the community.

So new Republican governors should adopt rules for countercyclical budgeting and fully funded pensions? Too timid, Mr. Bush says. “I would argue for the elimination of the defined-benefit pension system. Might as well just get right to the end of the conversation, that’s where this is all going.” Then, “figure out a creative way to deal with the unfunded liabilities.” That “means you have to take on the unions.” He notes that New Jersey Gov. Chris Christie has so far “shown that you can take on these entrenched interests and be popular and sustain the efforts to change the state.”

via Jeb Bush: Eliminate ‘defined-benefit pension system’ | Florida Independent: News. Politics. Media.