Monday, May 02, 2011

OFK spins a response

In an earlier post, I rhetorically asked, "How do the current heads of OFK spin that little nugget?" Now I know (number 5 below).

Real quick response to the OFK response to my 10 reasons not to vote for the levy:

Intro: Is the bond expert the same district resident (is the expert even a district resident?) who also is the district bond consultant? If so, working the weekend was not just a freebie. I bring this up only because OFK makes the claim.

1. Bond Residuals: Call the money what you want. The interest earned is not an investment (I explain that in a couple of blog posts). The IRS does not allow governmental entities to make an arbitrage profit on tax-free bonds. So the interest is equal (dollar for dollar, for the most part) to the interest current residents have been paying on the bonds. In other words, if the revenue from the bonds earns 5%, the district can only earn 5% on its investment -- there can be no "money mak[ing] money."

2. Search the web for O'Brien's comments as reported in ThisWeekNews. He changed his story with his letter to the editor. Also note that Lucas's responses to my letter to the editor did not refute my claim about O'Brien's comments.

3. The district is using previously-taxed dollars to pay-down the current bond payments, so to speak. How is that forcing future residents to pay their fair share? The older levies actually did what they said.

4. The elementary cost is 32% higher than the last elementary ($10.035 million to $7.8 million). And that is an acceptable increase?

5. Check the current five-year forecast on the district website to see that the district planned to lower the ratio.

6. This response has never made sense. As I read it, if the levy fails, the district will ask for MORE money to offset the proposed cuts in state funding that will drive lower expenditures if the levy passes. Or something like that. The argument sounds good but does not hold up to scrutiny.

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