We keep paying and paying for projects that enrich multi-millionaires and their private businesses while all levels of our government cry out that they don’t have enough revenue for the essential of government operations and we need more taxes.
As government lays off workers, it pays stiff costs that result from bad decisions by its top leaders - people as County Commissioner Tim Hagan and former Mayor Michael White.
Here’s another 2008 bill for $9.9 million that taxpayers may not realize they are paying. However, they are.
And it is exactly the kind of bill you can expect if Cuyahoga County ever builds its Medical Mart and Convention Center. These bills are paid by County and City of Cleveland taxpayers. They result from “overruns” on construction.
The bill that came due at the end of 2008 was to pay to finance overruns on the Gateway project.
The cost totaled $9,943,303.91, according to documents from Cuyahoga County.
Some $6.2 million represents interest payments and only about $3.7 million reduces the bonded County debt.
It’s slow going paying off bond issues of $75 million and $45 million that the County Commission legislated with little public input in the 1990s. Sound familiar?
That’s $9.9 million of tax funds going to pay for Quicken Arena overruns when the arena was built. The payments will continue through 2023.
In total, the cost to taxpayers will be some $300 million. What a nice round figure.
With the latest County payment, taxpayers already have paid more than $100 million on decisions made by a former County Commission of Hagan, Mary Boyle and Jim Petro.
Cuyahoga County had to issue a check on Jan. 15 for $3,691,942.33 toward the $9.9 million. Another $2.9 million had already been paid via the County in previous years. (This results from payments based on what the interest cost could be in prior years. Sometimes they are lower.)
Not only was the County on the hook for the overrun costs. The City of Cleveland also promised to contribute.
So the City of Cleveland turned over admission taxes collected at Quicken (Gund) Arena from Cavalier games and other events to the tune of $3,571,355.15 to help pay bondholders. Otherwise, these funds would have gone into the city’s general fund.
(The raiding of the city admission tax is similar to the city’s raiding of its own parking revenue account to pay the $30 million shortfall for bonds to build the Gateway Garages. For details see a previous posting: http://realneo.us/content/cry-cleveland-or-have-i-asked-question [1])
The bond bill included payment to Wachovia Bank for fees that totaled $67,973.26. There was also a $30,000 remarketing fee and $8,500 in rating agent fees.
This makes for lucrative, on-going income for the financial agents that attach themselves to County business.
Indeed, that’s a great impetus for building these massive projects. So many people and interests can dip their hands in the public pocket – contractors, construction workers, lawyers, bond counsels, fiscal agents, architects, and many, many other businesses.
The profits go to the businesses that rely on taxpayer financing but the promises are always for jobs for the rest of us.
If there is so much business that results, why don’t those who benefit pay for these projects?
Why should they when they have such helpful politicians as Tim Hagan to shift the cost to us.
Links:
[1] http://realneo.us/content/cry-cleveland-or-have-i-asked-question