Home > Uncategorized > LCO Bombshell: will McK schools really pay $56M to borrow $4M?

LCO Bombshell: will McK schools really pay $56M to borrow $4M?

mckThe Lost Coast Outpost has what ought to be a bombshell. McKinleyville Union School District appears to have put its future self [correction: or McKinleyville's future taxpayers] on the hook to pay upwards of $56 million to pay back principal and interest on $4 million of bonds.

Click the link above and read the report. Then, if you’re curious, you can always ask the McKinleyville Union School District trustees.  Click on the links below if you’d like to send email, or call 839-1549:

Brian Mitchell – President of the Board (he’s the VP for Accounting at Security National)

Tim Hooven – Clerk of the Board (he’s the Hooven from Hooven Construction)

Justin Zabel- Board Member (he’s from Mercer Fraser Construction)

Sara Alto – Board Representative (of Bella Vista Realty)

Don Rosebrook – BoardMember (controller for Murphy’s Markets when he ran in 2009, saying he could “help the district remain financially stable“)

Jack Durham of the McKinleyville Press conducted an interview with then Superintendent Dena McCullough and then Business Manager Maureen Hester back in 2008, about why the district needed the bonds:

http://mckinleyvillepress.wordpress.com/2008/05/16/measure-c-interview/

The vote (the bonds passed by 14 votes) was challenged by McKinleyville residents David and Penny Elsebusch: http://tomonkgoe.blogspot.com/2008/08/corporations-that-funded-mckinleyville.html

Understand what these bonds, as issued, do: they cause the people of McKinleyville to pay Wall Street one hundred dollars in debt service for every eight dollars received by the school district from the bond issue. But the cost has been shifted as far as 40 years down the road, when these directors will be retired or dead.

  1. December 2, 2012 at 12:13 pm

    Congratulations to Hank Sims for finding and presenting this information.

  2. Anonymous
    December 2, 2012 at 12:26 pm

    Has City of Eureka done any of these type bonds or other credit swaps?

  3. December 2, 2012 at 12:37 pm

    Yes, thank you to Hank Sims. When are ALL the schools in the county going to be included on the Comprehensive Annual Financial Report, so the people can see a true picture of the county’s wealth? Heavens, even if just Humboldt State was included the numbers would change dramatically.

    I MEAN, we’re 19th in education, just above Mexico . . . so no matter how much bonding funds, or other funding, is thrown at the public fool system, it is of little help to the students.

  4. Anonymous
    December 2, 2012 at 1:08 pm

    For what it’s worth, the current superintendent is new as of this school year and wasn’t involved in that decision. I think most/all of the board members are the same though.

  5. Anonymous
    December 2, 2012 at 1:16 pm

    From the LA Times article: “They are terrible deals,” (California Treasurer Bill) Lockyer said. “The school boards and staffs that approved of these bonds should be voted out of office and fired.”

    To be clear, it’ll be McKinleyville residents paying the $54 million, not the school district. If the state doesn’t bail McKinleyville out, it’s difficult to imagine how this won’t make MackTown a ghost town a few decades from now. Nobody will want to pay the taxes required to cover that debt.

  6. Anonymous
    December 2, 2012 at 1:24 pm

    CR’s former president (Jeff Marsee) was trying to float the same deal. Fortunately he lost his job before he could get them pushed through. Unfortunately, he left a pile of other financial problems the school is still dealing with. The public might keep in mind the Trustees who support these inept administrators.
    Once the problems are uncovered, no one seems to claim any responsibility or connection. I agree with Lockyer – vote out trustees that support and promote this kind of crap. In the case of CR, there are several cheer leaders (trustees) for Marsee that are still on the Board. Will their respective districts remember this the next time they are up for election??

  7. December 2, 2012 at 1:32 pm

    This story brings to mind the old joke about how Bush knew that Iraq had weapons of mass destruction — his dad sold them to Saddam and he’d seen the receipts. In this case, it’s how people who call themselves “conservatives” know that government shouldn’t be trusted with taxpayer money. Meanwhile, State Treasurer Lockyer is quoted in the LA Times:

    “They are terrible deals,” Lockyer said. “The school boards and staffs that approved of these bonds should be voted out of office and fired.”

  8. December 2, 2012 at 1:52 pm

    Mitch :
    This story brings to mind the old joke about how Bush knew that Iraq had weapons of mass destruction — his dad sold them to Saddam and he’d seen the receipts. In this case, it’s how people who call themselves “conservatives” know that government shouldn’t be trusted with taxpayer money. Meanwhile, State Treasurer Lockyer is quoted in the LA Times:

    Hmmm??? If I’m reading you right you’re blaming conservatives for this bond fiasco? Yet whenever they protest the various school bonds (other types of school bonds are often just as bad), they’re told they “don’t care about the children”. That’s exactly how the lefties sell these bond issues. Glad to see some of you are finally waking up.

  9. December 2, 2012 at 1:58 pm

    Fred,

    A bond isn’t a fiasco; this bond measure was probably needed. And no, others are not “just as bad.”

    The fiasco is the manner in which this set of bonds were issued, in order to get around a limit on the amount that today’s property taxpayers can be charged. This is the exact same sort of creative accounting that caused the economy to crash, and it’s the sort of “let the kids pay” behavior that so-called fiscal conservatives always criticize. Except this is the nitroglycerin powered eXtreme version, done by Humboldt County’s supposed financial whizzes. The so-called “liberals” in state government have been clear that the terms this and other school boards have agreed to are outrageous.

    Do you understand what “capital appreciation bond” means? It means that you don’t even start paying down what you’ve borrowed until well out into the future. It appears (and I can’t be sure, because I don’t have the background of people like VPs of Accounting) that the bonds will be paying 7% tax free for forty years, at a time when 30 year mortgages are around 3%. That’s the fiasco.

    I’m curious to hear how the trustees explain their actions.

  10. Anonymous
    December 2, 2012 at 2:01 pm

    Not news to Mac towns solid conservatives who tried their best to inform and stop this. BUT! Hell no , the liberal ,anti-prop13, schools at any cost mania, run away train could not be stopped. It’s sadder yet that heraldo hesteria types are crying foul. Better late than never though. With your one eye open now maybe you will see that your lord and equalizer Obama is selling the same damn snake oil. Naw, PJ & crew will find another to blame. Yhea, Bush. That’s the ticket!!!!!!!

  11. December 2, 2012 at 2:07 pm

    Sorry #10, but, in a word, no.

    This is the public policy equivalent of liar loans and zero down, and it was done by people who call themselves conservatives — just like the vast majority of the liar loan, zero down issuers. The voting public has a right to approve a bond measure without expecting that a trustee is putting the voters’ kids and grandkids on the hook for 13x the value of the bonds.

    This stinks of either corruption, idiocy, or most likely both.

  12. Anonymous
    December 2, 2012 at 2:17 pm

    Fred, if you think McKinleyville’s school board has lefties on it, whoo, you don’t know people.

  13. A pesky fact
    December 2, 2012 at 2:40 pm

    There are some issues where it is appropriate to cite ideology.

    This is not one of them. This is not a matter of ideology. It is a matter of corruption. As Glenn Reynolds often says, tar and feathers are the appropriate response.

    Let me aide in bringing sunlight. This isn’t a wall-street issue. Here are the next steps that need taking:
    1) determing which local entity/financial-advisor was involved in creating the paperwork and bringing the bonds to market. That person (likely also politically connected) likely received a large fee, as well as a yearly comparing for the life of the bonds.

    2) examine the process of the bondsgoing to market. Where there opportunities for persons to buy these bonds before they went to market? It is very likely that the financial advisor above (whose firm may have underwritten as well) also got to buy them in advance at a discount, for repackaging to local clients.

    3) who ended up owning the bonds?

    4). The above 3 things may be largely discoverable through FOIA, because the documents had to be presented to the board/district and are some degree of public record.

    Getting answers to the above will likely be VERY interesting. As in, interesting enough for criminal charges to become a possibility.

    This is not a matter of ideology. This is a matter of corruption. It’s very possible that some local folks made money on every step here, and ended up owning the bonds for themselves.

  14. A pesky fact
    December 2, 2012 at 2:42 pm

    *a yearly COMMISSION for the life of the bonds.

    The rest of the iPhone induced typos are irrelevant.

  15. Anonymous
    December 2, 2012 at 2:43 pm

    40 years down the road, when these directors will be retired or dead.

    And my kids will know better than to remain living in McKinleyville. Please kids, do attend college far away, and don’t return because we turned out town to crap.

  16. Anonymous
    December 2, 2012 at 2:46 pm

    That Mckinleyville Press blog post is interesting. The two people pictured in the photo aren’t in those positions anymore. Not their problem anymore.

  17. December 2, 2012 at 2:59 pm

    pesky,

    How is it possible that you haven’t noticed that the prevailing ideology of the American wealthy IS corruption? — it’s just called “the right” or, to a lesser extent, “Wall Street” because “the corrupt” doesn’t test well in political ads.

    Do you actually think the wealth accumulations are being awarded to brilliant engineers, scientists, doctors who are inventing things that bring huge new value to people? The wealth accumulations, for the most part, go to those with connections, balls, and luck. It’s always been that way in America, certainly since the transcontinental railroad.

  18. December 2, 2012 at 3:29 pm

    Here, pesky, an excerpt from George Bernard Shaw’s “Heartbreak House.” The whole play is up at Project Gutenberg. Good luck with your spaceport.

    MANGAN. Of course you don’t understand: what do you know about business? You just listen and learn. Your father’s business was a new business; and I don’t start new businesses: I let other fellows start them. They put all their money and their friends’ money into starting them. They wear out their souls and bodies trying to make a success of them. They’re what you call enthusiasts. But the first dead lift of the thing is too much for them; and they haven’t enough financial experience. In a year or so they have either to let the whole show go bust, or sell out to a new lot of fellows for a few deferred ordinary shares: that is, if they’re lucky enough to get anything at all. As likely as not the very same thing happens to the new lot. They put in more money and a couple of years’ more work; and then perhaps they have to sell out to a third lot. If it’s really a big thing the third lot will have to sell out too, and leave their work and their money behind them. And that’s where the real business man comes in: where I come in. But I’m cleverer than some: I don’t mind dropping a little money to start the process. I took your father’s measure. I saw that he had a sound idea, and that he would work himself silly for it if he got the chance. I saw that he was a child in business, and was dead certain to outrun his expenses and be in too great a hurry to wait for his market. I knew that the surest way to ruin a man who doesn’t know how to handle money is to give him some. I explained my idea to some friends in the city, and they found the money; for I take no risks in ideas, even when they’re my own. Your father and the friends that ventured their money with him were no more to me than a heap of squeezed lemons. You’ve been wasting your gratitude: my kind heart is all rot. I’m sick of it. When I see your father beaming at me with his moist, grateful eyes, regularly wallowing in gratitude, I sometimes feel I must tell him the truth or burst. What stops me is that I know he wouldn’t believe me. He’d think it was my modesty, as you did just now. He’d think anything rather than the truth, which is that he’s a blamed fool, and I am a man that knows how to take care of himself. [He throws himself back into the big chair with large self approval]. Now what do you think of me, Miss Ellie?

  19. Anonymous
    December 2, 2012 at 3:41 pm

    The product was bad. No doubt. The liberal , teacher union just raise taxes or float bonds mentality is equally to blame. You libs along with Brown, Cheesebro, Boxer, and Obama are running your own ponzie schemes. Calies schools suck. The unions, administration , and promise them anything politicians are to blame. Arnold turned out to be a fool. Brown is a joke. Hell yea, lets raise taxes and float more bonds. As #10 said real conservatives said NO!

  20. tra
    December 2, 2012 at 4:00 pm

    Well it’s about time someone found a way to get these freeloading schoolchildren to pay for their own schools!

  21. Anonymous
    December 2, 2012 at 4:03 pm

    Its time to fix prop 13. Prop 13 is ruining the economy of California.

  22. December 2, 2012 at 4:14 pm

    This is not the teacher’s union. The teacher’s union said the kid needs a cheeseburger, because the kid is hungry.

    It’s the school board that decided to pay Wall Street 13 cheeseburgers over the next 40 years in order to give the poor kid a cheeseburger.

  23. jr
    December 2, 2012 at 4:23 pm

    Mitch: Good analogy. Perhaps the Humboldt Grand Jury should open an investigation?

  24. December 2, 2012 at 4:27 pm

    I’d like to think there’s a way for districts that have entered into these arrangements to have them ruled null and void, on the grounds that the trustees violated fiduciary responsibilities. But the voters voted for the trustees, so who knows? At some point, if most people don’t bother to vote and the ones that do bother to vote line up behind someone whose smile they like, it just has to come home to the voter, doesn’t it? I wouldn’t have thought this was legal, but…

    I sure hope there’s some independent lawyer who wants to take this on, and I hope they win and their contingency fees make them wealthy.

  25. Anonymous
    December 2, 2012 at 4:33 pm

    Securities fraud is a federal matter. But hopefully our DA will take a look at it too. Maybe the POP could take time out from protecting us from pot grows to investigate fifty million missing dollars. Pay a visit to Security National and Mercer Fraser. Knock and talk.

  26. Just Middle Class
    December 2, 2012 at 4:49 pm

    Unfortunately the “reporting” by Hank, told only one small part of the story and now is leading to conclusions based on insufficient data, and therefore not reliable. Any real reporter would have checked on the facts or in a minimum talked to someone involved. I guess that is why blogs do not rise to the level of trustworthy news.

  27. Anonymous
    December 2, 2012 at 4:59 pm

    OMFG! You libs are unbelievable. Teacher unions and politicos are exactly the problem. There is no lack of money for school kids. But, never enough for pension and perk promises. Ask the DA to investigate the 1000$$ bonus per cali teacher. This mac school bond is a horror and real conservatives opposed it.

  28. December 2, 2012 at 5:09 pm

    So, please, JMC, tell us the rest of the story. The bond information on the Lost Coast Outpost seemed to originate with the LA Times.

    One of the advantages of blogs is that everyone gets to contribute. If a trustee wanted to correct the record here, they could do that quickly and easily, as could anyone who knows the missing facts you’re concerned about.

    It really doesn’t have to be a constant parade of people talking about “libtards” and “trolls”. In theory, it could be people sharing their information.

  29. tra
    December 2, 2012 at 5:19 pm

    Introducing the McKinleyville School District Mortgage Plan: Act now and you can buy a $200,000 house with a no-money-down, deferred-payment 40 year mortgage with low. low monthly payments! (Fine print: This loan requires a total payout of $2,680,000.)

  30. Anonymous
    December 2, 2012 at 5:37 pm

    Basically every one of the 15,000 souls in McKinleyville are borrowing $250 and they will repay over 40 years over $3700 each. Will new home buyers in McKinleyville require notification of this encumbrance? I mean legally?

    Someone above said this is like buying a house on a department store credit card. Actually its worse. It’s like getting a loan from Guido. If McKinleyville defaults will they send in the leg breakers?

    7 percent on a tax free bond? Thats not interest that’s vig.

    But we know who probably owns these bonds. Probably borrowed the money from the FED at no interest to stimulate the economy but used the proceeds of the no interest loan to buy 7 per cent tax free bonds to collect on for 40 years.

    SWEET!

    These are not bonds. This is bondage.

  31. December 2, 2012 at 5:43 pm

    #30,

    This sort of arrangement is not quite what you describe, since people move. A more accurate description is that the 5,000 households of today’s McKinleyville have obtained $750 each for school repairs, and those who buy in McKinleyville five years from now will get billed $10,000 each to repay.

    It’s a perfectly reasonable deal as long as you’re not planning on sticking around. It only seems outrageous if you plan on staying, or expect that your kids will.

    Meanwhile, there’s money to pay for construction, there’s money to pay for commissions, there’s money for everyone, and no bills in sight for years.

  32. December 2, 2012 at 6:02 pm

    Of course this all sounds bad, without knowing any possible details which might mitigate.

    However, I remember something just as bad, when the snowbirds moved into the southern Oregon area, and proceeded to shut down the school system, because they didn’t want to pay taxes to educate locals. And the schools closed. No future being treated properly there either.

    It was cruel, harsh, and unrelenting. It was of the same mindset as the twenty years later Tea Party et al. So if we look for craziness, or self-regarding acts, we should look first there.

    I can’t begin to guess what might be on the minds of those who set this McKinleyville thing going, but it’s not impossible that they took lessons, from such prior acts and from the likes of Grover Norquist, who saw nothing wrong with ‘drowning in a bathtub’ the government all but the rich depend on for balance, and incidentally apparently a few contra mission supports as well. Might that response have included ‘we’ll post the biil, and they’ll have to pay it’, and whether it makes any kind of sense at all?

    I’m not of any identifiable political label, but on a human scale, and while two wrongs or two immense future risks don’t make a right, it’s easy enough to suppose that sauce for the gander might apply in what people were thinking.

    I’ve seen far more irrationality on both sides of the supposedly educated and responsible American groups. Time for everyone to grow up, it certainly seems. How do you view it?

  33. December 2, 2012 at 6:30 pm

    Narration,

    I think there are two separate issues here: the bond vote, and the ultimate issuance of the last $4 million approved.

    I think the schools always need more money, and I think taxpayers are wise to allocate funds for schools. No problem there.

    The question is the way in which this set of bonds was structured.

    I don’t know — perhaps there were no legal alternatives, perhaps there’s some explanation for the approach used. We all need more information to reach rational conclusions, but one thing I’ve noticed in 20 years here is that it’s rare that the information ever arrives unless someone makes themselves an enormous pain in the butt. Stories occasionally appear, along with promises of followup, and they then sink back into the great sea of “it’s all good, dude.”

    From time to time, it appears to be worthwhile to try to make a major fuss. This seems like such a time. If it turns out that it really costs 13 cheeseburgers to feed a kid a cheeseburger, well, OK. But let’s find out why. If it turns out it’s because the kid can’t get a cheeseburger until this guy gets one and this guy gets a half and this one gets a third and this one gets two… let’s find out.

  34. J P Morgans ghost
    December 2, 2012 at 6:48 pm

    Wall street will be happy to refinance at any time, for a fee. They’ve figured out that taxpayers are the best suckers left out there, and actively seek out public deals like this. They were sniffing around the harbor a while back, but even they can’t get blood from a turnip. Bunch of thieves.

  35. tra
  36. unanonymous
    December 2, 2012 at 8:09 pm

    i say a bigger question is, why do the schools need to borrow? Sacramento has been requiring more and more unfunded programs while reducing and eliminating monies legally owed to the schools. The rich school boards are suing them for it now, all schools will win if they prevail. The recent proposition passed will only repay yes repay some pf the monies owed to the schools from the past two years. The progs in Sacto own this as much as the idiots who promoted these bonds.

  37. Anonymous
    December 2, 2012 at 8:17 pm

    Spot on #36

  38. Anonymous
    December 2, 2012 at 8:22 pm

    Schools need to borrow because prop 13 ruined Californias taxation system. Prop 13 must be fixed. Eliminate the grandfathered businesses. Prop 13 has become a major drag on Californias economy, no one wants to sell and lose the tax benefit. Why do you think there are so many vacant storefronts. Maybe the Dems can use their supermajority to fix prop 13

  39. Skippy
    December 2, 2012 at 8:40 pm

    Great find by Hank, fascinating thread and links here, Mitch. I’ve read them all and have been looking into it a bit more. At face value, it’s exactly as it appears to be: $56 million to borrow $4 million, an interesting cast of trustees who were smart and saavy enough to know the implications and difference while looking to skirt State regs, and a giant red flag by the LA Times for the shocking debt ratio of 13.5.

    In the comments here, #13 is cogently onto it, and initialy so was David Elsebusch in Tra’s #35 link describing campaign contributions made to facilitate this bond approval. It’s a little too early to tell exactly where this will go until we get a better idea of who may (or may not) have profited. It needs a more thorough investigation. At this point it might not be anything more unusual than a really, really bad deal. Even if that’s the case, the Trustees are responsible and should be held accountable.

    But here’s another piece of the puzzle to throw into the mix from the California Watch article relating to both the comments by #13 and #35. It specifically relates to school bonds and also mentions Blue Lake School as benefitting from these underwriting campaign donations : “With Campaign Donations, Bond Underwriters Also Secure Contracts.”

  40. Anonymous
  41. December 2, 2012 at 11:09 pm

    Ok, I got out a spreadsheet so I could begin to understand what seems to be going on here. Hank Sims’ article definitely has enough facts to work with.

    I would have to think that if I’m at all correct in figures, there’s a definite sign of what used to be called suede shoe boys around here.

    – if you borrowed the 4mil and paid it back in a simple yearly proportion, you’d spend 12.7mil if you took 40 years to pay it off.

    – the reason you pay 57.4mil instead is that _no_ payments are being made; thus you pay the interest on the full principle every year.

    – the balloon payment at the end holes the ship so it sinks, but meanwhile Wall St. gets to slice and dice and resell your debt, profiting all the while.

    – these CABs are everywhere, growing like weeds in California, because they seem to get around Prop. 13 for politicians.

    – But even the so-called poster child for this, Poway down here in San Diego, at least starts paying the thing off half-way through. The McKinleyville reporting seems to say they don’t pay off at all until the end of the bond. What can you say to that?

    – It’s very hard to believe that districts are going to somehow invest and save to make up the 7% apparent interest they’re being charged while their hands are tied not to pay against the debt. Property value appreciation is going to fill in for this? I don’t think I’d like that gamble

    – and of course, what happens when this cash received is gone? How far is 4mil going to stretch, over 40 years?

    Working this out just makes me sad, and even if I have missed something important that’s going to make it better, other than the legislation apparently under way to close the faucet on such practices.

    The ecology of this economics goes right back to what some of the commenters on Hank Sims’ article bring up, that our future has to be different in substantial ways. That the suede shoe boys can keep inventing financial gaming in this way suggests where the regulation part of it has to start. The rest — well, we have to be inventing the jobs (and the desires they support) which can only be done in our own country. On the path to that, fair proportion from those that net so much from employing outside it, no matter how they think they got into that custom. You can’t stop any of it, or the merry-go-round creaks to a halt, but you can certainly get started yesterday on shifting the proportions of what makes it go.

    That’s the hope of the next four years, to get it started.

    And Mitch, I am starting to understand some of your tendencies. The words helped, thanks.

    I will probably be sorry to have entered into any of this, in the morning ;). Not exactly my cup of tea, but sometimes you have to look a little at how the sausage is made…even if what you like is the tasty part…

  42. Anonymous
    December 2, 2012 at 11:16 pm

    Fees for calling back the bond issue will be a lot less than $56 million.

    “The politics of leisure” is playing out again.

    This is another gaggle of “full-time professional” republicans making damn sure the public will pay for these schools no matter what…as opposed to joining the chorus demanding funding from Sacramento. Every good republican retiree will thank them for providing a high interest investment that is safe when there are so many GO Bonds trading at high premiums.

    Taxing the $27 billion hiding in offshore accounts could begin to set things straight.

  43. December 2, 2012 at 11:32 pm

    Yeah, I’m well with you on any necessary variations on taxing that particular 27 billion.

    I’m not sure I understand what you mean by republicans assuring the ‘public will pay for the[se] schools no matter what’. Could you roll that out a little farther, so your point is clear?

    Thanks.

  44. December 2, 2012 at 11:34 pm

    And, it’s 27 Trillion. Does make such a difference, doesn’t it — when you start thinking about all those arguments of how we’re so far gone in US debt…

    Guess who’s holding all the money; but that gets boring to talk about. Hence Mitch’s dog piles in preparation so that the scent reminds, I think.

  45. Anonymous
    December 2, 2012 at 11:57 pm

    $27 Trillion indeed…ooops.

    I think the point you want rolled-out was already made above, “drowning McK in the bathtub”. This string has many references to other local boards, (generally deluged with republicans), issuing similar bonds. Otherwise, these board members might have to alter their ideologies and start making public noises about taxing the rich.

  46. December 3, 2012 at 12:11 am

    Yes, that I get, of course. The question was just about the phrasing ‘public has to pay’, as the public pays, no matter what. But I think now you mean public vs. the 1% feeling it, also well on board of course.

    Otherwise, I had been thinking it was about which pocket it came from, local public or Sacto public. Local tends to assure that the plutocrats aren’t touched, in that frame.

    I tend to suspect there are many more games being played with which pocket and which time, anyway. Which this current game is precisely. Finance is so often about when as well as who, as far as paying. Right back to the English method, which I have had as meanly as Dickens laid out to me across a carriage house kitchen there, knightly placards all over its tall livingroom walls. The same meme Jefferson couldn’t free himself of, but I digress.

    In midnight talking, i will admit I think we really have to reinvent how things work right around those people who think they’ve understood it all along and always will. That’s the real ratzel hanging about out there ;)

  47. December 3, 2012 at 3:01 am

    Past midnight talking,
    We must rescue ourselves this time. All those years of government schooling was fed into the left side of the brain. How do you distinguish theft from taxation? ‘Interest’ isn’t part of the equation, it’s never printed. ‘Interest’ at 1% is usury. We have tried the Ouija Board of Greek debt, then the talking in tongues of Greek politics. (‘interest’ – one of those vowel before two consonants – a negative condition of state). What we do has always been here to be learned by anybody who wants to discover it, it has nothing to do with time or place. . .
    remembering, forgetting, remembering. We’re overcoming our limitations to change our level of consciousness. Don’t believe what your eyes are telling you. Look with your understanding, find out what you already know.
    Talk to or email these trustees? Replace them. They are criminals and thieves or they wouldn’t be doing what they’re doing.

  48. Just Watchin
    December 3, 2012 at 6:30 am

    I recall seeing on the “rough and tumble” website a story that the CSU had gotten themselves into a similar situation, only on a much larger scale. The gist, as I recall, was that most of the new found future tax dollars would be going to pay down debt, and not benefit the school system. Seems that the chickens have come home to roost.

  49. December 3, 2012 at 8:15 am

    Narration #41,

    I’m glad words can sometimes communicate.

    I can easily understand someone declining to associate with any ideological labels, and I don’t find them to be particularly good fits myself. However, one thing I think I’ve seen since the GOP replaced Jimmy Carter (“He’s enough to give Christianity a good name” — Molly Ivins) with Ronald Reagan (“facts are stupid things” — Ronnie) is a brilliantly run and organized campaign by the wealthy to convince a generation that liberalism is a failure because it did not create Utopia.

    Young people who ought by right to be our society’s most compassionate and idealistic seemed to me to have been perverted into worshippers of Reagan’s backers for a long time, and to blame our society’s problems precisely on those working to ameliorate them rather than on those whose greed and general lack of empathy enabled the problems to grow huge. It’s a variant of blaming the victim — blaming the hapless helper. I don’t think it just happened naturally — I think it was thought out, planned, and well-implemented.

    I think it was done with words and pictures, among other things the much-parodied renaming of every bill with a word that signified its opposite — No Child Left Behind, the PATRIOT act. If the GOP had thought of a bill to deport the poor, it would have named it the “Help the Poor Act.”

    I think words do matter, and people should counter lies with honesty. That’s NOT to say that there aren’t a million valid perspectives on things — it’s just to say that in addition to those many valid perspectives, there are also pure lies, and we need to counter those lies while acknowledging our own limited perspectives and the existence of valid perspectives that we don’t share. I admire true conservatives, I hold many conservative beliefs, and I think true conservatives, if literate and informed, found the Reagan and W presidencies to be as awful and damaging as I did. I don’t admire today’s leading “conservatives,” who have turned hoarding/worshipping material wealth, denying complexity, and ignoring problems into art forms (or, to be more manly, into extreme sports).

    It’s exciting to see that young people these days are no longer brainwashed by the cult of Reagan, and I thank Bush the Second (wake up, JW!) for being so completely awful and hopeless that the Reagan spell has been broken.

  50. Anonymous
    December 3, 2012 at 8:23 am

    The Times-Standard is all over this story this morning. Sadly I don’t have a link.

  51. Just Watchin
    December 3, 2012 at 8:44 am
  52. December 3, 2012 at 8:54 am

    Anonymous writes (*),

    “God our newspaper sucks.”

    What newspaper? The Tri-City Advertiser?

    and JW writes,

    “Look over here, instead!!

    No thank you.

    (*) I had to use Google Translator on the quotes

  53. Plain Jane
    December 3, 2012 at 9:00 am

    Those aren’t Warren Buffet’s personal taxes but Berkshire Hathaway’s. Whether or not they are owed has not yet been determined, but it makes for a propaganda headline to make the goobers believe something that is not true.

  54. Just Watchin
    December 3, 2012 at 9:09 am

    Mitch :So, please, JMC, tell us the rest of the story. The bond information on the Lost Coast Outpost seemed to originate with the LA Times.
    One of the advantages of blogs is that everyone gets to contribute. If a trustee wanted to correct the record here, they could do that quickly and easily, as could anyone who knows the missing facts you’re concerned about.
    It really doesn’t have to be a constant parade of people talking about “libtards” and “trolls”. In theory, it could be people sharing their information.

    A trustee correcting the record?? Hate to break it to ya Gumby, but few outside the hand full of likeminded, back slapping libtards visit this blog. [and you, dearheart. --Mitch]
    And the Buffett piece seemed to fit, since you and others repeatedly called out the evil wealthy as the cause of this problem. Wasn’t this voted on and passed by the people? Are you saying that they are all stupid?

  55. December 3, 2012 at 9:11 am

    In some of the material from 2008/2009, there’s talk of MUSD owning some property. I wonder if it still owns it and, if so, why it wasn’t sold to avoid some of this. If the trustees had been able to get more than 50% of its appraised value, that would have been a godsend alternative to a 13x debt ratio on the bonds. Or could it have been mortgaged at 3 or 4%? I also wonder whether there was ever any thought of paying locals 4% interest on loans, rather than paying Wall Street 7% (if that’s indeed the rate).

    Oh, and here’s Dena McCullough’s job: http://california8acontractor.com/sites/california8acontractor.com/files/StatementOfQualifications052212.pdf

  56. Just Watchin
    December 3, 2012 at 9:17 am

    (Continued attempt at diversion moved to new thread. –Mitch)

  57. Anonymous
    December 3, 2012 at 9:28 am

    Thank God we have a financial mentor here to guide us through this thicket!

    Joe Bonino!

    I heard both Frank Jager and Sheriff Downey (YOU THE MEN!) describe Joe as a financial expert just recently. I know Joe is modest , but come on Joe we need your guidance now.

    Well actually the poor SOBs in Mactown need you more.

    Log on here right now Joe and explain all this to us. Show us why we made a mistake when we elected Linda.

    Don’t let us down Joe.

  58. Just Watchin
    December 3, 2012 at 9:31 am

    (Moved. –Mitch)

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