HomeMy WebLinkAboutCOM 0154.030 2010-2012ISSUE GVT CTY HI BOND 2010 -2011
testimony supporting reconsideration of Bill 311
for Hawai'i County Council 6 PM Tuesday, April 5, 2011, County Council room
by Cory Harden, PO Box 10265, Hilo, Occupied Hawaii 96 721, 808 - 968 -8965 mh @interpac.net
Kudos to Dominic Yagong for finding a way to have the $56 million dollar bond reconsidered. And to Pete
Hoffmann for planning to listen to his constituents on this issue.
The tension between the need for projects and the jobs they bring, versus the reality of these economic
times, have led to close votes, council members changing votes, and creative use of council rules.
But the bottom line is that "fly now, pay later" is not what you do with taxpayer money.
This bond is a double scoop of "pay later" —some of it would be repaid by short -term borrowing, which
means we'd pay interest twice.
This bond would put us even further in the hole than the Mayor's proposed budget .
The proposed budget would mean $29 million coming due later. This id would add $56 million. The
budget and bond debt would come on top of our existing debt - -$323 million. If you added up the total
debt, it would be almost as much as this year's entire budget. We'd pay $4.6 million a year for the bond,
on top of $22.8 million we already pay each year on debt.
Debt service is paid before all our other bills. It would rise to 14% of our budget. That's too close for
comfort to the highest recommended debt --15% of general fund revenues — especially if we consider-
• The tsumani impacted our economy
• Japan's unfolding disasters are impacting our economy
• New labor contracts in July may increase costs
• We might lose $18 million in Transient Accommodations Tax money
Our bond rating, which is now high, might take a hit from the increase in debt.
For each dollar borrowed for the $56 million, we'd pay almost 50 cents interest. That sounds like loan
shark rates.
And taxpayers would have no say in choosing projects.
Many taxpayers oppose the bond. Over 30 people testified against it at the November 30, 2010 council
meeting. Written testimony ran 10 to 1 against.
Isn't there some way to set money aside to pay for projects? Then instead of paying interest, we could
earn interest. Is that too much to ask of government?
Comm No. /5171. 3 0
Ref. To: PreeelOW Ce um u I
Ref. Date APR 5 2011