Wednesday, May 21, 2008

Ogden City Saves $2.5 Million in Bond Interest Payments

Unfortunately, previously earmarked BDO lease revenue won't ease the ultimate taxpayer pain

According to this morning's Standard-Examiner story, Ogden City got a great deal yesterday on its new $49.1 million water infrastructure bonding, as is reported by Ace Reporter Schwebke in his morning story, "Wall street helps Ogden's interest rate on bonds." Here's the lede:
OGDEN — A nearly 200-point drop in the Dow Jones industrials on Tuesday will likely save the city about $2.5 million in interest payments for a bond package to fund sweeping water and sewer infrastructure improvements, municipal officials say.
The city council adopted a resolution Tuesday night to proceed with the sale next month of $49.1 million in bonds to finance the improvements.
Mike Goodwin, the city’s treasurer, said Tuesday’s tumble on Wall Street prompted skittish investors to turn to more secure municipal bonds like the ones being marketed by Ogden.
“Municipal investors looked at our options,” he said. “It was very good for us.”
Wall Street stumbled Tuesday after oil prices spiked to a new record above $129 a barrel and a government report raised investors’ concerns about the impact of inflation on consumer spending.
Jerry Nowlin, a senior vice president for Wells Fargo Brokerage who is assisting the city in marketing its bonds, said about 15 major investors committed Tuesday to buy from Ogden. “We had more buyers than bonds (available),” he told the city council.
As a result, the city was able to negotiate a slightly better interest rate on its debt service payments, estimated to save about $2.5 million over the 30-year life of the bonds, he said.
Market timing is tough even for the most seasoned investors, though. Look at what happened to the Dow today, however:


The Dow was down another 227.49 (1.77%). Obviously we're in a declining investor market.

Although it might be suggested that the Ogden bond underwriter (Wells Fargo) might have waited another day or two before nailing down investor commitments... we're not going to say that.

Our main gripe, even with these market-driven and highly fortuitous rate reductions, is this:

Prior to 2005, Ogden City was set up to finance water system infrastrastructure improvements from Business Depot Ogden (BDO) lease revenue. These bond payments could have been largely paid from BDO revenue under the arrangements at that time, rather than from taxpayer-paid water rate increases, if original commitments had been kept.

Instead, Boss Godfrey, in his "visionary" risk-taking mode, persuaded the former "gang of Five Counsel," rubber stamp Godfreyite lackeys at that time, to re-commit BDO revenues to the "Wreck Center Project."

How's that project doing, BTW, we ask. Does anybody really know?

Recent reports indicate Ogden City taxpayers are now on the hook for at least four "Junction" $3/4 million bond payments, notwithstanding whatever paltry payments are now being made by the very few existing"Junction" tenants.

Three cheers for the soccer moms, gondolists, sheeple from the wardhouses and otherwise brain dead Godfreyites who lifted the little twerp to a third term as Ogden Mayor in the last election.

What a shame it is that these nitwits can't be personally assessed for the future economic damage they will will have have caused to Emerald City.

11 comments:

Karen said...

This is SO Mayor Godfrey.

He diverts the money that previous councils had dedicated for water system repairs, raises our water rates, and then claims he hasn't raised taxes.

Anonymous said...
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danny said...

Gasoline is today, $3.83 wholesale, with tax. Costco sells it for less than it costs them. Other gas stations are losing money.

With only a 5% markup it should be over $4 a gallon.

And yet, gasoline usage is only 1/2 of 1% lower than this time last year.

What will it take to get people to use less gas? Them a-rabs oughta charge $300 a barrel. It looks we'd pay it, so why not? Why not $1000 a barrel?

If we keep on a-buyin', no matter the price, we can't blame 'em for a-chargin'.

disgusted said...

we pay $125 per barrel and they pay $7 per bussel for wheat.

let them pay $125 per bussel for wheat. that might get their attention.

disgusted said...

went by the rec center on tuesday and the surf machine was still out of commission. i think that thing has been broken longer than it has been in operation.
also i cant think of one time in the last two dozen times that ive been to the rec center that i have seen anyone on the climbing wall.

Tec Jonson said...

disgusted,

The flowrider works just fine. Kids are still in school. It's been slow over the winter and does not run several hours a day. It has never been broken as far as I know. I rode it today. The interior needs work but the wave is fine. Don't be starting rumors or be carrying misconceptions. It can lead to misjudgement. We have a mayor who suffers similar lapses.

The climbing wall is rarely busy. Try a Saturday, though, you'll see a crowd. The Junction is getting a little busier. A new restaurant just opened and Iggy's is coming soon. Don't be negative for the sake of negativity. It shows.

There were enough people there Saturday before last for a brawl to break out in front of the Salomon at 11pm when i left the flowrider. Where is a cop when you need them.

The place is hopping on weekend nights so you may want to get out.

Did anyone else notice that 24th/Monroe is under facelift called Alta Ogden. Finally something happening there.

disgusted said...

not trying to be negative. i just mentioning what ive seen.
tuesday 11:30 am as i dropped someone off i noticed that there was a tarp or something draper over a large portion of the flow rider. other times that ive been by there the lights have been off in that area of the building or no one has been around including the hired help.
youre right though i dont go to that part of town on saturday night. im more apt to be found on two bit street where there is adult activity rather than a chucky cheese type of environment.

Curmudgeon said...

Tec:

You wrote: Don't be negative for the sake of negativity.

Exactly right. Ogden City is on the hook for a lot of money if the Salomon Center venues fail. Let us all sacrifice a goat or small mammal of your preference to the god[s] of your preference that it succeeds. In spades.

The fight is disconcerting, though. If they're going for a semi-yuppie crowd [Iggy's e.g.], teens brawling [presumably drunk?] on the premises is not likely to help things out.

Curmudgeon said...

At last, some good news in re: Ogden's airport. From the SE's website, news that a Swiss-based company, Jet Aviation, is opening a repair and maintenance facility at the Ogden Airport, and expects to be employing up to 200 people there over the next couple of years.

jill said...

Speaking of diverting money, or uses of land and property in this instance, I've noticed that many of the buildings whose tenants were lured to the "new" downtown are still vacant or are not close to capacity (Weber/Gold's Gym, First Security Bank Building, Bingham Cyclery).

realistic said...

How much is Ogden paying this new company to come to Ogden and how long before they go bankrupt? I was also at the "wreck center" last Thursday at about 8:30PM. There were only 3 of 32 lanes being used, about 10 people in the arcade, the bumper cars were not being used, the golf course was emtpy, the pool tables were empty, there was one family in Costa Vida. How is it possible to stay in business with no one there. I have been there many times and the scene is exactly the same.

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