Yawn. Longtime readers have heard this before. The string of economic disasters were discussed here long ago. What got laughed at a year ago is mainstream thought today. This morning's disaster is water rates going up because of municipal borrowing rates exploding. And while the article is ignorant of the "other shoe" at least we are making progress.
But with Metropolitan Water District of Southern California's short-term loan interest rates shooting through the roof, and the shaky economy's effect on municipal bonds and investments unknown, another hurdle has risen.
The district that supplies most of Southern California with water has managed so far to deal with the flux in the budget by cutting back on capital costs. But that could change.
"If this whole situation blows up, all bets are off," Brian Thomas, Metropolitan's chief financial officer told the Ventura County Association of Water Agencies on Thursday at its monthly meeting.
The challenge Metropolitan and other public agencies face is how their debt will be managed in the short- and long-term, and how much access they will have to credit.
The article lamely parrots the water districts' claims:
He said water rates are expected to rise, but that's because of the increasing challenges of delivery, energy and lack of water coming from Northern California — not the credit crunch.
Capital costs is code for developer subsidies and cash advances. Well guess what's happened to that revenue stream? Dead. So higher waters rates for bad borrowing practices to subsidize abd development practices. Instead of paying double the California taxpayer is going to be paying 4x for the privilege of having a clueless cadre of urban planners degrade their quality of life.
25 comments:
Ho Ho Ho - It's Santa Flipper Clause
Hey, stealing water costs money.
Murst?
Santa F. Clause
I thought you might be interested in a snapshot of who's on EN:
San Diego, California
Beaverton, Oregon
Los Angeles, California
Hermitage, Tennessee
Baltimore, Maryland
Golden, Colorado
Montreal, Quebec
Portsmouth, Rhode Island
Pittsburgh, Pennsylvania
Duluth, Georgia
Charleston, West Virginia
Lorain, Ohio
Trabuco Canyon, Califor...
Kronstad, Hordaland
Bronx, New York
Parow, Western Cape
Brentwood, California
Irvine, California
Marina, California
----
I find the geographic distribution fascinating.
Rob , are you serious about water prices going 2x-4x?
You forgot. Vancouver BC ;)
The water has uranium in it. But don't worry, they plan on mixing it into the good water, so that you won't die too many years before your time.
Water agency kept uranium contamination secret
I think I'm missing on that list.
And so's Lou, for that matter.
And me, too.
Then there's this:
Burn Fresno
The Pit of Despair in the Pit of California
Forget it Dawg, it's Chinatown.
Hey Rob,
Did you see this in today's LATimes?
MTA may have to cut commuter service
"It may not be able to keep trains and buses running if it has to quickly pay investors in AIG-related lease-back deals."
It turns they sold off a bunch of assets and leased them back...Oops.
SM_Landlord,
You bet I saw that. I was warning about leasebacks years ago. Now they are looking for another sales tax increase.
This it the MTA: 2007 fares accounted for 23% of operating revenue. 17% of total budget. $293,878,777 per year and the amount requested in “R” is 30 years $40b or approximately 4 times as much. Call the current farebox 25%, use that as a baseline and raise 25% from fare and 75% from taxes. Problem? Well I have a problem. Maintaining that ratio would mean a doubling of fares. Besides doubling fares is likely to only increase revenue 60-70%. Things should have never been allowed to get this disconnected service/cost. Now that we are here there is a very real threat of a voter revolt that will cut of their noses to spite themselves. To keep the taxpayer paying it is necessary to raise fares as much as possible until ridership and elasticity are stretched and then go to the taxpayer.
JVJ,
LOL! If ever there was evidence that people went for the comments/entertainment that proves it. Dead turd floating.
Massive levels of immigration--mainly illegal, but legal, too--are what is driving up the cost of your water.
Australia, Spain and other countries are rethinking immigration based on the fact THEY ALREADY HAVE TOO MANY PEOPLE (and too few jobs, too little water...etc.) Why aren't we?
Wasn't there a commercial where a little boy touches a bug-zapper, gets shocked, waits a minute then touches it again?
No can do on fares, Rob. The bus rider's union would shut down the system and the politicians' first impulse will be to cave. Yes there will be a voter's revolt when they find out that the MTA sold off the assets that were purchased with proceeds of the last several rounds of tax increases to pay for this disaster.
What this means is that service shrinks dramatically. That might actually improve the traffic situation, since the buses seem to cause more congestion than they alleviate on city streets.
My housekeeper and my neighbor's housekeepers all drive cars to work anyway, since the bus service is so slow and inefficient. The buses run mostly empty around here. And the few people who do ride are the types who be living in Camarillo right now if the PTB had not closed the state mental hospital back when Reagan was governor.
This is going to be very interesting to watch as it implodes. What a horrible mess the politicians have made.
Rob,
I don't see leasebacks as a general problem.
The problem is that when the contracts were signed, they allowed the lessor to add some terms in the contract that now have some bad consequenses for the MTA. I expect that at the time, they thought that by allowing these terms, they were saving money.
On the genral use of public transport -- most US cities don't have anywhere enough public transport to make it useful except for a small number of people. Public transport has to be ubiquitous for it to be useful for significant numbers of the population.
** CASEY IAFF ARCHIVE FOUND **
I just found this archive:
http://iamfacingforeclosure.com/1/archive
(Repost from bottom of earlier entry).
Millions of people along the Gulf Coast have gone without a municipal water supply for weeks on end over the past couple of years. It's no big deal cutting back drastically on water usage.
Most of SoCal is essentially a desert with nice weather (near the coast, anyway), only with water-sucking lawns and trees and filled swimming pools. Use native landscaping and your water problems will go away. No big deal. "Natural" California is pretty, the thirsty suburban plants imported to suburban tract houses aren't.
Farming in the San Joaquin Valley? Millions of acres of prime farmland in areas that receive lots of rainfall are fallow. Seems to me that it would be better to grow winter/early spring carrots in southern Alabama with rainwater than in Bakersfield with subsidized water coming down from the mountains.
Why is the San Joaquin Valley overly important to our food supply? I'll tell you: It's not the soil, it's the supply of easy-to-exploit cheap Mexican labor.
Gotta love those iaff archives.
"To get a job or to do some wholesaling/bird-dogging for other investors or both? I can’t wait any longer without solving the issue of income." (Oct 16, 2006)
A couple more gems ... note these are all from TWO YEARS ago:
"No more excuses! It’s true. I lied on my loans. I overstated my income, and misrepresented my owner-occupied status and concealed the cash-back-at-close from the bank. I knew it all along. Nobody made me do it. It was my fault. I take full responsibility. And, that’s how I originally started this blog." (Oct 4, 2006)
"Man, I Need a Real Job Or Something. This is the month. I’m at the end of my rope. The $3,000 that I borrowed from a friend got us through last month. Now that’s all gone. (Oh and I have to pay him back one of these days too)." (Nov 9, 2006)
husband-to-be to 1 sweet lady, the most special / attractive / amazing person in the world, the love of my life, a gift from heaven, an angel, the one and only
Casey has been tweaking his about page.
husband-to-be to 1 sweet lady, the most special / attractive / amazing person in the world, the love of my life, a gift from heaven, an angel, the one and only
He is soooooo full of merde. Abandoning your wife and forcing her to scrub toilets is not a sign of "love."
...to resist The Evil One and avoid sin / corruption and to recover quickly if I fall… to enjoy every single minute and every single adventure during this exciting deployment on Earth.
And thus full circle. His first online presence referred to his "mission to planet earth."
From Casey's twitter
"Felt inspired, new page: http://truecasey.com/about-... ..comments still off. On a break from personal blogging, trolls & haters
about 3 hours ago from web"
From Lou: "Why is the San Joaquin Valley overly important to our food supply?"
Growing food in hot dry conditions is much easier than growing it in hot humid conditions becasue there is way less disease. the problem is getting all of the water to the fields. San Joaquin is the perfect confluence of conditions for many crops. Ever grown wheat in the wind and heavy rain? The heads lodge. Carrots in wet rainy humid Alabama? All kinds of soil diseases. Diseases like Anthracnose are like wildfire with rainfall. At least in the desert the plants dry quickly under the dry air after sprinkler irrigating. Also, the bug pressure is so heavy in the places with summer rainfall that it would be very hard to grow vegetables without spraying a lot more insecticide.
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