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The DPS Bailout – Debts & Obligations

Part II - The Eventual Cost of DPS Liabilities to Michigan Taxpayers and Detroit Schoolchildren

Debt ImageDPS has two types of formal debt: operating and capital. Operating debt is a conversion of present and past annual operating deficits into ‘long-term notes’ sold to the financial markets, as well as more immediate debts owed to the State of Michigan directly. DPS capital debt exists only in the form of bonds which were sold to financial markets to purchase and rehabilitate facilities.  DPS’ formal bonds are identified by Series, which consists of the year issued and a letter suffix when different purpose bonds are issued in a single year.  The financial markets apply a further identifier, CUSIP, which is a unique identifier of municipal bonds by series and their intended dates of redemption.  All of the DPS debt sold to the financial markets has been enrolled in Public Act 92 of 2005, a program designed to reduce interest rates to local school districts in accordance with the 1963 Michigan Constitution’s Article IX, Section 16.  Most DPS debt is effectively secured by a general obligation to pay, which requires Detroit taxpayers to increase taxes and reduce spending should financial difficulties repaying arise.

DPS 2009B Bond StatementDPS pays off its capital debt in annual installments of both interest and principal, before it pays off (or adds to) its operating debt.  Bond interest and principal payments are required by bond terms which – if ignored – would result in immediate default and bankruptcy.  The exact contract terms of DPS debt sold to the financial markets are laid out in official statements which detail all the formal legal and financial features of the bonds.  The official statement is essentially a contract between DPS and its bond purchasers.

DPS’ operating debt payments are somewhat more flexible than capital debt payments because only a portion of operating debt has been converted into formal bonds covered by statements; much of it is separately owed to the Michigan School Loan Revolving Fund. The SSLRF can best be thought of as a State sponsored credit card. School districts tap into it when they are short of cash, and pay off their balance when they are flush.  Operating debt is only converted into formal bonds when Michigan school districts exceed their limits at the SSLRF.  Those limits are not exact, and generally come into play when DPS goes through one of its periodic financial spasms.

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The DPS Bailout – The Bankruptcy Alternative Not Taken

Part I - No, The Richmond USD Case Did Not Challenge U.S. Bankruptcy Court Authority

Daniel Howes ImageGovernor Snyder browbeat the Michigan Legislature to approve the $ 617 million bailout of Detroit Public Schools which he signed today by regaling them with a parade of horribles which would occur if the bailout was defeated and DPS was forced to file for bankruptcy. Daniel Howes regurgitated Governor Snyder’s compelling tales of impending doom delivered behind closed doors in a Detroit News article, but was any of it true?

Right at the top of Governor Snyder’s parade of horribles was the Federal bankruptcy filing of the Richmond [California] Unified School District on April 19, 1991 . Governor Snyder portrayed the outcome of this action as the U.S. Bankruptcy Court denying the petition and ordering the State of California to financially bail out the district.  From Daniel Howes’ article:

There is scant precedence for school districts filing for bankruptcy, the Snyder administration found. In 1990, according to an administration letter to state Rep. Laura Cox, R-Livonia, the Richmond Unified School District in Northern California filed for bankruptcy because of $42.5 million in debt. The judge ruled the district could not be protected by the court in bankruptcy and ordered the state to provide the district with operating funds.

Nothing could be farther from the truth.

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Democratic Socialism Comes to Southeast Michigan

RTA Funding Could Buy All Their New Riders New Cars, And Pay For Their Fuel and Insurance To Boot!

RTA Transit Map aThe new Regional Transit Authority of Southeast Michigan is out today with their transportation master plan to soak taxpayers in Macomb, Oakland, Washtenaw, and Wayne Counties for another $ 3.3 billion in property taxes over a 20 year period.Michael Ford Smiling RTA CEO Michael Ford released the regional mass transit plan RTA will submit to voters on November 8th under PA 387 of 2012. A 1.2 mill property tax increase and $ 1.7 billion in new Federal & State subsidies will provide four new bus rapid transit lines, 11 cross county connector lines, one regional rail line, and some extended/intensified local service.

Let’s have some fun by subjecting the new RTA regional mass transit plan to some real, pre Common Core, mathematics.

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Get Yer Jack Boot On

The 'other' definition of "force" once again rears its ugly head.

Pure-TicketThe logical conclusion to an over applied nanny state is the use of violence to prevent one from hurting oneself.

The Stings are on.  Grants to step up ‘enforcement’ (key use of words here) have been doled out. Click on Detroit says:

The Macomb County Sheriff’s Office will be participating in a mandatory seat belt enforcement grant beginning May 23-June 5.

Take the money, or else.

Indeed.  Click it, or we’ll put a gun to your head to save your life.  As Michigan goes into the high travel Memorial Day weekend, the stage is set once again to punish those who tempt fate by not strapping in.  In Macomb County they want to do it the nice way:

Extra patrols start Monday and continue through June 5 as part of the latest “Click it or Ticket” campaign, targeting motorists who are not wearing seat belts.

“Our primary goal is always to encourage voluntary compliance with the law. For those drivers who do not comply, our deputies will deliver warnings or issue violations as the circumstances dictate,” Macomb County Sheriff Anthony Wickersham said.

Oh, how friendly.

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My thoughts about restrooms…

There are more pressing issues than who uses what bathroom. Let t he free market sort it out.

I get the feeling that many people are worked up about this restroom issue…*sighs*.  It’s become a huge issue for many people.  It really is a war that the Government started and doesn’t belong in.

North Carolina awoke a sleeping bear that has been around for decades.  I hear many transgendered individuals have been using the public restroom of their sexual identity for decades now…mostly without concern or controversy.  Why is there suddenly attention to this issue?  Ask North Carolina.

My take?  This isn’t an issue that concerns government.  It concerns private property owners and their rights — and the rights of consumers to freely associate/shop where they wish, for any reason they wish.

So, Target allows people to use the restroom of the gender they identify with.  If you aren’t comfortable shopping at Target because of that, that’s fine.  Go shop elsewhere.  You can even tell Target why you will no longer shop there, if you wish.  Want to start a boycott of places like Target?  I support your right to do that as well (note: supporting one’s right to do something is different than supporting them doing it — there is a distinction).

What if you want to boycott businesses that have segregated restroom policies?  I support your right to do that as well.

What I cannot condone or abide is you using the guns of government to force your will onto other private people and businesses.  Any time you pass a law, you are sending out a man with a gun who is willing to steal and/or kill (if necessary) to enforce it.

What about public schools and other publicly owned institutions?  I submit to you the problem isn’t the restrooms, but the public ownership f these institutions.  Bring an end to the practice of publicly owned institutions (schools, libraries, parks, etc.) and you will solve this problem of restrooms on publicly owned property.  If there is a need for these services, the free market will provide for it (either through customer/provider relationships or donations/charity/patron relationships).

Logically, most restrooms have stalls as well as urinals (men’s rooms).  When you’re in an opaque stall, what does it matter to you what’s between the legs of the person in the private next to you?  Can they see you while you’re doing you business?  No, not unless they are peaking under the stall..in which case the store management might want to remove that person (regardless of gender identity).

Some people say, “I don’t want to share a bathroom with some sexual pervert.”  Just because a person has a different gender identity than the one they were born with, does that make them a pervert?  If it does make the person a pervert, would you rather this person go to the restroom of the gender they were born with and be around your sons, daughters or other loved ones?

Food for thought, I just wish people would focus time having debates that matter more like: the debt of the US Government, the Quantitative Easing policies (read: printing funny money) of the US Federal Reserve, endless world policing and war mongering…or any of a number of other issues that will drive our country to certain financial ruins.

You Betcha! (9)Nuh Uh.(1)

To the Warriors in the Fight for the Long Haul…

Dr. Strangelove - Riding the Bomb
I spend the better part of each day talking to brave souls around the country who are deep in the trenches of the state sovereignty movement. It is truly a breathtaking and awe-inspiring experience hearing from the patriots on the front lines. I hear war stories from the boots on the ground in the great, animated contest of freedom vs. tyranny everyday.

I am both honored and humbled to be in the position to relay this urgent message, and sound the clarion call of liberty upon the masses. It is with a very heavy heart that I deliver the following report to you.

I will not mince words about what I have heard from these warriors. It is a grizzly sight. Everyone is in pain. I hear about tragedies from every corner of the nation. I see what lies beneath the mask of the federal Hydra, and it is beyond the pale. Sometimes, I feel like I need to bathe in holy water after a day’s work.

It is truly horrific to bear witness to the machinations of the beast system as it manifests itself upon God’s kingdom, and savages the greatest country the world has ever known. Watching it slowly snuff the life out of the American dream, as every American value is demeaned and debauched upon unimaginable lengths is gutwrenching. The darkness has enveloped us. The avalanche of tyranny has descended upon us.

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They’ll Find the Money

Lawmakers will come up with enough dough to settle this temporary matter.

Somewhere.

There is a $460 Million unexpected shortfall in the Michigan Budget.  The Free Press reports:

The budget gap is the combined result of a revenue shortfall of about $330 million for the 2016 and 2017 fiscal years, plus higher Medicaid caseloads that are expected to cost the state about $130 million more than estimated, Budget Director John Roberts told journalists after the conference at the Capitol.

The added strain comes as the Legislature is already grappling with tens of millions of dollars in extra spending requests related to the Flint drinking water crisis and a major financial rescue that’s proposed for the Detroit Public Schools.

Oh yeah..

The Detroit Public Schools.

Gee, we never saw that coming.

 

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If we can convince you that smoking is good and get you to eat for breakfast what we want you to, then we can definitely get you to support this.

Take a good look at the picture below.

Edward Bernays Image

He’s going to factor heavily in this post (and more importantly, what YOU can do to protect your pocketbook).

{Continued below the fold}

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Save The Children!

Are Bailouts The Right Answer for DPS?

school-926213(Reposted from JasonGillman.Com)

The Michigan House just voted to give the Detroit Public Schools a $500 million bailout and the State Senate wants to give $800 million.

104th State Representative and incumbent Larry Inman explains it away as a necessary evil. He suggested on the Ron Jolly radio program Wednesday morning, that lawyers warned house leadership that if they didn’t do something, the courts would take over, and it could be far worse. He referenced the Michigan constitution, and its requirement on the legislature to provide funding for the schools.

My guess is that he did not ask the question of the attorneys advising the house “what might happen if every school district subjected the taxpayers to the same challenge?”

YES, the state is supposed to provide an education. The legislature is supposed to “maintain and support a system of elementary and secondary schools.. ” In fact, From the state constitution:

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Executive Mayhem in Oakland County: Theresa Antionette Gives Second Helping of Cake After Delegate Slaughter

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Yesterday, the Oakland County GOP Executive Committee (EC) met for the first time since the delegate allocation count was slaughtered by the arbitrary dictate of Chairwoman Theresa Mungioli. This meant that 503 spots were cut for the August 2016 election, and now hundreds of engaged delegates are going to be disenfranchised during an important Presidential election year. The people who will be tasked with ensuring Republican victory in November have been effectively slapped in the face.

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