Some questions on COP's and finances

Certificates Of Participation (COP's) are a financing mechanism used by our metro district. Why COP's? I have been told by very knowledgeable insiders in the metro district circles it is because the district feels a need to have cash available in case something comes along and they cannot risk a vote of the people. So, the district, through their financing arm which are the same people as the board, has "borrowed" $24,660,000 by way of COP's - and only on the vote of 5 board members.

As of the end of August, the district had $27,260,283 cash available - in large part because of this borrowing. And part of that is over $7,500,000 - in the GENERAL fund - which means this came primarily from the 19 mills supposedly needed for operations and maintenance.

But why do we REALLY need $27,000,000 in the bank and what does that cost?

Well, the issuance cost for the 2009 COP's (what it cost to borrow the money - sort of like your mortgage loan origination fees and closing costs), totaled $489,000 - (if I read the financials correctly, that is ONLY for the most recent 2009 COP's). The interest costs an additional $6,500 per month.

That seems like a heck of a lot of money to put it in the bank with no specifics of a plan ora budget of what we will spend that much money on. Sort of like taking out a mortgage, borrowing the money, putting it in the bank, paying interest, and THEN saying "Honey, let's go look at houses"!

Or ..... as some "people in the know" have stated, the district needs to have as much debt as possible so in the event that the citizens try to dissolve the district, the debt structure will be so difficult and the amount so onerous that it will be impossible to come up with a dissolution plan.

But regardless of speculation, there are some questions we DESERVE an answer to:

1. If there is $7,500,000 in the general fund and almost $2,000,000 in the debt service fund, and it will only cost $6.7 million to completely pay off the series C bonds, and thereby reducing every ones overall tax bill by 10% - that is if you pay $5,000/year for your property taxes, this would save you $500 - why is this not happening?

2. What plan is in place that will require $27,000,000 this year? And why have we been paying interest on this borrowed money for about 6 months?

3. Regardless of whether there is a NEED to ask for voter approval for a $27,000,000 tax increase instead of a loophole, is it not in the best interest of the community to ASK for this?

4. And by the way, if the city can have financials at its meetings that include copies of every invoice, including the line item bills from their attorney, why can't we get that information from the district (Please).

We all support our community and want to do what is best. But let's have a dialog and consensus.