The people of California generally agree that government should not go into debt without approval of the voters. The Encinitas City Council (minus Barth) think otherwise. Some governments get around laws requiring voter approval by using very disingenuous schemes involving "lease-revenue" bonds. Here is a must read tutorial on lease-revenue bonds.
Lease revenue bonds cost more to the taxpayers and the reason our city has issued several lease-revenue bonds is obviously because they don't want to alert the public to what they are doing.
Many in town know that for years I have been pitching the idea of an initiative to require all large bonds be approved by the voters. But, do we already have protections on the books?
This week's council agenda included a recommended revision to the city's policies. Here is a link to the agenda item. Please read it for yourself. Help me understand this. Here is an excerpt:
The way I read this, it looks like the city already has a weak policy requiring a vote of the people for bonding over $4 million. The city issued $20 million dollars of lease-revenue bonds in 2001 and 2006, for a park and library (firestations, park construction were also involved). There was no vote of the people for those bonds.
Are the bonds we issued "revenue anticipation notes"? If so, what is the revenue from the library? Twenty million dollars in overdue fines ;)
I can't believe it. When you read the staff report, does it look like staff recommended that this above section of the city's policies be deleted? I must have read this wrong. Did I?
However this sucker is written, Wednesday night should end with the Council adopting a policy that requires the city get voter approval for all debt over $4 million or which extends beyond 10 years.