The Voice of Modoc County
When the county leaders simply beat their collective heads against the wall for the past several years - even to the extent of continuing to allow inter-fund borrowing to keep us afloat, that is the time to say "enough is enough" and seriously consider the positives of municipal bankruptcy.As Wieckowski notes in the Stockton article, "No one knows what a garden-variety municipal bankruptcy looks like." He goes on to say about nuetral mediation that "this gets all the players in one room to put deals in place and admit that in a situation like this there are no winners, baby."This is exactly where Modoc has been for some time - unwilling to get all concerned in on what to do about this mess - to the extent of trying to keep other elected officials and the general public out of the process altogether.This taxpayer would much rather "sit down to work out deals with a neutral evaluator, most likely a retired bankruptcy judge," than continue going down this misguided, divisive, and ultimately more expensive over the long-haul process that our county leaders have been dragging us through for several years too long already.Let's get some real data such as a cost-analysis of the COPs/bonds versus municipal bankruptcy.Neither one will be inexpensive, but from all objective data available so far (i.e., the City of Vallejo's bankruptcy, which was concluded in about 3 years) we can either dig us a deeper hole and stay in it for many years longer by borrowing more money - or look to being out of this mess and looking for sunlight in less time that we've been screwing around just trying to do the past three years audits.Let's take the bankruptcy medicine if it make economic sense, and get better much sooner, rather than decades later.
9:28, You are missing the reason for the delays. Time limits for legal action against corrupt officials is running out. Nothing will be done until then. Our BOS recently confirmed by actions that they prefer secrecy, corruption and favored treatment for friends. Just listen to how Cantrall aplied different rules to her friends at public comment time at the last meeting. It was so obvious that the other supervisors should have called her on it but they went along with the favoritism.
If anyone listened to Auditor Locken this past Tuesday, it would appear that perhaps the County isn't in a position where Bankruptcy is necessary. I am however a little confused as CAO Robertson's numbers are quite different from what the Auditor presented. A few weeks ago he made mention about this compensated absences fund and that the number was near 3 million without the hospital liability. Auditor Locken stated that it was nearer 1.5 million with the hospital liability included. That is nearly half of what CAO Robertson stated previously. CAO Robertson presented a plan, though I'm not sure what he really said. What exactly are the priority's? And what exactly has been done? Has the County gone with legal council to the State to discuss the debt situation? What is the number exactly? It would appear that there might be consideration of a short term loan for roughly 3 million, which is quite a stretch from the 13 million that Supervisor Byrne posted here a couple of weeks ago. And there seems to be some discrepancies concerning the interest rate. CAO Robertson reported 12% a year ago, then 6% in the meeting the other day, however the Modoc Record reported that it was as low as 4% last fall. So why did CAO Robertson not mention that rate to the BOS?I also noticed that Health Services needed more money for their Toyota's. Did they bid that? Isn't there a policy regarding County purchasing. Is there a limit? And if that limit is exceeded don't you have to put out the specs, i.e., size, body type, etc., then it would go out to all dealers irregardless of the makes? This would include our local dealer. It is my understanding that those purchases made with public funds are to be spent responsibly. CAO Robertson and ACAO Randall chose not to question that purchase to make sure that the BOS was "informed". Is that because it was CAO Robertson's mother-in-laws department that put in for the request?That being said, there was some commotion over a promotion for an employee of the Sheriff's Office, and ACAO Randall sounded a little antagonistic towards the Sheriff, then made comment that she was just trying to keep the Board informed. "A.J" and "Sarah", from the Sheriff's office spoke up and explained the process which made sense and was presented very effectively and efficiently. This would lead me back to the Sheriff's open letter that there are problems between Admin. and Sheriff's Office. I would agree that there appears to be some problems, however the only one that was antagonistic was ACAO Randall.There were subtle differences in this meeting. Allan was more engaged, and CAO Robertson seemed somewhat scattered. He's hard to follow, and what some might call brilliance, I would be more likely to call the ramblings of a very disorganized young man.
10:22pm - Having the ability to borrow your way out of this situation, even for a short time as indicated by the latest 5 year COPS borrowing plan, does not mean that borrowing is the most fiscally responsible method we can use in dealing with the $13-$20 million dollar debt.That is why the other poster's suggestion of getting a cost/benefit analysis of municipal bankruptcy needs to be looked at seriously and soon.Until we get the best data available to compare these options rationally, we'll simply be continuing to drag out this process and, in the end, be making decisions based not on the best information we have available - but rather only on those options we have on the table.
Seriously......you think that Supervisors such as your representative Allan could possibly even come close to entertaining an action towards bankruptcy? He couldn't even give a a speech last Sunday at the "State of the Valley". He stated some nonsense about not having enough time to address the state of the County? He said that he would have to come back with Chester.....does he not have a brain of his own? If he can't give a brief speech or summary of the affairs of the County on his own, how could he possibly entertain the idea of bankruptcy? I suppose though that with Chester telling him what to do he might be fine. Lets face it folks the fate of the County lays in Chester's hands.
10:46 P.M. Your still assuming that the debt is 13-20 million. Do you know exactly what the negotiated amount is? Trinity County negotiated a "write-off" amount with the State. What has Modoc County done to pursue that same avenue? I agree that a cost analysis needs to be done, but do you know it hasn't already. The biggest problem here is that the public has little information to go on. Maybe it's 13 million, maybe it's 3 million. The county is in better fiscal health today than it was 3 years ago. Is bankruptcy still a viable option? What needs to happen is a viable plan that is realistic presented to the State. Once that plan is negotiated through the County can then move forward. The state has its own problems and in comparison, Modoc is but a tiny drop in the bucket.
7:23 AM, could you please provide a website or news article re: the Trinity County "write-off" of debt with the state?Also, could you provide data and examples of how, exactly, the county is in better financial shape today? There have been improvements (reducing high cost department employees through retirement and attrition) but the raises and benefit increases that were improperly built into the salary schedules which were paid for with illegally borrowed money over the past 15 years or so still exists. Until those employee costs are recouped, the taxpayers are still paying more for employees than it can afford. You are right regarding the state, we need to have a plan that is realistic and does not put us further into debt in an attempt to get us out of debt. That is fiscal foolhardiness. Negotiating directly with the state without the high-priced professional consultants would also be a step in the right direction, as these private contractors have too much to gain, while the state would settle for an equitable solution at much less cost and without any further taxpayer borrowing. And it's too bad the county put the kabosh on an open budget committee process involving all concerned, because without good information and ideas from all of the stakeholders, the end result will be less favorable for the taxpayers, and more favorable for the county employees and departments that did get a voice in that room from the beginning.Our employees Byrne, Allan, and Cantrall may think they know what's good for the rest of us, but that's a sure sign of hubris - which is what got us into this mess in the first place.
9:39 AM. You are correct but how do we convince the BOS to open the budget committee meetings? They have dug in their heels on this one. They even have the lawyer backing them up. I first started requesting access to those committee meetings last June. With the "new" chairperson there is little chance of a change from the total secrecy mode.
9:39 AM I disagree with your statement of "Negotiating directly with the state without the high-priced professional consultants would also be a step in the right direction" Who in the county is qualified to "negotiate" with the state. A consultant is not high priced providing they can produce in a timely manner. Having an attorney in the room on behalf of Modoc County is not negative. It only becomes negative if the County is paying that attorney and he can't deliver. Likewise for any other consultant. The current Administrative Office does not possess the qualifications necessary to negotiate. However I can guarantee that the State Controller and Attorney General have the qualifications necessary to do their jobs. Do we go to the State with two of these Board members and the CAO??? Do you really think that they have the knowledge base to even start that process? High priced consultants are sometimes a necessary evil when attempting negotiations that might mean millions to this County.
2:52 PM, Removing all professionals from the negotiating process with the state was not the idea - there are retired or non-profit professionals such as bankruptcy judges and attorneys that do not have "skin in the game" that could provide such services to our county taxpayers with less cost to us, especially regarding future borrowing costs, fees, etc.The problem now is that our local county officials are only relying on a select few insiders (past county auditor(s), past county CAO'(s), past county assessor(s), past District Attorney(s), to name a few) and leaving the other current elected officials (Auditor, Treasurer, Sheriff) and the taxpayers out of the process.
6:26 PM, I agree that leaving the current Auditor, Treasurer, Sheriff, and taxpayers is not what is most beneficial for the County. I believe that the County has a firm on retainer that has expertise in the matter, but I don't believe that they are using them. When you refer to retired professionals they (BOS) might agree with you, as that is what they are using now. None of them has a "skin in the game" per say either, and are providing those "services" to the County. I believe that Byrne posted that they were getting the "best bang for their buck" by utilizing those "professionals". Allan stated in a board meeting that former Auditor Tedrick was well respected throughout the State, and they were lucky to have him. It still comes down to whether bankruptcy is a viable option. The Auditor gave a presentation last week stating that the cash balance in the treasury is at $18 million, and that the County was in a better financial position. Bankruptcy is never a good option. If you think the economy is bad now, let the County go down. I realize that some folks out there think that it's the best option, but best for who? County employees own homes, buy insurance, fuel, groceries, support local eateries, etc. If those employees are without employment, those homes will be empty, more of Main St. will die, less kids will be enrolled, and the list goes on and on. Local vendors won't get paid, contracts won't get honored, and services will be non existent. As for those of us that are left here, our property values will hit an all time low, and what is already depressed will recede beyond recognition. If there is even the slightest chance that this County can climb out of this whether it be COPs, and/or prioritization of services then I think that might be the better alternative.
7:53. What do you mean "they don't have any skin in the game"? Those are the people that created this mess by their dishonesty and the skin they have in the game is obvious, there are things they want kept secret to avoid prosecutions. The present direction of the BOS simply perpetuates the secrecy and corruption that caused this mess. Look who they just installed as chairperson, the champion of secrecy and corruption and intimidation and "I'll blow his head off by gawd".
Bankruptcy is never a good option? What nonsense is this? If it weren't the best option in some situations, then it would never be used. Blanket statements like this are dangerous, because it keeps people from considering all of the options available.7:53pm, your doom and gloom scenario regarding bankruptcy is not based on facts at all. Just because a municipality like Modoc files for bankruptcy protection does not mean that the "county will go down." What it does mean, per the newest law regarding municipal bankruptcy in California, AB 506, is that "all involved parties, including those who hold debt in the form of bonds and employee unions whose paychecks and benefits depend on city [or county] revenue, sit down to work out deals with a neutral evaluator, most likely a retired bankruptcy judge."The city of Vallejo went through the bankruptcy process in less time than Modoc has spent already fumbling around in trying to fix its mess, and it survived and has no long term debt associated with COPs and borrowing to bog down the taxpayers and the county's recovery for the next 10-30 years.Sometimes a clean slate is needed, and for families, businesses, and municipalities bankruptcy can provide that. For Modoc, this seems to be that time. Let's at least get the data, share it with the public, and find out.
Modoc officials were fools when they started all of this illegal borrowing, and they are fools to be considering borrowing even more.
I disagree that bankruptcy is the way to go. A County is a little different than a City, if a City goes down the County assumes responsibility for those services, however a City does not assume the responsibility for a County. And this neutral retired phantom bankruptcy attorney is going to sit down with whom? Random people of off the streets? The current BOS? And what makes you think that this hero retired judge is going to have the people of this County's best interest at heart? Some are making assumptions without the facts and figures. There is very little information that state the facts one way or the other. There is a general assumption that the County has remained in limbo for the past three years. Have they? Do you know that? Have you gone to the Auditor or Treasurer and asked for the financials? Have you asked Admin. for those figures? Statements are made on this blog without regard for the hard facts. And when was the last time that bonds were mentioned? The County owes itself $13 million, in this day and age that amount is peanuts. Do you really think that it's best for the County to file bankruptcy if it costs 5 to 8 million to do so? And guess what, the County could still owe itself a big portion of that $13 million as some of it may not be forgivable. So now the County is 5 to 8 million more in debt? What is the difference? Can the County afford to just pay it back a little at a time over the next 10 years? If they can would that be a better option? Irregardless of the route, it is going to cost something, most likely monetarily and service reductions.
7:57 PM, You misunderstand municipal bankruptcy.As said before, neither the county, nor any of the public services it provides will come to a screeching halt if bankruptcy mediation begins. The poster at 10:13 AM is correct, and provides what would resonably happen should the county decide bankruptcy is in the taxpayers best interest. In part this poster noted that a "doom and gloom scenario regarding bankruptcy is not based on facts at all. Just because a municipality like Modoc files for bankruptcy protection does not mean that the "county will go down."What it does mean, per the newest law regarding municipal bankruptcy in California, AB 506, is that "all involved parties, including those who hold debt in the form of bonds and employee unions whose paychecks and benefits depend on city [or county] revenue, sit down to work out deals with a neutral evaluator, most likely a retired bankruptcy judge."The remainder of your post seems to simply be fear-mongering, and the bonds were mentioned at the last BOS meeting.One thing bankruptcy won't be is secret, because all of the cards will be on the table, not just the ones that a few county officials decide we taxpayers can see.Painful our path out will be either way, we can all agree on that - but I for one have had it with secrecy, lying by omission, and the ongoing refusal to put all of our options on the table.That is just continuing the same foolishness that got us into this mess."Truth Creates Money, Lies Destroy It" - Suze Orman
The salient point is that until all of the information is available, and all of the choices given equal considerations on their merits alone, being for or against bankruptcy (or borrowing) to bail ourselves out is ill-considered and hasty.But as we can see from the current county cronies, by their keeping some elected officials and the public at arms length and having secret budget meetings, this is the plan, and the only plan. Allowing the taxpayers to explore all of the options, having an open dialog and therefore transparent government are the casualties here. Same stuff, different decade.
I wonder if Supervisor Byrne still reads this blog? Hope so.
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