The Mayor’s discrimination against the three elected women now serving on the commission is evident, but my previous article only alluded to the heart of the matter which will directly affect the taxpayers of Blount County. Mayor Ed Mitchell appears to be working to stack the deck against fixed rate financing in the future.
As I mentioned previously, Mitchell did not want fixed rate financing on the Series E-3-B debt. The recently refinanced loan contained balloon indebtedness; where the principal payments were delayed until the end of the loan. Paying only the interest freed up more money to waste the past 13 years, while kicking the can down the road. It’s a generational curse, a morally reprehensible sin and it’s shameful to place this kind of large unstable debt burden on future generations.
Before the economic meltdown in 2008, few people understood the risks involved with variable-rate-demand-obligation financing. It’s still a complicated subject that few understand. However, what isn’t hard to understand is that paying on debt for 13 years without paying a single penny on principal doesn’t make sense. One man said to me, “It’s stupid.”
The good people of Blount County have been telling their commissioners that it is time to pay principal and live within a frugal budget instead of raising taxes. The commission rose to the challenge in November securing fixed rate financing for the Series E-3-B debt. Control of the commission got away from the Mayor.
The commission will be faced with refinancing a much larger amount of debt in 2016, about $79.8 million, because the county still has 37.5% of it’s debt in variable rate financing. With Mitchell nominating his friend to the Budget Committee, he may have a second vote to stop common sense fixed rate financing on this debt. Sharon Hannum is Mitchell’s friend to whom he gave an award earlier this year; creating a politically convenient conflict of interest. Hannum won’t be voting on her own salary and benefits, but being given awards and being highly praised in public is usually persuasive in getting what one wants from someone. It appears to be a smart move on his part but its a bad move for the taxpayers.
Commissioner Mike Lewis is on the Budget Committee. He is the commissioner who made the motion to seek common sense fixed rate financing on the Series E-3-B debt. He voted yes to send it on from the Budget Committee without any hesitation. However, at the November Commission meeting, he appeared to waffle, trying to kill it at the last minute. He made a motion to look at keeping the debt in variable rate financing. Thankfully the motion failed.
With Mitchell against common sense fixed rate financing, his friend whom he regularly flatters with an award and public praise, and Commission Lewis who waffled, that may be all that Mitchell needs to stop fixed rate financing when the next series of debt refinancing comes before the commission.
The other two commissioners on the Budget Committee are Commissioners Jerome Moon and Tom Cole. Moon will go which ever way the political wind blows. Look at his voting record for ample evidence of that. Commissioner Cole voted no on Commissioner Lewis’ original motion to seek fixed rate financing. He did vote for it when it came before the commission after receiving approval from the state comptrollers office. There doesn’t appear to be anyone on the Budget Committee who will fight for the people.
Thus, if Mitchell gets his way, he may have the deck stacked on the Budget Committee; putting an end to fixed rate financing in the future. The taxpayers need to be aware. That’s why I sounded the alarm on Mayor Mitchell’s nomination. The discrimination against the women now serving on the commission is not good, but what is being done against the best interest of the Blount County taxpayers in the future is even worse.