Such a Bad way to Finance Debt (Friendswood, TX City Council Sues Residents)

If you don’t understand the uproar in Friendswood about the city’s plan to issue $11 million in debt without voter approval, just ask yourself a couple of questions: What if city leaders are completely right about the legal question? Is it still a good idea to borrow money without asking voters for their approval? Is a good idea to obligate them when they have clearly indicated they want a say about any debt they’d be responsible for?

City officials have asked a judge in Travis County for a ruling that says the city can issue certificates of obligation to finance the debt.

Voters are used to voting on bond issues to fund public improvements. Cities across Texas increasingly are using certificates of obligation to finance debt. Bonds require voter approval. Certificates do not.

In 1997, voters in Friendswood amended their city charter to prohibit the city from issuing debt that it could not finance from its own revenue streams without voter approval. The exceptions allowed under the charter are cases of emergency or “urgent public need.”

It’s hard to see either in the city’s plans for the $11 million. The plan is to build roads, parks, an animal shelter and a records building.

The city’s position is that its right under state law overrides the citizens’ right under the charter to control debt.

Even if city officials are correct, isn’t hanging that debt on taxpayers just a slap in the face at this point? Remember, voters in Friendswood have just rejected a $9 million bond package. One of the recurring criticisms was that the proposal was too vague.

What many voters want is something remarkably simple. They want their leaders to give them a specific list of projects and reasonable estimates of their cost. Voters want their elected leaders to sell them on the idea that the expenditures are worth it. And then voters want a say, at the ballot box, in the final decision.

Asking a judge for permission to get around that traditional contract with the taxpayers isn’t good policy.

Incidentally, Friendswood isn’t the only community where this debate has erupted. Last year, Galveston’s leaders agreed to issue $19.5 million in certificates of obligation to fund water and sewer projects and a new fire station.

Water and sewer improvements are supposed to be funded with revenue bonds, which are financed with the revenues from user fees for water and sewer service — not from property taxes. Certificates of obligation, on the other hand, are backed by property taxes.

Why did Galveston officials put taxpayers on the hook for that debt? One answer is because they could.

The city council has asked a judge for a ruling on the law. They are not suing the citizens of Friendswood.

In the past the Friendswood city charter was amended in a manner that conflicts with the Texas Constitution and state law. They are asking for a clarification on that and on other points since some local folks have threatened to sue.

Using CO’s to purchase park land is nothing new. Years ago after the voters voted down the purchase of Stevenson Park Ralph “Brio Site” Lowe went ahead and bought it anyway. After the voters voted down the purchase of Centennial Park his daughter ramrodded that land purchase using CO’s.

Friendswood is a great place to live but there are nutbirds on the far right that distort facts and loony tunes tree huggers on the super far left that still think they own Friendswood because daddy was mayor. The fact is that some of the vocal people on the right have no clout and very little following. They are simply noise makers. It’s also a fact that Boss Brio’s little girls no longer have the political juice they used to and no matter how much they stomp their feet and hold their breath they no longer run Friendswood.

One thing not mentioned in this article was that after the contract to purchase the park land was signed Hurricane Ike hit. The city spent 8 million cash on Ike. The city did an incredible job after Ike. Since it had already committed to buying the park land (for a price that is not a deal, it’s a steal!) and also to other projects with the county, etc. they had to do something. These deals all take cash, cash that Friendswood would usually have on hand. FEMA still has not paid back the city millions it is owed. That put Friendswood in a cash crunch.

The people on the Friendswood City council do not usually see everything the same way. But they do on this topic and are unified. That’s a big deal. They also all now know that they must communicate much better with the citizens on an array of topics. The bottom line is that they are all good people trying to do their best. The job takes a lot of time and is unpaid.

At the end of the day there is not much to this......

No offence, but Friendswood has never been known to have particularly bright townsfolk.

Back in the day, due to its proximity to JSC, they were chock-full of dopes from Downey, Anaheim, Fullerton, Orange - essentially the rats fleeing southern CA. They bailed out of CA to infect places like Clear Lake, Seabrook, Friendswood - all over.

The parents weren’t the brightest bulbs on earth and their children were worse. That scenario could explain much of what goes on today. IMO, of course.

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