Purse Rose
by admin on Sunday, July 4th, 2010 | Comments Off
Purse Rose
California's Latest Deadbeat Property Owner: The City of Stockton (Reason Magazine - Hit and Run)
How broke is California's 13th largest city? This broke: It's about to get its
city hall repossessed. Some pertinent details from _The Record_ in Stockton:
> City government never moved into the building, which it bought in 2007 by
issuing $40.7 million in bonds. [...]
>
> City officials had hoped to trade in their historic clunker at 425 N. El
Dorado St., fill several floors of the WaMu building with all staffers from
the old City Hall and from the adjacent city permit center and save around
$250,000 a year.
>
> But the crash dried up the $1.5 million in moving money.
>
> Facing a $15 million shortfall this fiscal year, the council voted Feb. 28
to default on several lease-revenue bonds. [...]
>
> The city hoped to pay for the building with lease revenue. But the building
is only 41 percent occupied. [...]
>
> Simultaneously, variable interest rates on the bonds, initially low, rose
dramatically. The city projects the building will lose $3 million in fiscal
2012-13.
>
> As if that weren't enough, the building's value has nosedived far below the
$35 million purchase price, which the city paid at the peak of the boom.
_Reason_ has ...
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