I’m still trying to wrap my head around what the Mecklenburg County Commission did last week. Faced with sending almost $900m. in combined city and council debt to voters in November, the commission punted. The $360m. price tag for a new county jail was carved out via a vote to use certificates of participation. Oh.
For those playing at home that is still $900m. in debt — but now one-third of it with a higher interest rate. And the county is barely admitting that. County Finance Director Dena Diorio told the Uptown paper of record that “any increase in interest rates would be ‘negligible’ – less than three-hundredths of a percent.”
Really? What assumptions are built into that conclusion? A mere 3 basis point premium for COPs over general obligation bonds sounds awfully low.
Besides, debt is debt. The only way governments can repay debt is via tax revenue. And the only place that comes from is us.
