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Explore Board Borrowing The Buffalo News April 03, 2007 11:39BY: THE BUFFALO NEWS Something fishy is going on in Erie County government. Leaders of the county control board have announced that they can save taxpayers $4.1 million over 13 years — and the response from the county executive and country comptroller is to fold their arms and say: “Prove it.” Here’s a question: Shouldn’t these officials be interested enough in the prospects of saving millions of dollars to rouse themselves out of their snit and check it out themselves? They’re elected countywide and sworn to serve the interests of all county residents, after all. County Comptroller Mark C. Poloncarz and County Executive Joel A. Giambra, a former Buffalo city comptroller, claim financial expertise. Giambra certainly believed he had that when he pushed for the sale of the Erie County Medical Center to a public benefit corporation for $105 million in 2004, leaving the hospital with $18 million in pension and retiree insurance liabilities, county worker contracts and a promise of subsidies now compromised by county budget woes. And Poloncarz’s duties, although they don’t specifically include either recommending or passing on such a borrowing request, are to monitor county finances to benefit the public. So what’s going on? Not only should these guys be able to figure this out for themselves, they should have been the ones suggesting it to the control board. Certainly, the control board was put in place to do an important job (hint: It had something to do with elected officials failing to do theirs), but Giambra and Poloncarz were elected to serve the public and, unlike members of the control board, they’re being paid to do it. Shouldn’t a credible offer to save millions of dollars be enough incentive to get them to respond constructively? The issue here is repayment of county borrowing. Because the control board has a vastly higher credit rating than the county — whose rating is the lowest of any large county in the United States — it can refinance existing debts or incur new ones, on behalf of the county, at a lower interest rate. Hence the savings. County officials claim those savings would be offset by more years of funding the control board, which would have to stay in existence for the length of the loan. But if the county is managed back to the long-term structural stability it needs, the board wouldn’t have to remain “hard” and spending could be minimal. Poloncarz, who indicates he’s not definitely against control board borrowing but wants to see its estimates, also says his number-crunching shows the savings wouldn’t quite meet state guidelines for refinancing of bonds, which can be done only once. Financial experts agree that control board borrowing is a tool that could save money, although Wall Street would consider control board oversight more important than the limited savings. Control board members, including Chairman Anthony J. Baynes, say the real issue is resentment of the control board itself. Neither Poloncarz nor Giambra wants anything to do with giving it credibility or longevity, they say, and taxpayers be damned. It’s certainly plausible. Poloncarz is interested in becoming county executive and Giambra’s nose has been out of joint since the control board was formed. Both are understandable reasons for them to dislike the board. But they still need to be responsible. << back to: Op-Ed |




