As an attorney practicing in securities law, I was both shocked and surprised to read the proposal by Mayor Diane Dixon and Finance Committee member Will O’Neill to refinance the civic center debt.
I was shocked because this proposal was vigorously debated at the City Council. The city’s financial advisors determined that this proposal would cost the taxpayers an additional $21 million versus just paying off the debt on schedule. The analysis was presented by the advisors in a March 24, 2015 Memo to the City.
I was surprised because Dixon received this Memo and knows full well that her proposal does not make financial sense.
Why would we spend taxpayer dollars on additional analysis when the answer has been thoroughly documented? As noted in the 2015 Memo, market conditions would have to move in impossible directions for Dixon’s idea to ever make sense.
As Councilman Marshall “Duffy” Duffield’s appointee on the Finance Committee, O’Neill should have researched this before supporting it.
Dixon and O’Neill seem to imply that the city should have issued callable debt in 2010, but here again, the 2015 Memo clearly documents that taking this course would have resulted in a minimum of $7.1 million more in debt service, and if Dixon’s bet goes wrong, $21.6 million more in debt service. This is a gamble we simply should not have taken with taxpayer dollars, and I am distressed to see this idea so recklessly advanced.
Coupled with Dixon’s previous support of efforts to speculate in the stock market with taxpayer dollars, it is clear that the city’s fiscal health is in danger under her leadership. It is also clearer why she was so adamant about removing Councilman Keith Curry as chairman of the Finance Committee, since he has been standing up against these initiatives.
It also appears that the call to revisit the Civic Center debt 14 months after the issue was put to rest, is nothing more than a red herring designed to derail Councilman Curry’s demand for political reform.
I call upon Mayor Dixon to support and place on the Council’s agenda the minor revision needed to make Municipal Code, Section 1.25.040, regarding campaign contribution limits, enforceable by the City Attorney. This would help level the playing field in the 2016 edition of the run of “Team Newer to Newport.”
Team Newport has accomplished nothing since taking control of our City Council, except directing taxpayer dollars to the benefit of some of their contributors. The voters cannot afford this financial recklessness and we deserve better from our elected officials.
Kristin M. Cano / Corona del Mar
