Sep 3, 2010

Could an emergency financial manager be in the future for Livingston County townships?

A pair of Livingston County townships are in deep financial trouble because they are unable to pay back bonds used for a special assessment district (SAD) to put in water and sewer infrastructure for developers.

Garry Post, a candidate for State Representative in the 47th State House District, criticized his opponent, Rep. Cindy Denby, R-Handy Township for seeking a state taxpayer bailout of Handy Township for mistakes made while Denby was Handy Township supervisor.

Post said legislation introduced with little fanfare by Denby and others seeks to bail out Handy Township for potentially millions of dollars in principal, interest, and penalties rising from bond debt incurred for SADs..

“Denby’s failure to seek a security bond or other adequate private development responsibility for this liability when she was the township supervisor has left township taxpayers holding the bag for the cost of improvements for these developments,” Post said. “She owes the public an explanation for why she did not seek any security from developers before putting taxpayers on the hook for paying back the money. Denby should not expect taxpayers statewide to bail her out for the mistakes she made as supervisor.”

Handy Township is unable to make its payments for the bonds, which were backed by Livingston County. Handy Township officials are trying to negotiate with the county to try to get some relief from the principal, interest, and penalties. One option is for the county to pay the principal on the bonds for three years while the township pays the interest, with the principal repaid by Handy Township starting in 2026. That would mean taxpayers throughout Livingston County would be helping to foot the bill for Denby’s misjudgment.

Howell Township established at least five SADs for sewer and water back in 2007, and most of the property assessed was owned by developers.

The bills introduced by Denby and others seek to create a taxpayer funded state checking account to help bail out townships like Handy that are having trouble making payments to counties for developments that have failed to be completed as expected.

Post said that he supports calling a special town hall meeting for all Livingston County residents to allow township and county officials to fully brief taxpayers on the implications of the debt problems as well as the relief being sought in the Legislature.

“It is tragic that she exercised so little foresight when she was supervisor and approved the bond deal without adequate protection for Handy Township residents,” Post said. “Livingston County residents deserve a full and impartial review of how the townships got into their debt problems with the county and what the implications are for the county, the township, and the taxpayers.”

No comments: