A story from the AP. Not good news for us, but at least the Mariner's can't use that pesky bond argument to get out of paying for that stadium again!

This, in my opinion, is the first of many unforseen consequences of 695. Hopefully there will be some good ones too, but this is what happens when legislation is passed that, regardless of its good intentions, isn't very well thought out.

**************************************** Bond-rating firm warns of I-695 impacts

SEATTLE (AP) -- A "negative outlook" has been placed on the credit of two Western Washington cities by a major bond-rating firm, which also has warned that bonds of dozens of other communities could become risky because of Initiative 695.

The action by Moody's Investment Service of New York could mean higher borrowing costs for local governments.

King County officials say they may have already felt that effect.

About 10 days before last Tuesday's election, the county sold about $61 million in bonds to expand its sewage treatment system. The interest rate on the bonds was about three-tenths of a percentage point higher than normal, said Pat Steel, county budget director.

That increase will cost the county several million dollars in extra interest over the 35-year life of the bonds, Steel said.

"We attribute at least some of it to bond market nervousness about 695," Steel said. "We know the rating houses are watching us very carefully."

The initiative, passed overwhelmingly by voters, replaces the state motor vehicle excise tax with a flat $30 fee for annual license tabs. The tax is a major source of revenue for local governments.

Investors are now uncertain about how local governments are going to pay off bonds that finance roads, sewer, water and other construction projects, state and local officials said.

The initiative also requires voter approval of tax and fee increases, including those used to pay bond debt.

Moody's raised those concerns in an analysis three days after the election. The other major bond-rating firm, Standard & Poor's, also is monitoring Washington carefully, but has taken no action, said state Treasurer Michael Murphy.

Moody's listed 59 Washington cities and six counties as "high risk" because they receive 15 percent or more of their revenue from the excise tax. None, however, have bonds currently rated by Moody's. The state has 277 municipalities and 39 counties.

Of the high-risk communities, Moody's has so far only put a "negative outlook" warning on Des Moines and University Place. The move warns of possible increased risks, but stops short of lowering a credit rating, which would mean even higher borrowing costs.

"It sort of adds insult to injury," said Bob Jean, city manager of University Place, which will lose about 30 percent of its budget under I-695.

Analysts at Moody's described the analysis as a "heads up" for investors.

"It's going to be challenging for these communities to address these revenue (losses)," said Raymond Murphy, a Moody's vice president. "What will happen in the future depends on what the state will do."

The state's credit rating, meanwhile, remains strong and unaffected by I-695, Moody's said. Analysts said they expect most local governments will find ways to offset I-695 losses, and that the Legislature will eventually bail out the hardest-hit local communities.

Gov. Gary Locke has proposed using as much as half the state's $1 billion surplus to help local governments and transit.

-- Jeff Running (jeff@djc.com), November 10, 1999

Answers

Yeah, I thought about it. And I thought, "Not to worry... with all those hundreds of thousands of people who opposed 695 voluntarily paying their old MVET rate for their tabs, the financial impact won't be nearly as bad as the anti side portrayed."

Of course, if government comes to the peopl,e with a request for bonding increases BEFORE they get the bonds... then how low will the rating be?

Westin

Who knows that through their actions, the vast majority of those voting to oppose 695 will hypocritically pay the $30 like everyone else... as if we could logically expect their alleged character to extend to their wallets.

-- Westin (86se4sp@my-deja.com), November 10, 1999.

Well, those bond analysts are aware of the language of the bill, so I'm sure they've already considered this in setting the bond rating. But obviously this doesn't concern you much. Once again, those that back 695 show me the depth of their understanding of the issues they've come to champion.

And as far as voluntarily paying full rate on the car tabs, all that tells me is that you want someone else to pay for your roads for you, which seems to be the real heart of 695, rather than the power to the people mantra I keep hearing.

Sounds pretty "liberal" to me, Westin. Thought all you hard core 695ers were the conservative type.

-- Jeff Running (jeff@djc.com), November 10, 1999.

You left out the part where it said those two cities weren't selling any bonds anyway.

"But obviously this doesn't concern you much. Once again, those that back 695 show me the depth of their understanding of the issues they've come to champion." Liberals forever forfeited any ability that they had to claim moral superiority over ANYONE when they excused the First Delinquent for DOING what they were willing to lynch Clarence Thompson for allegedly TALKING ABOUT.

So let's be honest. You and others like you are willing to excuse the high price, inefficiencies, and intrusiveness of big government because you philosophically believe this is an acceptable price to pay for economic levelling as a steppingstone to Socialism. We (I and people like me) want a leaner government, that does less, but does it more efficiently. We are willing to accept the fact that this will cause temporary pain, as the perverse subsidies derived from excessive government are squeezed from the system. But if you hope to make us feel BAD about that, you're pumping at a dry well. If it were within my power to do so, I'd deny another 15% of revenue to government simply to force the downsizing. If individuals get hurt in the process the blame lies with you and those like you who have lured people into making decisions based on the perverse incentives of government subsidies, for the purpose of justifying bigger and better government.

-- Mark Stilson (mark842@hotmail.com), November 10, 1999.

Oh, and as far as Clinton vs. Thomas goes, at least Clinton picked a willing conspirator. But that's one of those little details that gets overlooked sometimes, I guess.

Of course, that doesn't make Clinton any less of a dog than he is. But we all know that if it had been a republican that got busted, the republicans would come to his or her defence and the dems would be calling for his head. Partisanship at it's best, mirrored in this message board!

-- Jeff Running (jeff@djc.com), November 10, 1999.

Dang, Marky Mark Stilson. Hittin' em with the philosophical angle. Couldn't have said it better myself.

-- Paul Oss (jnaut@earthlink.net), November 10, 1999.

Yeah- an intern a couple of years older than his daughter. Clarence Thomas didn't DO anything, and is only ACCUSED of making risque comments to a Yale graduate lawyer and fairly senior civil service individual who waited a decade to ACCUSE him of talking dirty. REAL comparable situations, that. And you accuse US of partisanship? But the point is that NOTHING that you say now will ever make us feel guilty again, because we know it's all hypocrisy and guerilla theater. You lack the capacity to take a MORAL stand. That being the case, yeah, it's going to be political philosophy against political philosophy, without listening to or being influenced by your false moralizing. And, as this initiative shows, there's more of us than there are of you. Enjoy the post impeachment political world. It's gonna get tougher.

-- Mark Stilson (mark842@hotmail.com), November 10, 1999.

Running Dog-

You now start to understand the price of lost credibility. Your greatest successes came from making your opponents feel guilty. You've lost that now, and the results of that will be worse than your worst nightmare.

-- (zowie@hotmail.com), November 10, 1999.

Wow! Guess I riled up the troops. To be fair, I posted a comment before that Clinton thing that for some reason didn't make it on the board. What that said was this, more or less:

"People like you" ... what do you know about me? All you know is that I oppose 695. That's it. I'm a liberal Clinton lover just because I'm against 695? Tell me this: is it possible, do you think, just possible, that someone can be against big government AND against 695, simply because they think it's bad legislation? Apparantly not, from the attitude of some of the more die-hard 695ers out there.

As far as the bond rating goes, if you really don't think that's something to worry about ... I'm not sure what to say. Let's see what happens next time the city wants to build something. Of course, that might be a good thing in some people's minds, so what the hell. Throw a monkey wrench in things, step back and see what happens.

This isn't about "making my opponents feel guilty" either. I don't really feel like I'm anyone's opponent on this for one, and I'm not crying foul and championing the plight of the welfare mother bus rider. I simply think it makes bad economic sense to risk the gains we've made as of late to make a point. Good times won't last forever, and risking not only the buffer we've accumulated to cover this gap, but also our credit rating makes me wonder what will happen if in five years to this area the economy takes a downturn. Maybe things'll be fine, maybe not. My point is that no one knows, and this bill set some things in motion that throw economic caution to the wind.

So cross your fingers everyone. I hope it works and we all pay less taxes and things miraculously start running more smoothly in Olympia. I really do. But it will definitely take some luck.

-- Doggedly Running (jeff@djc.com), November 10, 1999.

Good for you, Mark S., I second that! You tell'em! As we speak, the utility company informs us they are getting a rate increase, the rent's going up, groceries are going through the roof, gasoline is 10 cents higher in Olympia than in Tacoma (why is that?), the cable bill increased, the phone company is tacking on charges for who knows what...and on it goes! When does it stop, or even slow down? There was no increase in most people's wages so the average household has to constantly "downsize" and prioritize spending, so why can't the government do the same thing? Instead they expect an unlimited bank account. We can't pay anymore so let's decide what can be given up and get on with it.

-- sw (ware99@wa.freei.net), November 10, 1999.

Jeff

You ask,"Subject: Did you think about this when you voted?"

No. I thought about controlling government spending, since the pols don't seem able to.

Also, I thought about the $1300 it will save me next year.

Ed - now thinking about the UW-UCLA game this weekend

-- Ed (ed_bridges@yahoo.com), November 11, 1999.