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By BOB NORBERG
THE PRESS DEMOCRAT
Construction bonds sold by the Sonoma-Marin Area Rail Transit District, which will pay for more than half of the cost to build the system, are being converted to fixed interest rates.
The rail agency initially sold $190 million in bonds at a variable interest rate of about 1 percent. The money was put in escrow during an unsuccessful bid by SMART opponents to qualify a measure for the November ballot to repeal the quarter-cent sales tax that funds much of the district.
The rail agency is now free to use money from the bonds, which will be converted to a fixed rate of between 4.3 and 4.5 percent through their maturity in 2029.
The yield is expected to be $171 million after expenses.
The SMART board approved the conversion on Wednesday at its meeting in Santa Rosa.
“For planning purposes, it is advisable to fix the interest rate so you know the cost structure going forward,” said Sarah Hollenbeck, senior managing consultant with Public Financial Management Inc., the firm handling the bond sale.
The bond sale provides almost half of the $360 million needed by SMART to build the first segment of the rail line. The remaining money for the segment would come from local, state and federal funds.
SMART is planning to build the initial line from Guerneville Road in Santa Rosa to downtown San Rafael, with service to begin in late 2015 or early 2016.
The line is 38.5 miles, which is shorter than the 70-mile line that was proposed to run from Cloverdale to Larkspur. It will be extended as more money becomes available.
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This is just a money pit to allow friends and schemers to have a laundering venue! Typical of the leftist job killers that have brought this state to its knees.
Follower:
after a long day, I’m gonna go down to City Council and look after our freedoms.
You can ‘follow’ me down there, not too many show up. Some I know are afraid they’ll be as vindictive with them as they have me.
I was a Smart volunteer, didn’t have time to get as many signitures as I’d like, that work thing cuts up the whole day.
Other than blog three sites, write letters, hold meetings, hand out fliers,
break out the bull horn on occasion, speak the truth, educate others, put our public officials on notice, attend meetings, spearhead an effort to get our ICLEI membership on the agenda, etc..
With two business’, that’s all I have time for.
This train is just an excuse to implement OneBayArea.
Other than start a petition, put the public officials on legal notice, or run for council…OK, maybe I’ll do that too.
That’s all I can think of, but I’m open for suggestions or HELP.
The closely gaurded truth is our treasonous ICLEI membership.
I’m not a sheep, I’m a sheep dog.
It’s not a good time to follow along.
@Jim Bennett
That’s a nice bedtime story but the reality is that the sheeple voted for this, the sheeple refused to support the repeal, the sheeple will vote to increase taxes (on the other guy) to pay for the inevitable increased costs and the sheeple will re-elect every one of the scum responsible for this mess.
Over & over again.
…sorry about your bubble.
“California is ungovernable” Dianne Feinstein
Now & then a politician in a moment of weakness (or stupidity) reveals the closely guarded truth.
“This is my last election. And after my election, I have more flexibility.” Barack Obama
Smart will ‘crash’ without ever hitting a hard object.
Hopefully some political careers will too.
If they can’t identify a wrong and stand up for the People’s interest
(punn intended), what good are they?
We will remember.
I think I have come to understand SMART by comparing it to a scene in the movie “Fame.” The people of Sonoma County are playing the role of Coco Hernandez (Irene Cara). The Press Democrat and the SMART board are playing the role of the sleazy director.
You may remember the scene where Coco is approached by a supposed director who tells her he wants to cast her in a film he is making in the south of France and wants her to come in for a screen test.
But when she shows up ready to be a star it becomes apparent that the director is just a low rent pornographer. You can see the realization on her face. And when he asks her to take off her blouse she knows for sure her dreams are shattered. You see this clearly on screen. Everyone feels what she does. The disappointment and crushing of hopes.
But the director ridicules her when she hesitates and says he thought she was a professional not some dumb kid.
That works. In spite of the realization. There is that glimmer of hope and dream that is enough to make her take off her blouse as tears come down her cheek.
The people of Sonoma County are taking off their blouse for the sleazy director. The ridicule from the Press Democrat and the SMART board and their politically correct friends is enough to cause them to abandon all reason and evidence.
Oh, yeah. Yeah. Could you arch your back?
Arch your back a little, Coco. Smile for me, Coco. Come on, Coco. Smile, smile.
We’re not just losing our dignity as Coco did. We’re going to lose billions and have a perpetual tax burden.
Keep your shirt on Sonoma County. Let’s set about getting this SMART business repealed. It’s obvious what’s going on and why. No need to wait for the movie.
Let me remind everyone how incompetent the entire Bay Area governmental bodies are. Not just incompetent but corrupt, sleazy, good-for-nothing.
What happened to the Bay Bridge replacement that was literally millions? Where is the money for that? I tried to google it and it doesn’t EXIST anymore. The only thing that will be done….in 2013 is the Eastern Span Replacemnt!!! That is it.
That was zillions of dollars? The old Oakland Bay Bridge will continue to stand, and it’s not in good condition.
Further, according to a REAL NEWSPAPER, the Sacto Bee & the SJ Mercury News (which reported on the Bee’s story) where is the money, and it’s NOT EVEN SAFE!!!
http://www.sacbee.com/2012/03/25/4364084/panel-that-reviewed-by-bridge.html
This is what we’re looking at. The incompetence, political correctness, the cheap crap, it never ends. The Dems in power are doing this to us, and what do Bay Areans do? Well they continue to vote for the D’s each and every time. They think they’re so smart, they have their degrees and their leftist rhetoric down, and their slogans.
Yet when questioned about corruption and safety, they are at a loss for words, or worse, they DEFEND the indefensible.
I am pleading with my fellow Sonoma County brethren to wake up and smell the coffee. Voting for the D’s is endangering our lives, really.
Read this article.
http://www.sacbee.com/2012/03/25/4364084/panel-that-reviewed-by-bridge.html
Hey folks, remember the most expensive public transportation system ever built in the U.S., the Big Dig in Boston, Mass. SMART has many similarities to that project. It was plagued by excalating costs, scheduling overruns, design flaws, and poor build out.
It was scheduled to be completed by 1998 but was completed in December, 2007. It’s projected costs were $2.8 billion, but it cost $14.6 billion and the debt is still being paid.
All of this sound familiar? SMART is on the same track. Has the Big Dig mitigated traffic congestion? No, traffic is worst that before.
The Big Dig pedestrian and bicycle paths were not funded in the Big Dig because of the massive cost overruns.
SMART, the train to nowhere, is on the same track to disaster and has been from the beginning.
History repeating itself right here in Sonoma and Marin Counties.
RE: Cotati station neighbor – “The people have spoken. there is a train coming to town.”
The SMART sign along highway 101 states that a train is coming to town. It doesn’t actually say how many stops for your town, or that it will even stop at your town. Sure seems like a lot of money to spend for a commuter train that doesn’t make very many stops for the commuters. Maybe SMART is acknowledging that with the true projected ridership, not many stops are needed. Guess they should just have a ‘start’ and an ‘end’ stop, since nothing will really be needed in the middle. Will make it easy to stay on schedule too. Kudos to SMART for covertly acknowledging it.
@Cotati Station Neighbor
Let me say it first so we get it over with, and don’t have to wait a few years down the road until it become apparent to everyone – except for the people who will make huge salaries and pensions off this very unfunny boondoggle – what a huge mistake this San Rafael Local for the Yokels is: “I told you so!”
@Cotati Station Neighbor-
Using your own rationale, I guess it’s a good thing that SMART didn’t just roll it up and “get over it” after the tax measures failed the first two times, huh? Progressive zealots who finally figured out that if you manipulated the district, distorted the facts, promised more than the system will ever deliver, and repeatedly bludgeoned the voters into submission until they got sick of hearing about the whole thing…again and again, they would get with their program. The best thing about SMART is that it’s going to incinerate all on its own. It’s just too bad that it’ll be such a costly lesson in abysmal failure. No matter though- when SMART comes back to the voters with another sales tax measure in 2016 that will be necessary in order to complete(maybe) what was promised the first time, the outcome will reflect a much more savvy voting base who realizes that their money was squandered and that they’ve been duped into paying for something they never needed, nor ever will. In the meantime, enjoy the transit gulag you live in.
I wonder if this was a good idea.
Let’s see, convert variable bonds that cost us 1% for fixed ones that cost us 4.3% to 4.5%?
I bet it went something like this, Hey Shirley and Deb, come in my office quick like, I’m working on math and out of fingers. Here Farhad use our toes, we got 11 each. Ok now subtract the 9 from the 5 and carry the 1. Oh damn it just sell the bonds.
How about it Press Democrat? Assign a reporter to consult with an actuary and accurately report exactly what the true cost to build and operate SMART will be?
Since there is not a single LRT or commuter rail project in the USA that came in on budget, we can at least double the estimates SMART is presently claiming. At least double, probably much more.
Where is the reporter telling us the facts about how long it will take and how many people could actually use it to commute? Let’s tell the story of a person taking the completed SMART train commuting from Cloverdale to a job in Union Square in San Francisco, say the Bank of America right at the cablecar turnaround on Powell St. How long would it take? How much would it cost?
Where is that story? We may as well be reading stories from 1975 telling us we’d have moving sidewalks and flying cars and eating all our meals in pill form.
The Press Democrat’s reporting on SMART is a complete disservice to the community. For the most part, the Press Democrat has regurgitated SMART propaganda uncritically. That’s wrong. Is there no journalism left in the Press Democrat talent pool?
If I’m wrong on any of this, proper journalism can convince me. What we’ve got so far is unconscionable. Why does the managing editor allow this to continue? Is there some other billion dollar public expense that needs proper scrutiny?
You’ve all dropped the ball on the biggest story in Sonoma County history so far. And for what? Political correctness? How about a pinch of healthy skepticism for a change in regards to SMART?
get over it graeme. The people have spoken. there is a train coming to town.
“The yield is expected to be $171 million after expenses.” What? please help me understand this.
SMART borrows $190 million, after upfront cost SMART get $171 million however the tax payers will pay interest on $190 million. Is that correct ?
How much do you have invested in these bonds Bob? Transparency is a good thing right?
So we issued bonds at a $20 million loss to pay for “half” the cost? Half of half a system, right? Where is the sales tax income going? Isn’t there a single reporter willing to tell the story of how much this is going to cost and how little utility it will provide and the perpetual tax burden it will be to keep operational?
We’re going to have empty stations and disused tracks. This is a disaster not a dream.