Second tranche of $3M in general obligation bonds goes the way of the first tranche

November 2022 Truth or Consequences voters approved the issuance of $3 million in general obligation bonds, $2 million for the water and wastewater systems and $1 million for streets.

The Chamber of Commerce led the successful campaign that resulted in an 80-percent passage rate. It was a low-information campaign. It failed to inform citizens that their property taxes would more than double or that such an obligation means the city may raise taxes with no cap in order to pay off the debt. In fact, a general obligation debt allows the governmental entity to tap gross receipts tax, utility funds or any other source to pay off the debt, increasing GRT and utility fees if desired or necessary.

I wrote several articles on the G.O. bond proposal that pointed this out. I also pointed out how vague the ballot language was and how it would allow the city to spend the money on any water, wastewater or streets project, including a bridge across the river and expanding water and wastewater across the river, if the city commission so desired. I suggested that voters might want to insist the language be tightened up so that projects and accompanying plans were specified, controlling the spending.

Since the measure was passed, there has been no follow up report by city staff or their city-hired financial consultants, Mark Valenzuela of Bosque Advisors and Chris Muirhead of Modrall Sperling.

At the April 24 meeting, Muirhead said the city issued a first tranche of $790,000 in “2023,” of which $520,000 was to be spent on water and wastewater and $270,000 on streets. This second tranche would be divvied the same and in the same amount, Muirhead said. Like the first, the second bond issue would be sold to New Mexico Finance Authority, which gives a good interest rate, Muirhead said.

Muirhead, for the first time, informed the city commission April 24 that the city has four years to issue all $3 million in bonds. I guess we can expect two more similar sized tranches in 2025 and 2026.

Muirhead said the “financing” part of the ordinance is blank, without explaining why interest rate, life of the bond, maturity date, professional fees, administration fees, issuance fees and other charges were not included now and when that information might be reported, if ever.

How can the city commission and public evaluate this bond issuance without knowing what the money will be used for, without engineering plans attached, without financing information and without a recap of how the first tranche was used? They can’t.

These obvious omissions in reporting by city-hired experts and city staff must be at the T or C city commission’s behest given the frequency of scant information. Keeping the public ignorant is the goal. The city commission’s brand of performative governance seems to satisfy the people, given the lack of complaint during public comment and the evident willingness to pay ever-increasing taxes and utility fees.

The city was only asked to approve the “publication” of the bond-issue ordinance April 24 and they did, unanimously, with zero discussion or questions. Publication consists of a legal ad in the Sentinel stating the barest essentials about the bond issue. Anyone may speak for three minutes at the city commission meeting on May 7, when the city commission will hold a public hearing on the ordinance.

I didn’t do the usual Inspection of Public Records Act request to find out how the first tranche was used. I want this article to be an example of why IPRAs are necessary to give the reader basic information on their city.

Recently previous-City Commissioner Shelly Harrelson went to the mic to complain about the excessive IPRAs the city clerks have to fulfill, naming the top four, with me among them. Harrelson seemed to be unaware that the city and all government agencies must fulfill record requests by law, since we are a democratic republic governed by the rule of law and not by autocrats.

Harrelson regularly complained about my articles during her nearly four-year tenure and praised the Sentinel’s as being “factual” and “truthful.” She never gave specifics, never fact-checked me or asked for a correction. And she never answered my questions sent via her government email account that gave her the opportunity to give her account before the article came out.

Harrelson is typical of the autocratic, no-questions-asked-or-answered kind of leadership in T or C. None of the city commissioners have answered my emails on substantive issues and questions I have put to them over the last five years. The city commissions I covered from 2006 to 2013 for the Herald were nearly as bad.

I agree that the city clerks are burdened by too many IPRAs, but the city commission could greatly alleviate that load by requiring regular written and oral reports from city department heads, city-hired experts, engineers, architects and other professionals. The people pay dearly for this information and should be privy to it. This G.O. bond is the perfect example of lack of reporting, lack of transparency and lack of democratic leadership.