Jul 21, 2015|
Jake Haulk, President of Allegheny Institute for Public Policy talks to L. A. Tarone about the Commonwealth Financial Authority
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Automatically Generated Transcript (may not be 100% accurate)
When I searched online amongst information I found. About the commonwealth financing authority. Was from a page on the Allegheny institute for public policy. A man who world that Paige the president. All the Allegheny. Institute for public policy is on the news regular line winners now. Why are indeed what is the commonwealth financing authority. And it came true station I believe legislature and me. Governors to back. Second 2004. We want to do. Find a way I guess to channel. Limited steep plunge into it. An organization that could borrow the money against those funds. And then notice handed out to there. An exit date. Think her warning to get some money from the mandate they elicit a bunch of things situation. It's supposed to be qualified to get assistance. Directly in the original list. And then not later on this and is six more so there fourteen. Categories of programs should now get up. And they got to me commonwealth financing authority it's well and it was as an authority. I'm they had no independent source of income other then. I think it makes stub loans they get paid back against it and get that money back but the only source of these really incompetent added as the State's founding. That they get a cheer from the lender. Sure some legislation. Some legislator does grant CF AA me an amount of money every year any use is that the flow bonds and and make loans. Is correct and from our I grab some other issues grant slide and they'll never get that back. Then they would say they began operating in 2000. And by the year 2013. Point eight fire there on their annual report was put together or there audited report. And and step to want clean sheet something million now that was seen in June of 2013. I cannot find any beta. Later than that they have now policy any further information. About time how much borrowing they've done it could be more couldn't. Come may be about the same that can already. How easy it is me or. A bomb of over three quarters of a billion dollars in just sat amount of time. So I like a year well let's say to these are some like six years and they weren't that far in the red. I think the police every year handing out money that's another some loans. Split even if you look at their kid nation. At bats can be lonesome they have. Out opponents outside. It's terrible. Oh sure the amount of top. I've almost three quarters of a billion dollars of how much they borrowed so that there really. I'm calling up a bit here and they don't visible means of support or money to state legislature. Ships to them now they're getting some gaming money now my they're getting some Marcellus Shale Bryant revenues. Which is help out until. When you got that much yet. Your debt service. Over the bad here operating cost BA finish eating up most of anything which you can get a hand and it and a bigger question and that's always. Stuck in my craw. It's a these are not supposed to be able. Two armed. And dad and then count on the taxpayers. To bailout they're supposed to have their own sort of the revenue. And in this case. Have got a quote quote so disagreement. With the state tax. That this will provide eighty million dollars a year from now we're providing it in 2013. Were up 247. Million. Shots and playing just stinks and I am so this. I don't know what you do about it coming to legislature. If they wanted to fix this thing could. I haven't seen anybody offering me. Our legislation to say wait a minute this place needs to be shut down. And these bonds paid off. Now when when I hear the word authority in Pennsylvania it means a very specific staying as per the Pennsylvania municipal authorities act of 1945. It for an authority owns assets. It charges a user fee. It hand float bonds it can't incur debt but he uses its own servers these. To pay off bad debt and I think of something like transportation. Authority. But does that uses flares to collect the pay off. Debt that it may flew all the buying new buses for example. That doesn't appear to fit this at all for example you're used the word absent before AS SET. Does your mother while financing authority have any acids and all call. Well yet again that they have to push some action they had balance I may not bonds they have done. Loan since they have to. Issued some of these organizations that have applied for them. Reap double but that's not nearly enough. To offset them on a ball and they've got. Basically depending on. These states do come up with complete sheer convicted that's service payment. You're such a situation that. That's intricate the turnpike into the turnpike. It's anywhere or heard fifty million dollars an hour to the Transportation Department. And having their base turn pike counties in order to exclude office. I'd sit dissing you mention that I'm also a newspaper columnist in the nasal things standard speaker and I thought my column on line and that's exactly what I wrote about this weekend. How act 44 she should be repealed. Because it does exactly what you said it has a turnpike commission bank cannot 450 million dollars a year. And to get at 450 million dollars the other constantly raising turnpike tolls and it's it's. Heard he's an income people in this state realized. That ever again made good on the turnpike. Air subsidizing. Inefficient public transit that think they would probably scream. Now I'm looking at you war in emit the the page that you put up about the large and growing commonwealth financing authority you can find it or anybody if you want finding his son commonwealth and saw enough. Allegheny institute dot org search commonwealth financing authority known come up and you write eight specific programs is you just mentioned this when the first grades. This is in our sites program first industries program's second stage loan program. Pennsylvania venture guarantee program and and four others. I have a doubt I thought I knew a little bit about some in his stuff I never even heard of many of these programs. You speak. Of I am. Not absolute bunny and a recurrence of program. Terry but overall he hit it could be. A launch of the new program duke student there's guzzling. Item is that I really think over the kept a note if you didn't do. Well. We're losing your it would lose your call. Data has been and I got AM I met my plan was slipping down but considering how bad. And it's very complex for those big government assists and eight. So this elaborate on the content. And then look at the program DC in the mirror. People involved these same C it is true. Also that people were tortured Billick did. What I am somewhat familiar with here is that if guarantee program nasty tax incremental financing. Op program that is an on sort of tax abatement program that's been used in. Few. Instances around he. Here apparently can't coast. You can eccentric. Program. You can now. Are some money. Dues say increasing value of the product but I think I'm pretty sin I'm. Actually that's detailed photos thought right. That tax cut but this is truly a couple that anything had counted as a pretty high. It did detect them. We're losing that call Ed terribly Eminem Mary I I'm I'm getting like every other word. OK well. Let me. Do you have a number record in the land mine yes. I'm in a port yacht called and I do community here is 1800. 43700. All nine eights. 800 or treat 70. You read back and that and then I'm okay sounds done and I'll take a break right now and now we'll be back whereas speaking to Jacque house. He is our president on the Allegheny institute. About the commonwealth financing authority. And a pack up our conversation as soon as we come back at age seventeen as Monday night against Iran on W I'll get. Friday 221 and I we're back on BN news for an airline went by Jake how the op president of the Allegheny institute for public policy talking about feet. Commonwealth financing authority mr. Al Khobar gobble a basic question is does this group. Does he authority have. AEC. Eat all our chairman or something any is there a board of directors. Yes amid all of sorties. Are required to have a burden it's a Saturday chief operating officer and that is basically run. On the clock stopped and a lot of that ETC. In Harrisburg and he doesn't. I don't look at it as separate quarters anywhere. GR eight what went and the chairman is somebody from DC he and I believe yes I believe it stated in DCD. How about the board of directors we have any idea how many there are who may not far. And so I don't know they're usually. Honesty doesn't have created priority there's seven or not I'm not always my number now. I don't know if there's anybody been replaced with a new governor anyway. Because I'm told one I'm amazed somebody from option aero former chamber of commerce here and none northeastern Pennsylvania. What god is more than anybody give away and anything else is. I could go on the Commonwealth's website the portal or wanna numb and. Open DC ED. And DET. I'll open DC and. The law enforcement. You know Giuliani who's in charge your Mitt. You know I telephone number to reach Saddam pot with any questions. You can't find anything about the commonwealth financing authority anywhere in the public online records and a commonwealth of Pennsylvania and that's very disconcerting that may. It's this thing in the first place 'cause when I first read it to work and seeing. God accept bonds as. I don't know who these people so excited looking into it. And Ellen and read the bill and they created them. And I insisted things that no solid from wanted to required to. Opposed to annually. Into financial statement. Has it done and they sent out of work disk base in February of fourteen right and not published a single. Piece of financial data. Got my contact but one of my legislator friendship. And said for example this they're supposed to give these things. Tunisia there's an asset in the senate and secretary is there were ever filed all the documentation. And and and they're desperate to be published on the Pennsylvania bulletin. Southern Baptist started looking into it took them awhile but they've finally done. Found somebody that had copies of their annual report. Which had been doing since 2006. Hello from the gun was in 2013. So now they they haven't done one for fourteen yet. I don't know what you went on over there. Can charges Danny's got double murder and didn't see that. And something I rented impact I was in another surge to see if they detonated there. Report down in the crackdown runs the only thing they've posted this year is that they are coming out request for proposals. Hurt somebody to do. So this sailor and. I saw that I saw an ad because I surged this morning to see whether or not anything new would come up since you and I talked on Thursday or Friday night whether. There was anything new and I saw that and other men mad. Nothing and again you warm page on. The Allegheny institute is more information economy while house out and that's what really bothers me about this in the August is all this is some sort of shadowy organization and that is funded through some kind of means that may be enough barriers are not nefarious and then they decide what the fund among themselves and did not pop they don't know waving at. It's it's good that it's the government and its worst I mean number one this state taxpayers should not be providing the money. It paid her debt service on the bonds and this group this. Approach that it's basically. I am. The sort of lay out. I was so I got a rep told people often to turn email us news and stuff and I emerging stops and for example 8800 million a year into this thing we're gonna barred two billion. That does sound like Ponzi scheme I mean there was an entertainer you're around here who did that he sold spot on himself. Kenny is using money he taught again to pay out past investors that's what sounds like it's going. But it's it's a little less. An explosive than that but it is essentially. Asking where they're leveraging. And revenue stream tomorrow's a whole lot of money so they can handed out so all these organizations that they want a fond. Instead of finding the money in the budget to. To do to. To make these grants or loans. Directly from the state in one of its agencies and they've created this thing at a week so they can balloon the amount they can borrow. And that's just outrageous. He'll he'll ride ND DC ED has other programs with appropriated funds -- is a Ben Franklin partnership been totally CED's budget this is thirteen fourteen about 200. Thirty. 237 million dollars 78 million low will be transferred. To CF eight at covered costs right. This is so it was cold this is a whole thank. Do you do you use the word hope we don't have the money to find all the project Tunisia CD. Because we can't appropriated enough to Ichiro the taxpayer just aren't going to be. I can do that much money. So we'll go they need a million here let's say how much can borrow against that. She and create this certain that they will use this money to pay off. And it was leveraging their revenue stream is what you're doing but they're doing it in a way they really and in violation. A little and they created a thing which has. You cannot. Obligate ST taxpayers for the dad that the authority takes sound but that's exactly what they've done. Let's let's talk about outlaw that the law that dad created the commonwealth financing authority. I believe you ram it down labeled as the public authorities and claws I public organizations act of 2004. Did do anything other than create the commonwealth. Financing authority and if so what are those other things. I don't think so proud to have this is basically. That. I think it was an end content like the longest. You lose your job done under a and others can't they just amended it. To create this thing. I'm looking at the list. A matter of business loan programs that you have here in addition an intense guarantee we mentioned a few of them use an error six no one's is six new programs in addition to mr. How does the commonwealth financing authority to decide this project deserves support. This one doesn't that one we're not sure about. This one we now I mean usually there's a mission statement that is at least I mean it may be allowed gobbled the gold and at least it's something of a guide. With this organization we have no white. I've. And I think he beat me at the nail on the head that is so secretive and has operated. In the back of ECB. Had. They don't. Aren't going to publish you need financial information. Page and the stakes sagged at this point until I. Racists think about it and got this guy in the legislature asking questions. All of a sudden they publish the previous six years worth of this financial reports. On the and the Pennsylvania bulletin that I am that he thinks sensor that was a year in three months ago. Hi I'm gonna continue to hide until somebody in the legislature. Put some power active speaker. So these. You can. Unity president to pour into this senate Anderson says you know what. This is not we need to know what's going on here that needs to be. We need to Paterno would just rock didn't show on some I don't want to going on here. Now dead Italian troops mr. out that's all reason we're talking about this tonight that may be some of our rock. Listeners and callers they represented isn't state senators and say I heard them talking about this thing on the radio the other day we know anything about. You better do something about this. Well. You'd think somebody did this is and I Harrisburg. What's promising to do out to promote good government and isn't an easy one. Yeah I mean this it's dilate so many. Comfortable and good government animated it's sort of hidden. It's violating the law and it created by using state taxpayer money to plundered yet. It's. Operating can you say sort of in the shadows. And they must be a lot of people benefiting from this because it has been done away. It well see that's my my suspicion gets up about this does I was covering state government back in the ninety's when there is a big blow up about lambs walking around money out my legislative initiative grants they were technically called and you got that this guy and I will give a much you know a couple of a 100000 dollars a year to build this bridge here and. You know it doesn't amount to much money. In individual projects come when the total but it's a lot of money sounds like no wait a handout ends. Well I wouldn't. I don't know did it say the boy am is that there's certainly. The possibilities. Of political favoritism being. Applied to getting these. Grants and loans and an economy that means brisk pace and stay in not really upfront about what it is they're doing. Mexico is an up front organization they would publish. Every. Granted they make it right there who got it how much were is that I was further work that would be you be able to go online and kind of got. Give the finder important though there's online at least know they are you can do that when every commonwealth organization admitted he had to border directory you can call them. Yeah that's true right right if we can have been very involved on. And I try to get a hold this guy Dumbledore I. I AM gonna do that now that you're ninja that I'm circling his name I scribbled it down nine democratic column tomorrow and see if we can now against some clarification. The other thing that this organization and is he if it gets any public coverage in all if anybody. If if the average person sees the name the commonwealth financing authority at all it's every year. When they had Dow gaining grants that's how we got talking about it a couple of weeks ago they handed out about 35 gaming grants and was turned down a. I know a bunch of people and a bunch of organizations were put in application is my understanding used. They get something like 200 applications for funding and they fund about 35. That's how we wound up talking about this in the first place. How does the commonwealth financing authority decide what's 35 of those 200. Applications a fun I guess the answer is we have the famous I'd yeah. Rampant cloak. Hey this may say they're the ones that did the most minutes saved that community but how do we know that. That they've they've done they've kind of missing. On on these. Approach me why I know I allegation I I had a legislator. I tell me a couple of years ago they had men out based on job creation or job preservation and and boy those are two loaded terms are very otherwise one. Mean but I mean we saw a couple of what I thought were outrageous. Grandson my gaining assistance up here right now we just saw a multimillion dollar corporation medical industries get out our big. Go big. Get a chunk of the and gaining grants last year there was big money for shot glass corporation who insists her corporation. Had been here many since moving back to Germany before that there is a private organization and hazel Tenet received. It damion grant for like five or six years in you know raw hole. I mean these days isn't I'd it to me this money supposed to do public goal lead and not for some sort of shadow we job creation claims. That goes to a private organizations. Well. We did some research students for ten or twelve years ago we looked dead. I don't know dozens of these economic. And he economic development handouts or grand Sturm looked at as many jobs were promised not such insurgent and we can be easily get one that's current and that's promised to. And that was what we found. More ambitious back then I mean you don't states if you don't produce the number of jobs or close to it. Less for their money back right let Pennsylvania doesn't do that. You know it's interesting that you mention them because I guess about five years ago the legislative budget and finance committee elected the KOZ program. And while it didn't give. I had an actual total of jobs created. It said that 75%. Of the KOZ properties have produced. Zero jobs funny to me that's a really bad track record. Yeah well a big league program. In Surrey. We should be should've been helpful. Why is it like every every every other state program that gets distorted Bryant that was supposed to the east. Okay c.s were supposed to go in. Industrial sites. Stick a week playing to. It wouldn't be whatever putting money in if there was some incentive to do it. And secure supposed to try and need to distribution. For manufacturing something it hadn't. And a multiplier effect jobs so you can do to help the community yep well they redid it they were given these things to people to build these sound. So proud of places to. It's yeah I'd say that I can yeah I gonna create it there is some outrageous grants some outrageous tales he's status is is they have bats the correct term. Copyright Intel dual one. That was given to a lawyer's office and the number of jobs straight it was won the paralegal that was higher. I high flood that was outrageous and you're absolutely right that they were supposed to be. To reuse old industrial sites more than a year resolve its creation it quickly became. Pristine land I'm an industrial park a pair that was built almost in Todd that was expand and I should say. Almost entirely on the KOZ program and an expanded in the web ads there rewards Erin how they chop them down make one up. All of these distribution centers and I'll stop from Iran can't Zeke properties so. The in the entire intent of that law whiz. Twisted it well as standardized and everything else so many years yet that. What happens when good intentions but demand is so. Politicians to. Wanna see something happen and end bear. If I could fail but a lot of people who give money to politicians expect stepping back and led to make any program that's so. So distorted and it means got completely off track but that program down here in Pennsylvania I named Allegheny County. Still recite being used for that is paying out staff didn't but never intended. Like retail. And residential. It was never intended for that it was supposed to creating jobs not certain places to sell people stuff. OK I was gonna say because there was okay I'm aware of one proposal. To use a test program in Lucerne county specific players in west haseltine is about maybe six years a golf. And the project never got off the ground but that's what I was it was a combination of retail and housing. There are certain losers there are other ways to go about encouraging. Those kind of things that you do not use tax increment financing for that purpose. For an assistant. Then I think and defeating the purpose than to the way to Williams that he was supposed to generate. Good paying jobs and retail certainly isn't that involves now is some and it's time we do that just load up. The municipality. And developer would get. And he's got to depend on and attacked assessor doing some thing to get the tax mill up and then of course. It doesn't work out in this commonwealth financing authority has just stepped in and pay off the debt and it Datsyuk has had to do out here in Mount Lebanon Pennsylvania. And and it does so by taking the money is appropriated by the legislature and borrowing against it. He had said this competitors. I'm glad that I can tell you know I guess wow. That and you simply just circle. How legislators. Are well versed as I had a legislator on here recently brought that up and passing. And he's like I don't even know what daddy is so I I'm assuming that a lot of legislators are probably not do well versed on the commonwealth financing authority. Well if you went back to 2000 foreign and ask the people who were there may end now if they knew what they were voting on. Assists and most people are very important to know. They say well somebody told me it was a good idea and the governor wants this so we're gonna do it. And it just sort of slipped under. Under the radar and got created. And now it's here with almost two billion dollars in debt they can go away. It is in this is a little bit of the old newspaper writer in me but didn't doesn't the way this operates violate the sunshine along. Yes kids it's probably say it doesn't but found. Did this take it really operates is closely this thing can still not listening out. Anymore information and invest it. When nobody we have legislators there approved in budget's dead money for this thing they don't know what it is but that's not good. And when Europe for what you just said before you said the same thing I did. On this patent or request for proposals solar and that's where energy advisory. I'm modeling or something. Well they have to put those out but. Those two very few people out now that they are not. If you people in this state of Pennsylvania and agreed to Pennsylvania bulletin directly enough do you notice that I learned. And you have found it didn't look. Before I exactly yes that guy and and I look for specifically because of but conversation that started a couple of lazy on the one you and I have a last week and then that's the only reason that I even a heat even bottom as. Yeah I I don't not easy is just a hole in the way this is under such a shroud and Bob Hope back. Yeah and that's that's what bothers me more than anything else does he can find out virtually anything you want about any most all of our. Our commonwealth law offices cabinet level positions. End this thing absolutely nothing it's astounding. Yeah open and we may not even putting online it'll requires. And financial statements. And a timely manner that Scioscia all you need to know about their desire to keep this under wraps as best they can. Well I think to clean up the legislature to now. Raises an interesting question it does can come back to what when I mentioned how much in the legislature even knows about this thing. How much I mean there is you know where that is how much the how many billions of dollars in debt doesn't Abby just mention a figure a couple of minutes ago and I'm for Alan I want to one point 81 point eight billion dollars in dat. I wanna how many legislators actually know that. Probably not very many so that's a lot of money tactics seemed opinions in me and he scheme of things and actually it doesn't amount to very much but. And Pennsylvania one point eight billion dollars still gets people attention. And it so. It's my Brothers I would have happened. Somebody in the legislature and an important committee on the budget and finance committee for example start raising questions about. What they're doing over there. At least reports financial reports online enlists a board of direct boards toward the board of directors and Mack ten and Eminem. Does this basic information and some follow up analysis aware of the money gone to Girardi let out but good as they've done. Do we need to review our. Procedures for deciding who gets the money can't. And should we stop beaten by doing any more money because. And we're going to get ourselves to name. Hold and it is going to be apparent basis. Will happen if they keep borrowing money because at some point this State's going to be able to keep mean look at the State's problems now with. Attention attention for his bride pensions is a big one. Well mr. Al thank you very much again if you wedge about let's see Allegheny institute what do you guys do. So thick and I think we do we do we know a lot of work and economic development we do them. But didn't come and stuff we do education we've been a lot of education of people interested in. How old educations anyway shouldn't Pennsylvania. Then Google web site and and learned that is we don't know about public transportation. We Britain a lot of downed. I think like tax increment financing. The whole east taxi give away things. But if it lit the government doesn't function. How would probably written about it. You can learn but he India from a Mike covering of government up here. Or radio television and and the newspaper. What is the one. Tax break is seems storm produced. Some mild degree of economic growth without a lot of costs because your at least continuing to hey. The existing property taxes on. The land as it exists in many can phasing in the the improv and called on call as it's called. Yeah I think that's program I have the least problem when I mean if it's speed it's probably the best did and and sought out I'm sure there have been abuses. But it's a lot better. Then that sustained and make those defense because they just don't tell the mystery is now. Government's opponents in the league sells high end antibody is interesting just go and having any institute's web site at Allegheny institute that's ORG. We've got twenty years worth the research done. Almost every. State and local issues you can think up. Now I have vowed that home may jump right now your top story in ten IE is achievements school district though Weller turn around failing school. That's going to know so we've heard a lot about education this year especially. Will beat. Bit equity planning commission or whatever yeah that was circulating in crimes so well Bolden their arguments about you fixed. This sound pending situation for education it's been without a lot of Stanford. There's inside baseball in terms of getting. Don't think the real. Understanding of what the issue to discuss. How most people who talked about that they don't want to propaganda has no pain for a lot of rhetoric around and we we don't get the facts. Well nothing I appreciate you being with us tonight thank mayor. Here again and sent the Allegheny institute dot org mr. out I'm sure we'll talk again and as we talk about those kinds of things like tax break any guys already don't you are right thank you very. I'm back.