More CFA problems: The debt bomb
Heavily redacting the content of emails that should be mostly public might not be the worst of the problems for Pennsylvania's secretive Commonwealth Financing Authority (CFA) and its parent, the state Department of Community and Economic Development (DCED).
A review of authority audits by the Allegheny Institute's Jake Haulk shows a deepening morass of debt for which the public, as per usual, could be left on the hook. Mr. Haulk, a Ph.D. economist, says those audits show a “net asset position” at the end of fiscal 2012-13 was “negative $760 million.” And the authority is obligated to pay debt service of $147.9 million annually through 2042.
The law that created the authority says CFA debt doesn't violate the Pennsylvania Constitution's prohibition (Article VIII, Section 8) against pledging the commonwealth's credit. Yet the audits mention a state pledge to seek annual appropriations for the authority's debt service. “And therein lies the problem,” Haulk says.
The $80 million that DCED provides annually will leave the authority, which lacks its own revenue source, about $67 million short of its debt-service needs. Haulk warns that sooner or later, the state will have to raise taxes or cut core functions — “either of which would be a de facto constitutional violation” — to honor its authority debt service commitment.
Halting further authority borrowing would help avoid that scenario.
But beyond that, taxpayers newly aware of the Commonwealth Financing Authority's debt bomb must demand that they not be stuck with the bill for cleaning up a mess created — and hidden — by the authority, the DCED and their Harrisburg protection racket.
Show commenting policy
TribLive commenting policy
You are solely responsible for your comments and by using TribLive.com you agree to our Terms of Service.
We moderate comments. Our goal is to provide substantive commentary for a general readership. By screening submissions, we provide a space where readers can share intelligent and informed commentary that enhances the quality of our news and information.
While most comments will be posted if they are on-topic and not abusive, moderating decisions are subjective. We will make them as carefully and consistently as we can. Because of the volume of reader comments, we cannot review individual moderation decisions with readers.
We value thoughtful comments representing a range of views that make their point quickly and politely. We make an effort to protect discussions from repeated comments either by the same reader or different readers.
We follow the same standards for taste as the daily newspaper. A few things we won't tolerate: personal attacks, obscenity, vulgarity, profanity (including expletives and letters followed by dashes), commercial promotion, impersonations, incoherence, proselytizing and SHOUTING. Don't include URLs to Web sites.
We do not edit comments. They are either approved or deleted. We reserve the right to edit a comment that is quoted or excerpted in an article. In this case, we may fix spelling and punctuation.
We welcome strong opinions and criticism of our work, but we don't want comments to become bogged down with discussions of our policies and we will moderate accordingly.
We appreciate it when readers and people quoted in articles or blog posts point out errors of fact or emphasis and will investigate all assertions. But these suggestions should be sent via e-mail. To avoid distracting other readers, we won't publish comments that suggest a correction. Instead, corrections will be made in a blog post or in an article.
- Sunday pops
- The solar problem: Subsidized inefficiency
- The Box
- Benghazi: The gun smokes
- Sunday pops
- Fast & Furious: Still unresolved
- The ‘green’ ruse: Germany’s poor ‘model’
- Saturday essay: Waltz of the robins
- Pipeline pap: The real agenda
- Volunteers’ contributions: Growing flowers & more in Connellsville
- The Takata air bags recall: It’s about time