Proposition 463: Pima County Proposes Ponzi Scheme

Pima County Administrator Chuck Huckelberry is asking the public to approve yet one more bond package, Proposition 463, despite the fact that under his management, the County has bonds it cannot afford to use. As a result, there has been wide-spread speculation that the latest bond request before voters is really little more than a Ponzi Scheme.

Ponzi Scheme
noun

A form of fraud in which belief in the success of a nonexistent enterprise is fostered by the payment of quick returns to the first investors from money invested by later investors.

A Ponzi scheme is able to maintain the illusion of a sustainable business as long as there continues to be new investors willing to contribute new funds and most of the investors do not demand full repayment and are willing to believe in the non-existent assets that they are purported to own.

In November 1997, Pima County voters approved $350 million in Highway User Revenue Fund (HURF) bonds, to be repaid with a portion of the County’s share of HURF revenues from the State, to widen and rebuild roadways throughout Pima County and within cities and towns. Today, a full 18 percent ($62.4 million) of the bonds remain unused as over 70 percent of the roads fell into “poor” or ‘failed” condition.

 

Huckelberry blames everyone and everything for the fact that “the 1997 HURF revenue projects were originally planned for completion by Fiscal Year 2013/14,” but “have taken longer to complete.” Whatever the case may be, according to Huckelberry, “For Fiscal Year 2017/18, HURF revenues to Pima County are projected to total approximately $61.6 million, and 40% are forecasted to repay debt for these transportation projects.”

Bond Sales (As of June 30, 2018)
BondsTotal Authorization (Millions)Total Bond Sales (Millions)Remaining Authorization (Millions)Percent Remaining
1997 General Obligation$ 257.0$ 257.0$ 0.00%
1997 Sewer Revenue$ 105.0$ 105.0$ 0.00%
1997 HURF Revenue$ 350.0$ 287.6$ 62.418%
2004 General Obligation$ 582.2$ 582.2$ 0.00%
2004 Sewer Revenue$ 150.0$ 150.0$ 0.00%
2006 General Obligation$ 54.0$ 54.0$ 0.00%
2014 General Obligation$ 22.0$ 22.0$ 0.00%
Total$1,520.2$1,457.8$62.44%


From Ally Miller, Pima County District 1 Supervisor [Published on Sep 21, 2018] Constituent asks Huckelberry why taxpayers being asked to pay $33 MILLION in interest and expenses for bond road repairs. Huckelbery explains options including how the county “launders the money,” and creating Certificates of Participation (COPs) debt.


Gary Davidson discusses his opposition Proposition 463 with Chris DeSimone of 1030AM KVOI’s Wake Up Tucson.

For more information on Proposition 463: