How to Expose Local Government Debt

Get a “preliminary official statement” (POS) to expose the growing level of local government debt that you, a resident taxpayer, owe. A POS is a “plain English” document created before bonds are sold. Jack Bogdanski covered this in his Sept. 28, 2007 blog “Portland [Oregon]: A city deep in hock.”

Bogdanski explains, “the “˜POS,’ as it’s known, has to be written in plain English. It’s essentially a sales pitch, but by law, it must disclose all the material facts that an investor would reasonably want to know in deciding whether to invest in the city’s IOU’s. Financial institutions that buy bonds (i.e., lend big bucks) don’t want hundreds of pages of hide-the-ball data”¦. No, they demand the straight skinny.”

After reviewing a recent City of Portland POS, Bogdanski calculates “the average man, woman or child living in Portland right now owes around $7,500 in long-term debt to individuals and corporations who own the city’s bonds.” Add in the debt of Multnomah County, Metro, Tri-Met, Portland Community College, and Portland School District, and Bogdanski offers a guesstimate that brings the total city resident debt to $8,500 per capita.

Local government debt is piling up throughout Oregon. Expose it by getting a copy of a preliminary official statement and share it with your friends and local newspaper editors.