One of our very own frequent commenters John Konop made the AJC. The gist of his comments are: “Let’s agree on fiscally rational financial requirements of these projects before we debate the politics behind them.”
Let’s start with the Cherokee Charter Academy. I support charter schools, if they are properly funded. But before we debate the viability of charter schools, we should first understand the liabilities put on taxpayers.
From what is reported, it is obvious that we have discrepancies about the financial viability of the school. Taxpayers would not only lose their initial investment, but the quality of our school system will be shaken as it struggles to absorb close to 1,000 students from a failed charter school mid-year.
We, as a community, can prevent these kinds of financial losses in the future by requiring a surety bond (or some other form of security) from the private company receiving public funds.
Being in the construction industry I tend to agree that “If no financial institution will provide a reasonable rate for guaranteeing a particular public/private venture, that should be a red flag that the project scope and financing needs to be restructured or not implemented.”
Good post, John.
Article source: http://www.peachpundit.com/2012/07/16/private-surety-for-projects-with-public-funding/
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