Fitch Reports on Cape Coral : More debt to finance debt, Falling home price and Persistent Unemployment (Fort Myers: sale, 2013)

[yoko]

" The city's revenue base has been severely pressured by a precipitous drop in taxable value of more than $12.8 billion or 59% from fiscal 2007-2011.

Management identifies the city's reliance on property taxes as its biggest concern, noting taxable values are still expected to decline anywhere from 4% to 8% per year over the next several fiscal periods.




Dec/01/2010
Fitch Rates Cape Coral, FL's Non-Ad Valorem Revs 'A+'; Outlook Stable | Business Wire






Click on the link and read the rest of report by yourself

[equalrightsforeveryone]

That is very discouraging reading.

[rikoshaprl]

Bond credit rating - Wikipedia, the free encyclopedia

The ratings given to the Cape Coral debt are pretty good.

[equalrightsforeveryone]

Originally Posted by rikoshaprl

Bond credit rating - Wikipedia, the free encyclopedia

The ratings given to the Cape Coral debt are pretty good.

I do not trust Wikipedia they have to many problems with people altering information on that site, this has been widely reported. I would want to confirm that information on a different site.

[stahltkd]

Originally Posted by equalrightsforeveryone

I do not trust Wikipedia they have to many problems with people altering information on that site, this has been widely reported. I would want to confirm that information on a different site.

Google it... the interwebs have all the information...




http://www.fitchratings.com/web_cont...and_scales.pdf

[rikoshaprl]

Equal, if you checked the link (and Stahls) it is just a description of what the letter grades mean.

[yoko]

" $17,400,000 series 2010A
The bonds are scheduled for competitive sale on Dec. 7. Proceeds will finance various capital improvements to the city's charter schools and refinance commercial paper notes issued to finance the same on an interim basis.
$90.6 million special obligation revenue bonds,
$40 million gas tax revenue bonds, series 2010A and 2010B
$17.9 million capital improvement and refunding revenue bonds"


Source: Fitch


How all these newly borrowed money is getting wasted:



" Leaders in Cape Coral are talking about adding a new beach, college and amusement park.

"Sometimes to try to improve on something with all these grandiose ideas and a lot of money goes down the table," Irlbeck said.
While a lot of residents we spoke to said they might like to see a beach or college in the Cape, they pointed out the bigger question is where the city will get the money to pay for all these projects. "




Dec/03/2010
Residents split on bringing new attractions to Cape Coral - NBC-2.com WBBH News for Fort Myers, Cape Coral & Naples, Florida





Take care of canals, parks, loose animals, controlling the city water problems, etc. before thinking too big on borrowed money!

[stahltkd]

Originally Posted by yoko

" $17,400,000 series 2010A
The bonds are scheduled for competitive sale on Dec. 7. Proceeds will finance various capital improvements to the city's charter schools and refinance commercial paper notes issued to finance the same on an interim basis.
$90.6 million special obligation revenue bonds,
$40 million gas tax revenue bonds, series 2010A and 2010B
$17.9 million capital improvement and refunding revenue bonds"


Source: Fitch


How all these newly borrowed money is getting wasted:



" Leaders in Cape Coral are talking about adding a new beach, college and amusement park.

"Sometimes to try to improve on something with all these grandiose ideas and a lot of money goes down the table," Irlbeck said.
While a lot of residents we spoke to said they might like to see a beach or college in the Cape, they pointed out the bigger question is where the city will get the money to pay for all these projects. "




Dec/03/2010
Residents split on bringing new attractions to Cape Coral - NBC-2.com WBBH News for Fort Myers, Cape Coral & Naples, Florida





Take care of canals, parks, loose animals, controlling the city water problems, etc. before thinking too big on borrowed money!

First you were griping that there was no "cultural" things to do.. now this? You can't have your cake and eat it too. In order to attract more money, there needs to be a reason for businesses and people to come.

Cape Coral is not named after anyone on this forum. It's not your world - it's our world. Instead of trolling the message boards and bad mouthing, leaving out the whole story, and posting up things that have nothing to do with what you're talking about (the Chief's sons) put your mouth where it can do some good... run for office... since obviously you're the only one with all the answers.

[nhkev]

The problem with this thread is that it starts like most of yoko's threads. She takes what someone reports, changes a few words for example no where does it say falling home prices it says drop in taxable property (big difference). 2nd she says the article says persistant unemployment. Doesn't say that in the article either, it says lagging. Why is this different because Cape Coral's unemployment was 14.1% in January was 13.1 in October and is now 12.7 while the rest of the country has remained the same in that same period. the article said it is decelerating and expected to get better in 2012 and 2013.

Could you imagine playing that game where you whisper something in one person's ear , then they repeat the message to the next person, then the last person says what they heard. Well with yoko this is how it goes.... "It is a world of Puppy dogs and rainbows" last person "Cape Coral is hell on earth and is doomed"

The whole premise of the article is not to analyze the housing market or the economy of the area. It is to rate the city's credit worthiness. It is comparable that when someone is applying for a loan they will look at your books but they are not going to do a whole study on housing, it is about the revenue that the city expects to get from housing.

Normally when a city derives at a budget they figure out how much they are going to spend first, then they set a millage rate based off the budget divided by total taxable property amount. So normally if property values drop millage rates increase, if they rise millage rates could drop. This city is doing things differently.... like the article said the council is unwilling to raise the millage rate or add new ad valorem taxes and have instead cut the budget by 28% and are looking to battle the unions to slash the budget more.

Lastly It's a rating agency. If I had to name only one group that caused the mess in housing in the first place it would be rating agencies. They were the one group that took subprime mortgages called them triple A rated which enabled wall st to package and sell to pension funds and governments that thought they were getting safe mortgage back securities that were like fico scores of 720 / 20% down/ with verified income. if people new they were buying no money down, unverified income, fico scores of 530 they would not have bought them and if their wasn't a market to sell them the loans wouldn't have been made in the first place, there would not have been the overbuilding, or foreclosure fiasco, credit crisis. We wouldn't have had the boom but neither the bust.

[yoko]

Originally Posted by yoko

" $17,400,000 series 2010A
The bonds are scheduled for competitive sale on Dec. 7. Proceeds will finance various capital improvements to the city's charter schools and refinance commercial paper notes issued to finance the same on an interim basis.
$90.6 million special obligation revenue bonds,
$40 million gas tax revenue bonds, series 2010A and 2010B
$17.9 million capital improvement and refunding revenue bonds"


Source: Fitch


How all these newly borrowed money is getting wasted:



" Leaders in Cape Coral are talking about adding a new beach, college and amusement park.

"Sometimes to try to improve on something with all these grandiose ideas and a lot of money goes down the table," Irlbeck said.
While a lot of residents we spoke to said they might like to see a beach or college in the Cape, they pointed out the bigger question is where the city will get the money to pay for all these projects. "

Dec/03/2010
Residents split on bringing new attractions to Cape Coral - NBC-2.com WBBH News for Fort Myers, Cape Coral & Naples, Florida


Take care of canals, parks, loose animals, controlling the city water problems, etc. before thinking too big on borrowed
money!

A new Amusement park?

What will happen then to the very fragile Sun Splash Park?



"Cape's Sun Splash making money, closing the debt gap
Last season, the park was nearly $650,000 in the hole. As of Thursday, new manager Sandie Greiner says the park is closing the gap – bringing that number to just -$200,000."

Sept/24/2010
Cape's Sun Splash making money, closing the debt gap - NBC-2.com WBBH News for Fort Myers, Cape Coral & Naples, Florida