Jim Harbison - Beware of Gov't Agencies Bearing Grants

Jim Harbison

At the most recent City Council meeting the Council passed several resolutions accepting various government grants from both Federal and State agencies. Now on the surface this seems like a great deal for the City because after all it is free money. Right? Well not exactly.

Many of these government grants contain conditions or restriction such as matching funds or other constraints on how the money can be used. Not all of these conditions are necessarily consistent with the policies of the City Council. This money is used by the Federal and State governments to implement policies or programs that may or may not match the needs or priorities of the City or more importantly the needs or desires of the citizenry.

One of the resolutions that passed concerned a Federal HUD grant of approximately $1 million which required the City to provide $500,000 in matching funds of to the Affordable Housing Land Bank. Another was a $758,000 grant from NMDOT to construct the 6-mile Outfall Channel multi-modal trail from I-25 to the Rio Grande and requires the City to provide $252,000 in matching funds. Unfortunately, the City has not identified where these matching funds will come from. In the case of the HUD grant the City may identify them in the 2011-2012 budget year. Bottom line is that acceptance of this grant obligates a half a million dollars from next year’s budget and gives it a priority over other City projects without consideration of the actual needs of the City.

Sharon Thomas

The Outfall Channel Trail was number 4 on the City’s list of unfunded projects. Accepting this grant now moves it to the top of the list and circumvents the priority list established by the Council and City staff. Councilor Sharon Thomas is the City’s advocate for walking paths and bicycled trails. Obviously she was very excited about this grant and voted for its acceptance.

There are several questions that should be answered before the City accepts these “gifts”. First, what is the impact of the loss of the $252,000 from the current budgeted projects to suddenly fund an unfunded project? Second, if there are other funding sources for the existing City projects, why weren’t they included in the creation of the original City budget? Third, what is the impact on those projects that had a higher priority on the project list?

The various City departments will frequently state that matching funds do not need to be actual dollars but can be “in kind contributions.” What are “in-kind contributions?” As I understand it, it is where the actual value of work performed on the project by City staff can be considered as payment toward the matching fund amount. Examples would include design work done by the Engineering Department or preparatory work performed by the Public Works Department or the Utilities Department.

Sounds simple, right? Well consider that this is work effort that is diverted from currently approved and funded City projects. This may force the previously funded project to be delayed or even moved into the following budget year. Ever wonder why your road isn’t repaired, or why your neighborhood continues to have drainage problems? Perhaps it is because the City staff is working on in-kind projects because the City didn’t have the budget to fund these grant driven projects.

Remember, there is no free lunch and acceptance of grants can have consequences. Let’s hope our City Council realizes this and does not jeopardize other projects. They must not allow the Federal and State governments to divert the direction of the City Council by the offer of “free money”.

Jim Harbison - Beware of Gov't Agencies Bearing Grants

Councilor backs off proposal to ban feeding prairie dogs, hopes for urban wildlife plan

From The Santa Fe Newmexian - City Councilor Ron Trujillo has backed off an idea to make it illegal to feed wildlife such as prairie dogs on Santa Fe city property. Instead, he is calling for a task force to help the city enforce policies about handling such critters. Like the burrowing rodents that have lost habitat to urban encroachment, Trujillo is somewhat trapped. He's thinking about his — and other — elementary-school-age children whose sporting events are affected by animal burrows in city parks. He says he's also listening to their parents, whose tax dollars pay hundreds of thousands each year for park maintenance and prairie dog removal. However, there's an outspoken contingent of Santa Fe residents and taxpayers — many of whom also live in his district — who advocate for prairie dog protection above recreation. People with all those viewpoints will be invited to participate in the group Trujillo hopes the city will convene to discuss a citywide "wildlife management plan," with prairie dog issues at the top of its list. In June, he proposed an ordinance to impose an unspecified penalty for feeding wildlife on city land. When fellow councilors, city staff and some in the community balked at the idea, he decided to withdraw the proposal. Read more

Councilor backs off proposal to ban feeding prairie dogs, hopes for urban wildlife plan

Holocaust Denier Ahmadinejad Dodging Grenades?

Mahmoud Ahmaddinejad

A flurry of conflicting reports about a grenade attack on Iranian President Mahmoud Ahmadinejad were published in Iranian media on Wednesday. A conservative Iranian website published a report saying an explosive was thrown at Ahmadinejad who was standing in an open roof car as he drove through the western Iranian city of Hamedan. Later in the day, the report was removed from the site. Semi-official Fars news, reported that a grenade had been thrown at the route of the president, but only after the president’s motorcade had already passed by, reported AP. Iranian state media also quickly published a string of articles denying there had been an attempted attack against Ahmadinejad. Officials and state media attributed the explosion to a firecracker taking place about 300 feet behind the president’s car. Read more here:

Holocaust Denier Ahmadinejad Dodging Grenades?

State Budget Deficit Keeps Getting Bigger

Governor Bill Richardson

The state will receive $104 million in extra Medicaid dollars thanks to federal legislation projected to clear Congress in the next few days, New Mexico state officials said Wednesday. The funding contained in the $26 billion federal legislation for New Mexico’s Medicaid program is $56 million below the $160 million the state had anticipated. That means the state budget gap New Mexico is struggling to address for the fiscal year that began July 1 will grow to about $220 million. Read more here:

State Budget Deficit Keeps Getting Bigger

Picacho Hills Water Utility in Hot Water

Picacho Hills

The Public Regulation Commission (PRC) might not issue a record $850,000 fine or order a fraud audit of a Las Cruces water utility’s finances despite protests from some of its staff. The difference of opinion emerged during a hearing Tuesday and included a reference to a letter submitted by one staff attorney reiterating staff’s desire to see the utility face stiff punishment. “If penalties are not warranted here, where will they be,” reads a letter penned by PRC attorney Ashley Schannauer. The company “violated almost every procedural order in this case, illustrating disregard and defiance of Commission authority,” Schannauer wrote. The alleged violations by Picacho Hills Utility Company — the company at the center of Tuesday’s hearing — include failing to comply with a PRC order to extend a sewer discharge line to the Rio Grande in order to avoid sewer contamination of ground and surface water at the Picacho Hills Country Club, southwest of Las Cruces, according to a PRC staff report. Read more here:

Picacho Hills Water Utility in Hot Water

Progressive Magazine - Mosque Controversy

The Republican response to the proposed New York City interfaith center and mosque has very little to do with Islam and a lot to do with what the party has become. Once upon a time, the Republicans were comprised of at least two distinct wings: the pro-business, country club types, and the more socially conservative group. Now, with the exception of a rapidly dwindling moderate faction (best exemplified by Maine’s two women senators), the GOP has been taken over by a hard right that sees the party as dedicated to defending America’s Christian character. Read more here:

Progressive Magazine - Mosque Controversy

Ken Blackwell - The Rangel Scandal

Ken Blackwell

Four years ago, House Speaker Nancy Pelosi promised to “drain the swamp” of corruption in Washington, D.C., but after failing miserably to do so it now appears she’s choosing to ignore it – while letting her colleagues sweep it under the rug. In the latest example of this trend, a House ethics panel last week recommended that Rep. Charlie Rangel be “reprimanded” for a laundry list of corruption charges. Rangel, a Democrat who has been in the House for forty years, is facing a battery of serious allegations which, if proven, should cost the career lawmaker his job – if not land him in jail. Read more here:

Ken Blackwell - The Rangel Scandal

Caroline Baum - Squeezing the Rich

Arthur Laffer

Thirty-six years after an academic economist named Arthur Laffer drew a curved line on a cocktail napkin, the debate over supply-side tax cuts paying for themselves is still going strong. Why, after all this time and an extensive body of data, are we still questioning whether reductions in marginal and capital- gains tax rates increase economic activity enough to generate more revenue for the federal government? “Because they don’t like the answer,” Laffer says of the doubters. “It’s not tax cuts that pay for themselves. Tax cuts on the poor cost you lots of money. Tax cuts on the rich pay for themselves. Rich people can afford lawyers, accountants, and can defer income.” Read more here:

Caroline Baum - Squeezing the Rich

Borrow Money to Study Ants & Improv Music?

A new report from Republican senators Tom Coburn and John McCain says too much of the $862 billion in stimulus money is being spent with dubious results: $700,000 for a researcher to study improvised music. For a project on interactive dance, 44 percent of the money goes to "overhead." The $1.9 million spent to photograph ants in foreign countries has created two jobs created so far. That's better than other ant research stimulus projects: $451,000 has created one job, $276,000 spent on another created six one-hundredths of a job, and the $800,000 spent on a different one created no jobs. Read more here:

Borrow Money to Study Ants & Improv Music?

Two Year Treasury Notes Yield .58%

Treasury two-year note yields were near a record low on speculation employment reports will add to evidence that the U.S. economic recovery is too fragile for the Federal Reserve to raise interest rates. The difference in yield, or spread, between two- and 10- year Treasury notes narrowed as investors reduced their inflation expectations. The possibility of deflation and a recession in the U.S. is 25 percent, according to Mohamed A. El- Erian, chief executive officer at Pacific Investment Management Co. The Fed’s next policy decision is scheduled for Aug. 10. “Markets are once again more fearful about the economic outlook,” said Glenn Marci, a fixed-income strategist in Frankfurt at DZ Bank AG, Germany’s biggest cooperative lender. “Investors are not confident enough to believe we’ll see a sustained recovery and are looking more at the double-dip scenario.” The two-year note yielded 0.58 percent as of 10:04 a.m. in London, after falling to a record low of 0.5143 percent on Aug. 3. The 0.625 percent note due July 2012 traded at 100 3/32, according to BGCantor Market Data. Ten-year yields were little changed at 2.96 percent. Read more here:

Two Year Treasury Notes Yield .58%