May 21, 1975 (8 pages)

ssi BWQOMING = THE . AC THE TOURIGT: ARE BEGINNING TO, Earl G. Waters Moral obligatio An incident which may have a far reaching effect on future governmental capital outlay projects, both local and state, . occurred recently in‘New York. It was the default on a $100 million bond issue by the New York Urban Development Corporation. The agency is similar to the housing\and urban renewal agencies in California. The bonds were ‘moral obligation bonds’’ issued without _ voter approval. California has not issued precisely this type of bonds, or at least not in the same manner or volume as have some 30 other states. But there has been, an increasing trend to “revenue” bonds by both the state and local governments. The default was probably not the first by local government in the U.S. but the amount involved was such that it has caused a nationwide stir and a new look by buyers and bonding consultants. It also can be predicted it will not be the last default to be heard of. For the changing enconomy alone places some such issues in jeopardy while the massive social changes occurring with. rapidity is bound to affect others. Governments have gotten themselves into the predicament by the trend which has developed to avoid voter approval through the device of “joint powers’? which permits issuance of revenue bonds ' without a vote. In many cases in California revenue bonds have been resorted to after a vote of the people has rejected general obligation bonds for a proposed project. This was the case in Sacramento where the citizens rejected a bond -issue for a community center, Undaunted, the officials went ahead with the project by floating revenue bonds. The initial revenue projections have proved to be wrong and only by using tax dollars through some legal gymnastics is the city avoiding default on the bonds. . Other areas of California face similar disasters. The City of Ontario floated $25 million in. revenue bonds to. finance a speedway. It. depends upon the revenues from auto races but a gasoline shortage could end that source. Other cities, namely San Diego, Oakland, San Francisco and Anaheim expended millions for stadiums, largely dependent upon their use by the professional baseball teams for revenues. yet, rumors constantly have these teams transferring to new locations. Most of California bond issues, even though they may be based on revenues, have been voter approved. But this is not true of those issued by local governments. The California Taxpayers Association reports that as of 1972-73 there were outstanding more than $433 million in bonds issued by local governments through joint powers and another $180 through non-profit corporations. Thus local taxpayers have more than $600 millions of debt hanging over their heads without considering the voter approved bonded indeptedness as of 1973-74 of $155 million for the 58 counties and a staggering $3.6 billion for all cities. An additional method of escaping the voters approval has been the lease-purchase agreements executed by local governments. The total liability Taxable sales up 14% schedules reunion Taxable sales in Nevada county in 1974 were reported up 14.4 percent by the State Board of Equalization. Statewide the growth was virtually. the same as the inflationary increase in’ prices during the year, 10.2. percent; thus the physical volume of goods sold was approximately. the same as in 1973. Taxable sales in Nevada county were up 14.4 percent Elmer Stoon Fg ate gas cee eter oe Fea es ted 6 te oe ae ereN “SUMMER 1S HERE, FLAG/“~ THE WILD FLOWERS. ARE.BUTTERFLIES ARE OUT OUCH! POO eb eee ed eeete 5 e FE} RN 3.3. Byte’, are’, Pr “se ; ; P AROS CSSHEH SH HH ORE HEH OH AR EER ee WS Sa Be A Ry Oe he ty B ee May 21, 1975 Wed.,The Nevada County Nugget 7 © n bonds of local governments for these debts has not been calculated but 14 counties reported that the money value of leases now in effect amounted to $896 million if carried to termination. The League of Cities reported a . similar indeptness for the municipalities .of $699 million. To what extent the total liability upon property might be in the event of failures in the economy or other causes is not clear. In practice however, as in Sacramento’s community center, the officials find ways to subvent the debts with the property taxes. , The New York case serves to point up the dangers involved in non-voter approved financing. The result is that bonds become harder to sell, whether voter approved or not, and the costs to the taxpayers for the financing rises according to the difficulty of selling them. — It is little consolation now and will be even less solace later to know that Cal Tax has consistently opposed both lease purchase and joint powers on the grounds that both by-pass the voters and result in higher interest costs. Still, the spenders continue to push legislation for “regional” governments which can only lead to more joint power agreements, more indebtedness acquired by by-passing the voters, and eventual bankruptcy. for a total of $43,641,000. Sales _in Grass Valley were $30,494,000 and in Nevada City, $9,934,000. Statewide service stations with 29.8 percent showed a larger gain than any other class of business due to increases in the price of gasoline, while sales of new car dealers were 10.2 percent less than in 1973. Food stores selling all s of alcoholic beverages had a 22.4 percent ain in taxable sales. WSTANT BUYERS & SELLERS att ; Placer-Nevada CowBelles. is a busy organization The Placer-Nevada CowBelles organization was instituted in January 1964 by a group of women from Placer and Nevada counties and as auxiliary to the Tahoe Cattlemen’s Association they assit in promoting the cattle industry as well as to increase beef consumption and create’ a public understanding of the cattle business. Organizer and first president was Dixie Meredith of Loomis. Dora Troost was vice’ president; Dorothy Bickford, secretary; Eunice Bierly, treasurer; and directors were Lillian Phelan, Gene Long and Jerry Tyberg. Two $100 scholarships to second year students at Sierra . College are awarded annually, with the Dixie Meredith ‘Memorial scholarship going to a student majoring in home economics and one going to an agriculture student. They also present a $75 scholarship at each high school having an FFA prgram in the two counties. In the past years the group helped the Cattlemen’s Association build three barns at area fairgrounds used for livestock offices and displays. They have exhibits at all the fairs and give $25 toward trophies to promote beef as well as: providing clean stall awards to 4-H members. Some of the group’s. other. activities are to provide beef packets to buyers at junior auction sales and fairs. They give a beef dinner for two to parents of the first baby born on Mother’s Day and a beef roast weighing the same as the first baby born on Father’s Day. In addition they serve beef broth at the Auburn and Lincoln blood banks. For fund raising activities the women serve dinners and luncheons at cattlemen’s meetings, have food booths and rummage sales. They also sell beef cookbooks, stationery and beef broth. Their 1975 project is to sell napkins decorated with rancher’s brands. Each year a CowBelle of the year award is presented to an.outstanding member. The first went to Dixie Meredith; others honored were Jen Martin, Mary Amlin, Dora Troost, Edith Dennison, Vera Hawkins, Margaret Bickford, Marian Conway and Lila Vineyard. The 1975 recipient was Frances Coefield. Officers for this year are Caroline Stanart, president; _ Marge Carmen, vice president; Mary Mason, treasurer; and Vi Pharoah, secretary. Directors are Mary McCarthey, Rose Harbour and Marian Conway. _ Class of 1940 big pulling power ame, CLASSIFIED ADS Grass Valley High School class of 1940 is planning their 35th reunion on Aug. 30 at the Classified Ads, the little fellows with the Holbrooke Hotel and many special plans have been made 10. Crafts and Services for this event. The committee would like These names include Alice “ROBERT L. ROSS, JR. N.C. May 23-26. Reasonable. _ Sate score a Ty ae omen i s sii ill St., Ph. 273-62 asamates whose oy, 147 Mill St., Ph. 273-6246 ‘information as _ to .the 40. Miscellaneous for Sale whereabouts of the following =~ ; should be sent to Edward Yun, FOR SALE: Unique: wood 110 Dolores Drive, Grass burning old style water heating Valley device. Can be seen at Camp Gold Hollow, Lake Vera Rd., ~ BUSINESS Joy Allen, Clyde Capps, , : Edward Gustafson, Emma Bill’s foun slapohy, Hons Jans, I Melba McClusky, van Murray, Douglas Popst, Better . Robert Reeder, Barbara y Buys Thoma Kimsey, Helen Clark Snedeker, Barbara Walker " we Kirby, Darlys Linc on Margaret Cra ’ and George Hawley. Bra ke adjustment *1.88 RAISED WHITE LETTERS . ]FARMERS INSURANCE GROUP] PLAZA JP. *HEPEREN INSURANCE AGENCY IRE. . TYTW,Moin’. > P.O Box 10345 . TIRE CO., INC. 2 ene z a Me Hy a hy BILLBOARD . AVAILABLE NOW. _ . RECAPPING SERVICE Len Gilbert . WIDE OVAL TirES 13” . . M'tGrass Valley.Co. 265-6166} . BEHIND SPD 265-4642 ET eEEORUOL ED UE Oe qhaeeavevevenen CURVE esses ae eey ees” RAS Pe . * b RT EE EET EONS eA * t {RAF 4 3 a ee ee eet VAS. Fae SUS Sea

ssi BWQOMING = THE . AC THE TOURIGT: ARE BEGINNING TO, Earl G. Waters Moral obligatio An incident which may have a far reaching effect on future governmental capital outlay projects, both local and state, . occurred recently in‘New York. It was the default on a $100 million bond issue by the New York Urban Development Corporation. The agency is similar to the housing\and urban renewal agencies in California. The bonds were ‘moral obligation bonds’’ issued without _ voter approval. California has not issued precisely this type of bonds, or at least not in the same manner or volume as have some 30 other states. But there has been, an increasing trend to “revenue” bonds by both the state and local governments. The default was probably not the first by local government in the U.S. but the amount involved was such that it has caused a nationwide stir and a new look by buyers and bonding consultants. It also can be predicted it will not be the last default to be heard of. For the changing enconomy alone places some such issues in jeopardy while the massive social changes occurring with. rapidity is bound to affect others. Governments have gotten themselves into the predicament by the trend which has developed to avoid voter approval through the device of “joint powers’? which permits issuance of revenue bonds ' without a vote. In many cases in California revenue bonds have been resorted to after a vote of the people has rejected general obligation bonds for a proposed project. This was the case in Sacramento where the citizens rejected a bond -issue for a community center, Undaunted, the officials went ahead with the project by floating revenue bonds. The initial revenue projections have proved to be wrong and only by using tax dollars through some legal gymnastics is the city avoiding default on the bonds. . Other areas of California face similar disasters. The City of Ontario floated $25 million in. revenue bonds to. finance a speedway. It. depends upon the revenues from auto races but a gasoline shortage could end that source. Other cities, namely San Diego, Oakland, San Francisco and Anaheim expended millions for stadiums, largely dependent upon their use by the professional baseball teams for revenues. yet, rumors constantly have these teams transferring to new locations. Most of California bond issues, even though they may be based on revenues, have been voter approved. But this is not true of those issued by local governments. The California Taxpayers Association reports that as of 1972-73 there were outstanding more than $433 million in bonds issued by local governments through joint powers and another $180 through non-profit corporations. Thus local taxpayers have more than $600 millions of debt hanging over their heads without considering the voter approved bonded indeptedness as of 1973-74 of $155 million for the 58 counties and a staggering $3.6 billion for all cities. An additional method of escaping the voters approval has been the lease-purchase agreements executed by local governments. The total liability Taxable sales up 14% schedules reunion Taxable sales in Nevada county in 1974 were reported up 14.4 percent by the State Board of Equalization. Statewide the growth was virtually. the same as the inflationary increase in’ prices during the year, 10.2. percent; thus the physical volume of goods sold was approximately. the same as in 1973. Taxable sales in Nevada county were up 14.4 percent Elmer Stoon Fg ate gas cee eter oe Fea es ted 6 te oe ae ereN “SUMMER 1S HERE, FLAG/“~ THE WILD FLOWERS. ARE.BUTTERFLIES ARE OUT OUCH! POO eb eee ed eeete 5 e FE} RN 3.3. Byte’, are’, Pr “se ; ; P AROS CSSHEH SH HH ORE HEH OH AR EER ee WS Sa Be A Ry Oe he ty B ee May 21, 1975 Wed.,The Nevada County Nugget 7 © n bonds of local governments for these debts has not been calculated but 14 counties reported that the money value of leases now in effect amounted to $896 million if carried to termination. The League of Cities reported a . similar indeptness for the municipalities .of $699 million. To what extent the total liability upon property might be in the event of failures in the economy or other causes is not clear. In practice however, as in Sacramento’s community center, the officials find ways to subvent the debts with the

property taxes. , The New York case serves to point up the dangers involved in non-voter approved financing. The result is that bonds become harder to sell, whether voter approved or not, and the costs to the taxpayers for the financing rises according to the difficulty of selling them. — It is little consolation now and will be even less solace later to know that Cal Tax has consistently opposed both lease purchase and joint powers on the grounds that both by-pass the voters and result in higher interest costs. Still, the spenders continue to push legislation for “regional” governments which can only lead to more joint power agreements, more indebtedness acquired by by-passing the voters, and eventual bankruptcy. for a total of $43,641,000. Sales _in Grass Valley were $30,494,000 and in Nevada City, $9,934,000. Statewide service stations with 29.8 percent showed a larger gain than any other class of business due to increases in the price of gasoline, while sales of new car dealers were 10.2 percent less than in 1973. Food stores selling all s of alcoholic beverages had a 22.4 percent ain in taxable sales. WSTANT BUYERS & SELLERS att ; Placer-Nevada CowBelles. is a busy organization The Placer-Nevada CowBelles organization was instituted in January 1964 by a group of women from Placer and Nevada counties and as auxiliary to the Tahoe Cattlemen’s Association they assit in promoting the cattle industry as well as to increase beef consumption and create’ a public understanding of the cattle business. Organizer and first president was Dixie Meredith of Loomis. Dora Troost was vice’ president; Dorothy Bickford, secretary; Eunice Bierly, treasurer; and directors were Lillian Phelan, Gene Long and Jerry Tyberg. Two $100 scholarships to second year students at Sierra . College are awarded annually, with the Dixie Meredith ‘Memorial scholarship going to a student majoring in home economics and one going to an agriculture student. They also present a $75 scholarship at each high school having an FFA prgram in the two counties. In the past years the group helped the Cattlemen’s Association build three barns at area fairgrounds used for livestock offices and displays. They have exhibits at all the fairs and give $25 toward trophies to promote beef as well as: providing clean stall awards to 4-H members. Some of the group’s. other. activities are to provide beef packets to buyers at junior auction sales and fairs. They give a beef dinner for two to parents of the first baby born on Mother’s Day and a beef roast weighing the same as the first baby born on Father’s Day. In addition they serve beef broth at the Auburn and Lincoln blood banks. For fund raising activities the women serve dinners and luncheons at cattlemen’s meetings, have food booths and rummage sales. They also sell beef cookbooks, stationery and beef broth. Their 1975 project is to sell napkins decorated with rancher’s brands. Each year a CowBelle of the year award is presented to an.outstanding member. The first went to Dixie Meredith; others honored were Jen Martin, Mary Amlin, Dora Troost, Edith Dennison, Vera Hawkins, Margaret Bickford, Marian Conway and Lila Vineyard. The 1975 recipient was Frances Coefield. Officers for this year are Caroline Stanart, president; _ Marge Carmen, vice president; Mary Mason, treasurer; and Vi Pharoah, secretary. Directors are Mary McCarthey, Rose Harbour and Marian Conway. _ Class of 1940 big pulling power ame, CLASSIFIED ADS Grass Valley High School class of 1940 is planning their 35th reunion on Aug. 30 at the Classified Ads, the little fellows with the Holbrooke Hotel and many special plans have been made 10. Crafts and Services for this event. The committee would like These names include Alice “ROBERT L. ROSS, JR. N.C. May 23-26. Reasonable. _ Sate score a Ty ae omen i s sii ill St., Ph. 273-62 asamates whose oy, 147 Mill St., Ph. 273-6246 ‘information as _ to .the 40. Miscellaneous for Sale whereabouts of the following =~ ; should be sent to Edward Yun, FOR SALE: Unique: wood 110 Dolores Drive, Grass burning old style water heating Valley device. Can be seen at Camp Gold Hollow, Lake Vera Rd., ~ BUSINESS Joy Allen, Clyde Capps, , : Edward Gustafson, Emma Bill’s foun slapohy, Hons Jans, I Melba McClusky, van Murray, Douglas Popst, Better . Robert Reeder, Barbara y Buys Thoma Kimsey, Helen Clark Snedeker, Barbara Walker " we Kirby, Darlys Linc on Margaret Cra ’ and George Hawley. Bra ke adjustment *1.88 RAISED WHITE LETTERS . ]FARMERS INSURANCE GROUP] PLAZA JP. *HEPEREN INSURANCE AGENCY IRE. . TYTW,Moin’. > P.O Box 10345 . TIRE CO., INC. 2 ene z a Me Hy a hy BILLBOARD . AVAILABLE NOW. _ . RECAPPING SERVICE Len Gilbert . WIDE OVAL TirES 13” . . M'tGrass Valley.Co. 265-6166} . BEHIND SPD 265-4642 ET eEEORUOL ED UE Oe qhaeeavevevenen CURVE esses ae eey ees” RAS Pe . * b RT EE EET EONS eA * t {RAF 4 3 a ee ee eet VAS. Fae SUS Sea