Comments on: Redevelopment Risks http://johnknoxwhite.com/2008/12/10/redevelopment-risks/ mindfulness in the face of a challenge Sat, 10 Jul 2010 14:41:17 +0000 http://wordpress.org/?v=2.9.2 hourly 1 By: dl morrison http://johnknoxwhite.com/2008/12/10/redevelopment-risks/comment-page-1/#comment-1225 dl morrison Thu, 11 Dec 2008 23:11:24 +0000 http://johnknoxwhite.com/?p=639#comment-1225 This discussion has continued on Blogging Bayport, #73: http://laurendo.wordpress.com/2008/11/21/north-housing-by-northwest/#comment-74624 This discussion has continued on Blogging Bayport, #73:

http://laurendo.wordpress.com/2008/11/21/north-housing-by-northwest/#comment-74624

]]> By: dl morrison http://johnknoxwhite.com/2008/12/10/redevelopment-risks/comment-page-1/#comment-1224 dl morrison Thu, 11 Dec 2008 06:15:37 +0000 http://johnknoxwhite.com/?p=639#comment-1224 Thank you for this comprehensive posting on municipal bond defaults. I have in mind a particular type of event that might lead to a default on redevelopment bonds, one that's germane to California -- an earthquake. Suppose that a redevelopment agency issued bonds to pay for a project's infrastructure, and that the infrastructure was largely completed and then seriously damaged by an earthquake, either before the entire project was completed or not long thereafter. Would the agency (or ultimately the city) be left paying off the bonds plus faced with the expense of repairing the infrastructure? This is not a hypothetical example. The Hayward Fault is due for a major quake any time now, and based on past history, it might well be a whole series of quakes, which is what occurred in the late 1800's. So it's possible that the city/agency could issue bonds for Alameda Point, even if only for a fraction of SunCal's projected cost, and be left with nothing to show for it but a bunch of overdue bond payments. With a large project on unstable fill, it could represent a substantial risk for the city. Would bond insurance cover a risk like that? It would be useful to know. Thank you for this comprehensive posting on municipal bond defaults. I have in mind a particular type of event that might lead to a default on redevelopment bonds, one that’s germane to California — an earthquake.

Suppose that a redevelopment agency issued bonds to pay for a project’s infrastructure, and that the infrastructure was largely completed and then seriously damaged by an earthquake, either before the entire project was completed or not long thereafter. Would the agency (or ultimately the city) be left paying off the bonds plus faced with the expense of repairing the infrastructure?

This is not a hypothetical example. The Hayward Fault is due for a major quake any time now, and based on past history, it might well be a whole series of quakes, which is what occurred in the late 1800’s. So it’s possible that the city/agency could issue bonds for Alameda Point, even if only for a fraction of SunCal’s projected cost, and be left with nothing to show for it but a bunch of overdue bond payments. With a large project on unstable fill, it could represent a substantial risk for the city.

Would bond insurance cover a risk like that? It would be useful to know.

]]> By: dazed and confused http://johnknoxwhite.com/2008/12/10/redevelopment-risks/comment-page-1/#comment-1223 dazed and confused Wed, 10 Dec 2008 22:51:18 +0000 http://johnknoxwhite.com/?p=639#comment-1223 Without getting into all your other remarks; Please explain how you can consider that ARRA & CIC are two "non-cityageancies that deal with re-development" Without getting into all your other remarks;

Please explain how you can consider that ARRA & CIC are two “non-cityageancies that deal with re-development”

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