One who intends to leave others better off for his having existed.

1/30/14

GPAC Mess from the Rhino and News & Record; Sounds like the Community Foundation actually has $5 of $35 million

From the N&R;

"...The foundation will be responsible if the pledges don't come through, city officials said."

What would the Foundation pay with "if the pledges don't come through"?

Would any charities take a hit if the foundation had to pay? 

...the foundation plans to provide the city $5 million in cash and seek a bank loan for the rest. The city will get a check for the $30 million...

Sounds like the foundation has $5 million.

The foundation will be responsible if the pledges don't come through...
 
Where is the other $30 million?

How can a foundation with no money set aside,
pay if the pledges don't come through?

"If there is a default on the part of the pledge, the city shouldn’t be liable for it or at risk," Roth said.

Shouldn't doesn't mean won't.

Council members also stressed that the city must own the center.

...however the foundation may have a stake in the building for a short period in order to secure the loan.

If the foundation has to have a stake in a building,
how would Greensboro's taxpayers not be at risk if the pledges fall through,
while a bank has a legal right to foreclose on City of Greensboro property?
 
http://www.news-record.com/blogs/killian_lehmert_the_inside_scoop/article_6407e128-8926-11e3-be88-001a4bcf6878.html
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From the Rhino;

"...Wilkins asked how the $35 million in pledges to the Community Foundation would be secured – that is, how the city could be sure the money would be raised and the City Council could be sure Greensboro wouldn’t be left responsible for part of the $35 million.

Vaughan...said the Community Foundation will, at the beginning of construction, have about $5 million in cash on hand and will obtain a bank loan for the rest, guaranteed by the pledges of the donors.

So $35 million in private pledges = $5 million in hand?

...Roth said that Vaughan has been clear that the city wants to eventually own the facility.

Roth also said that, if there were joint ownership for five years, the Community Foundation could use the building as collateral for its loan. She said that, under that scenario, the city would take full ownership after the five years."...

Sounds like they are looking to use Greensboro's $30 million taxpayer investment
as part of the collateral to back up the loan backed by private pledges.

...if the Community Foundation gives the city a check for $35 million, why does the city care whether the community foundation collects the pledges or not – it’s not the city’s problem.

Unless the collateral is the building, jointly owned by the Community Foundation
and City of Greensboro taxpayers.

...the Community Foundation will pay for the first $5 million in architect fees for the performing arts center and that city negotiators expect the Community Foundation to provide the remaining $30 million up front.

As long as a financial institution can guarantee getting the loan money back
with City of Greensboro taxpayer monies invested in the facility,
meaning taxpayers would be on the hook for the loan for 5 years.

...Councilmember Mike Barber ...said that when people pledge money, it is typical for 5 percent to 10 percent to go uncollected.

10% of $35 million = $3.5 million 

He said, “That’s just a truth.”

Barber said, “I can’t vote for it unless the city owns it.”

Meaning Barber won't vote for it
if the loan is collateralized by the building?

http://www.rhinotimes.com/council-getting-comfortable-with-gpac.html#.UuqTI9Eo6AI
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If the $30 million is good, why would the foundation need to have the taxpayer funded part of the building attached to securing a loan?

Why do they need a loan?

Where is the money located?

What is the money currently invested in?

Still no timeline of when how much is supposed to be paid over 5 to 10 years.

If the foundation comes up short, could the bank foreclose on the building,
at the expense of city taxpayers?
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Still unanswered information requests that the city said it doesn't have answers to, and the Community Foundation has so far refused to provide;

If any assets are currently in equities and are to be paid over time, please provide estimates of what could occur if financial markets fall 20%, and how much money is at risk for what time period?

If any assets are currently in medium to long term bonds with maturity dates longer than donation time lines, please provide estimates of what could occur if interest rates rise 25%, and how much money is at risk for what time period?

Please disclose if any funds are reliant on hypothetical expectations of return over time, and if so, how much?

If hypothetical return estimates are involved, please provide the assumptions used for the estimates, including inflation and fees charged by the Community Foundation or whomever is managing the monies.

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