The underpinnings of last Wednesday's shitshow now appear to be the Council's failure to read and/or understand the original contracts between Hoboken and then-United Water.
Its not rocket science. Nor is it great political theater.
It's just due diligence.
The Council sat for two months, July and August, with concerns about a large ($8.35M) liability that was identified in the renegotiated SUEZ contract. Yet apparently they:
- Never obtained the Hoboken-United Water contracts,
- Never read them,
- Never obtained expert advice from a municipal accountant, muni bond lawyer to understand how the contracts were structured, why the city has never been billed, why it is illogical to "INVESTIGATE" when the terms of a contract are being met, and why this liability does not belong in the City's budget.
The reason why Hoboken hasn't been billed is because the Hoboken-United Water deal was structured with a contingent liability.
A series of edifying remarks were posted on MSV by screen name GreenGopher098. Unlike the City Council, GreenGopher098 has read the United Water-Hoboken contracts and understands them. GA has independently verified through a mutual acquaintance he works in finance and is exactly what he says.
From GreenGopher098,
"I am a municipal bond analyst. I know tons of attorneys. Once you have the docs, it is pretty easy to forward them to an attorney w/ a simple question and get an answer in less than an hour. You folks should try that next time. Might save Jen and the rest of the fools on the CC from stepping on a landmine on purpose.
This liability is a contingent liability that the way the contract is structured is ultimately designed to be sent along over to ratepayers to pay. Contingent liabilities w/ low probabilities of payment are not reflected on the Balance Sheet at all and you certainly don't put something on the budget unless or until you expect to actually pay it. If the goal of the city is to shift the cost to ratepayers, then that means contingent liability never gets triggered, city never pays, city has no obligation to include the liability or cost in the budget or the financial statements. If folks read the WHOLE CONTRACT and actually understood how it worked, why it was structured the way it was structured and what Zimmer was doing, they would get WTF is going on.
But here is the problem, we have a bunch of people who have less than no experience in finance or contracts opining on a contract based on their read of ONE CLAUSE in the contract. Not one of them are looking at it holistically. This is why the same people who don't understand the contract keep harping on the same exact talking points. I also don't think these people are smart enough to understand that if the City Council keeps going down this very irresponsible path they are on, they might actually trigger the contingent liability (the one ratepayers should be paying), forcing the city to record the liability on their financials next audit and resulting in a property tax hike not only to cover the cost of the accrued liability but also all future repair costs for as long as the contract is in force. Yes - stupid decisions by the City Council can cause exactly what I am describing and it will be 100% the fault of the CC if it happens.
Clearly you missed the sections that explain the city's options on paying the liability - like raising water rates. Guess what, if the city's plan is to shift the cost to rate payers, the city ain't planning on paying the liability which is why it is a contingent liability.
If this is what the city selected "(ii) the City and Suez shall have otherwise mutually agreed to an arrangement which adequately compensates Suez for such costs" - that in no way requires payment in less than 1 year and is more than vague enough to allow the city to do quite a bit. You also missed the part mentioning Suez potentially fronting the entire amount of pledged capex in 1 year and how the contract contemplates that eventuality. You do realize not only can Hoboken roll the liability but draw down on future capex commitments early w/ no obligation to pay back in the interim. Your statement on Section D misinterprets the contract. You should read it again and check w/ bond counsel like I did.
BTW, not surprised by that. The same people whining and moaning about the contract for 4 days have had access to the contract for 4 days and have been trying to play this cute little game where they pretend they don't have it, clearly have read it and make pointed comments and like to play "gotchya" games. It is pretty frigging dishonest and I'd argue games like this are exactly why we all ended up hating Beth Mason and her cronies back in the day. Shocking how similar the parallels are from that blast from the past and not in a good way for Jen and company."
Did you get all that? Read it a couple of times.
Now, recall WHO negotiated this shitty deal with United Water for Hoboken: (Mayor Anthony Russo) and WHO has been working for 1.5 years to renegotiate this deal, now with SUEZ (Mayor Zimmer.)
Recall WHO publicly attacked the Mayor for a good faith renegotiation FALSELY inferring that she had done something nefarious and or negligent: (the Council.)
Recall WHO publicly attacked the Mayor for a good faith renegotiation FALSELY inferring that she had done something nefarious and or negligent: (the Council.)
Wednesday's Council attacks on the mayor ("what did you know, when did you know it...") about a contingent liability which the city was never going to pay per contract, borders on incompetence.
Moreover, why was the Council so contemptuous toward 2015 Budget Auditor Steve Weilkotz when he told the Council that as the City had never received a bill or a dollar amount, it was not necessary to allocate funds for the liability in the budget.
Perhaps it was a missed opportunity for Weilkotz to give the Council a lesson in municipal accounting and contingent liability as per terms of the Hoboken-United Water contract.
But he didn't, and mayoral candidates on the dais jumped into the void.
Mike DeFusco demanded that the DCA "investigate" and Jen Giattino told the Hoboken Reporter, "an independent investigation into this matter is warranted"
It is sad and it is depressing.
Here are the Hoboken-United Water contracts.
Hoboken-United Water Agreement (1994) by GrafixAvenger on Scribd
Hoboken-United Water Amendment 1 (1996) by GrafixAvenger on Scribd
Hoboken-United Water Amendment 2 (2001) by GrafixAvenger on Scribd
We thought about the so-called "read" option. But at our combined Team GiaFusco Investor Conference, ginning up a faux Watergate story was the unanimous choice. It's fun, it's exciting, you get to say cool stuff like "What did she know and when did she know it?!?" and "The cover-up is worse than the crime!" You don't really get any of that with the reading option.
ReplyDeleteWe've received a lot of criticism for not being able to cite a reason why we're running. So now we have one: Entertainment!
Hoboken Watergate is off-the-charts entertaining. Reading, not so much.
Enjoy the bread and circuses everyone!
Team GiaFusco: Change that's Changey
Can I say I really like reading your comments!!! Seriously I really do
DeleteThe more I read about Jen the less I like her. She's an imbecile.
ReplyDeleteI am glad that the "2015 Budget Auditor Steve Weilkotz". . ."told the Council that as the City had never received a bill or a dollar amount, it was not necessary to allocate funds for the liability in the budget." and those morons STILL didn't get it.
If those words are not clearly understood, then one has no business on the dais.
The truly bizarre thing is they are so fixated on trying to prove Zimmer is dishonest. They come up with these bizarre theories based on misinterpreted documents and twist those interpretations and the facts into some grand conspiracy theory that becomes the narrative for all their attacks against Zimmer. They get slapped down by 1 commented who proves how they are wrong and they pop up with a new ID and say "what about this" and then that comment gets slapped down. This goes on for 4 days, comment after comment and the only thing they accomplish is they end up looking stupid and their theory gets torn to shreds. I think now they are just peddling the narrative that the mayor is dishonest, doesn't ask for input when making executive decisions, blah blah blah. Shocker, a mayor making decisions. I could have sworn that was part of the job description.
ReplyDeleteAnd none of them get how bad they look or how weak their arguments are. They all think they are the smartest people in the room - which is only true when they are in a room all alone. It does not help that not one of Zimmer's vocal critics in that forum has an iota of experience in the subject matter they are pretending they understand. Oh well, I am sure they will come up w/ a different nutty theory tomorrow. That is how the new 411 rolls.
This proves that Jen, Peter, and Tiffanie have moved from the professional zone to the political zone. It's terrible and hurting our city. What is the matter with them? Why so unprofessional. Read a contract, consult with a professional. Is it that tough?
ReplyDeletewait, i thought tiffanie was "good with numbers"???
ReplyDeleteobviously, this isn't a matter of "they didn't read it" or "didn't understand it", etc. it's intentional. they know exactly what they are doing, which of course makes it all the worse.
If Tiffanie and Jen are so "good with numbers", then why are they both unemployed?
ReplyDeleteThat's not true. They both have part time jobs as city council women. And Jen is a realtor.
ReplyDeleteTiffany left or lost a job as, I believe, chief financial officer of a shopping mall developer years ago and has been "between opportunities" since, but neither is actually unemployed.
But neither is employed in a field that would suggest they understand WTF is going on with respect to this specific topic and it shows. It also shows that their proxies know even less.
DeleteCity council is not a "job", even though it comes with pay, it's an elected office. And if Jen really is a realtor, then she's been privy to and voting on matters that have huge conflicts of interest. I don't recall her ever recusing herself.
DeleteBased on the trajectory of Zimmer's rapid descent into total corruption as reported by MSV and trumpeted by its stalwarts, she will be Anthony Russo by Thursday.
ReplyDeleteWorse than Russo by then. Tomorrow she'll hit Russo levels. :)
DeleteOnly if you believe the alt-wrong fake news peddled on MileSquarePullCrappollaOuttaMyHorsesRearEnd
DeleteDon't you Backroom-loving zimmer zombies realize we've got Peter Cunningam, a professional muni-bond expert? That's our credential right there. He knows his stuff inside and out. That's all the professional credibility we need for you to be sure that if proven wrong on the Suez contract, we're probably lying.
ReplyDeleteThat's how we roll in the REAL REFORM RESISTANCE REBEL ALLIANCE!!!!
This comment has been removed by the author.
DeleteAnd by the way, even once we're exposed as liars, we still think people will vote for Jen because people are willing to tolerate a little disinJenuousness from politicians, as long as they don't have them other "unelectable" factors of outlandish candidates like Bhalli, if you get my meaning.
ReplyDeleteClearly this is all nonsense. That's why Dawn Zimmer suddenly chose not to run right before it came to light, and Ravi Bhalla has had to recuse himself. But they will sue you if you tell anyone, or just give you a $62,000 taxpayer funded settlement for illegally throwing you out of a meeting.
ReplyDeleteKen Osmond, do they pay you in kibble? Cowhide chew toys? Beef bones?
DeleteBig fan! I never thought Merrill got the credit he deserved. Which would you say is the most talented of your brothers?
DeleteIt's encouraging in a way that NO ONE attempts to answer Green Gopher. MSV is running the usual "you'll see, big news coming, just wait, any second now..." up the flagpole in lieu of a reply.
ReplyDeleteNot unlike Hudson County View, where instead of attempting to defend the indefensible fish story that Patty Waiters is paying for the Romano challenge, one of the MSV all-stars continually attempts to out the critics. Hint: it's the same one who bitches the longest and loudest about being outed.
What you have in both cases is people admitting they don't have a leg to stand on. I guess that's good. Better than the alternative anyway.
The one who complains about being outed is probably where MSV got the docs from. Since he had only information up to a certain period of time, it is why they are missing docs or don't have the background materially necessary to answer questions.
DeletePerhaps if the CC spent a little less time acting like little snots and a little more time compiling a list of coherent questions that needed to be answered and maybe picked up the phone and asked them instead of grandstanding at an open meeting, I suspect they would have voted on the Suez contract already. It took GG like 2 days to rip their talking points to shreds. No reason why the CC couldn't have spent the last few months figuring stuff out well before last weeks vote.
But nooooooooooooooo, they want to make a stink because it is an election year and they are pissed Zimmer didn't ask their permission before endorsing a candidate. As if she needs their permission to make a personal decision like that.
What a bunch of spoiled petulant little children some reformers have become when they don't get their way. BTW, I am firmly convinced it is b/c they are bored, have nothing to do all day and they exist only to complain and cause trouble.
It's that, but its also because Giattino is not just a sweet mom who wants to help her community as her lit claims. She's an ambitious pol who wants the status of being mayor. Also some of her brain trust consists of power hungry people who desperately want her to be mayor because they believe they will be able to exercise the power and influence they crave through her (something they couldn't do through Zimmer despite their efforts). And then there's Tiffanie....
DeleteKeep laughing. Let's review the ground-breaking, earth-shattering, game-changing justifiably breathless reporting from...
ReplyDeletethe Team GiaFusco Reform Resistance Corporate Website:
PROOF* that John "Pedo" Podesta is a pedophile operating out of a DC pizza parlor.
PROOF* that Seth Rich and NOT the Russians gave away all the DNC emails.
PROOF* that climate change is a hoax.
PROOF* that Jen Giattino cast all 5 votes in favor of eminent domain, thus saving the Southwest Park.
*"Proof" in this instance is meant in the alternative-dictionary sense of "devoid of any proof whatsoever but earnestly believed anyway due to disdain for the alternative and/or contempt for the party or parties targeted by the 'proof.' "
We are about to PROVE a link from the Suez contract to John "Pedo" Podesta, to the exaggerated predictions of hurricanes, to higher-ups in the mayor's office! We will also PROVE that outing commenters is the same as disPROVING their comments.
All this and more! Yet less! Yet nothing actually!
Team GiaFusco: Change that's Changey