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Sep 14, 2012

City Bond without Legacy

Darrell Bradley

The municipal bond by the Belize City Council was launch on July twenty-third and it was tabled in the House of Representatives one month later in late August. The twenty million dollar bond, according to CitCo, is being floated by inviting the business community to invest in City Hall for much needed infrastructural improvement in the City.  The prospectus was to have been issued by the end of July, but two months after and it still has not been published.  As financial advisor to the Council, the Legacy Fund’s director of Projects and Research Linsford Coleman joined mayor Bradley in a press conference where he said that the council would introduce a garbage collection fee, reassess properties and their taxes; essentially a revision of finances that would allow the council to meet interest payments as well as payment allocation for its sinking fund provisions. But it seems that the only thing that will remain of Legacy’s relationship with City Hall is a solemn goodbye.  Legacy recently sent out a press release in which it announced that as of August twenty-seventh, it was no longer a service provider for the Belize City Council with respect to the twenty-million dollar infrastructural bond project.  It further said that Legacy Fund has been disengaged from the project, due to an impasse with the Council over terms and conditions on moving forward with the municipal bond offering. Mayor Darrell Bradley says that this discontinued relationship with Legacy Fund does not derail or threaten the bond; but it has simply delayed the process by a week.

 

Darrell Bradley, Belize City Mayor

“I don’t think that anything went wrong. From the very beginning, we’ve been using several financial advisors to advise us as it relates to the launch of the bond. We’ve been assisted tremendously by Legacy and they did a full forensic analysis of our financial operations. They delivered on a lot of the works that they were supposed to give us in terms of putting us on the right footing; meeting with potential investors. We also have benefited from the insight and direction of the Central Bank of Belize. We’ve also been advised by our internal persons; we also have our auditors who are also assisting us. So we have a team of financial advisors who have complemented the internal persons from the City Council who really are in charge of the release of this bond and our perspective. So it is not a problem for us to say that well at one point, we feel certain works to be delivered by certain service supplier has been completed and we don’t want to proceed with you going forward. There is nothing wrong with that and that does not derail or threaten the launch of our bond nor does it derail and threaten the confidence that our potential investors have expressed in the bond program. I don’t think that anything is wrong with the process. All persons who are dealing with this are supreme professionals. Legacy is a firm that is made up of professional persons; I am confident of that. The City Council is made up of individuals who are professional and we act in a professional manner. If you reach a certain point where you disengage from a person who is providing advice to you; that does not jeopardize the integrity of the program. And that is what we are saying. We are saying that both Legacy and the City Council continue to be committed to the program. We are supremely confident that we will be able to launch our bond in the very, very near future. Up until this week here, I’ve had meeting with very large potential investors and they are very interested in purchasing he bond and in moving forward. So we don’t think that this will be a stumbling block. I mean of course, it would be remiss of me to say that it isn’t something that I would have wanted to avoid, but I mean I don’t think that it would be any impediment for us to launch the bond.”

 

Mayor Bradley says that the council is in the process of finalizing the prospectus which would take some time given the fact that it is a first bond that any municipality in the country and the Caribbean has undertaken. When the council receives the monies from the bond, it would go into those potholes and poorly constructed drains and streets of the City.


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11 Responses for “City Bond without Legacy”

  1. Lucas says:

    Belizeans BEWARE of buying bonds from a UDP govt. cause they haad to pay.

  2. Bobby Cadle says:

    Give the gentleman a break because he is trying to make things right in the city. He needs the support of all city residence regardless of your political affilation. I have no apology by expressing my opinion.

  3. Rod says:

    Now they want the business community to pay again for the same things they have already paid for but since all that money has gone into the pockets of these ministers now they want the same business community to pay again how dumb do they think we are damm.

  4. Storm says:

    Hmmm. The nation will finally default on the Superbond next Wednesday, the 19th. As a nation, Belize has become a “dead-beat.”

    That must make it practically impossible for the City to launch a new bond. Who will be foolish enough to invest in the Jewel anymore when there is no history or prospect of repayment from us?

    Thanks to PUP and UDP, because they worked together to bankrupt us and destroy our credit. And for the life of me, I don’t see any benefit that the nation got out of spending a BILLION BORROWED DOLLARS.

    A further question is, why must the City live beyond its means? If roads must be repaired or bridges [or private mansions] built, don’t borrow, just budget out of current revenues. Bonds means that today’s politicians get the joy of spending, and tomorrow’s taxpayers get the burden of paying — and paying and paying.

  5. Teddy Steinway says:

    No way anyone wants another Belize bond.

    Not until Mr. Barrow settles down to business.

  6. Ricky Malthus says:

    Selling of this bond to the Belizean public will have negative ramifications on the economy as this will shrink the economy because City council will crowd out private funds that could be better used elsewhere in the economy. Belize is an underdeveloped country still dealing with corruption, crony capitalism,looting of our treasury(taxes collected), and the the legacy of slavery and slave mentality and syndrome. Once we have conquered these social evils, we can start developing and grow our economy. Anything less, we will have the same thinking and inaction for the ensuing 500 years. It is truly saddening to see both political parties not being able to discern this .

  7. William Freda says:

    I believe that the intentions of the Mayor are true and sincere unfortunately the record of the Belizean government is very bad. There are many factors when investing in municipal bonds on of them is that unfortunate Belize City’s local economy is very bad coupled with the high unemployment makes it extremely vulnerable for any investor. The tax increases would not cover payment of the bond as you would see and immediate slow down in the local economy this is what happened with the super bond. What the Mayor should do is think outside the box attend a city conference where city’s from all over the World meet and see is he can get some sort of mutual aid not sure how it would work but There are other forms of infrastructure aid that Belize can get. Write to some of the large foundations around the world that have large amounts of money and can secure a long term low interest loan or even a grand I know these are far fetch ideas but the reality is that the country has very very very bad governance. One of the problems of Belize is that it does not think through the policies it invokes and the long term problems it creates in the future like bond assurances and credit.

  8. BMNJ says:

    Who love bonds? Said Musa and Ralph Fonseca. Maybe Mayor Bradley should approach them because they may very well invest in it.

  9. rodddy says:

    GET RID OF THE PM!!!!! David Fonseca was the best mayor. Bring him back. He only stole 300 thousand. Moya went with millions. Dean Barrow Billions@! i want him gone bad… i could cry.

  10. Jose says:

    I am sorry for those who will pay this bond. 20 Million for such a compex city is not really a lot…a lot of it will go to administration fees, consultancy fees, legal fees etc…and at the end of the day…tax payers will be saddled with another failed bond. Such a bond should be reserved for an emergency purpose. What will the city do after the Cat 5 that might be coming up any time now??? Just think..people,,think.

  11. Rod says:

    I say every minister should give up a part of the monies being embezzled and fix the streets or maybe the pm should fix he streets himself since he just bought his wife a 10’000.00 ring when belizeans are starving in the country hope all the poor people in this country need fu march march to his house unu the starve while them and his ministers live off of your misery.

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