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5-7-08 Davis’ spending and debt will haunt Oconee County in years to come – Part 2

The biggest debt and mistake is the Hard Labor Creek Reservoir Project in Walton County. Oconee County has signed onto an open ended obligation with little water resources obtained for the high costs. ..................................... Mr. Davis is glib in newspaper articles and in radio interviews. However, the facts do not back him up.

AVOC

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May 4, 2008

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Davis’ spending and debt will haunt Oconee County in years to come – Part 2

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By Wendell Dawson, Editor, AVOC, Inc

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Oconee County has spent money on a lot of things in the last several years.It has incurred debt of historic record size.   Much of the spending has committed more tax money in years to come.Larger facilities cost more to staff, operate and maintain.   Ad valorem tax relief is just a hollow slogan.

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The biggest debt and mistake is the Hard Labor Creek Reservoir Project in Walton County.  Oconee County has signed onto an open ended obligation with little water resources obtained for the high costs.

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Mr. Davis is glib in newspaper articles and in radio interviews.   However, the facts do not back him up.   Melvin Davis recently appeared as a guest on WGAU’s (1340 AM) Tim Bryant show.  The interview is available as a pod cast at the following link: http://1340wgau.mypodcast.com/2008/05/Newsmakers_with_Tim_Bryant_Thursday_May_1_2008-105324.html

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Charlie Baugh, who has been an avid advocate for honest and open government, wrote an analysis of the Davis interview and rebuts many of Davis’ glib claims about the Hard Labor Creek Project.  

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Charlie is a retired IRS official who can read financial statements and bond resolutions.    Charlie is very specific in describing costs and sources of debt obligation of the Hard Labor Creek Project.   He is convincing that Oconee Citizens and Taxpayers have been misled on Hard Labor Creek.   See Charlie Baugh’s analysis of the Davis interview below.


May 1, 2008: Davis’s Statements on Walton County Water Project are not accurate and are misleading.

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Charles Baugh, President

Citizens for Oconee's Future, Inc.
P. O. Box 1301
Watkinsville, GA 30677

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OconeesFuture@aol.com

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I missed Tim Bryant’s show today but I went to the web site and listened to the interview with Melvin Davis.  Davis’ answer about the payback for the debt to be incurred for the Walton County water project was not accurate and was misleading.  He stated that the project would be paid for by the sale of water.  I just completed reading the Offering Documents for the $ 19,585,000 bond issue the county just approved as part of the funding for the project.  

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The Preliminary Offering Statement states emphatically that the county system revenues are not pledged for payment of the bonds.  In fact the revenues are pledged for pay out the Bear Creek reservoir bonds.  The Only revenues pledged are ad valorem taxes.  The following passages from page 10 are quite clear:

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"The County has also agreed to levy an ad valorem property tax, unlimited as to rate and amount, on all property in the County subject to taxation for such purposes in order to make the contract payments to the extent that the County does not have other funds to make such payments.  The County intends to make the contract payments with moneys derived from the County System Revenues; however, the County System Revenues have not been pledged as security for the Contract Payments or the Series 2008 Bonds."

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Couple this with the inflated population and revenue estimates and you can bet the bonds will be paid with property tax dollars or with future sales tax dollars.  You will see this in the next proposal to do a SPLOST vote which will include substantial sums for "water system improvements".  In fact the bond documents mentions future improvements to be paid for with sales tax revenue.  

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The BOC just went through a charade to implement "conservation pricing" for water, taking advantage of the drought to increase water rates for increased revenue to pay for the bondsPage 1 of the Moody's Rating Service Report states:"The County has also recently adopted increases to water rates and connection fees to fund the additional debt service expenditures".  Nice trick, tell the water customers they must pay more for conservation and tell the rating agency rates were raised to pay debt service.

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The citizens of Oconee County need to know that sometimes things are not as they seem in Oconee County Government.


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