Well, it's been a couple of days since this story was in the local paper, The Blade, but it got me so angry on so many levels that I've just now been able to blog about it.
Apparently, our county commissioners don't think that enough people are buying art, so they've decided that they're going to help. (Nice of them, huh?) You see, people who want to buy art, aren't always able to because of the cost - so, according to Comm. Ben Konop, there's now a program to make it 'more affordable.'
Under the new 'economic development' program, individuals who qualify can get a loan of between $500 and $2500 at an interest rate of 1% to purchase a piece of local art. The maximum amount that Key Bank will loan under this program is $25,000.
And why would Key Bank make such a program available? It's because they're going to get a $250,000 investment from the county in the form of a certificate of deposit...and they're only going to pay 1% interest for the cd.
So...instead of the County Treasurer, Wade Kapszukiewicz, getting the best rates for the county, he's agreeing to this investment which, according to his office, means that the county treasury will be out $7,881 (the difference between the going interest rate and the 1% that will be paid).
And please don't advance the argument that "it's only" a small amount of money...in this case, the issue is not the amount of interest that's NOT going into the county treasury, it's the mistaken philosophy that public funds should be used to advance social issues.
From the article:
"County Treasurer Wade Kapszukiewicz said he is always looking for ways to use the "financial resources of the treasurer's office to move the county forward.""
In doing research on this, I could find nowhere in the Ohio Revised Code that detailed this as one of the responsibilities of the office of treasurer. But I did find plenty of references to 'safe' or 'secure' investments including the following:
"Safety, liquidity and earning a market rate of return on the county's money are primary responsibilities of the Treasurer."
Further, the State Auditor has issued a manual for county treasurers which states:
"The main goal of the county treasurer is to coordinate the county spending with the active/inactive funds. The desire is to match short-term needs with the short-term deposits, and to match long-term needs with long-term investments. It is fiscally irresponsible to invest short-term funds in a long-term investment. This matching can be achieved by coordinating spending with estimates of income. Open communication is necessary between the auditor and the treasurer to plan the timing of the investments. The portfolio should be managed to maximize interest rates while keeping risk to a minimum." (emphasis added)
So, if the investments should be managed to maximize interest rates, has our treasurer done this? Nope! He's decided that, instead of maximizing interest rates, he's going to help people buy art.
Then there is the whole issue of a the program itself. If the county commissioners were going to provide a program of low interest loans, is buying art the best target of those loans? What about purchasing a vehicle - that would generate more than the $300 in sales tax that they estimate the art sales will provide. Or maybe a recent high school graduate would like a $2500 loan at 1% interest to help pay for college. Or maybe you'd like to redo your kitchen - wouldn't YOU love to have a 1% interest loan for that? How about any other purpose - landscaping your yard, putting up a new fence, buying a new big screen tv, or even a vacation?
And what are the qualifications for such loans? The article doesn't say, but is it likely that people who qualify aren't really in NEED of a loan to purchase art? And do we think that people who don't NEED a loan to purchase art will still take advantage of this program?
If I was planning to purchase a piece of art at $2000, I could invest $2000 in any number of ways that would generate more than 1% interest, but let's use the county's rate of 4.157%. Such an investment would give me about $83.
Then, I could take out the loan at 1% and purchase the artwork. The interest on the loan will only be $20. So I get the artwork AND I make $63 doing so. And I do this at the expense of the county treasury and all the county taxpayers. Sounds like a great deal to me!
I know that there are a lot of people who are firmly convinced that the best investment for a community is art - everything from subsidized rent to this kind of a program. But 'art' is in the eye of the beholder and it's so completely subjective.
My preference is that we prioritize better.
Our county jail is in serious need of attention - individuals with multiple court cases are never held to account because their crimes are non-violent misdemeanors so they are released without ever going to court due to the Federal Court Order on overcrowding in our jail - not to mention all the security issues and recent problems well documented in our local media.
Our historic County Courthouse has needs that have been detailed for years by the judges. What about all the individuals who've appealed their property tax valuation - any decrease in property valuation means a decrease in property taxes resulting in less money in the county treasury. I'm sure there are many other things that you think would be more important than using county tax dollars as a guarantee for artwork loans.
But as of today, other than the media report on the day of the announcement, no one's said a thing. So remember - any lack of opposition to a decision is perceived by our elected officials as being support for the decision, leading to similar types of actions in the future. Make your opinions known.