APS' bond rating substantially weakened

From the Journal (link sub req)

An operating deficit and turnover of key financial officers has "substantially weakened" the financial position of Albuquerque Public Schools, Moody's Investors Service reported Tuesday.

APS just sold $75,000,000 worth of bonds to
Morgan Keegan & Co. Inc.
Taxpayers will pay $25,000,000 in interest.

It is going to cost taxpayers only $25,000,000, because APS, based on its bond rating, was able to borrow money at a low interest rate; 3.99%.

APS' bond rating is established by Moody's Investors Service.

The leadership of the APS was worried that Moody's might downgrade APS' bond rating. A downgrade would mean higher interest rates for bonds, and would be difficult to explain to taxpayers.

They worried that Moody's might downgrade APS based upon the public corruption and incompetence in the APS Financial Dept. that is coming to light.

According to the article, Moody's gave the APS an Aa2 rating despite;

... negative comments regarding an audit released by the district last week ,that showed that APS is $53 million short of its reported net worth, and revealed personnel issues in its finance department.

The APS has an annual budget of around $1,000,000,000.

It also has a Chief Business Officer who recently resigned amid allegations of sexual harassment.

His accuser, the APS Head of Accounting, was placed on administrative leave in September; leaving the APS without even a single CPA on duty.

She is on leave while being "investigated" by the APS.

There has been no communication from the district as why their investigation is taking such an inordinately long time. It is worth noting that the length of her leave is consistent with her allegation that she has been placed on leave in retaliation for blowing the whistle on financial irregularities.



Worse,
one of my readers reports that,

"The CPA from Chicago that Acting Accounting Director Ted Osbourne and Tom Savage hired, walked out last Friday because there was no one at APS that had any accounting knowledge who could help him with the 2007 audit."

The citizens of Albuquerque may have to put up with the corruption and incompetence in the leadership of the APS; but Moody's does not.

APS has hundreds of millions of dollars worth of bonds yet to sell. Taxpayers will have to pay millions of additional dollars in interest on those bonds, if APS' bond rating is downgraded.

APS' bond rating will be downgraded if the corruption, incompetence, and the complete lack of accountability in the leadership of the APS is not exposed and corrected.

APS' bond rating will be downgraded if there is not an impartial accountability audit of the leadership of the APS.



This situation represents a financial crises for the APS
which we cannot afford to ignore.


Nor can we continue to allow the leadership of the APS to stonewall the issue.


The leadership of the APS must either;

• begin an honest accountability audit; or
  

• explain to stakeholders' satisfaction, why they will not.

It is time for the APS Superintendent Beth Everitt
to stand and deliver a response to the question;

Superintendent Everitt,

Will there be an honest and impartial audit
of your administration?

... yes, or no?