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Monday, March 24, 2008

WTF? Funding the Medical Mart, Ken Lay style

Posted By on Mon, Mar 24, 2008 at 3:43 PM

When told about the deal in an interview from Hell, Ken Lay let out a hearty chortle of admiration
In their ongoing quest to blowtorch your wallet, then stomp it to death while doing Cherokee war cries, Cuyahoga County commissioners may have fashioned their worst deal yet to build a new convention center/medical mart in Cleveland. In a new C-Notes series, Ace Reporter Lisa Rab breaks down the absurdity of the deal for those of you scoring at home: The commissioners have promised to front an estimated $400 million in bonds to build the center. But Chicago’s Merchandise Mart Properties will be in charge of actually laying down the bricks and mortar, and when it’s done, the private company will own it. Guess how it’s going to repay the construction loan? With more of your money! … That’s right, ladies and gentlemen, this is where is gets really fun. We, the people of Cuyahoga County, will pretty much pay for the whole project. And what do we get for picking up the tab? Only the right to rent our own convention center! And we’ll pay the Mart folks $40 million a year for 20 years for the privilege. In return, they’ll be using our own money to repay what we lent them in the first place! Then, just for kicks, we’ll also pay them at least $103 million to operate the joint, and they’ll be able to keep any profits they earn. To put it in perspective, imagine going to the Buick dealership for one of those sweet new LeSabres. In the case, the dealership loans you the money to buy your LeSabre, then keeps giving you money so you can pay back your loan. To top it all off, the dealership also provides a handsome yearly stipend to compensate you for driving their car. At the end of the day, you have a free Buick that you’re being paid to own! That’s the beauty of doing business the Cuyahoga County commissioners’ way! We now return to our regularly scheduled, far less painful programming…

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