Skip to comments.Chicago Public Schools borrow $275 million at sky-high interest rate
Posted on 06/20/2017 7:22:43 AM PDT by george76
The Chicago Public Schools will pay 6.39 percent an extraordinary interest rate by short-term lending standards to borrow $275 million it needs to make a mandatory payment for retiree pensions before a June 30 deadline.
Thats more than four times the interest rate a typical government would pay on the same borrowing deal
Its yet another sign of the dire financial condition of the nations third-largest public school system, which for months has had a junk credit rating from Wall Street financial institutions.
CPS officials secured the $275 million on Monday from J.P. Morgan. Its the final chunk of cash needed to make the $721 million payment for teacher pensions thats due at the end of the month
An additional $112 million thats needed to fund district operations will be borrowed separately.
(Excerpt) Read more at chicago.suntimes.com ...
How are they going to pay back the loan?
first one is free. next one is 5 bucks.
What happens when the next payment is due ?
Interest Rate - Schminterest Rate.....if they have no intention of paying it back.
What a rabbitt hole ! Someone other than them is backing that - no chance anyone lends into that bankruptcy in progress at 6 and change.
Yet the MASSIVE CORRUPTION that has poisoned Chicago for DECADES goes UNnoticed.
Meanwhile, the MSM continues to masturbate at the fiction of Trump “obstructing justice” and “colluding with Russia”
>>CPS officials secured the $275 million on Monday from J.P. Morgan. Its the final chunk of cash needed to make the $721 million payment for teacher pensions thats due at the end of the month
>>An additional $112 million thats needed to fund district operations will be borrowed separately.
Operating costs are $112 million and pensions are $721 million ?!? 6.44 times as much? And they’re borrowing 46.5% of their total expenses each month? Yeah, that’s sustainable financing...
Didn’t the Ill annoyed Supreme tyrants rule the state must pay out the full pensions by law? What a goat cluster copulation of a state.
“What a rabbitt hole ! Someone other than them is backing that - no chance anyone lends into that bankruptcy in progress at 6 and change.”
For sure, JP Morgan isn’t going to expose 275M without some guarantee from someone big. And what happens with next payment?
They aren't. We are.
Recently,a local Boston talk host mentioned that an MBTA employee (the MBTA is Boston's regional transit system) retired with a $97,000/yr pension.
That employee,boys and girls,was a friggin bus driver!
I worked for decades at one of the world's most famous hospitals and I know *heart surgeons* with smaller pensions.But of course *they* never belonged to a "public service" union.
Probably only lent for 2-3 months until receipts from second half year property taxes become due. Anything above six months would probably have attracted a much higher rate.
LOL, if they can't roll it over, and even if they can, they're not going to pay it back.
When the bill comes due the politicians have already got their own generous retirement locked in and don't have to clean up the mess they created.
If the muslims and the globalists don't destroy America the public employees unions are waiting in the wings to do the job for them.
It’s too bad the California Hollowoodies don’t donate all their money to Emanual’s schools instead of buying House seats in Georgia.
The DEMS are banking on the government owned CHICAGO CASINO that’s in the expanded gambling bill in the ILLINOIS GENERAL ASSEMBLY to bail them out.
A community organizer should step up and save Chicago.
J.P. Morgan is imprudent to loan this money, but I’m sure they’re betting on being bailed out when the loan goes south, and it will.
Not to worry. Rahm Emmanuel will ask his good friend the President of the United States to ... wait a minute ...
... paying back the loan may be a bit of problem ...
$17.5 million debt service without a single principal payment.
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