Saturday, June 11, 2011
We have no quarrel with the need to keep our streets well maintained and this piece of equipment is not unreasonable to do the jobs carried out by our street department. What is troubling is the manner in which this deal is moving forward. Under Article 8 sec. 3 of the Idaho Constitution debts, liabilities or obligations going out beyond one budget cycle are not permitted. We filed a public records request to see the lease-purchase documents and the request was denied by City Finance Director Eljay Waite.
Mr. Waite maintains the motor grader is "ordinary and necessary" and has ignored the Idaho Constitution. He does not have the legal authority to make that determination and there is ample case law under Frazier v. City of Boise case law in 2004 and 2006 that clearly spells out what is and is not "ordinary and necessary". This lease-purchase does not meet the criteria by any stretch of the imagination. The Idaho Constitution says Mr. Waite, has to come to the voters and ask our permission to enter into a long term contract such as this or they can choose to use the Judicial Confirmation process to stay withing the strictures of the Idaho Constitution.
The City of Caldwell has every right to simply lease this piece of equipment on a annually renewable lease with no ownership rights. However, when they choose to enter into a long term lease that will obligate future elected officials they have stepped over the line. They can also purchase it outright with cash up front for the deal.
A new John Deere motor grader will cost city taxpayers about $200,000.00 plus interest charges for the five years of the lease-purchase deal based on internet research on the cost of a new motor grader. Once again your Idaho Constitutional rights are about to be trampled on and ignored by the city of Caldwell Finance Director and the blessing of the Caldwell City Council. It need not happen when there are perfectly legal ways to swing this deal.
EDITOR NOTE: We received the contract today (6-14-11) from the city attorney's office. Sure enough there is a clause in the lease purchase stating the lessee can purchase the motorgrader for $1 at the end of the lease. To be clear the City of Caldwell has not entered into a lease-purchase to our knowledge at this point in time.
Posted by Paul Alldredge at 5:54 PM