Following Tamarack’s Loan Request

[Update via New West: Tamarack’s Investor/Owners filed for bankruptcy protection last week.]

After inquiring from a financial whiz I know, who – incidentally – knew nothing about Municipal Bond Banks or the like, I decided to call the state treasurer’s office to find out how the scoop on Tamarack’s seeking to “persuade the state to guarantee a $42.5 million low-interest loan to a local sewer district for a major expansion of sewer and drinking water systems that serve the ski and golf community and others in the area.”

As I learned today, the MBB is a conduit for the acquisition of financing.  With an educational background and degrees in the biological sciences, history, and religious studies, I know practically nothing about finance; I barely balance my checkbook.  However in reading this story, I found this almost unbelievable, and even asinine:

The bond bank generally lends on the condition that Idaho can intercept state sales tax revenue destined for the local government, in the rare instance that government no longer can make its payments.

In this case, the loan applicant, the North Lake Recreational Sewer and Water District, doesn’t get state tax money. So the resort has offered the property as security instead.

Thus, Tamarack will offer as collateral, land, to help the North Lake Recreational Sewer and Water District case when making the presentation to the MBB.  But how was the state to get the repayment funds from Tamarack?

The MBB board will be meeting on March 4, 2008 in Room 208 (2nd floor)  of the State Treasurer’s temporary office – in the Borah Post Office downtown – at 1:30 pm.

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