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Erie County's borrowing stalemate

The two-year battle between the Erie County government and the state-appointed control board is no closer to settlement than it was when it started. Each of the two governmental entities wants to borrow millions of dollars to pay for Erie County's much-needed road repairs, bridges, buildings and its community college campuses.

The impasse over who borrows the money to finance the needed improvements is most unusual. Generally, most government entities would not want to assume this massive debt, but here we have two vying for the right to borrow the money on the county's behalf. As a result, neither the county nor the control board can borrow the much-needed dollars.

Nobody disputes the need for the borrowed millions and, in most instances, nobody would be battling to assume such debt.

This unusual scenario became a problem when County Executive Chris Collins publicly stated that he would never let the control board secure a long-term loan for Erie County because of his concern that the control board would be forced to exist for as long as it has debt. In addition, there is no doubt that Collins is not happy with the existence of the board and wants it to disappear as soon as possible.

The control board insists it must finance the needed work in order to fulfill its obligations, and it says it could save the taxpayers of Erie County a million dollars a year on repayment of the loan. The county meanwhile has insisted it must be the borrowing agency and as a result, the impasse of the past two years continues unabated.

Let me say at the outset that I cannot commit to a categorical statement on whose side I fall in this intolerable dispute. I, in my years of doing this column, have always taken a firm stance but in this instance, I do not know which side is best for the citizens of Erie County and as a result will step aside and hope that somebody or some entity will enter the fray and issue a ruling that will untangle the impasse.

The work that would be financed by the loan is important and must be financed to proceed.

Collins has said he is willing to let the control board take out short-term debt but in the past, two one-year deals fell apart. And as a result, the impasse between the county and the control board just goes on with both parties seemingly unwilling to compromise their positions.

The control board's financial adviser and its bond underwriter have agreed that the board's plan could indeed save a million dollars a year on repayment costs, but the county comptroller and the county attorney say the board's claims are "complete fiction." That is where the matter stands, with the control board unwilling to let the county have its comptroller sell the necessary bonds needed to proceed with the work.

The control board, eager to have the work go forward, has said it would borrow the needed money on the county's behalf by selling its own long-term bonds. Leaders of the Erie County legislature have indicated they would consider such an idea but the county executive is not likely to change his position, so the impasse continues.

It is unfortunate that the county executive in his public statements on the issue has made it difficult for himself to back off and accept a compromise that could end this impossible situation. It appears that a third party may have to step in and offer a compromise that both Collins and the control board can accept. Sooner or later, that will have to occur, and hopefully it will be sooner.

Murray B. Light is the former editor of The Buffalo News

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