Saturday, December 11, 2010

Virginia HOA locked into long term contract with telecom provider; Congressman writes FCC

In a letter dated Tuesday, Dec. 7, U.S. Rep. Frank R. Wolf (R-10-VA) reached out to Julius Genachowski, chairman of the FCC, about the informal complaint filed by lawyers on behalf of the 1,117 residents of Southern Walk at Broadlands and its homeowners association. The residents first reached out to Wolf's office in the fall, and have been in communication with him regarding their concerns and their legal efforts since that time.

Wolf's letter states that the concerns of a residents "merit serious consideration" by the commission. "The complaint raises serious concerns about the fairness of a developer committing my constituents to a multi-generational obligation with a pre-selected communications provider," the letter reads.

Leesburg Today has the rest of the story.
There is a way to avoid these kinds of locked in deals. Developers can build open access fiber networks owned by the homeowners rather than a private vendor. Apparently the developer of the HOA involved here didn't go that route -- most likely because there was more money for the developer in having a for profit company provide the service. Another example of why privatizing local government is poor public policy.

Sunday, December 05, 2010

Mounting State Debts Stoke Fears of a Looming Crisis

Mounting State Debts Stoke Fears of a Looming Crisis

Municipal bankruptcies or defaults have been extremely rare — no state has defaulted since the Great Depression, and only a handful of cities have declared bankruptcy or are considering doing so.

But the finances of some state and local governments are so distressed that some analysts say they are reminded of the run-up to the subprime mortgage meltdown or of the debt crisis hitting nations in Europe.

Analysts fear that at some point — no one knows when — investors could balk at lending to the weakest states, setting off a crisis that could spread to the stronger ones, much as the turmoil in Europe has spread from country to country.
Governments in Europe and at all levels in the U.S. are reeling in red ink. While economic observers note consumer confidence and retail spending are up, reports like these as well as continued high unemployment demonstrate the ongoing powerful gravitational drag exerted by the implosion of the real estate bubble into a massive financial black hole in 2008.