Under Strain, Cities are Cutting Back Projects
Cities, states and other local governments have been effectively shut out of the bond markets for the last two weeks, raising the cost of day-to-day operations, threatening longer-term projects and dampening a broad source of jobs and stability at a time when other parts of the economy are weakening.
How does that effect us locally? It's not a terrible burden for the immediate future, but it's something that may eventually cost the City. Since interest rates have been quite low for some time, most of the City's financed debt is at a low interest rate. However, if we were to need to go our for financing to redevelop the riverfront or we wanted to do bonds for road work to take advantage of today's prices over tomorrow's escalating prices, it's going to be much more difficult. As you can see in the article I linked, we would end up paying more in interest if we could even get anyone interested in lending.
