Wednesday, June 13, 2018

Debt-Ridden Tampa Bay Times Duping Employees, Subscribers , Advertisers, Suppliers

Cross Post from Jim Bleyer, Tampa Bay Beat blog

With approximately $100 million in debt and operating nowhere near profitablity, the Tampa Bay Times is in its death throes as a viable, traditional newspaper entity, Tampa Bay Beat has learned.

The pension plan is in jeopardy. Assets have been mortgaged. Filing bankruptcy could very well be on the horizon.

Some creditors know this. So-called “local investors” must be aware of it. But worst of all, Publisher Paul Tash, who also serves as board chairman of the Poynter Foundation, has been cognizant of the deteriorating financial situation for several years.

The Poynter Institute is the parent company of the Times.

Tash, the $550,000-a-year chief executive, using a three-card-Monte ploy to stave off bankruptcy, seizure of assets, and an ignominious finality to a longstanding media entity, has known for some time the company’s pension plan is at extreme risk. Times employees have a regular payroll deduction for pension benefits but it could very well be funneled into financing current operations instead of its intended purpose.

Any employee, sufficiently deranged to want to continue employment at the Times, should require an examination of its books. Hell—subscribers, advertisers, suppliers and any entity that has advanced money to the Times should demand to see the results of a forensic audit as well.

The Pension Benefit Guaranty Corporation, a federal agency, has placed liens totaling $70 million against The Times Publishing Company. The Times’ total indebtedness is believed to be in excess of $100 million.

The PBGC obtains revenue from four sources:
Insurance premiums paid by sponsors of defined benefit pension plans;
Assets held by the pension plans it takes over;
Recoveries of unfunded pension liabilities from plan sponsors’ bankruptcy estates; and
Investment income.

PBGC liens against the Times (only opens in Google Chrome):

—Oct. 15, 2015 totaling $7,610,616.

—Jan. 15, 2016 totaling $2,888,797.

—Oct. 15, 2016 totaling $10,904,192.

—Jan. 15, 2017 totaling $3,496,356.

—Apr. 15, 2017 totaling $30,476,992.

—Oct. 15, 2017 totaling $15,369,170.

On June 28, 2017, Crystal Financial signed a Satisfaction of Mortgage, releasing Poynter Institute from a 2013 loan totaling $28 million. The mortgage security released was the Poynter Institute property and the parcels of land comprising the Times printing plant.

On the same day, Encina Business Credit LLC signed a lien subordination agreement with PBGC on Encina’s $20 million loan. The agreement identifies that as of January 15, 2017, the Times has an outstanding lien from PBGC for $59,615,990.

The subordination agreement was written so as to basically replace the same subordinated lien that Crystal had with the Times. Encina is a lender of last resort, one step above Tony Soprano’s loan sharking operation.

The subterfuge, paper shuffling, and co-mingling of funds are mind boggling.

In a “distress termination,” where the plan does not have sufficient money to pay all benefits, the employer must prove severe financial distress, e.g., the likelihood that continuing the plan would force the company to shut down. PBGC would pay guaranteed benefits, usually covering a large part of total earned benefits, and make strong efforts to recover funds from the employer.

Greasing the skids for the Times was its purchase of the Tampa Tribune from Revolution Capital Group for a reported $22 million, about $22 million too much. With property, buildings, and a printing plant divested, the Times basically purchased a name, some temporarily inherited advertisers, a subscription list, and a shabby web presence.

The machinations of the Times and Tash are eerily reminiscent of events leading up to the 2009 bankruptcy filing of the Journal Register Company. It operated the flagship New Haven Register in Connecticut as well as smaller papers in four other states.

A top executive declared the company would “emerge stronger and more viable” from the bankruptcy but three years later the papers folded.

A 2012 New York Times article recounts the duplicity of John Paton, chief executive of the management company Digital First Media Group, parent of the Journal Register group. The syndicate was run into the ground and it was perceived Paton filed bankruptcy to shift the pension burden to PBGC.

Paton was quoted as saying pension benefits should be covered by the federal agency. He said he was “embarrassed” as if that mitigated him taking a bloated salary, lying to his employees and suppliers, and putting pensioners in limbo.

Sound familiar? Tash has been insisting publicly that the Times is profitable. He said this after accepting close to $15 million from influential local businessmen who, since the stopgap bailout, have been elevated to godlike status in the paper’s so-called “news” pages and columns.

One investor, Kiran Patel, was the Times “Floridian of the Year” in 2017. Out of 17 million residents, Patel, was deemed to be the shining star. But in May of last year, two of his businesses paid more than $30 millionin a settlement with the federal government after accusations of artificially inflating costs for health care. No admission of wrongdoing was part of the settlement.

Another investor, Jeff Vinik, has really gotten his money’s worth. In past trouble with the Securities and Exchange Commission on both ethical and legal grounds, Vinik tried to bleed taxpayers on a shady Museum of Science and Industry relocation.

His ineptly named downtown project, “Water Street Tampa,” is in serious trouble. Insiders say it will be ten years before it reaches fruition, if at all. But as far as the Times is concerned, the $200 million and counting in taxpayer funding to support Vinik’s “vision” is money well spent.

Steve Yzerman, general managet of Vinik’s NHL Tampa Bay Lightning never makes a wrong move, according to the Times. But he has been GM for eight seasons without a Stanley Cup. Former GM Jay Feaster, who served under a previous owner, was GM for 2 1/2 years when the Lightning won the championship.

There’s more Vinik cbicanery but adverse news regarding him in the Times is verboten.

Tampa Bay residents, who are savvy enough to glean information from alternative news sources, know better. Meanwhile, the Times continues to be nothing more than a mouthpiece for its investors and vested Poynter Foundation board members. Even the “Politifact” feature is slanted and inaccurate.

The recent plethora of Times/Poynter misadventures are codified here.

Former staff writers collecting a pension might start researching freelance opportunities. Although pensioners would stand at the head of the line, a bankruptcy would interrupt pension payments. It’s extremely questionable whether or not a sale of assets would make the retirees whole.

Current employees should have been bailing for at least a couple of years as the paper has been publicly stripped of any vestige of ethical standards. It also is difficult to fathom that anyone, paid to investigate and gather news, failed to sniff out this debacle occurring in their very own workplace.

Advertisers, subscribers, suppliers, and anyone else advancing cash or goods to the Times should be squirming. When the hammer falls, it will be 20 cents on the dollar in a rosy scenario and that group will comprise the caboose.

The Times two months ago announced it would slash printing of its totally superfluous *tbt tabloid from every weekday to once a week. Tash blamed the action on the institution of newsprint tariffs by President Trump. Ludicrous.

Meanwhile Tash has been living like a Russian oligarch. In recent years, Tash sold his posh $1.6 million, Snell Isle waterfront digs and acquired even more lavish quarters, a $1.8 million condo at Vinoy Place in downtown St. Petersburg. In late 2016, he reportedly sold that condo for $2.15 million, and is now renting a comparable crib on Beach Drive in St. Pete.

Records on file with the Pinellas County Tax Collector have been changed, no longer reflecting the name of Paul Tash when a search is conducted.

Tash continues his profiteering while drawing an immense salary and driving the company’s debt to the stratosphere through artiface and gross mismanagement.

(Tampa Bay Beat will have follow-up stories on the Poynter/Times slide into bankruptcy)

Friday, June 8, 2018

Fund Transportation and No Tax Hike Is Needed!

Transportation planning and progress has been dysfunctional and elusive in Hillsborough County for over 20 years. After three failed sales tax initiatives, from the committee of 99 to to Moving Hillsborough Forward to GO Hillsborough, and multiple unfunded Long Range Transportation Plans from the Hillsborough MPO, the “Powers” that be may have finally faced reality and the future.

On Wednesday, June 6th the Hillsborough BOCC voted to send a future transportation revenue plan presented to them earlier this year to the county Citizen Advisory Committee for their consideration and advisement. The plan was initially presented by Dr James Davison to the Board on April 4, 2018.

Davison's plan consists of 5 separate revenue sources totaling $8.468 Billion, yes billion with a “B”, over the next 25 years. About $6.2 billion goes towards transportation, but the unique thing about this plan is that for its last 20 years there is no increase in your property tax millage or sales tax rate. There is a small increase of 1/4 percent in the sales tax for the first 6 years until 2026 and then the sales tax returns to its current 7%. There are “No New Taxes” for Hillsborough residents in the plan. 

Not only are there no new taxes, but more money is available for transportation/transit than in the recent GO Hillsborough plan

The entire plan revenues are shown below:
1. Mobility Fees on new development passed 2016: 2021-2045 - $600 Million 

2. Restructure current 10 year property tax BOCC Transportation Policy to 25 year program: 2020-2045 - $1.15 Billion 

3. Value Capture (tax increment financing, development rights, etc) along any premium transit line to leverage state and federal money: 2021-2045 - $1.0 Billion

4. County Transportation Sales Tax @ 1/4 percent: 20121-2045 - $3.01 Billion total
  • $ 1.054 billion to HART
  • $ 1.37 billion to HillsboroughCo
  • $ 499 million to Tampa
  • $ 41.1 million to Plant City
  • $ 27.4 million to Temple Terrace
5. Renew CIT @ 1/4 percent instead of 1/2 cent currently levied:  2027-2046 - $2.708 Billion total **
  • $ 894 Million to School Board
  • $ 190 Million Affordable House
  • $ 1.137 Billion Hillsborough Co.
  • $ 414.3 Million to Tampa
  • $ 34 Million to Plant City
  • $ 22.8 Million to Temple Terrace
**Note: The CIT tax is a local infrastructure sales surtax enabled by FL 212.055. The statute currently only accommodates a 1/2 percent or 1 percent tax. The state legislature will need to amend the statute to support 1/4 percent or make it similar to the transportation sales surtax that can be any percentage up to one percent. We believe the state will accommodate when the county (or counties) request the change.

Dr Davison stated that over $2 billion would go to transit or almost 3 times what was being allocated with GO Hillsborough. Plus over $4 billion dollars to the county and cities to pay for repaving, bridge repair, sidewalks bicycle paths, increased road capacity and new technology. All within a shorter period of time and with no new taxes. At 1/4 percent, the renewed CIT will raise more money in 20 years then the present CIT did at 1/2 percent in its last 20 years and over $1 billion dollars more then in its first 20 years.

After Dr. Davison made the presentation to the BOCC on April 4th , Commissioner White requested that the plan be forwarded to the county Citizens Advisory Committee (CAC). County Administrator Mike Merrill requested that the administration “vet” the numbers before taking them to the CAC. 

Last month Dr Davison and Commissioner White met with Hillsborough County's Director of Finance, Bonnie Wise, Director of the Budget Tom Fesler and Chief County Economist Kevin Brickley in separate meetings. It was confirmed that the numbers and future estimates in the plan are accurate. Of course they were the county's own numbers to begin with.

Wednesday June 6th the BOCC unanimously voted 6-0 to send the plan on to the County CAC. Conspicuously, Commissioner Ken Hagan and County Administrator Mike Merrill, who keep pushing tax hike referendums, got up and left the room right before Dr. Davison was to speak Wednesday. Commissioner Hagan has a consistent behavior of rudely walking out of meetings when he does want not his vote recorded. Since Hagan is running again, he should be asked by voters/constituents if he supports the county seriously looking at this alternative funding plan. 

Davison stated there is still a lot of work to be done, but he is confident that this plan can be accomplished. “There is no reason to raise taxes when we have growth in our revenue streams going on like we are have in Hillsborough County”, he said. The key is funding priorities.

In addition, Davison could not explain why the MPO has not included “Value Capture” to pay for transit capital costs in the LRTPs like it did prior to 2000. Value capture includes recovering some of the property value gains to finance the transit project. The Trump Administration has stated they want to make federal transit grants conditional on value capture.

The Hillsborough County Citizens Advisory Committee meetings are held the 4th Friday of every month at County Center. We anticipate numerous different groups will be there to weigh in on the matter and we will also be keeping an EYE on it.

We have often asked here at the EYE the same questions. Why has it taken so long to come up with a plan that together with revenues already committed over the next 25 years, will provide Hillsborough county over $17 billion dollars to improve roads, transit and mobility. All without increasing taxes. 

The county commissioners must seriously consider this plan and throw out any plans that would needlessly raise taxes. 

To be continued!

Tuesday, June 5, 2018

'Unity' Confab Fizzles; Janet Cruz Campaign in Shambles

Cross posting from the author Jim Bleyer

By any measure, the Janet Cruz Campaign for State Senate’s so-called “unity” event last Thursday in South Tampa was a failure. Worse, it was an embarrassment.
The stunt was necessitated by what Tampa’s progressive community considers reprehensible behavior by Cruz and the Florida Democratic Party. It was a lame attempt for Cruz to mend fences.
After declaring her intention to file for a Hillsborough County Commission seat, Cruz inveigled her way into the state Senate race to unseat incumbent Dana Young. Using the state party as a club and wanting to avoid a bruising primary, she forced community-conscious attorney Bob Buesing out of the race. Buesing, a darling of progressives, faced Young two years ago and lost 48-41 percent.
He had already raised an ample war chest and hit the campaign trail, salivating over a promising rematch. Progressives were ignited.
Not any more. Many rank-and-file Democrats vowed to pass the race on the ballot. A handful, determined that treachery should not be rewarded, will vote for Young.
Buesing, incentivized by a possible appointment if a Democrat captures the governorship, has called for unity and says he supports Cruz.
It’s translating even worse than Bernie Sanders’ call for his supporters to vote for Hillary.
The number of attendees according to multiple sources reached 40, including all the ins and outs. That anemic figure includes Buesing and some close friends, Cruz and her entourage, media, and Alex Sink, the self-styled kingmaker of the Democratic Party whose heavy-handedness caused the ruckus.
A notable absentee:  Karen Buesing, wife of the screwed-over ex-candidate.
There were virtually no progressive Democrats attending. They are the segment of voters that Cruz, a term-limited state representative, absolutely needs in her corner to have any hope of unseating Young.
Chances of that are slim and none ... and Slim just left town.
One local news entity reported that Cruz and Sink declared at the event the Democrats are “now united.”  Laughable.  Tampa Bay Beat contacted several in attendance who would dispute that.
Another tell: the Cruz campaign posted one photo of the event on her Facebook page.  It was a picture of her and Buesing. No one else. No crowd shots because there were no crowds.
Neither Sink nor Cruz had the smarts to say they wished more progressives had attended.  Party hacks, it seems, always go for the Big Lie.
Sink’s power is a total disconnect from her (lack of) ability to get elected herself.  In her last two attempts at political office, Sink lost to two neophytes, Rick Scott and David Jolly, who had never before run for public office. State CFO is virtually ancient history.
Democrats were heartened this year as the 2016 independent candidate, Joe Redner, said he would support Buesing. With Young held to less than a majority two years ago and Democratic voters determined to vote this midterm, the party, especially progressives, met Buesing’s campaign with enthusiasm.
With a fractured party, the opportunity to flip the Senate seat has faded. A further irony is that Cruz would have been favored to win the County Commission seat. As of today, it tilts Republican.
One longtime Hillsborough County political observer declared that the Cruz campaign represented a lust for power, not the furthering of progressive principles. Another pointed out enthusiasm for Cruz is lacking, stating that her candidacy has been met with “collective indifference.”
What was deemed an extremely doable Democratic pickup is now a dubious longshot.
Jim Bleyer, a former reporter at the Orlando Sentinel and Tampa Tribune, writes the Tampa Bay Beat blog