Fingal County Council to borrow €70 million from the EIB - Good or bad?

Degeneration X

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https://www.independent.ie/regionals/fingalindependent/news/councils-70m-bid-to-land-eib-funding-36335824.html

https://www.independent.ie/regionals/fingalindependent/news/a-broad-welcome-from-councillors-for-70m-eib-loan-bid-36335826.html

https://dublingazette.com/news/fcc-puts-horse-cart-bold-loan-move/

"Fingal County Council is pursing an historic loan of some €70 million from the European Investment Bank to help fund its capital spending programme over a five-year period, making it only the second local authority in the country to draw down loan funds directly from the bank.

Council chief executive, Paul Reid explained the rationale behind seeking the loan arrangement saying that Fingal was the fastest growing region in the country with the youngest population and that was placing new demands on the council's resources.

Economic Development Director in the council, Ed Hearne said the council had two more stages to go through with the EIB before completing the framework for the loan and he hoped that could be done 'in the next couple of weeks'. The final step will be approval of the loan by councillors."

"Cllr Tom O'Leary (FG) congratulated the council executive on being among 'first movers on this area in Ireland' and said it would be 'great for the county'. He said that he and a number of Fine Gael colleagues had met with the EIB, last year and were aware the bank was eager to invest in Ireland. He did not share the concerns of some councillors that Government funding of the council would fall in response to the loan, saying that the funds would allow access to greater funding from Government on specific funding because the council could provide the matching funds to unlock those grants.

But Cllr Ken Farrell (Lab), Cllr Malachy Quinn (SF), Cllr Darragh Butler (FF) and Cllr Eoghan O'Brien (FF) and others while all praising the initiative, did worry that the Government might use it as an excuse to reduce their funding of Fingal. Cllr Butler said that the council should not be 'punished for being head of the class' in being the first council in the country to pursue this line of funding.

There were also calls from several councillors to ensure the funding is fairly spread to benefit everyone in the county.
Cllr Matthew Waine (Sol) said he had concerns about the initiative and said if it was used to put in infrastructure to open up lands for private development it would 'financially benefit private interests'.

But Cllr Cian O'Callaghan (SD) it was one of the most impressive proposals he had seen from the council and he 'wholeheartedly' supported it."

So is it a good idea for Irish Local Authorities to spend themselves into debt from the EIB or should local authorities raise the funding themselves to pay for expenditure.

Please discuss politics.ie users.
 


Lumpy Talbot

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No
Well I hope it isn't the same financial instrument in use by various German local authorities in the last decade which was a form of borrowing or securitisation against future income streams.

Only problem being that if future rather optimistic income streams forecast do not actually materialise then the local council and residents are saddled with a debt increasing as interest rates rise and less income for services so you end up with a mini-Detroit scenario.

Wouldn't surprise me if Irish local authorities made the same mistake as various German regional authorities but managed to do it just as interest rates were on an upward swing and blissfully unaware of the dangers of securitisation in order to access the 'lump sum'.

Interesting also to see what Finglas does with the upfront money. Let's hope there isn't a tidal wave of brown envelope stories. This sort of deal looks good to councillors etc as it means a bonanza of loan money secured against rates and so on but what they do with it is all important and of course they don't have to report to central government on what they do with it- until such time as PAC becomes aware of the inevitable dissipation of the lump sum in corruption.
 

Degeneration X

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Well I hope it isn't the same financial instrument in use by various German local authorities in the last decade which was a form of borrowing or securitisation against future income streams.

Only problem being that if future rather optimistic income streams forecast do not actually materialise then the local council and residents are saddled with a debt increasing as interest rates rise and less income for services so you end up with a mini-Detroit scenario.

Wouldn't surprise me if Irish local authorities made the same mistake as various German regional authorities but managed to do it just as interest rates were on an upward swing and blissfully aware of the dangers of securitisation in order to access the 'lump sum'.

Interesting also to see what Finglas does with the upfront money. Let's hope there isn't a tidal wave of brown envelope stories.
Finglas isn't in Fingal oddly enough. It is in the DCC area but Fingal does have a terrible record when it comes to corruption going back to the old Dublin County Council days.
 

Hitchcock

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Finglas isn't in Fingal oddly enough. It is in the DCC area but Fingal does have a terrible record when it comes to corruption going back to the old Dublin County Council days.
You're broadly right but there is a small part of Finglas around Charlestown and Lanesborough that is in the jurisdicion of Fingal CC.
 

Catalpast

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https://www.independent.ie/regionals/fingalindependent/news/councils-70m-bid-to-land-eib-funding-36335824.html

https://www.independent.ie/regionals/fingalindependent/news/a-broad-welcome-from-councillors-for-70m-eib-loan-bid-36335826.html

https://dublingazette.com/news/fcc-puts-horse-cart-bold-loan-move/

"Fingal County Council is pursing an historic loan of some €70 million from the European Investment Bank to help fund its capital spending programme over a five-year period, making it only the second local authority in the country to draw down loan funds directly from the bank.

Council chief executive, Paul Reid explained the rationale behind seeking the loan arrangement saying that Fingal was the fastest growing region in the country with the youngest population and that was placing new demands on the council's resources.

Economic Development Director in the council, Ed Hearne said the council had two more stages to go through with the EIB before completing the framework for the loan and he hoped that could be done 'in the next couple of weeks'. The final step will be approval of the loan by councillors."

"Cllr Tom O'Leary (FG) congratulated the council executive on being among 'first movers on this area in Ireland' and said it would be 'great for the county'. He said that he and a number of Fine Gael colleagues had met with the EIB, last year and were aware the bank was eager to invest in Ireland. He did not share the concerns of some councillors that Government funding of the council would fall in response to the loan, saying that the funds would allow access to greater funding from Government on specific funding because the council could provide the matching funds to unlock those grants.

But Cllr Ken Farrell (Lab), Cllr Malachy Quinn (SF), Cllr Darragh Butler (FF) and Cllr Eoghan O'Brien (FF) and others while all praising the initiative, did worry that the Government might use it as an excuse to reduce their funding of Fingal. Cllr Butler said that the council should not be 'punished for being head of the class' in being the first council in the country to pursue this line of funding.

There were also calls from several councillors to ensure the funding is fairly spread to benefit everyone in the county.
Cllr Matthew Waine (Sol) said he had concerns about the initiative and said if it was used to put in infrastructure to open up lands for private development it would 'financially benefit private interests'.

But Cllr Cian O'Callaghan (SD) it was one of the most impressive proposals he had seen from the council and he 'wholeheartedly' supported it."

So is it a good idea for Irish Local Authorities to spend themselves into debt from the EIB or should local authorities raise the funding themselves to pay for expenditure.

Please discuss politics.ie users.
The reason they have to borrow so much money is that the population has exploded exponentially in the last 2 decades

- with absolutely no planning or thought put into it

Indeed most if not all political parties denied it was happening and made vile comments about anyone who warned of the dangers

Fingal Co Council will be the Detroit of Ireland circa 2037...

- a Wasteland.......

 

Degeneration X

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The reason they have to borrow so much money is that the population has exploded exponentially in the last 2 decades

- with absolutely no planning or thought put into it

Indeed most if not all political parties denied it was happening and made vile comments about anyone who warned of the dangers

Fingal Co Council will be the Detroit of Ireland circa 2037...

- a Wasteland.......

I wouldn't compare it to Detroit - after all Henry Ford never opened a factory in Fingal.

Why would you think Fingal would wind up like Detroit due to borrowing a relatively small sum?
 

Notachipanoaktree

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when you consider what they will get for their 70 Million, really it would make you scream.

5 km of cycle track.
Drug distribution center.
3 Fact finding missions.
Graft all round the FDC
Election funds for 4.
 

Lumpy Talbot

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No
Because if they have to borrow money with an expanding population they are automatically taking a gamble on being able to repay it. And local authorities do not have a good record when it comes to accountancy.

Should Fingal (or Finglas or anywhere else) get into difficulty in servicing the debt on a 70million euro loan they should be told to f*ck right off if they come pleading for assistance from central funding thereafter.

If they have an expanding population and cannot foresee raising enough money for services from that population the rest of the country should not find itself taxed for a shortfall in that area.

Borrowing is all very well but that borrowing needs to have a risk assessment along with it and with the short termism available to politicians even at local level I don't see the chances of an assessment of for example a series of interest rate rises making the debt unsustainable.

As I've said there are more than a few local authorities who entered into securitisation deals with landesbanken and foreign banks in Germany who wish they hadn't.

I just hope some homework has been done on the downside here and that there are safeguards to ensure that this authority doesn't go on a splurge and leave a debt mess for future councils to sort out- or worse come begging for central funds when the money is allocated and they are looking at large debt repayments to the EIB.
 

Notachipanoaktree

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Because if they have to borrow money with an expanding population they are automatically taking a gamble on being able to repay it. And local authorities do not have a good record when it comes to accountancy.

Should Fingal (or Finglas or anywhere else) get into difficulty in servicing the debt on a 70million euro loan they should be told to f*ck right off if they come pleading for assistance from central funding thereafter.

If they have an expanding population and cannot foresee raising enough money for services from that population the rest of the country should not find itself taxed for a shortfall in that area.

Borrowing is all very well but that borrowing needs to have a risk assessment along with it and with the short termism available to politicians even at local level I don't see the chances of an assessment of for example a series of interest rate rises making the debt unsustainable.

As I've said there are more than a few local authorities who entered into securitisation deals with landesbanken and foreign banks in Germany who wish they hadn't.

I just hope some homework has been done on the downside here and that there are safeguards to ensure that this authority doesn't go on a splurge and leave a debt mess for future councils to sort out- or worse come begging for central funds when the money is allocated and they are looking at large debt repayments to the EIB.
Ah! you don't understand. With the growing population of Nigerians et al. They'll have no difficulty paying it off. Think of all the extra dole money and new houses and ETB/FAS Centers. High quality jobs in Teaching, Local nursing, Probation and Prison Services.

What's your beef, eh? Jealous, eh?

[video=youtube;1-JdsBXkHs8]https://www.youtube.com/watch?v=1-JdsBXkHs8&feature=youtu.be[/video]
 

Lumpy Talbot

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No
What has any of this got to do with President Orange Smallhands?
 
Last edited:

Degeneration X

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Because if they have to borrow money with an expanding population they are automatically taking a gamble on being able to repay it. And local authorities do not have a good record when it comes to accountancy.

Should Fingal (or Finglas or anywhere else) get into difficulty in servicing the debt on a 70million euro loan they should be told to f*ck right off if they come pleading for assistance from central funding thereafter.

If they have an expanding population and cannot foresee raising enough money for services from that population the rest of the country should not find itself taxed for a shortfall in that area.

Borrowing is all very well but that borrowing needs to have a risk assessment along with it and with the short termism available to politicians even at local level I don't see the chances of an assessment of for example a series of interest rate rises making the debt unsustainable.

As I've said there are more than a few local authorities who entered into securitisation deals with landesbanken and foreign banks in Germany who wish they hadn't.

I just hope some homework has been done on the downside here and that there are safeguards to ensure that this authority doesn't go on a splurge and leave a debt mess for future councils to sort out- or worse come begging for central funds when the money is allocated and they are looking at large debt repayments to the EIB.
Rate hikes and a Property Tax increase are also on the cards to pay for all the spending in Fingal. I think their calculations take account of this.
 

Catalpast

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I wouldn't compare it to Detroit - after all Henry Ford never opened a factory in Fingal.

Why would you think Fingal would wind up like Detroit due to borrowing a relatively small sum?
Because it will grow and grow....................

Detroit went Bust because the City Fathers borrowed and spent like there was no tomorrow

- eventually they borrowed so much they couldn't borrow enough any more to keep the place running

- and pay back what they owed

Too many people on handouts

- and not enough ratepayers to finance the services

Have we not been here already with this?:roll:
 

Hitchcock

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Because it will grow and grow....................

Detroit went Bust because the City Fathers borrowed and spent like there was no tomorrow

- eventually they borrowed so much they couldn't borrow enough any more to keep the place running

- and pay back what they owed

Too many people on handouts

- and not enough ratepayers to finance the services

Have we not been here already with this?:roll:
The collapse of industry in particular the car industry was the critical factor.
 

Catalpast

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The collapse of industry in particular the car industry was the critical factor.
The Race riots of 1967 drove a lot of white folks out

- White Flight

- + overspending by the City Council

They borrowed and borrowed and borrowed.....

Fingal Co Council will do they same given the chance.

Have we learnt nothing from the Bertie years....:|
 

Hitchcock

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The Race riots of 1967 drove a lot of white folks out

- White Flight

- + overspending by the City Council

They borrowed and borrowed and borrowed.....

Fingal Co Council will do they same given the chance.

Have we learnt nothing from the Bertie years....:|
Fingal council has enough land zoned and serviced to build thousands of houses but they are not building and the private aren't building because there isn't sufficient profit in it for them.

Ah white flight in the US and Catalpast is concerned while ignoring the redlining aimed at atomising black communities across the US.
 

Catalpast

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Fingal council has enough land zoned and serviced to build thousands of houses but they are not building and the private aren't building because there isn't sufficient profit in it for them.

Ah white flight in the US and Catalpast is concerned while ignoring the redlining aimed at atomising black communities across the US.
Fingal council has enough land zoned and serviced to build thousands of houses

Have you got a Link for that please?

Also they would need funding to build the houses too

Long term residents of Fingal should be prioritised 1st if and when they go ahead...
 

gerhard dengler

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Because it will grow and grow....................

Detroit went Bust because the City Fathers borrowed and spent like there was no tomorrow

- eventually they borrowed so much they couldn't borrow enough any more to keep the place running

- and pay back what they owed

Too many people on handouts

- and not enough ratepayers to finance the services

Have we not been here already with this?:roll:
Illinois is on the verge of bankruptcy also.

Fingal's financial statements 2016
http://www.fingal.ie/media/AUDITED AFS 2016.pdf
 

Lumpy Talbot

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No
Would anyone here trust their local councillors with a sudden borrowed 70 million euro which would have to be repaid in the years to come?

First thing they'll do is try to use it to ensure their own re-election at council level and use it to propel themselves Dailward.

The repayments are on the never-never. And of course the repayments- if interest rates rise- will be the problem of future councillors.

Does anyone think there is sufficient oversight on local authority spending in their area?

And finally do you trust your local councillors not to blow the 70 million on grand gestures and then disappear when the EIB are sending red letters on repayments?
 


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