Saturday, April 30, 2016

Report: Harvey IL stiffs some bondholders

Abandoned Harvey house
I hate to keep repeating myself,  but when Harvey, Illinois is in the news it's nearly always for something bad.

From Bond Buyer:
The cash-strapped Chicago suburb of Harvey has stiffed some of its bondholders.

The impoverished city south of Chicago, in local headlines for internal governance turmoil, appears to have initially made debt service payments owed in December on a $37 million new money and refunding general obligation issue from 2007 but then pulled back the payments, according to one investor.

The next payments are scheduled for June 1 on the bonds, for which an ad valorem property tax is pledged.

The city, which was the subject of an unprecedented move by the Securities and Exchange in 2014 to block a bond deal, did later make some payments on the tax-exempt portion of the deal, but not the taxable piece. That's according to a representative of a fixed-income investment management firm that purchased a portion of the taxable bonds for his firm's retail clients.
The good news is that Harvey may finally begin collecting property taxes, according to the Cook County Clerk.

Such is life in a Blue State.

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