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Exotic Deals Put Denver Schools Deeper in Debt
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| Parent(s) |
Candidate
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| Contributor | COSDem |
| Last Edited | COSDem Aug 06, 2010 03:49pm |
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| Category | General |
| Media | Newspaper - New York Times |
| News Date | Friday, August 6, 2010 09:00:00 PM UTC0:0 |
| Description | In the spring of 2008, the Denver public school system needed to plug a $400 million hole in its pension fund. Bankers at JPMorgan Chase offered what seemed to be a perfect solution.
The bankers said that the school system could raise $750 million in an exotic transaction that would eliminate the pension gap and save tens of millions of dollars annually in debt costs — money that could be plowed back into Denver’s classrooms, starved in recent years for funds.
To members of the Denver Board of Education, it sounded ideal. It was complex, involving several different financial institutions and transactions. But Michael F. Bennet, now a United States senator from Colorado who was superintendent of the school system at the time, and Thomas Boasberg, then the system’s chief operating officer, persuaded the seven-person board of the deal’s advantages, according to interviews with its members. |
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