May 12, 2012

SandBoxBlogs: Denver Post "Colorado bond companies' role in school campaigns raises questions"

David Olinger:
"When Colorado citizens vote to borrow money to build new schools, a library or a recreation center, the crusader behind the curtain is often the investment banker who gets paid to sell the bonds.

For those pushing bond issues in a tough economic climate, help from a bond underwriter can mean the difference between election day success and defeat. But the prevalence of bond house involvement — everything from polling to designing yard signs — also raises concerns from critics who worry they exert undue influence in a campaign.

At worst, critics and experts say, governments pay bond companies extra to help pass tax increses, a potential violation of Colorado law.

"It does seem like a backdoor way of using public funds (to finance campaigns)," said Colorado Ethics Watch director Luis Toro. "To say there's no chance of corruption is totally out of touch."

The Denver Post analyzed 15 successful Colorado bond campaigns backed by large contributions from investment banks. In every case, the bank that helped finance the campaign sold the bonds....."
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"Unapologetically pursuing and tracking patterns within the news others make since 2010."

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