Was the 2008 pension financing a new and different type of financing structure for DPS?
No. DPS copied in 2008 the structure it used in 2005. In addition, more than 100 public entities in Colorado alone have used variable rate debt over 500 different times in the last 12 years. NYT story: “Denver schools had issued pension certificates before, but this time the banks added a little spice to the recipe: an interest-rate swap that made the variable rate mimic a fixed-rate instrument.” This is false. Simple background research would have revealed that DPS had done the same type of pension financing in 2005, before Mr. Bennet or Mr. Boasberg had joined DPS, as it did in 2008. Q: Is the 2008 pension financing performing today much worse than projected? A: No. Approval for the financing was given by the DPS Board on the basis that the rate would be 6%. The rate is currently at 6.1%. In both cases, all fees are included. NYT story: “In the end, a deal that JPMorgan said would have an interest rate of around 5 percent spiked to 8.59 percent during its first fiscal year, and has s
