Cow-nty Hornswoggled

December 9, 2008

The world wide financial crisis has directly impacted our pasture. San Mateo County was heavily invested in Lehman Brothers, one of the first casualties of the credit crunch and is now merely one of many creditors in the largest bankruptcy in history. It turns out San Mateo County had invested more than $155 million in Lehman Bros. according to a recent article in the Chronicle. The San Mateo County Board of Supervisors has also authorize a lawsuit against the officers and directors of the Lehman Bros. investment firm for misleading investors leading up to the firm’s collapse.

Other agencies including school districts, some cities, the San Mateo County Transportation Authority, the Peninsula Corridor Joint Powers Board, the Bay Area Air Quality Management District and fire districts contribute amounts into the County Investment Pool, and 5.9 percent of that account was invested in Lehman Bros.

County Treasurer Lee Buffington could only say, “There is no way for me to express how bad we feel about the loss, and at this point we are trying to recover at least a part of the lost funds by aggressively pursuing both the bankruptcy and the federal bailout of the Wall Street firms.” We certainly hope so – but in the meantime, how does this affect us in Woodside?

We expect to feel the impacts of this loss in a number of areas. The San Mateo County Transportation Authority, the county agency charged with improving transportation in the COWnty by spending Measure A funds, lost more than $22 million in the Lehman disaster. Besides possible holdups in increased ferry service, Caltrain improvements, and rail over the Dumbarton bridge to Redwood City which will no doubt affect Woodside-area commuters, there are also road improvements to Woodside roads that may well be delayed. There are dedicated funds from Measure A that are used to support bicycle transit that might have helped alleviate some of the concerns Woodside has over our two-wheeled visitors. The most noticeable victim of any disruption in SMCTA money, however, might be our surface streets here in Woodside. As the SMCTA notes, millions of dollars in Measure A money have come home to Woodside to help repave and seal cracks over the years – money that may well disappear into Lehman Brother’s bankruptcy court.

The biggest hit may be to our local area schools, however. The San Mateo County Community College District which includes neighboring Cañada College lost $25.2 million. The Sequoia Union High School District, which includes our hometown Woodside High School, lost a whopping $6.6 million, more than any other high school district in the COWnty.

Jean Holbrook, the County Superintendent of Schools, made the situation very clear: “It’s hitting at the same time that we had a late and inadequate state budget….”Those losses are impossible for a school district to absorb. This is not money just sitting around in reserves. It’s used for our ongoing operating expenses – paying salaries, and making the payments on buildings and facilities.” She also stated that many of the COWnty’s school districts may have to cut jobs and supplies and materials.

Hopefully San Mateo County will be successful in recovering at least some of the money from Lehman, and we fervently hope that the budget knife doesn’t cut too deep on the programs and services, we’ve come to take for granted. It doesn’t look very good, however. The one thing that’s a bit of a bright spot is that Woodside apparently has its money in a very safe investment that so far hasn’t been touched by the Wall Street melt down – or so says Susan George.

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