Joe Downing's "Tooth Fairy" Accounting
The major financial problem facing the Port of Olympia is the legacy of bad capital expenditures. Judging by his statements and actions, Commissioner Joe Downing supports this tradition of fiscal irresponsibility.
Downing dismisses the financial importance of depreciation on capital investments as non-cash costs. He likes to use the example of a personal car and how meaningless its depreciation is. In this simplistic example, he overlooks another element key in his favored mode of accounting ( the widely discredited EBITDA). That forgotten element is the cash payment of interest due. In Joe's example, one need not worry about depreciation on the car since it would likely have been repossessed for ignoring the interest payments. Unfortunately, in the case of the port, we, the taxpayers, are the co-signers for bad capital investments. In essence, we will be on the hook for Joe's bad debts.
Juxtaposed to Downing's accounting is the view of the astute investor, Warren Buffett. Buffett holds that: "Depreciation is not a non-cash expense ...It is a delayed recording of a cash expense." Moreover, he asks the question: "Does management [i.e. the port commission] think that the tooth fairy pays for capital expenditures?"
At our port, there is no "tooth fairy" to pay for these bad investments. The taxpayers are on the hook. And, as Downing is blithely unconcerned about tax levy increases, hold onto your wallets.
We need responsible fiscal governance at our port. Vote for Helen Wheatley.
Denis H. Langhans
Discontinue natural gas hookups in new buildings to fight climate change
The world’s young people have become more and more engaged in taking action on climate change. Over 4 million people attended the Global Climate Strike on September 20. In Olympia, over 2,000 people attended the Student Climate Strike at the Capitol, which was organized and lead by our local youth.
The Strike is not the first climate action students have taken. A group of young people recently persuaded the Olympia City Council to pass an inheritance resolution committing the City to net-zero emissions by 2040.
That’s a tall order. Now it is up to the Council to make good on that promise.
The City is participating in a regional Climate Mitigation Plan, along with Thurston County and the cities of Lacey and Tumwater. But there are numerous actions that can, and should, be taken before the plan is finalized.
So, first – let’s stop digging the hole any deeper. Our greatest source of emissions in this community is buildings. Buildings make up over half of our emissions and yet we are still allowing gas heating in new buildings. With the new bill passed by the Washington State legislature requiring our electric sector to be 100% Clean by 2045, the City should discontinue hookups to gas in our new buildings and incentivize electrification of existing buildings. There are plenty of viable, price competitive options to replace appliances and heating systems currently fueled by gas. And, that is a climate solution – one that our children will thank us for.