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Runaway Train 

Why is Muni in such a hurry to win approval for a blindingly complex, potentially risky, $1 billion plan to privatize the city's rail fleet?

Wednesday, Apr 10 2002

Page 3 of 3

How does this transaction plan to skirt the federal government's ruling outlawing this type of deal? Is it reasonable to think the Breda cars will last 30 years? Is the deal's proposed maze of Cayman Islands lenders, obscure money-handlers, and apparently conflicted insurers trustworthy? What, specifically, happens if one of our new offshore partners goes bankrupt? Or pretends to? And who, precisely, is receiving the estimated $10 million in overhead costs on this deal?

Supervisor Aaron Peskin, who sits on the Finance Committee with Chris Daly and Sophie Maxwell, was skeptical at first, he said. But Monday, Peskin said he was thinking of supporting the deal.

"It definitely raises the hair on the back of my neck," Peskin said. "If there's no harm done, God bless. But if it's a pig in a poke, shame on us."

Shame, indeed. Before deciding that the city should pay out $1 billion over 30 years through obscure offshore financial firms, our public officials ought to know a lot more than the meager information Muni officials have provided the Board of Supervisors. The supervisors should insist on having time to make sure this isn't the last puff of the flimflam boom.

About The Author

Matt Smith


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