Who is Steve Russo?
He manages all these Limited Liability Companies.
His law firm manages and makes a profit from the The Industrial Development Authority of the County of Pima:
The Authority is empowered to issue its bonds to provide funds for the financing or refinancing of the costs of the acquisition, construction, improvement, rehabilitation or equipping of a “project” as defined in the Act.
The Authority’s interest include the promotion of economic development and the development of affordable housing.
Russo and his firm have a financial interest in the work of both the Pima County IDA and the Community Investment Corp.: It acts as the attorney for both.
“We make more money if there are more deals done,” Russo acknowledged in an interview last week. However, he added, “There’s no incentive to push a deal that shouldn’t be done.”
His firm began representing the Pima County IDA in 1978, when Russo’s father, Russell, became its lawyer. Steven Russo has represented the IDA since 1987, though his partner Michael Slania has taken over most of the work, Russo said. IDA work takes up about half of Slania’s work time and a quarter of Russo’s, said Russo, who is semi-retired.
In 2008, the most recent year for which tax records are available, the Community Investment Corp. paid Russo, Russo & Slania $146,166 for its services.
Their work on out-of-state projects hasn’t prevented the Pima County IDA from doing them in-state. So far this year, the IDA has completed eight in-state bond deals, most of them for charter schools, worth $44 million.
Read more in the Arizona Daily Star, 12 September 2010.
Bonds for Charter Schools that can’t write English
This means that the tax-free bonds that Montgomery County is about to issue- are to help pay a foreign investor off. Can I sign up for that deal? And- even more confusing is that according to the article- which is clear as mud- the Industrial Development Authority of the County of Pima, Ariz is issuing them? Huh? Right on their website under the non-profit area it says:
The Industrial Development Authority of the County of Pima (the “Authority”), in conjunction with Wells Fargo Bank, is committed to supporting the development and expansion of the local community by awarding low interest rate loans (“Non-Profit Loan”) to nonprofit organizations in Pima County.
Is Pima County breaking its own rules?
. . . .
I took a breath- and then dug a little deeper:
The IDA does not act as a lender but as a “conduit,” allowing a lender to issue tax-free bonds on behalf of the borrower, Russo said. The conduit role earns the IDA fees and brings money to its partner in many projects, the Community Investment Corp.
The IDA receives a $3,000 fee for each successful application, and gets a fee of one-tenth of 1 percent of the principal of each bond issue every year. That money can help the IDA with other programs it runs, such as a nonprofit loan program and a program that helps single-family home buyers, Russo said.
The Community Investment Corp. acts as the administrator of the IDA’s charter-school financing projects. For its services the corporation charges a set-up-fee of $1,000 and an annual fee of $8,000 or $12,000, depending on the size of the bond issue. That money can help the corporation’s charter-school-finance program and other activities, such as investments in local start-ups, said executive director Frank Valenzuela, also a director of the IDA.
When you look at the site for “The Community Investment Corp” you find a shell of a site- with pages still under construction- even though this non-profit was set up in 1996. From their “Site”
The Community Investment Corporation (CIC) was founded in 1996 as a non-profit 5O1(c)3 agency to assist small businesses and provide public purpose services. Working in collaboration with other agencies, CIC has provided investment in new and existing businesses for start up and business expansion.
Once again, smoke and mirrors. So what we have is the Montgomery County Commissioners, voting to approve a tax exempt bond issued by a development authority in Tucson AZ that subcontracts to another Tucson non-profit to administer the bond, which is floated by a Wall Street bank (like Wells Fargo) to an Ohio non-profit, for a Chicago based firm, owned by Turks to put a school in Dayton.
And we wonder why the country is about to head into default?
Read more HERE.