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Pressure Is On IBM To Forgive Millions In IT Debt
coondoggie writes to tell us that several California state legislators are pressuring IBM to release the Costa school district from some $5 million of long-standing debt as a charitable donation. "The back story on this tale is that the school district owes IBM for computers ordered in the late 1980s and early 1990s. For one reason or another the computers were never used and no one now seems to be able to locate either the paperwork or the hardware. The school district experienced hard financial times and ultimately never paid Big Blue for the computers. In 1993 the district and IBM negotiated a long-term settlement that said the school district would pay the first of four $1.25 million installments beginning in 2008. Payments were deferred until then because 2008 was the year the district was scheduled to finish making state loan repayments under its previous loan plan, according to the Contra Costa story."
They give the school 15 years and now the school wants it just forgiven? I wish I could wait 15 years on my loans.
coondoggie writes: to tell us that several California state legislators are pressuring IBM to release the Costa school district from some $5 million of long-standing debt as a charitable donation.
Do you mean Contra Costa?
How do you lose that much computer equipment? It must have walked off.
And obsoleted computers does not mean they should be let off their debt. I reckon I may leave everything I owe for 27 years or so then claim that.
Seriously instead of saying "let us off" they should be saying "here's your money, _please_ don't charge us interest or take us to court".
They agree to defer payments for 15 YEARS, and now that they're finally at the time they might have to actually start paying something they want to just pressure them to make it go away entirely? Yow.
Oh, so that makes it OK to rip IBM off.
Well, "honorable" lawmakers, how many of your teacher's pensions are in IBM stock?
Or what about your investments?
Or some of your other constituents - many who are retired and are relying on IBM making an actual profit in order to make money on their retirement investments.
Not all stock investors are rich, fat, white, dudes who nobody has pity for.
Mental note: Do not give credit to the CA schools - cash only.
I prefer Flambe as apposed flamebait.
...this invalidates the forgiveness part of their plea: Unaccountability encourages corruption.
"What you subsidize, you get more of".
Have the school district *try* a little harder to find out where it all went.... a good first step.
If the taxpayers het mad enough at the failure to do this, *then* you'll get some accountability, although late.
BWilde
So the school district is corrupt, and the computers got jacked, and now we want corporate America to take it as a tax write-off. I'd like to see it referred to a criminal court so the guilty actually pay the price.
technical writing / development
Besides...lets say they were using the computers. How does the fact that they're missing affect whether they can pay for them? Surely the district didn't place a $5 million order with no means to pay for it?
to a collection agency. Let the agency buy the loan at a discount and then harrangue state officials until they ante up. It would be good for the officials to experience the same kind of pressure and hectoring that they allow consumers to endure...
The contest for ages has been to rescue liberty from the grasp of executive power. -- Daniel Webster
Just like the first world should cut off aid to Africa to ultimately strengthen it, corporations should cut off aid to school districts and other governmental dead beats who think technology will solve education problems.
And the school still wants a free pass.
What sort of example are they trying to set?
---- Booth was a patriot ----
The school ordered and received the equipment. If they used them or not is irrelevant, and that they can't find the stuff or any records only speaks to their incompetence. They need to pay their bill.
If you want news from today, you have to come back tomorrow.
"Unlike corporations such as IBM - with revenues of $22 billion in the first quarter of 2007 alone - our schools do not have the ability to generate new dollars to fund projects or pay for employees," the lawmakers wrote. "Our schools rely solely on limited state and federal assistance to educate our students and every dollar is precious."
If every dollar is precious, they should've thought twice before spending $5 million in hardware that was never even used!
This district's atrocious conduct is precisely the reason why IBM should not forgive the debt.
Meanwhile, the State of California has insisted on, and gotten, much stricter terms (including interest.)
Now, the State is suggesting that IBM should forgive their loan altogether?
Maybe, if forgiving those loans is so good an idea, the State of California should go first?
Lacking <sarcasm> tags,
Big Blue can afford it. Nobody seems to dispute this.
The school will have difficulty paying the money back. The owed money may end up being written off anyway.
Nobody is forcing anyone to do anything. There's a lot of pressure being applied but it's up to IBM, and IBM can benefit from this. They'll get some of the money back as a tax break, more as good PR, and this will mean more money for the school to spend education, which will benefit IBM in the long run. That, and the person who makes the decision will have a feeling of being a nice person.
Ultimately it will be better for everyone if IBM forgives the debt.
Lessee, the school district has such lousy financial controls that they can't account for the systems, and they can't pay for them. Typically, the socialist argument is to not hold them accountable. I say bankrupt the district and put some people in who won't let $5M get STOLEN.
How we know is more important than what we know.
The basic problem is, in 1992, they got a superintendant who was going to revolutionize everything. New schools, new ways of doing things, the works.
He turned out to be a corrupt bastard, but he disappeared without ever having to pay or atone for anything, and the people who use the schools have been paying for it ever since.
So call Dog the Bounty Hunter.
IBM should forgive the debt, and everyone should learn a lesson from this:
Why? This isn't the first case of a customer who can't pay. You negotiate, threaten, sue, and settle for a discount.
Don't let public institutions pay with credit.
This isn't a problem of a public institution paying with credit. It's a problem of a public institution, ordering something, losing it, and not having the money to pay. Credit has nothing to do with the problem.
In the real world, if you demand cash on the barrel for every large sale, you are going to lose sales. That is why car dealers offer financing.
Then make the elected and appointed officials legally and financially responsible for their decision to incurr debt. Use fines for "negligent public non-service" to pay off all or part of the debt. This would discourages the borrowing of spectacular sums from future generations with little or no thought to whether and how they can repay those sums.
The hard part is deciding where the line is between a district with financial troubles due to mismanagement versus a district in trouble due to factors outside their control. Or perhaps the *uckup is the responsibility of all the administrations between those that incurred the debt and those responsible for planning its repayment. So fine 'em all I say! Perhaps $10k per year served per board member. Special triple fines to the chairpersons and chiefs!
No, it means that in 1993 the superintendant and a buddy of his with an F-350 put a bunch of equipment in the back of a truck and sold it a pawn shop to feed his coke addiction.
I say, make 'em pay the $5 mil. Teach the bitches a lesson in accountability (not mention financial planning).
There is bad business... and then there is PR. Chances that the School Board that exists now isn't the one that was there in the early 90's. So, with that in mind, maybe asking for debt forgiveness shows actuall aptitude of the current school board. I know if I was on it, I'd be trying to negotiate at the very least. The other side of this is you have Microsoft "giving" schools technology, and so many other companies giving to education, to hold a school liable will not look good. If Big Bad Blue holds them to this, I don't care what you think, it just looks bad, and screwing up PR will probably cost more than the $5mil loan payback. It would be smart for both sides to come to some kind of settlement, both for a school district in debt, and for a company that still has the cold suit and tie image no matter how many witty commercials they put out.
The fact that the states lost, nor that the states were using "states rights" as a euphemism for expanding the influence of slavery, doesn't mean the idea is dead or bad.
I can't tell how you feel about the issue just by your post. Personally, I feel that the idea of keeping as much power as feasible at the state and local levels is a good idea. It gives people more power to influence the policies that affect them. Its easier to change that policy when you're voting against 1 million or 30 million, instead of 300 million.
The proof is in the government agreeing to an extended repayment plan. Admission that the debt is valid and owed. If there was any question as to the validity of the debt, it should have been raised 15 years ago.
T Money
World Domination with a plastic spoon since 1984
You stated it a bit more clearly than me.
On an acute basis, we need concentrated power. Once people are ensconced, they want to wield their power on a chronic basis. It's too easy to ignore the creeping acquisition of power.
Get thee glass eyes, and, like a scurvy politician, seem to see things thou dost not.--King Lear
... that $3 million of the $5 million that the school district absconded with is being taken from the pockets of retired or soon-to-be-retired working Americans. (Sorry, old rhetorical trick I picked up in college to deflate the balloons of folks who liked to make every issue into The Class Struggle. Most billion dollar companies, once you trace through the intermediaries like pensions and mutual funds, as a series of thousand dollar chunks. Many of the owners or beneficiaries of these chunks would not strike you as being very wealthy, or even as being investors, if you were to bump into them in the checkout at the supermarket.)
Help poke pirates in the eyepatch, arr.
IBM has already done the school district a favor by not selling their debt to a vulture credit company that would be way more heinous in how it dealt with the district. Normally when loans like this start taking longer than usual to get their money, companies like IBM write off the debt and sell it to vulture funds for pennies on the dollar, and then these vulture funds turn around and gauge the debtors for as much as they can get.
So the fact that IBM did NOT do this means they have a heart. Don't be stupid and keep on asking for more. IBM is a business, and if they let this customer go, they would simply have more problems in the future.
Many sports can be played in small, restricted versions with less resources. Another poster has pointed out stickball as a restricted form of baseball. You don't need much to play football. You can play it in the middle of the street if you want to. My guess is that you never did that because where you grew up, kids played soccer instead. Let's look at soccer. Would you agree if someone said that you need special goals, a special ball, shin guards, and a huge playing surface with offsides lines to play soccer? Of course not, because those things are not needed for the small restricted form of the game that is casually played. Soccer is great, but don't be unfair and try to make it look like the game that God handed down to humanity. What do you think American children do during school recess?
Truth be told: They are in California! California taxpayers pay more to public schools than any other state, per capita CA is in the top 5. 5 million dollars is nothing to Costa school district. School Districts that size could find that money in a year or two. They just need to shave a few hundred here and there and cut one of their other million dollar projects. Sadly, school seems to breed unaccountability.
IBM would have no need to prove they delivered anything. They already have a settlement/agreement to make repayment. As such the school district has already admitted that they owe IBM $5 million. It's too late to start arguing that they never received the goods.