St. Petersburg City Council members dispute dire predictions
A debate at Thursday’s St. Petersburg City Council had the elements of a science-fiction flick: computer shutdowns, employees not being paid and the city not being able to receive money from the state.
The only thing missing was the talk of rationing bread in Williams Park. But the talk ended without much fanfare.
As the City Council considered renewing a $144,000 contract with Bank of America for banking services, council member Steve Kornell requested to table the deal.
He wanted bank officials to explain why the lender hasn’t fully adhered to the $25 billion national mortgage settlement. Kornell said he didn’t want the bank profiting off taxpayers while evicting homeowners in foreclosure, adding: “We should stand up for them.”
A staffer then warned that the city might not be able to access money to pay bills or employees if the contract wasn’t extended by the April 30. She also warned that it could take up to a year to switch banks.
"It would interrupt the financial transactions of the city," City Administrator Tish Elston said.
Others didn’t by the doom-and-gloom scenarios.
“I don’t think Bank of America would stop us from running our 500 million through the bank,” said council member Charlie Gerdes.
Council members Jim Kennedy, Bill Dudley and Jeff Danner didn’t buy into Kornell’s rationale.
Danner even questioned whether Kornell believed everything he read in newspaper about the 2012 mortgage settlement, saying: “Where is that information?”
Under the settlement, five of the nation’s biggest banks must grant billions in relief through measures like refinancing mortgages and reducing loan amounts, letting homeowners dodge foreclosure while making payments they could afford.
In the end, the group passed the contract. But a workshop is being scheduled next month to discuss the issue.
It’s unknown if bankers will attend.