Tag Archives: Loans

Chicago school system plans to borrow up to $389 million

FILE PHOTO: Chicago Mayor Rahm Emanuel speaks during the U.S.-China Joint Commission on Commerce and Trade Investment Luncheon Program in Chicago, Illinois, U.S., on December 17, 2014. REUTERS/Andrew Nelles/File Photo

By Dave McKinney

CHICAGO (Reuters) – Chicago’s cash-strapped public school system plans to seek up to $389 million in short-term loans to avoid closing schools early for the summer and to make required pension payments next month, the mayor’s office said on Friday.

The fix will be secured through short-term financing against $467 million in delayed block grant funding by Illinois’ fiscally paralyzed state government, which has not passed a full-year operating budget in 23 months.

Escalating pension payments have led to drained reserves, debt dependency and junk bond ratings for Chicago Public Schools.

The planned borrowing follows Republican Governor Bruce Rauner’s veto in December of legislation that would have funneled $215 million in state funds to the nation’s third-largest school system to help it make a required $721 million pension payment next month.

A school-funding overhaul that would direct more money to Chicago’s schools passed the Illinois Senate this week but drew immediate criticism from Rauner’s education chief, casting serious doubts on the measure’s long-term prospects.

Absent any movement in the state legislature on school funding, Chicago Mayor Rahm Emanuel described the borrowing plans as a short-term bridge.

“While we work with state lawmakers on long-term solutions to Illinois’ education funding challenges, in the short-term, (we) are doing what is necessary to keep our students in the classroom and on the path to a brighter future,” Emanuel said in a statement.

Terms of the borrowing were not immediately known. The Emanuel-appointed Chicago school board expects to vote on the new borrowing authority at its May 24 meeting.

The grant money upon which the borrowing will be secured is part of $1.1 billion in state payments Illinois owes to more than 400 school systems. The state has been unable to distribute those grant payments because of the unrelenting budget stalemate.

The mayor’s office said CPS expects to receive its allotment of state grant funds in “coming months.” But Abdon Pallasch, a spokesman for Illinois Comptroller Susana Mendoza, said on Friday his office has no idea when the money will be disbursed.

Rauner’s office did not have an immediate reaction to CPS’s new borrowing.

(Editing by Chizu Nomiyama and Matthew Lewis)

Some Chase branches in Seattle closed by protests over pipeline loans

Native American leaders and climate activists demonstrate outside of a Chase Bank location, to oppose the Keystone XL pipeline, in Seattle, Washington, U.S. May 8, 2017. REUTERS/David Ryder

By Tom James

SEATTLE (Reuters) – Native American leaders and climate activists protested at several Chase branches in Seattle on Monday, forcing them to close temporarily as demonstrators demanded the bank not lend to projects like the Keystone XL oil pipeline.

Police said 26 people were arrested by late afternoon. Activists said they disrupted operations at 11 Chase branches, and two other branches closed as well.

Darcy Donahoe-Wilmot, a spokeswoman for Chase, which is a unit of JP Morgan Chase & Co, declined to comment.

At a branch in downtown Seattle, about 50 protesters occupied the main lobby, where they made speeches, sang songs, held signs and banners and even ordered a tall stack of pizzas before police blocked the doors.

At another Seattle branch, a handful of protesters went inside while two others locked themselves by their necks to the front doors with bicycle locks.

“I have a personal responsibility to make sure we have a livable climate,” said a protester who locked herself to the door and would only identify herself as 21-year-old Andrea from Olympia, Washington.

Organizers of the protests aimed to dissuade Chase from lending to the companies behind two major oil infrastructure projects, the Keystone XL pipeline and Trans Mountain Pipeline expansion, and tar sands oil production in general. Protesters said they were fighting global warming.

Keystone XL is a project of TransCanada Corp and Trans Mountain Pipeline is a project of Kinder Morgan Inc.

These efforts echo similar efforts with other banks as activists have shifted to targeting the financial backers of the pipelines rather than sites like the Dakota Access Pipeline in North Dakota, where thousands protested last year.

Bank are more sensitive to bad publicity than the pipeline companies, said Seattle city council member Mike O’Brien, who participated in one of the protests on Monday.

“It’s a relatively small percentage of their overall portfolio,” protest organizer Ahmed Gaya said of the banks’ stakes in various oil and gas pipelines. “If you can make that very small part … have a vastly disproportionate effect on their public image, that’s very persuasive.”

In April, Citigroup executives conceded they had approved investments in the Dakota pipeline too quickly after a noisy protest at its annual shareholder meeting, while Greenpeace activists protested Credit Suisse’s dealings with companies behind the same pipeline. The previous month, Dutch bank ING Groep agreed to sell its $120 million share of a loan for the Dakota pipeline.

(Reporting by Tom James, Editing by Ben Klayman and Cynthia Osterman)

Nepal quake survivors struggle with debt, raising trafficking fears

By Rina Chandran

KATHMANDU (Thomson Reuters Foundation) – Hundreds of Nepalis who had borrowed money to rebuild their lives after two earthquakes left them homeless are at risk of being trafficked or duped into selling their kidneys to pay off their debts, an international development organization said.

Nepal received $4.1 billion in pledges from donors for reconstruction after quakes last April and May killed 9,000 people, injured at least 22,000 and damaged or destroyed more than 900,000 houses in the Himalayan nation.

More than a year on, reconstruction has been slow with unrest over a new constitution adding to the delays. Unable to find work, hundreds of Nepalis are deep in debt, the Asia Foundation said on Tuesday.

“Their ability to pay is very limited and indebtedness makes them more vulnerable to exploitation,” said Nandita Baruah, Asia Foundation’s deputy country representative in Kathmandu.

“Their desperation makes them take greater risks, such as sending their children away for what they think are better lives, or even selling their kidneys,” she told the Thomson Reuters Foundation in an interview.

“We’re going to see an uptick in people moving out to earn money as their debts become due. Some of them will be trafficked,” Baruah added.

Nepal’s economy is highly dependent on remittances sent back by its migrant workers, which make up about 30 percent of its gross domestic product.

Following the earthquakes, hundreds of migrant workers returned to Nepal to help their families.

Many are likely to have paid their employers to be allowed to return home, going without wages for several months while spending money on rebuilding, Baruah said.

“These are workers who pay 200,000-500,000 rupees ($1,850-$4,640) to go abroad in the first place, and are very likely still paying off that debt,” she said.

“The quakes exacerbated their indebtedness,” she said.

BORDER CHECKS

Activists say there are signs of an increase in the number of Nepali women and children being trafficked after last year’s disaster.

Anti-trafficking charity Maiti Nepal said it stopped 745 women and children – suspected victims of human trafficking – at the Nepal-India border in the three months following the earthquakes.

That compares with 615 such interceptions in the three months before the quakes, their data showed.

Nepal is both a source and a destination country for victims of human trafficking with some 8,500 Nepalis trafficked every year, according to the country’s human rights commission.

Women are typically trafficked for sex work, domestic work and forced marriages to India, the Middle East, China and South Korea – while men are made to work in construction, as drivers and in hotels in India, the Middle East and Southeast Asia.

Some victims are duped into selling their kidneys and brought to India, where a chronic organ shortage has fueled a black-market trade in illegal transplants, activists say.

Nepal’s economy is forecast by the Asian Development Bank to have grown only about 1.5 percent in the fiscal year to mid-July after reconstruction delays and trade disruptions. A recovery is dependent on the pace of reconstruction, it said.

“Now, the aid will also stop flowing. We’re going to see more migration, more trafficking,” said Baruah.

“Those who have taken on debt don’t have options,” she said.

(Reporting by Rina Chandran @rinachandran, Editing by Katie Nguyen. Please credit the Thomson Reuters Foundation, the charitable arm of Thomson Reuters, that covers humanitarian news, women’s rights, trafficking, corruption and climate change. Visit news.trust.org to see more stories.)