Municipal taxpayers are not a bank. There are many banks out there to borrow money from. Use one of them.
Using the city's balance sheet in this way is not a victimless crime. There are huge infrastructure demands for projects that actually make the city work better and that wouldn't be built any other way. City bonds and their coupon advantage should be utilized for these projects because it will mean higher costs for actual projects the city needs. Conversely, why doesn't CNRL issue some corporate paper to pay for the arena? Similar financing costs and they bear the repayment, interest rate, and others risks.
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