Aug 6, 2010 1:37 PM by Bea Karnes, News First 5
The Denver school system is reportedly stuck paying millions of dollars in interest and fees because of a pension financing deal recommended by Sen. Michael Bennet while he served as superintendent.
The New York Times reported Friday that the deal has cost Denver at least an extra $25 million.
The Denver school board unanimously backed the deal in 2008 in hopes of saving tens of millions of dollars in annual debt costs. But, much like an adjustable rate mortgage, the deal's interest rate was subject to change depending on economic conditions. Bennet and former chief operating officer Thomas Boasberg say the deal saved the district from having to pay $20 million to cover a pension shortfall. They say no one could have predicted the credit crisis that ended up making it so expensive.
Bennet was appointed to the senate seat vacated by Ken Salazar when he joined President Obama's cabinet. Bennet is now embroiled in a fight to retain his seat. He's being challenged for the democratic nomination by former Colorado House Speaker Andrew Romanoff.