Debt

Financial writers got all goggly in 2005 over the weird debt that Malcolm Glazer issued to buy England's Manchester United soccer club. Unlike debt known by the Morgans and the Rothschilds, Glazer's notes did not pay cash interest. They paid - more debt. "An exotic new species of bond," said the Financial Times. Not really. "Pay-in-kind" debt has supercharged this year's acquisition boom by private equity outfits but has been around for almost as long as there have been stupid leveraged buyouts.

Howard County's debt is rising, and is higher than what the county spends in local funds on its vaunted school system, but officials say there is no cause for alarm. In fact, a county-sponsored citizens committee convened annually to gauge the county's economic outlook heard yesterday that Howard is growing vigorously in all the right ways. While the amount of debt is higher, it is shrinking as compared to total property values and annual tax revenue. "The trend is going down," Ronald Weinstein, the county budget director, told the members of the Spending Affordability Committee at the group's first meeting in the county's Gateway Building.

It's tough being a young professional in Baltimore. Actually, anywhere, for that matter. That's according to local economist Anirban Basu, who spoke to a group of 20-something professionals on the economics of being young at an event last week sponsored by the Maryland Business Council. The reason? "In today's policymaking environment, young people are treated so poorly," argues Basu, chairman and chief executive of Sage Policy Group Inc., a Baltimore economic and policy consulting firm.

Howard County Executive James N. Robey unveiled a $98 million capital budget proposal yesterdaythat is 24 percent smaller than this fiscal year's, but fueled by enough surplus cash to plan for a new Fulton high school, a disputed in-line skating pavilion and a new Ellicott Mills Middle School.Robey said he resisted seeking more in order to begin reducing the county's $400 million debt -- a burden that would cost $45 million in operating budget cash just in interest payments next fiscal year.

The NFL, which last month approved a loan to prop up the debt-strapped Ravens, has borrowed the money from Chase Manhattan Corp., according to a league spokesman.The terms provide for up to $85 million in assistance, although both a league spokesman and Ravens president David Modell say the team will probably use much less. The bank has provided a $55 million loan, due next year, and $30 million in revolving credit, said NFL spokesman Greg Aiello.Aiello said the league anticipates the team will require less than $55 million.

Faced with an uphill battle to raise new equity and a desire not to take on additional debt, Prime Retail Inc. is turning to another weapon in its quest to raise new capital: its factory outlet centers.The Baltimore-based real estate investment trust announced Thursday that it will sell a stake in three of its projects -- including one in Hagerstown -- to an affiliate of a German company for $274 million.Prime Retail expects that the deal with Estein & Associates USA Ltd. will generate $78 million in cash, plus another $24 million from debt refinancing and other payments from the German concern.

WASHINGTON -- Last summer, economist Cynthia Latta was crunching her forecasts for the burgeoning federal budget surplus when her projections reached a landmark simply too mind-boggling to accept: early in the next century, the publicly held federal debt would simply disappear.In a panic, the principal U.S. economist for Standard & Poors' DRI -- its forecasting division -- did what she expects Congress to do. She threw in some tax cuts, some extra government spending, and to her relief, the debt was back -- that is, until last week, when President Clinton announced that he planned to eliminate it by 2015.

The Ravens have reached a tentative agreement with a minority investor who will relieve the team of its extensive debt burden and will have the option to eventually purchase the entire team.The investor is Stephen J. Bisciotti of Millersville, according to sources familiar with the deal who spoke on the condition of anonymity. Bisciotti is a principal in Aerotek, a Hanover-based employment service company.Bisciotti, 40, is a lifelong Marylander who attended Severna Park High School and Salisbury State University before starting his company in 1983.

Ravens chief executive officer Art Modell plans to sell a share of the debt-laden team to a new investor.Modell said yesterday that he will hire an investment banker in the next 30 days to advise him and help procure a partner. The buyer would not acquire a controlling share of the Ravens -- which would continue to be held by Modell's wife, Patricia -- but might receive a right of first refusal in the event the team is sold, he said."I'd like somebody who's a younger age than me, who can grow with the business, grow with my son, David.

It is axiomatic in sports that a team moves to a new stadium and gets rich.It happened to the Orioles. And the Cleveland Indians. And the Washington Redskins. The list is long of teams that have been enriched, mostly by taxpayers, during this decade's boom in stadium building.So what happened to Art Modell?The Ravens owner did the unthinkable when he moved his NFL franchise to Baltimore from Cleveland after the 1995 season. Desperate for revenues and frustrated by his inability to pry a stadium from Ohio politicians, he took up Maryland on its offer to build his team a new home.

Maryland Comptroller Peter Franchot, meet your nightmares. Yours, too, Gov. Martin O'Malley. And yours, President Barack Obama and Fed Chairman Ben Bernanke. Their names are Matthew and Meredith Targarona. They live in Towson, and they are cutting spending, increasing savings and paying down debt. Since the financial crisis hit last year, they've been saving more than $1,000 a month and applying it against their home-equity loan. They paid off the loan a few weeks ago - "a really great feeling," says Matthew, 28, who works for Verizon.

Sinclair Broadcast Group Inc., which had said it might be forced to file for bankruptcy protection because of substantial debt coming due, said it has reached a tentative deal to pay off nearly $438 million in convertible notes. Under an agreement reached with a committee of note holders, Sinclair subsidiary Sinclair Television Group would issue notes that would mature in 2014 and be secured by a second lien on assets securing the television group's bank credit facility. The broadcaster would use the proceeds to repurchase outstanding debt from note holders who are entitled to exercise options in May 2010 and January 2011.

Sinclair Broadcast Group Inc., facing declining advertising revenue amid the recession, said Wednesday that net income fell to $2.8 million, or 4 cents per share, from $11.8 million, or 13 cents per share, in the second quarter of 2008. The Hunt Valley-based owner of television stations said net broadcast revenues from continuing operations fell nearly 19 percent to $133 million for the three months ended June 30. Operating income fell to $25.8 million from $43.3 million, Sinclair reported.

DETROIT -General Motors Corp. might miss a $1 billion bond payment due June 1 if it doesn't complete a debt-for-equity exchange by then, the company said Wednesday. The troubled auto giant plans to make the exchange offer soon to bondholders, perhaps next week. GM has $28 billion in unsecured bond debt. GM said in a statement that it will not make the payment if the exchange is still in progress June 1, which is also its deadline to reduce debt, cut labor costs and complete other restructuring steps to the government's satisfaction.

Energy regulation bill passes Senate vote A plan to move the state back to a regulated energy market won approval Wednesday night in the Maryland Senate, after lawmakers sparred over whether the proposal would save ratepayers money. The Senate voted 27-19 for the plan that has the backing of Gov. Martin O'Malley. The Democratic governor said in a statement after the vote that he looks forward to working with the House of Delegates on the bill. But with less than two weeks left in the legislative session, the plan's fate is unclear.

A monthly fee charged to Maryland parolees often grows to a burdensome debt that hinders their attempts to build a life after prison and runs counter to the mission of the parole program, according to a study that will be released this week. More than 80 percent of parolees do not pay the state parole supervision fee on time and some consider committing crimes to pay the fee, which amounts to an average of $750, according to the Brennan Center for Justice at the New York University Law School.

Growing up in northern Homeland, I saw my first film at the Senator Theatre at 10. I went four times in four days to see Dick Tracy and got sick from eating too much popcorn. During breaks from college and the Peace Corps, I regularly took in screenings at the historic theater and made an effort to be an ambassador for the Senator, as Tom Kiefaber advocated to patrons before each performance. I even took part in the 2007 campaign to save the Senator from the auction block, going door to door in the neighborhood to collect small donations and get the word out to area residents.

Readers of "In Their Debt" (Dec. 21-23) may be dismayed - as we all are - by descriptions of individuals struggling to pay medical bills. But they ought to be far more focused on the fact that under Maryland's one-of-a-kind and widely praised rate-setting system, those who can pay for health services, but don't do so, unfairly burden everyone with higher rates and costs, including patients. Hospitals are strongly encouraged and given incentives by the Health Services Cost Review Commission to collect unpaid bills precisely so that everyone pays a fair share to shoulder the cost of care for those who truly cannot afford to pay. Under HSCRC rules, all unpaid patient bills are included in future rates that Maryland hospitals are given approval to charge to all patrons, including the insured and uninsured.

CHICAGO - Baltimore Sun parent Tribune Co. is working with bankruptcy advisers at the investment bank Lazard and the law firm Sidley Austin to weigh financial options, including a possible restructuring for the heavily leveraged media company, sources said yesterday. Tribune Co. has been struggling under a $13 billion debt load since real estate magnate Sam Zell took the company private last December in an $8.2 billion leveraged buyout. The company, which also owns the Chicago Tribune, Los Angeles Times and the Chicago Cubs faces a deadline today on $70 million of unsecured debt it took on before Zell's deal.

The Big Three automakers need a bailout because we don't buy enough gas-guzzlers. The Wall Street Journal reports the government has less gas tax revenue to pay for bridges and roads because we've been driving less. Now we hear that retailers will go out of business if we don't shop till we drop this holiday season. Enough. Consumers have done more than their fair share to keep the economy afloat for years. We have the debt to prove it. It's time to let others lift up the economy. Or, as ethicist Bruce Weinstein says: It's OK to be a tightwad.