L.A. struggles to borrow money

The sale of short term notes is typically a non-event. Money raised this time of year - this time around $1.2 billion - goes to help pay expenses before tax revenues start arriving later in the fiscal year, and there's usually no problem lining up the necessary investors. Not this time. From Money & Co.:

The big buyers of short-term TRANs are money market mutual funds, and they were relentless in asking questions about the risks to L.A.'s fiscal health, said Natalie Brill, the city's chief of debt management. In 10 years on the job, "This is the most I've ever talked to investors" about a TRAN sale, Brill said. Even though the notes had top credit ratings from debt-rating firms, "It didn't seem to matter," she said.

The city ended up selling the notes, but at much higher yields than a year ago. That, of course, jacks up the cost of borrowing.

The money market funds' concern typically isn't that a TRAN borrower won't repay the notes on schedule, but that some bad news about the borrower's finances over the next year could make the funds that own the debt look riskier to their investors. The funds "don't want any 'headline' risk," said Paul Derse, Ventura County's chief financial officer.

The other budget related news was a wildcat sickout Thursday by nearly three dozen emergency 911 operators. They were protesting furloughs and pay cuts. LAPD personnel handled their shifts. (LAT)