So far, California has mailed $354 million worth of IOUs and plans to issue a total of $3 billion by the end of July. Around $140 million of the warrants are expected go to small business owners. While the state controller's office won't say exactly how many small companies will be hit, it's likely to be a big number: The state's department of general services says it holds $2.7 billion worth of annual contracts with at least 14,000 small companies, most of them California firms.... Staff USA provides medical staffing for various state-run divisions, and Freeman says that California owes her hundreds of thousands of dollars, much of that for services she rendered early this year. In anticipation of receiving an IOU instead of money, Freeman has laid off five employees.... Most small businesses hope to cash in their IOUs at a bank, a process that's turning out to be difficult. Initially, all major California banks said they would honor the IOUs by charging customers a small processing fee [!!], paying out the face value, then taking over the interest. However, the state's largest banks, including Bank of America (BAC, Fortune 500) and Wells Fargo (WFC, Fortune 500), later imposed a deadline. They stopped accepting the IOUs on Saturday.... A number of California's community banks and credit unions plan to accept the IOUs indefinitely, but in many cases, the terms are tough. "My community bank will redeem the IOU for a fee [!!], but I have no choice but to do it," says the owner of an 11-person firm who asked not to be named. "It's not worth my while to wait for this thing to mature. I'd be losing money." His company, which does $10 million in annual business with the state, has been providing goods to prisons, state hospitals, and schools for more than 20 years. This is the first time he's been confronted with an IOU.... As a last resort, cash-strapped companies may be able to redeem [meaning here, "sell,""trade," or "pawn"?] the IOUs at check-cashing storefronts or via online marketplaces such as Craigslist or eBay (EBAY, Fortune 500), but small business advisors warn against that because of the large fees [!!] and face-value discounts that would be incurred.
Staff USA provides medical staffing for various state-run divisions, and Freeman says that California owes her hundreds of thousands of dollars, much of that for services she rendered early this year. In anticipation of receiving an IOU instead of money, Freeman has laid off five employees....
Most small businesses hope to cash in their IOUs at a bank, a process that's turning out to be difficult. Initially, all major California banks said they would honor the IOUs by charging customers a small processing fee [!!], paying out the face value, then taking over the interest. However, the state's largest banks, including Bank of America (BAC, Fortune 500) and Wells Fargo (WFC, Fortune 500), later imposed a deadline. They stopped accepting the IOUs on Saturday....
A number of California's community banks and credit unions plan to accept the IOUs indefinitely, but in many cases, the terms are tough.
"My community bank will redeem the IOU for a fee [!!], but I have no choice but to do it," says the owner of an 11-person firm who asked not to be named. "It's not worth my while to wait for this thing to mature. I'd be losing money." His company, which does $10 million in annual business with the state, has been providing goods to prisons, state hospitals, and schools for more than 20 years. This is the first time he's been confronted with an IOU....
As a last resort, cash-strapped companies may be able to redeem [meaning here, "sell,""trade," or "pawn"?] the IOUs at check-cashing storefronts or via online marketplaces such as Craigslist or eBay (EBAY, Fortune 500), but small business advisors warn against that because of the large fees [!!] and face-value discounts that would be incurred.
This "IOU" issue is supremely ill-conceived. Sacramento really screwed constituents. I suppose that means representatives expect to be re-elected. Diversity is the key to economic and political evolution.
As for Prop H8.... keep to the Fen Causeway
I fail to understand how a state that appears reliably democrat at national level can deliver the most retarded repugs to run the State itself.
Granted, they gave us Waxman and Boxer, too, but I think the fascists trump the good guys on the Gullyvornyah balance sheet.
Not that Virginia's senators are much better, but I'll take Timmy over Der Gropenfuhrer any day of the week. Conservatives want live babies so they can raise them to be dead soldiers. - George Carlin
