COUNTY OF SAN MATEO

Inter-Departmental Correspondence

County Manager’s Office

DATE:

April 22, 2009

BOARD MEETING DATE:

April 28, 2009

SPECIAL NOTICE/HEARING:

None

VOTE REQUIRED:

None (Informational Only)

TO:

Honorable Board of Supervisors

FROM:

David S. Boesch, County Manager

SUBJECT:

County Manager’s Report #5

Update on Lehman Brothers Holding, Inc.:

The hearing on the impact of the Lehman Brothers Holding, Inc., bankruptcy before the House Financial Services Committee has been confirmed for Thursday, May 21, 2009. Inc. This hearing will be conducted in Washington, DC. A second Congressional Field hearing may be conducted later in May in San Mateo County.

In preparation for the hearing, Beacon Economics, has been retained to complete an economic analysis of the benefit that would accrue to the economy were the $155 million in Lehman investment restored. It is hoped that analysis will demonstrate the number of jobs that would result, as well as the positive multiplier effect and the resulting purchasing power.

It was suggested by House Financial Services Committee Counsel that using federal bailout funds for local governments would create a drag on the TARP funds. It is hoped that the Beacon Economic analysis will disabuse committee staff of this concern.

Additionally, San Mateo County Counsel and the County Manager’s Office staff met telephonically with Mr. Michael Tae, Director of the Office of Financial Stability, Department of Treasury, to discuss the request for assistance under the provisions of TARP. Mr. Tae expressed an understanding for our issue and requested that we provide additional information. Specifically, he asked that we scale the problem and provide him with a brief background piece on the impacts to local governments. Attached please find the additional information provided Mr. Tae and Department of Treasury officials.

Attachments