Last evening's post is generating precisely the caliber of discussion I hoped it would: A Candidate’s Progress (9): It’s time to answer those River View questions."
Following is a comment of Bluegill's that strikes to the very core of the point we're trying to make here. Whatever happened to two-way streets, anyway?
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Dan Chandler wrote: "The opportunities available to Mr. Bobo are available to anyone else who wants to invest here in a similar manner."
Bluegill responds:
There's at least a part of the rub. In reality, this translates to opportunities being available only to those who have already achieved a certain level of personal wealth, creating a rich get richer scenario.
We're not talking about an incentive program that's open to everyone and scales according to investment level say, on a percentage basis up to a certain cap, but rather about creating singular opportunities exclusively for those who already have a lot of money.
Do we have public money to make scalable opportunities available to people at different income levels? Yes. Could those opportunities increase the tax base via property improvements, employment, etc? Yes. Could they save us money in other areas in which we regularly spend? Yes. Do we do it? Typically, no.
TIF is only one way to approach the situation, so simply saying it wouldn't be viable to use TIF for certain smaller projects doesn't really address the issue.
In terms of the resource prioritization that Gina has mentioned, I think two-way street reclamation provides one good example among others.
While campaigning, Mayor England regularly made promises that two-way street conversion would be a major priority for his administration. He got quite a bit of electoral support from downtown residents and business people as a result and was elected by a narrow margin.
The cost of that street reclamation was estimated at $2 million with the purchase of new traffic signals given as the single largest individual cost. Thanks to a federal stimulus grant of ~$900K, most if not all of those signals have now been in place for some time.
What have we heard from the administration in terms of two-way streets? Hardly anything, even though the initial expenditure would be a lot lower and both tangible and intangible public benefit more clearly understood.
At one point, I was told that an additional study/plan would be needed and that staff had a contractor in mind to complete it. What they didn't have was the money to pay for it, so two-ways were stalled.
Wanting to help and knowing that a) two-way reclamation was important to many in the neighborhoods and b) neighborhood groups would have some opportunity to acquire funds, I asked for a cost estimate of said study/plan to determine if perhaps a neighborhood group(s) could help or completely pay for it if doing so would move things along. After asking several times for over a year and not getting a number, I gave up asking.
More recently, another resident trained in urban planning volunteered to help with traffic/pedestrian/bicycle studies or plans (including helping with grant writing) for free. He was turned away under the guise of city staff not having time to deal with it.
However, it was no problem to come up with funds for an RV feasibility study nor to devote staff time and other administrative costs to it.
So, which is better for the people who live here and pay the lion's share of taxes? Two-way, pedestrian, bicycle, and business friendly streets or a single development?
Who gets priority? Multiple downtown neighborhoods who helped put the mayor in office, who have been asking and volunteering for years, and are concerned about safety and quality of life (in addition to their own property values/profitability) or a single developer whose primary goal is to extract money from the community for out-of-town investor profit?
River View isn't occurring (or not) in a vaccuum. We have an overall development/redevelopment attitude that says providing corporate air conditioning is a bigger priority than basic housing safety. I'm not sure how to calculate that as a good deal for anyone besides out-of-town investors.
Monday, April 11, 2011
Economic development thread elevation: "Who gets priority?"
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9 comments:
If I may distill Jeff’s concerns, I believe he’s giving his answers to two questions.
(1) Does giving opportunity to Mr. Bobo deny opportunity to other businesses?
(2) Does pursuing RV make achieving other redevelopment goals (like two-way streets) much more difficult?
My replies:
(1) My support for RV is contingent upon its value to citizens. If Mr. Bobo were poor and/or just starting out, RV would not be a better or worse deal for the public.
Prove to me that $12M TIF for RV makes less opportunity available for small business. I believe we should pursue as much opportunity as possible for all businesses with the potential to increase overall quality of life in NA. I do not believe public policy should blunt opportunity for some because others differently situated cannot take advantage of a particular redevelopment tool. If creating opportunity for one removed opportunity for another, that’s a problem. But if removing opportunity for one has no effect on another, then it’s cruel to intentionally block opportunity. Arbitrarily blocking opportunity denies our community many benefits that come from having a variety of business types.
(2) I’m not sure that a TIF bond for RV makes materially less money available for two way streets. I doubt shelving RV will make two-way streets much more likely, but I’ll acknowledge that no one can know this for sure.
If you have a problem with inaction on two-way streets, then complain about that issue. Complain that there is insufficient redevelopment staff. I’m not sure how that affects RV. I’m not clear how it’s “either/or.”
Over and over again when city residents have brought forth legitimate issues, they have been told a) we can't figure out how to utilize the funding mechanisms we have to address the situation and/or b) even if we could, we don't have enough staff to do it. When a monied, out-of-town investor comes calling, though, the same folks with the same resources typically can figure it out and do have time, almost as if it's magic.
Under the direction of certain elected officials, they are choosing to prioritize one over the other, i.e., arbitrarily creating opportunities for one by removing them from others.
In most cases, nary an argument has been made as to why choosing one priority is better for the community as a whole as compared to many other possible choices. In fact, strong arguments to the contrary have often been made and ignored.
Until that attitude drastically changes, tripling staff would do us no good and could actually further damage us by creating a playing field even further tilted and more difficult to eventually level. In fact, that's exactly what's been happening around the country day in, day out for several decades now.
It could very well impede much better deals for New Albany. Just because Mr. Bobo originally hailed from NA is not enough reason for the city to make a non reversible 28% investment in a private venture especially in such a prime area. Most any project that needs that much "help" is probably not worth doing. It's great for Mr. Bobo. He makes a 30% return even he sells his 30mil investment at cost.
Dan, you asked earlier why do we care what the developer makes. Because at least part of the profit is tax dollars. If he(or someone else)builds the exact same value project and the city has to kick in "only" $5mil, that leaves the TIF district with 7mil extra to spend elsewhere in the district. That could help other businesses, big and small.
Jeff, do you think that if RV is abandoned, two way streets or code enforcement will be embraced with new vigor?
Mark, a $12M garage does not equal a $12M profit, for many reasons. For one, I presume the city will execute either a permanent easement or a 99 year lease giving the public virtually unlimited access to a large portion of the garage. Whoever bought the garage from Bobo would buy it subject to the rights of the public.
I don't know, Dan. I just know that this administration has positioned RV (and a trickle down approach in general) as more important than either of those two and lots of other possibilities. In that sense, RV is a continuation of the status quo rather than a change from it.
Many administrations at different governmental levels and in many locales including this one have chosen similar priorities as part of their development schemes for a long time. Over the long haul, it hasn't done citizens much good by contributing to grossly unequal opportunities and outcomes and unsustainable business practices.
The more citizens around the country realize that, the more they're looking for environments that handle development differently. We can begin becoming one of those environments with a shift in political will. Given the stark contrast between some candidates, I think this current local election cycle could actually have a significant impact on that beginning.
Okay, we can quibble over what the garage is worth. Depending on IF we do the things that you mention(back to, what in NA's history...?)the garage would still have value.
Roughly speaking, if we gave a 10 year tax abatement, that would reduce the taxes in half to about 6 mil. Why we would invest more than that and take some risk(no matter how slight)still hasn't been proven to me.
"However, if the deal is properly structured, the odds of that happening are miniscule. Big real estate developments with multiple financial contributors are everyday occurrences for attorneys who specialize in this field."
How many people with "big real estate development" do we have on staff at city hall?
Are you suggesting a second-rate city whose track record with tiny real estate developments (Tabernacle, Linden Meadows..) is abysmal are qualified to shepherd something like the River View project?
Gina, I don’t care how brilliant a deputy mayor or city attorney you are, unless putting these types of deals together has been your entire career, you won’t know what you’re doing. Any city, whether it’s New Albany or New York, would look to outside council for guidance. There are risks associated with any development project. It’s fair to ask the city how those risks will be mitigated. It’s not fair to dismiss the project wholesale.
Err counsel
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