Thursday, March 01, 2012

Planning Omissions

I went to a Racine Planning Commission meeting last night to learn more about the Porters project and the TIF proposed to help with the financing. But that was not the only issue before the commission.

It seems that there are some folks who want to utilize (purchase or rent?) the Women's Club building on the outskirts of downtown. The one and only controversy discussed was over parking and traffic congestion that might result when the proprietors have a funeral procession departing from their establishment. Apparently this was the second time wrangling over the issue and this time the proprietors proposed routes which seemingly would have been different from those used by a neighboring funeral home. We also learned that in the last five years, they have only had about five funerals that did not go from a church directly to a cemetery. In other words, unless they change their modus operandi, they will have very infrequent funeral processions. Even so, they spent close to an hour discussing this phantom problem before deferring action until such time as the proprietor can relieve the concerns of the committee. How exactly to successfully address the "problem" of a once a year funeral procession on public streets was left unsaid.

Regarding the Porter's project, it was a love fest from start to finish. The project itself looks great and I wholeheartedly endorse the Waters family using their own money or that of investors to move forward. Fearing the TIF would sail through the committee like a funeral procession on an open road, it was up to me apparently to suggest that a TIF is a serious investment by the public, with considerable risks to the taxpayer, and that the risks should be fully explored before the matter is voted upon. But alas, with no discussion beyond praise for the Waters family, they voted unanimously to approve the TIF. The matter now heads to the full council.

22 comments:

GearHead said...

My guess is the neigboring funeral home has an ear in the planning commission. As you point out, if the city wants to do it (Porters) there can be no objection. If the city doesn't (womens club) there will be no support for it, regardless of how ridiculous the purported "objection" is.

But that leaves an opportunity for you and me. Let's buy the womens club ourselves (because the aformentioned funeral parlor won't fly) and rename it "the mens club." We'll hold it open to men only. We'll allow cigar smoking to go on, and have live music on the stage. Card playing and Vegas nights. Our community service commitment will be to support concervative causes and conservative educational outreach. How long do you think we'll stay open before the disaffected and disenfranchiesed women call for our shut down (unless there is inclusion?) Oh, the humanity!

Denis Navratil said...

Yes, and we can use the "W" from the signage and make it the White Man's Club so they won't have to worry about another Park 6. By the way, it was suggested to me that maybe, just maybe, that that was the unspoken objection to the proposed use of the Women's Club, who's would be proprietors are black, or at least the one speaking last night was. I would hope that the committee would not reject a perfectly valid use for a building because another business catered to rowdy black people, but that would make more sense anyway than a whole lot of hand wringing about a once-a-year funeral procession.

Anonymous said...

I was at the meeting also. It seemed Mayor Dickert was falling asleep during the discussion over the funeral parking - he kept putting his elbow on the table to rest his head on his hand, and then suddenly seemed to wake up later.

The Parking is a legitimate problem. The Mayor clearly pointed that out - so why don't they get rid of some of the more decrepit buildings and create more parking and open space?

I believe that the funeral home was pointed in the direction of buying the parking lot that is for sale close by if they want to be there. It is a good idea and the funeral home should strongly consider it.

Will the Racine Y go away when the Mt. Pleasant Y is finished? The high rise housing stands empty. Why? If it closes - then what?

Anything to distract the discussion from the true troubles of Racine - a shrinking tax base, overpaid/overcompensated public employees and a spendaholic Mayor.

Making Racine competetive would be painful to the City Employees and RUSD, no doubt - but how much longer can they scavenge and loot the City before it economically collapses?

All they do is kick the can down the road to buy another day - and pray it lasts long enough for their retirement to begin. They are almost out of time - if they won't deal with reality - reality will eventually deal with them.

Anonymous said...

No, reality will deal with US. I'll lose my house before any of them lose theirs.

Anonymous said...

If it was YOUR HOUSE - you would have allodial title. It is YOUR liability, which THEY control.

CONTROL IS EVERYTHING. Ownership is NOTHING. Change your thinking and it becomes easier.

LOL. The TIF was rammed through, and already on the Agenda for March 5, 2012:

"Subject: (Direct Referral) Communication from the Director of City
Development requesting an advance of funds from the
Intergovernmental Revenue Sharing Fund to be repaid from Tax
Incremental District no. 17 (Porters of Racine Building"

AN ADVANCE OF FUNDS!!!

Be sure to check out the agenda on the legislative calendar on the City of Racine website.

Anonymous said...

Denis, I have a question for you.

I keep looking at the TIF documents, and I can only find ACTUAL investment of $1,785,062 from the taxpayers.

YET - the number presente was S5.5 Million.

Now, I find this in the TIF document: "Economic Development. As a result of the creation of this District, the City projects that
additional land and improvements value of approximately $3,174,000 will be created as
a result of the anticipated redevelopment ($1,865,000 net of base value)."

What is Micah Waters personal investment?

Is it actually -0-

Is the entire TIF money a LOAN to Micah Waters, or his development Corporation?

Denis Navratil said...

Anon, I greatly appreciate the info you have provided for me and I am glad to know that someone besides me has some concerns. At the meeting the other day, it was pretty lonely insofar as I was the only one there without a tingle running up my leg. Anyway, I just finished reading the proposal and while it didn't occur to me that Micah might not have skin in the game - the city can't really be that stupid - I did find some interesting stuff. For example, "There have been no known environmental studies performed within the district." Really! A 150 year old furniture company, in less enlightened times, might have been pouring varnish or who-knows-what chemicals out the back door. The whole property could be a toxic waste dump unsuitable for residential use without hugely costly expenses. Who will be on the hook for that? You guessed it - the taxpayer! Would love to meet with you anon if your willing but if not by all means keep the info flowing. I plan to address the full city council next Tuesday and while I am not hopeful that I can slow this train down, I can at least introduce a better idea - a more modest property tax increment break of, say, five years wherein any developer large or small is eligible.

Anonymous said...

We'll get together sometime and talk.

It was suggested that Alderman Marcus might be able to help - I'm on the outside - so maybe you could contact him and ask him some questions - specifically who else is investing money, and what is the amount. There are no numbers there.

If I am reading the TIF documents right, it is the taxes generated from the additional future value of the property that pay the 1.1 M back. SO - if the City loans it to someone - it's in essence FREE MONEY! I want some of that!

If I undersand what I am reading, the City has wide discretion in what they can do with the money - and might be able to use the TIF to borrow more. Now, I'm not sure, and that is why I am uncomfortable with it.

Know what else is on the AGENDA for the next Common Council meeting?

Get a look at this:

"Subject: Communication from the City Administrator requesting to
present a recommendation to change the organizational structure of the
City's management team regarding the positions of City Engineer, City
Assessor and the Building Complex Facilities Manager."

What is going on there - and why?

It's a request from Dickert himself - so something fishy is up! Tie this in with the TIF - and, well, SOMETHING IS BEING PLANNED because it is a Dickert power grab.

If you know anyone in the know - ask them what the significance of this may be.

Anonymous said...

From the Porters Term Sheet:

"Redevelopment to have an estimated assessed value of $3.2 million."

JT said $5.5 M

"City will provide the developer with a tax incremental financing grant of $1.1 million for costs related to the renovation. City’s funding shall be drawn during construction in proportion with the project’s bank financing."

This will be a FREE LOAN as the money is paid back by property taxes generated above frozen value.

"City will provide a special fa├žade grant of $160,000 to the developer for renovation of the building facades to a design approved by the city."

FREE MONEY!

1.1 M + 160,000 = 1260000

3200000 - 1260000 = 1940000

MAX private investment of $1.95M

Since the 1.1M and $160,000 is essentially FREE MONEY - the developer could put in more, up to a max of 3.2M with "no loss" if the project makes money.

So yeah, it's a $5.5 M development, built at a taxpayer LOSS, and Mr. Waters has been granted a tremendous advantage over everyone else.

Subsidized apartments - YOU BET!

Does this make sense?

Denis Navratil said...

Hey anon. The TIF doc describes the incentives as a grant and that is exactly what it is. It is a wealth transfer from taxpayers to developers, plain and simple. TIF advocates will often call it a loan that is "paid back" in taxes, but this is pure b.s. Try making the argument that you shouldn't have to pay your property taxes as you haven't received something that you have to pay back. Yah, that'll work.

You are right about a huge amount of discretion on the part of the city/TIF administrators. The TIF document is chock full of legalese that will allow them to do whatever just about whatever they want. Look out taxpayers!

Eric Marcus is I think a pretty smart guy willing to mix it up with Dickert or whomever but on this development he appears to be fully on board. As such I suspect he might be in full advocate mode if I contact him. But perhaps I should give him the benefit of the doubt and call him. Good suggestion.

Re the administrative reshuffling proposal, I don't know what to make of it. What is your suspicion? Like you I am very much on the outside. I suppose that is the result when you are willing to criticize and or scrutinize folks who prefer not to be challenged.

Denis Navratil said...

anon, I didn't find anything about a $160,000 facade grant. May I ask where you found that info? Thanks.

Anonymous said...

I am still reading and digesting the documents - I have more questions than answers - and am suspicious - caveat.

Here is where the information for the facade grant is:

http://legistar.racinenet.org/Attachments/be3faf51-7f31-46a8-9533-be58d0e2cfd3.pdf

From page 19 of the 3rd. Revision of the TIF document:

"All costs are based on 2012 prices and are preliminary estimates. The City reserves the right to
increase these costs to reflect inflationary increases and other uncontrollable circumstances
between 2012 and the time of construction. The City also reserves the right to increase certain
project costs to the extent others are reduced or not implemented, without amending the Plan.
The tax increment allocation is preliminary and is subject to adjustment based upon the
implementation of the Plan.
This Plan is not meant to be a budget nor an appropriation of funds for specific projects,
but a framework within which to manage projects. All costs included in the Plan are
estimates based on best information available. The City retains the right to delete
projects or change the scope and/or timing of projects implemented as they are
individually authorized by the Common Council, without amending the Plan."

It reads like "BLANK CHECK" to me. All Dickert needs is Common Council approval. This could get HUGE.

Yes, I beleive the 1.1M is a GRANT, based upon more reading.

Page 16 from 3rd. version TIF

"CASH GRANTS (DEVELOPMENT INCENTIVES). The City may enter into agreements
with property owners, lessees, or developers of land located within the District for the
purpose of sharing costs to encourage the desired kind of improvements and assure tax
base is generated sufficient to recover project costs. No cash grants will be provided until
the City executes a developer agreement with the recipient of the cash grant. Any
payments of cash grants made by the City are eligible Project Costs."

The 1.1 M is called "DEVELOPMENT INCENTITIVES" which = CASH GRANT. SO the 1.1 is FREE MONEY for the Developer. I suspect the City will increase this amount to whatever it takes to build what they want.

Page 17:

"Costs identified in this Plan are preliminary estimates
made prior to design considerations and are subject to change after planning is completed.
Proration’s of costs in the Plan are also estimates and subject to change based upon
implementation, future assessment policies and user fee adjustments."

Anonymous said...

I am still reading and digesting the documents - I have more questions than answers - and am suspicious - caveat.

Here is where the information for the facade grant is:

http://legistar.racinenet.org/Attachments/be3faf51-7f31-46a8-9533-be58d0e2cfd3.pdf

From page 19 of the 3rd. Revision of the TIF document:

"All costs are based on 2012 prices and are preliminary estimates. The City reserves the right to
increase these costs to reflect inflationary increases and other uncontrollable circumstances
between 2012 and the time of construction. The City also reserves the right to increase certain
project costs to the extent others are reduced or not implemented, without amending the Plan.
The tax increment allocation is preliminary and is subject to adjustment based upon the
implementation of the Plan.
This Plan is not meant to be a budget nor an appropriation of funds for specific projects,
but a framework within which to manage projects. All costs included in the Plan are
estimates based on best information available. The City retains the right to delete
projects or change the scope and/or timing of projects implemented as they are
individually authorized by the Common Council, without amending the Plan."

It reads like "BLANK CHECK" to me. All Dickert needs is Common Council approval. This could get HUGE.

Yes, I beleive the 1.1M is a GRANT, based upon more reading.

Page 16 from 3rd. version TIF

"CASH GRANTS (DEVELOPMENT INCENTIVES). The City may enter into agreements
with property owners, lessees, or developers of land located within the District for the
purpose of sharing costs to encourage the desired kind of improvements and assure tax
base is generated sufficient to recover project costs. No cash grants will be provided until
the City executes a developer agreement with the recipient of the cash grant. Any
payments of cash grants made by the City are eligible Project Costs."

The 1.1 M is called "DEVELOPMENT INCENTITIVES" which = CASH GRANT. SO the 1.1 is FREE MONEY for the Developer. I suspect the City will increase this amount to whatever it takes to build what they want.

Page 17:

"Costs identified in this Plan are preliminary estimates
made prior to design considerations and are subject to change after planning is completed.
Proration’s of costs in the Plan are also estimates and subject to change based upon
implementation, future assessment policies and user fee adjustments."

Anonymous said...

Here is how I am getting to documents - since links I copy and paste don't seem to work -

Go to City of Racine website

Under HOT LINKS click on Legislative Calendar

Listings of Agendas and Minutes will come up - I am looking at AGENDA for March 5, Redevelopment Authority. Click on agenda.

When the agenda comes up - all blue words are links. You will see one for PORTERS TERM SHEET

RACINE TID DRAFT PLAN

and the number 12-7450

That is straight from the horses mouth and the best place for information.

Anonymous said...

Here is the info from the Common Council agenda, for 03-06, item #12-7449:

You'll need to go there on the website, click on the item, and then click on "Organizational Structure" to see Tom Friedel's letter asking to re-organize the City Engineer, City Assessor, and Building Facilities Complex Manager - the letter states: "These Changes Will Require MODIFICATIONS to the several City Ordinances."

People need to be there, and calling their Aldermen to find out more - because this is a power grab of some sort - in my suspicious mind.

Anonymous said...

I have more questions than answers as I think about it -

Is such an open-ended TIF wording even legal? It didn't stop Dickert with his gun-ban.

Where is the money from the Advance going?

Is the City self-insured for health care?

Is additional funding necessary to increase participant numbers?

Once it's been rammed through - can you go back and challenge it if things were done illegally - or are the defects accepted?

This stuff is starting to bother me. Somethings up. Too much, too fast, too many inter-related things.

TSE said...

Here is a link to the Wisconsin Department of Revenue TIF manual that spells how a TIF is legally done.

Is Racine following the LAW?

http://www.revenue.wi.gov/pubs/slf/tif/cvmanual.html

Anonymous said...

Glad to see others watching city hall. There are alot of games being played there. Festival Hall would make for a good case study.

TSE said...

Possible questions for the Common Council -

Was the required Class 2 Notice Published as required by law? Perhaps you can check with the JT.

Did the notice contain the fact that Developer Incentives would be provided - as required by law?

Public Hearings – The Planning Commission (or the Development or Redevelopment Authority of the municipality) must hold a public hearing to address the proposed boundaries of the TID and the project plan for the TID. These hearings can take place at the same meeting, or be scheduled separately (see the Timeline for Creating TIF Districts). The public hearing affords all residents a reasonable opportunity to communicate their feelings concerning the creation of the TID, its boundaries, and the projects that will be funded. This hearing must be publicized as a Class 2 notice under Wi. Stat. Ch. 985, and the time, date, and place of the hearing must be included. If Developer Incentives are part of the proposed project plan, that fact must appear in the public notice. The notice must appear in two consecutive weeks at least 7 days before the date of the hearing. Copies of the project plan must be made available at the hearing and to the public upon request.

TSE said...

Here is the Link to the City's Official "PUBLIC HEARING NOTICE."

Doesn't say anything about "Developer Incentives" or being published twice as a class 2 Notice.

http://legistar.racinenet.org/Attachments/6a971ba8-609e-4c8d-8cda-e20027b9574c.pdf

Did the City meet the legal requirements for a Public Hearing?

Call the Director of City Development, Brian F. O'connell at 636-9151 to check.

TSE said...

IT GETS EVEN BIGGER!

March 8, 2012 JT

Page 7B - Legal Notices

The City of Racine is issuing $5,000,000 in General Obligation Bonds to buy a Marina and fix it up.

It has been suggested to me that it is Sam Azarians Marina!

TSE said...

It's for Reefpoint! I was wrong



b) Resolution No: 2011-99 – Executive Committee authorizing Racine County to enter into agreements
with Racine Harbor Marina, LLC (RHM) and its designees, agents and tenants to effectuate the
purchase of all improvements at Reefpoint Marina pursuant to terms in the original license agreement
and any amendments, and all leases and subleases involving RHM and its tenants and authorizing
Racine County to Transfer up to $5,000,000 from the Unreserved Undesignated account and use
proceeds from that source to execute the purchase and to issue a timely bond to reimburse the
Unreserved Undesignated account.