Steamboat Springs delays base area decision amid loan issue

Bank negotiations to continue for base area loan; Duckels contract stalled

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Reason for default

U.S. Bank sent the city a default notice April 19 asking for additional security on the city’s $17.5 million loan for base area redevelopment, primarily because of a decrease in Steamboat Springs School District property tax assessments announced in December, about a week before the loan was approved.

The school district, along with at least six other entities, assesses a property tax within the base area Urban Renewal Authority. Increments of those tax revenues fund the URA and support the $17.5 million redevelopment loan.

Thus, the school district’s collection of less property taxes than documented in the loan means there could be less revenue available to pay off that loan.

On Dec. 14, the school district approved a reduction in property tax assessments, or mill levies, because the district had over-collected about $4.2 million worth of property taxes between 2007 and 2009. The over-collection occurred because of an incorrect interpretation of legislation involving the state’s Taxpayers Bill of Rights.

The city’s loan, approved Dec. 22, did not account for the school district’s decreased revenue stream. U.S. Bank called that a default on the loan conditions.

Dale Mellor, finance director for the school district, said Monday that the district’s property tax collections will be lower than planned until 2013.

— City officials on Tuesday postponed action on base area redevelopment work until May 18 while they negotiate with U.S. Bank and explore other financial options in the wake of a default notice on the project’s $17.5 million loan.

The Steamboat Springs City Council’s unanimous decision also suspended signing an associated $4.5 million contract with Duckels Construction, or releasing any funds for this summer’s redevelopment work at the base of Steamboat Ski Area, until at least May 18.

The postponement followed Monday’s confirmation by City Manager Jon Roberts that the city received the default notice from U.S. Bank on April 19. The notice said the Steamboat Springs Redevelopment Auth­ority was in default on the loan because of property tax rates that decreased without city documentation, and were not changed in the loan conditions, before the loan was approved. The bank is requiring the city to provide $3.75 million within 30 days as additional security for the loan.

The City Council acts as the city’s Redevelopment Authority. The group met in executive, or secret, session for about 30 minutes Tuesday to discuss how to proceed in negotiations with U.S. Bank.

Councilwoman Meg Bentley said the executive session included discussion of “other financial alternatives” to support the redevelopment work. Councilman Jon Quinn seconded that.

“U.S. Bank is not the only commercial lender,” Quinn said. “It may be that there are other financial options out there.”

City Council President Cari Hermacinski said the two-week postponement allows city staff, including Finance Director Debra Hinsvark, to present the council with a more clear recommendation than the four options presented Tuesday night in Centennial Hall. Those options included using $3.75 million of the city’s unallocated general fund to secure the loan, and proceed with work as planned; delay the work a year; cancel this summer’s work and essentially repay $5 million of the loan, which is in the form of bonds backed by U.S. Bank; or scale down this summer’s work and repay about $2.5 million of the loan.

Councilman Walter Magill said he would not support using $3.75 million from the city’s unallocated general fund to back base area redevelopment, even if that meant stopping this summer’s work. Quinn also expressed disapproval of that idea.

Meanwhile, Duckels Con­­struction is in limbo as to whether to plan and prepare for a $4.5 million contract that could dramatically change in two weeks. Derick Duckels said Tuesday that he learned last week, on about April 28, that there could be problems with the base area redevelopment loan.

“They just said they were having issues with the bonds,” Duckels said about what he was told by city staff.

Duckels said he learned the extent of those issues Monday from City Manager Jon Roberts.

Duckels said including their crews, subcontractors and others, about 200 workers could be involved in the base area work this summer.

“It makes scheduling really hard,” Duckels said.

City officials said the time is necessary, however, to negotiate the best result for a default notice that caught them by surprise and was not initially understood.

Hermacinski said it seemed “unprecedented” that U.S. Bank would issue a default notice when no payments had been missed and, she said, the ability to continue payments was not in question. Hinsvark also said the delay in action on the notice was at least partly because its intent was unclear.

“We weren’t quite sure what the notice was telling us,” Hinsvark said.

She said the city’s bond counsel, Sherman & Howard’s Denver office, told city officials that U.S. Bank could not use the default notice to freeze funding from the loan. So the city proceeded last month with awarding the contract to Duckels, while beginning negotiations with U.S. Bank.

Hermacinski said she learned about the default notice April 20 and that information about it was made public “at the very next public meeting” of the City Council — Tuesday night’s gathering at Centennial Hall — after the notice’s intent was clarified for the city.

She said city attorney Tony Lettunich notified council members of the default notice April 23. Bentley called the notification procedure “very appropriate.”

“I don’t think there was ever an effort to keep anything from the public,” Quinn said.

Duckels declined to comment about whether he felt there were ethical concerns with the city’s awarding of a $4.5 million contract the day after receiving a default notice on the supporting funds. He said he’s simply dealing with information as it comes to light.

“I have to roll with the punches,” Duckels said. “I don’t have a choice right now.”

Comments

seeuski 4 years, 7 months ago

Great incites Scott, it looks like the time for reflection and reality has come and this default may be a blessing in disguise. Stop the project and ease the burdens of the school revenue problems with the money that would have been used for loan payments. Lets wait out the storm first and at least see what happens with the Ski Time Square redevelopment project. That would be an indicator of some improved economic activity and renewed tax revenues. Taking on new debt now for an unnecessary improvement is not fiscally sound.

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Scott Wedel 4 years, 7 months ago

She said the city’s bond counsel, Sherman & Howard’s Denver office, told city officials that U.S. Bank could not use the default notice to freeze funding from the loan. So the city proceeded last month with awarding the contract to Duckels, while beginning negotiations with U.S. Bank.

This must also be a distortion of facts. If it was true that US Bank cannot do anything about the loan (such as freezing funding) so then it was reasonable to proceed with awarding the contract to Duckels then it makes no sense to now suspend construction and consider taking out $3.75M from reserves to cover the loan.

US Bank must be able to do something with severe consequences or the city would not have agreed to $3.75M. They say US Bank's options do not include freezing funding, but they obviously fear other options available to US Bank. Like what? go to court and cancel the entire bond and force the city to come up with $17M? It must be something like that if the City accepted $3.75M as the number to satisfy US Bank.

This whole thing stinks. It is obvious that the City did not want to disclose this to the public and hoped they could get it resolved with US Bank without the public ever hearing anything about it. But now they are two weeks past a default notice and may need to allocate millions to resolve it so it could not be kept secret any more and they are trying to pretend that they weren't keeping anything secret.

They are like the shoplifters that claims they forgot to pay for the items stuffed into secret pockets of their metal lined jackets that upon being caught red-handed says they weren't stealing, they were going to pay the next time they went inside. And since they didn't pull out a gun and rob the cashiers then there was no armed robbery and if there wasn't armed robbery then there was no crime.

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Scott Wedel 4 years, 7 months ago

THE FIRST POST TO THIS ARTICLE THAT I POSTED LAST NIGHT ON HOW WE WERE BEING MISLED WAS YANKED A FEW MINUTES AGO. FOR WHAT?

For telling Mike Lawrence the questions he should have asked?

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Scott Wedel 4 years, 7 months ago

For saying Cari must be stupid and ignorant if she, a lawyer, thinks it is unprecedented for a loan to be in default even though the City signed a bond agreement that misstated URAAC income by millions when the City had to be aware of the school district's decision a week earlier?

That Cari thinks it is unprecedented that the lender would care about the facts stated in the contract being signed as long as the payments are being made?

Right Seesuki and George? You saw the post that is now gone. Did you see any reason for it to be yanked?

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Scott Wedel 4 years, 7 months ago

For saying that they mention receiving the notice of default as if that was the first indication that there was an issue with US Bank, but that it is far more likely that US Bank would have verified with the city that the school district numbers were not accurate and would have sought a settlement based before sending a default notice.

So we are being misdirected by being encouraged to focus on the date of the default notice instead of asking when where there any communications between US Bank and the City regarding issues with this bond prior to the default notice.

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seeuski 4 years, 7 months ago

No Scott, I think your correct as to why. And I feel sorry for anyone who parades around as terrorist Murderer like Che. Very telling indeed.

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pitpoodle 4 years, 7 months ago

There are huge mismanagement problems associated with this Council: 1) trying to force the SB 700 annexation agreement on residents before having all the pertinent facts regarding current resident's potential liability, 2) leaking information in a bidding process then not re-doing the bid because there was no time to do it right, 3) not giving information to a lender when city revenues changed pretty dramatically, a fact known in 2009. We should question who is watching the store and the newspaper should be on top of this. We wonder why the Pilot continues to protect little Ms. H. Who is watching out for taxpaying residents? Not Council.

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Clay Ogden 4 years, 7 months ago

I saw Mr. Wedel's 1st post and found it to be a rude and inappropriate personal attack. Should it have been pulled? I'm not sure. To me the total lack of even basic civility just invalidates any reasonable point you try to make.on this issue.

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Scott Wedel 4 years, 7 months ago

Seesuki, BTW, this issue does not affect school district funding. The funding mechanism for an URA makes the assumption that if the area needs redevelopment then it must be bad and so property and sales taxes are probably decreasing or flat. So they set the sales and property taxes as a baseline when the URA is created so that county and schools still get the same amount of taxes. But the URA gets the taxes above that baseline as if the URA itself is the reason why there is an increase in collected taxes.

The school district decision did not take tax revenue from the URAAC and transfer it to the school district. No, the school district admitted they overcharged by how they tried to avoid TABOR limitations and so is refunding the overcharge by lowering their rates. But in the URAAC, that cut wiped out the tax collected above the baseline and so cut money going to the URAAC.

Which is why it is truly amazing that neither the URAAC or the City claim to have recognized the importance of the school district's actions. Maybe both hoped that no one (in particular US Bank) would notice so that they could use the bond money plus some extra money from city reserves to continue on.

So we, the public, are faced with wondering if the City and URAAC are that incompetent or that deceptive. I think we can find an answer if we can get them to reveal their communications with US Bank prior to getting the notice of default.

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John Fielding 4 years, 7 months ago

Putting aside all the questions of how the City has dealt with the disclosure, we are left with the decision of what to do now.

It really comes down to a question of whether we are willing to take some risk in improving our main economic engine, in following through with the plans we have so carefully made.

If we plan for the future to bring increased benefit from our investments we should proceed now while costs are lower and the activity can help ease the stagnation of the local construction industry.

The risk is that if we are unable to meet payment expectations per the original plan that we will have to make other arrangements. While this would be an unwelcome burden on the budget it would be possible to manage it in a way that would have fairly minor impact.

Ultimately the entire sum will be recovered from the source intended, the value generated by the improvements. It will take longer than expected, but the value will be there, the promenade will be an asset that will be useful in selling our services.

Let's plan on the future being better, not worse. Our expectations will be self fulfilling.

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Scott Wedel 4 years, 7 months ago

John, "Ultimately the entire sum will be recovered from the source intended, the value generated by the improvements."

I think that is a big question right now. Depending upon the assessed values up there then the URAAC could be financially crippled until it expires. This current issue is because the mill levies are less than expected. Next shoe to drop is assessed value being less than expected.

If the City and URAAC were unable to predict the effect of the school district mill levy adjustment then it is real hard to believe that they can accurately predict the effect of this year's reassessment of property values that has yet to happen.

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John Fielding 4 years, 7 months ago

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It's not about their ability to predict the value of assessments so much as our ability to predict that having the promenade will help us sell more summer events, raising tax revenues and improving the business climate at the base area. With that accomplished the value of the URAAC district properties will follow the improvement trend.

Again it will be dependent on our determination to succeed. To paraphrase the famous saying, "If we do not build it they will not come."

.

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Duke_bets 4 years, 7 months ago

Scott - Are properties going to have new assessments this year? Those took place last in 2009. I thought it was every 2 years.......Correct me if I'm wrong.

Your point is very valid, regardless of when the property assessments take place. Values will most likely decline for the next couple of years.

Clay - Rude and inappropriate? Really? Check out Quinn's responses on similar posts directed at Scott. Talk about rude and inappropriate. Those posts were of a juvenile level. And, that being from an elected official.

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Scott Wedel 4 years, 7 months ago

Duke, I think one year they do residential and the next they do commercial. Either way there are going to be reassessments up there changing values from 2007/8 to 2009/10. My guess is that they will be lower. I do not see either the City or URAAC are using reduced valuations in their revenue projections..

Clay, How was my comment regarding Cari Hermanski crude and rude? Saying that she would have to be stupid and ignorant to, as a lawyer, believe that it was unprecedented for a bond to be put in default for seriously wrong claims of income that were stated on the bond? Note that I am actually saying nothing bad about being a lawyer, but I used that to argue that it is very hard to believe that someone that should be intelligent and knowledgeable is claiming to be so ignorant and stupid to honestly believe that it is unprecedented. Would it be better if I said I think she is a liar on this issue?

Or is that wrong to say she must not understand the word "unprecedented" and think that it must mean something that happens all the time such as "It was unprecedented that city hall screwed up".

My first post was a detailed shredding and mocking of the deceptive comments she made as a city council member. If that same standard was applied to Obama and mmj posts then those whole threads would be mostly deleted.

Cari is not some shrinking violet private citizen. She is pro term of the City Council and a talk show host. And now, on a project that the paper supports, she is protected from having her unbelievable comments ripped to shreds.

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Scott Wedel 4 years, 7 months ago

Brent Boyer, Please explain why my first post was removed.

Are local politicians protected from criticism? Are local politicians protected from biting criticism? Are local politician protected from being mocked and sarcasm? Is there a limit of 3 or 5 specific criticisms per post?

Is it wrong to post the critical question that Mike Lawrence failed to get answered (when did who knew what about US Bank's concerns with the bond prior to the notice of default)? Is it wrong to note that these same URAAC and City officials were quoted in a Tom Ross article in Saturday's paper about the prospects of base area construction starting very soon? And yet Cari said the notice of default was made public in a timely manner while Tom Ross was being misled on the true state of things?

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Scott Wedel 4 years, 7 months ago

Brent, Can you please send a copy of the deleted post to my email address? Apparently, it is being claimed that it was deleted because it was a vicious personal attack Cari Hermacinski's family and gender for which I should apologize. And if I said anything close to what I was just told that I had said, then I would apologize. But I cannot remember of anything in that post that I have not subsequently posted and I see nothing requiring an apology at this time.

Though, if she is able to present facts proving me wrong then I will apologize.

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Bill Dalzell 4 years, 7 months ago

Pitpoodle and Scott you obviously have a beef with council. There are some good points, but some misguided information. Pitpoodle you do a lot of name calling for being anonymous. It appears you use this board to anonymously criticize someone that you have a personal problem with. Its weak sauce. City council did not leak information in the bidding process. At least do your homework. From what I understand City council and the URAAC work together, but they sometimes make their own decisions. I agree, tighter oversight is probably needed, due to some obvious conflicts of interest. Scott, you have some good points and good questions, but your conspiracy theory ruins most of your credibility. You rant about what everyone needs to do, but do you go to these meetings? You ranted about 700, but did you ever participate in the WSSAP. From what I understand the school system messed up their budget and it gave the bank an out, as the mill levy changed. Most likely, we are in trouble anyway, due to TABOR and the more than likely sharp declines in assessed property values. Its probably a good thing that this whole thing is being reevaluated. That being said its also important not to get too short sighted. Costs are down, and now may be the best time to improve the base area. Our base area needs work and it is one of the weakest aspects of the resort. Almost everyone relies on tourism in one way or another in this town, and it might be worth improving one of our strongest assets, the ski area. Its kind of like advertising in a down economy. No one wants to spend the money, but it can bring great results. Just seems like there is a lot of hate and finger pointing, in these posts, and no action being taken.

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Duke_bets 4 years, 7 months ago

BillyD - Costs are down justifies your debate? And, how exactly are costs down? The city is in default on a loan. The council knew this and yet decided to issue a $4.5 mil contract. The bidding process was a mess. They paid off 2 of the 3 bids. Claims of leaks and preferential status came about. Duckels has most likely spent a ton of cash getting ready for this project and work may not start. If they don't go forward, does Fred get reimbursed for his to date costs? He should. A city council member spouts off on a message board stating that he doesn't need the votes.

There's no conspiracy theory. There's just a bunch of facts.

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sparkle 4 years, 7 months ago

Scott's comments re:" Cari" were mild in comparison to the demonizing of certain committed community members over the past year in the Pilot and in the blogs. Towney, where are you? I still believe in your good character. Are you not on the editorial board now? Who asked for Scott's blog to be removed?

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pitpoodle 4 years, 7 months ago

Yes, I do have a beef with council. We all should. There is no misguided information here. It is council who needs to check their information before making decisions. We, as citizens, have a right to at least that.

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Bill Dalzell 4 years, 7 months ago

Duke Bets. Its a complex issue no doubt. There was no justification. Just revisiting the idea that it will improve our base area and that it might be a good time to do it. I think the council thought that they would work out the loan. There are other options such as another loan. Banks are nervous in today's economic climate and its not easy to make financial decisions whether you want to lend or borrow money. I also don't think a project that had a financing hiccup should necessarily pull the plug. The bidding process was a mess, because information was leaked, not by a council member. Its a matter of working forward. Why waste energy on a forum rather than getting involved and helping make informed decisions. It just seems like the same people continue to rant about how everyone else is doing things wrong. Why not try to productively fix a problem. The conspiracy theory was Scott's line BTW. Loretta, I do feel some of your facts are a bit misguided, and I doubt you had any input in the west of steamboat plan, just a lot of criticism.

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sparkle 4 years, 7 months ago

Must apologize for using"blog" instead of the correct word "comment". Thanks

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Kevin Nerney 4 years, 7 months ago

Scott I read your orginal post and saw no reason for them to pull it.
Billy D you say the weakest aspect of the "resort " is the base area. I say let the "resort" pay for it. If ski corp. doesn't want to pay for it perhaps who ever wants to develop Ski Time Sq, should be required to fix up the base area before they can get a building permit approved. City Council was looking for all kinds of concessions from SB700 regarding road work and water rights, why not get the developers like One Steamboat Place to kick in. While the City is at it maybe they could get the developer to pay some of the back taxes owed due to early demolition.

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trump_suit 4 years, 7 months ago

I too saw Scott's original post and saw no reason for it to be pulled. Brent, please inform us why his comments were taken down??? I have seen and complained about posts that I thought were much more demeaning that were ultimately left on the site.

Whatever your opinion on whether the URA should mover forward, it is clear that someone knew about these issues and chose not to inform the public. This kind of decision making should not be allowed to go unchallenged.

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John Fielding 4 years, 7 months ago

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We sometimes seem to be in denial about who is paying for all this. If I understand the formula correctly, the payments are made in lieu of property tax on the increase in value of the subject properties. Therefore everyone who pays property tax has a slightly increased burden to maintain the funding of the services which are supported by that tax.

Eventually, when the debt is paid off the base area properties will no longer pay into that account and there will be a slight decrease in everyone elses' share of the costs of public services. But the property tax payers are the ones footing the bill. It makes little difference if it is paid over a period of two decades or three, if the existing plan works as projected or if we have to modify it to accommodate unforeseen developments. We still are the ones who will pay for it, as we have agreed to do.

Theoretically we agree to do this because it will increase the amount of business and there will be a widespread general benefit. In a normal economic environment that is certainly true. In tougher times like these is is less certain. It may still be the factor that gives us the edge to maintain a favorable position in a more competitive market. Or it may not be enough to offset factors such as our more remote location from the metro customer base.

I am of the opinion that eventually it will pay off in many ways, and I accept that my property tax will be higher to fund it. Lets just stay the course, plan for a prosperous future, and work hard and pay the price to build the basis for that prosperity.

.

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Scott Wedel 4 years, 7 months ago

Hi, No response from the paper yet. Though, I have confirmed with Mike Lawrence that the paper did remove the post (ie it was not some computer error). I asked Mike what specifically was wrong and while he was aware of the post, he was not able to state why other than it was a personal attack. I ask at what point it is not acceptable to criticize local officials for comments made as public officials and he could not give an answer and took the message for Brent to call me so I could learn what was wrong with that post.

You are free to dispute my conspiracy theory. A nice thing about the secrecy theory that I think is that it can be verified or proven false. All that needs to be determined for the centerpiece of my theory is whether or not there was communications between the URAAC/City and US Bank regarding the mill levies or US Bank wanting additional reserves prior to April 19th default notice.

Cari "unprecedented" comment is also easily enough to prove or disprove. I think it is easy enough to find commercial loans to businesses that have not missed a loan payment, but have violated a loan covenant to be put into default. For instance, I just did a Google search on "default notice covenant" and got 107,000 hits with the first few pages full of companies put into default on loans for violating a covenant while up to date on payments. Thus, I think the "unprecedented" comment is clearly contrary to easily available facts. It is rather disappointing that our pro term council member has two weeks to inform herself of relevant issues and yet makes such a blatantly inaccurate statement.

I think there is clear proof already of part of my secrecy conspiracy. Tom Ross's Saturday article on the imminent start of base area redevelopment construction had direct quotes that construction could start Wednesday (today) from two members of the URAAC board. So unless URAAC board head David Baldinger Jr and board member Jon Wade were not aware of the default notice (which would not have been an amazing secret to keep from the URAAC) then they declined to make critical information regarding the default notice public when talking to a reporter about base area development. Could there have been a more timely situation to disclose the default notice? Their comments were the exact opposite of a timely public disclosure of the default notice.

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Scott Wedel 4 years, 7 months ago

Do I think the paper is in on a conspiracy to silence my comments? No, but I don't think I made that claim. I do think it was easier for Brent to yank a post that he disagreed with than it is one that he largely agrees with. At the very least that is human nature of being more inclined to negatively misinterpret comments you don't like than ones you like. And honestly while I was out this afternoon, I was wondering if my repeating of comments that were as close as I could remember to what was yanked was going to result in most of my posts being yanked and my account suspended. Because if my initial post was truly wrong and I posted the same material again then then my account should be suspended. So there is a certain intimidating effect on having a post yanked, especially when I cannot get a specific answer as to why it was yanked.

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Scott Wedel 4 years, 7 months ago

John Fielding, I think your account of how the URA works is close, but off just a little.

Those in the URAAC do not pay any more property tax mills (percentage of assessed value) than anyone else in SB. Thus, they are not paying an "slightly increased burden".

The way it works is that there is a baseline established by the year in which the URA was formed. That baseline is the property and sales tax revenues collected in 2005 for the base area. Once the URA is formed then those 2005 numbers become the maximum that the state, city, county and schools will get from the URA. All revenues above the baseline now go to the URA.

Thus, in the previous few years when property values went up across the board and taxes went up for everyone, the county and schools got more money from the rest of the people, but the same from those within the URA. The URA got the extra money. So, those within the URA are not paying slightly more, they are paying the same mills as everyone else, the increase in revenues just goes to the URA instead of the county and schools. Thus, they are actually keeping a share of their taxes that "should" be going to the county and schools for them to use for them to make their properties nicer.

In a truly depressed region it is plausible that properties are so run down that they have minimal value and using an URA to collect some money to improve properties could have a serious positive effect on property values. Downtown OC could probably have used an URA to make it more visitor friendly. The SB URAAC was always a distortion of the purpose of the law allowing URAs because the property in the URAAC was always quite valuable. But the URA law allowed a 2 of 3 sort of criteria and so while the base area was off the charts in terms qualifying via property values, it was just barely able to qualify using the other criteria. The URAAC is a convenient means of SB collecting money that would go to other governments to pay for base area improvements that otherwise would have to be paid out of the city's budget.

It is extremely unlikely that the base area improvements will clearly pay for themselves in terms of increased property values and sales taxes. The property tax mills is less than 1%, the URAAC gets only a portion of that, say .25%. Thus, for improvements to pay off in property values then $1 spent on projects would have to increase property values by $30 for the increased taxes to pay the debt service. If property owners up there thought that spending $1 would increase their property values by $30 teen they would form a property owners association in a heartbeat to pay for those improvements.

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Scott Wedel 4 years, 7 months ago

John Fielding, BTW on the other default notice thread you said the Che comment regarding George had been removed. No, that post is still here further up on this thread. That Che comment was not on that other thread.

For some crazy reason I cannot post to that other thread. It always says I need to log in and then after I log in again then it says I need to log in. I can post on this thread though.

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John Fielding 4 years, 7 months ago

.

All I'm saying is that we always knew we taxpayers would be paying for the improvements by allowing the subject properties to use part of their tax to fund the projects.

. We do it not just for the sales taxes and property values, but mostly to keep business thriving. For every dollar in sales tax there is ten times that going into the local economy.

It is probably even more important now than ever to keep improving the foundation of our local economy, while we also find ways to diversify.

.

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John Fielding 4 years, 7 months ago

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BTW thanks for pointing out my oversight.

I take back half the nasty things I said.

Hey, half is a lot!

.

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John Fielding 4 years, 7 months ago

.

Also watch out that, crazy log in thing happened to my just before my hard drive got fried.

I think I was hacked through participation in this blog, but I am an unrepentant paranoid.

.

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Scott Wedel 4 years, 7 months ago

John, yeah, taxpayers are going to pay for base area improvements, but it was not supposed to be financed out of the general fund, but by the city's creation and that is not working right now. And this is a really bad time to be funding the projects from the city's general fund (aka reserves).

And this year, instead of the URAAC paying for construction, it looks like the city is going to have to pull $3.75M from reserves to fix up a loan that URAAC got under false pretenses.

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pitpoodle 4 years, 7 months ago

You are wrong BillyD. First, I have had no criticism about the West of SB plan - ever. You have no idea of whether I have been involved and your claims of misguided information are bull. I said, I have a problem with city council's bad decisions: 1) trying to force the SB 700 annexation agreement on residents before having all the pertinent facts regarding current resident's potential liability. You can't argue with that. 2) leaking information in a bidding process then not re-doing the bid because there was no time to do it right. Joe Kracum, redevelopment coordinator disclosed the price range for initial bids on the base area work before the bidding process was completed. That is a leak by anyone's standards. Mr. Kracum's contract was renewed by council earlier in April. That appears that he is doing work for the city. The Town Manager said he violated the city's procurement regulations for public projects. Yes I am critical that no action was taken with regard to Mr. Kracum's conduct. and 3) not giving information to a lender when city revenues changed pretty dramatically is a bad decision. I suppose you think that is just fine? You should have a problem with all of these things too.

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Steve Lewis 4 years, 7 months ago

When the URA was formed, the school district expressed reservations about its possible impact on their revenues. I didn't fully understand the conversation then, but the schools were certainly concerned about the TIF impacting them.

I disagree with John Fielding. The promenade is not worth its cost in these economic circumstances. Yes to the typical $$ spent on chamber type marketing, but no to further and larger investments in the base area.

We have committed a tax stream into the base area that we may still regret. We need to limit its obligations (principle balance) for awhile until assessments and sales tax receipts start growing. This economy is not out of the woods yet, and even our existing debt has become a troublesome realm.

Now is the time for extremely conservative fiscal policy.

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