Tuesday, January 18, 2011

No-So Goes Before Economic Development Committee Tonight

The City-County Council's Economic Development Committee will take up Prop 292 again tonight. This proposal would float $98 million in bonds, secured with property taxes generated by the consolidated downtown TIF district, and loan the proceeds to Buckingham Cos. for the development of 11 acres just north of Eli Lilly's Corporate center, called North of South.

The meeting will begin at 5:30 pm in room 260 of the City-County Council.


Jobs with Justice said...

There was no vote on the proposal. They will take a vote at a special meeting on February 2nd. Same time, same place. Tonight they voted down an amendment that would allow the city to hold companies accountable if any of the partners in the deal are found guilty of wage/hour violations or racial discrimination charges. They would be able to recall the bonds if these allegations were found true. The amendment was voted down 4-3. The city testified that the amendment should not be included because even if we called the bonds, we would have pre-payment penalties with the bond holders. Even if we demanded repayment, we would have to continue making payments to the bond holders, so what is the point. If we tried to negotiate the pre-payment penalty, we would not find any bond holders to purchase the bonds. Also, Councilor Malone felt that any allegations of wage/hour or discrimination made would not be resolved in a timely manner, and the ten year timeline to call the bonds would pass.

Had Enough Indy? said...

JWJ - I don't like hearing that they are looking to float bonds that would have a pre-payment penalty. Well, frankly, I don't like much of anything I hear about this deal.

Thanks for the update. Did they give a reason for not voting tonight?

Jobs with Justice said...

Bond Bank said there is always a pre-payment penalty with the bonds they float.

They did not give a reason for not voting. Perhaps because they don't have the votes? February 2nd would be the 2nd special meeting. Councilor Malone also referenced "putting the cart before the horse again" on a problem she had with the proposal regarding the certified techonology park.

Had Enough Indy? said...

When time frees up, I'll check the video archives for these hearings.

Its news to me that bonds usually cannot be paid early, without penalty. That question gets asked from time to time and I've not heard this answer before. When they refinance bonds, which is routine, they pay off the old and float the new. So, to enter into bonds with a pre-payment penalty is not in our best interest.

Malone brings up a great point. The 'technology park' designation will free up $5 million from State coffers - money that will flow to the City and the City will 'gift' it to the developer. In order to nab those bucks, the plans include 30,000 square feet for offices. They 'hope' someone will put a lab in one of the offices, thus qualifying the entire 11 acres for the 'certified technology park' designation. Its blatant what is going on here. Besides all that, they haven't secured that particular tenant.

Thanks again JWJ.