Monday, March 31, 2014

Administrative Approvals - February 28 - March 28


Here are the latest Administrator Approvals listed in the Citizen Access Portal on the DCE webpages:

Here are those shown as having been submitted - but for which no decision has been made:

2014ADM050 - cell tower
8500 KEYSTONE CROSSING
INDIANAPOLIS IN 46240


4700 ENGLISH AVE
INDIANAPOLIS IN 46201

2014ADM027 -- elevations
6081 E 82ND ST
INDIANAPOLIS IN 46250

2014ADM052
8435 PENDLETON PIKE
LAWRENCE IN 46226


Approved 3/27/14
2014ADM036
6231 N KEYSTONE AVE
INDIANAPOLIS IN 46220

Approved 3/26/14
2014ADM048
227 W MICHIGAN ST
INDIANAPOLIS IN 46204


5360 W 16TH ST
SPEEDWAY IN 46224


Approved 3/25/14
2014ADM049
2119 N PARK AVE
INDIANAPOLIS IN 46202


Approved 3/21/14
2014ADM046
2700 S BELMONT AVE
INDIANAPOLIS IN 46221

4650 W 86TH ST
INDIANAPOLIS IN 46268

Approved 3/20/14
2014ADM040
6161 DECATUR BLVD
INDIANAPOLIS IN 46241

Approved 3/18/14
2014ADM045
6901 ZIONSVILLE RD
INDIANAPOLIS IN 46268

11725 FOX RD
LAWRENCE IN 46236

3636 E 38TH ST
INDIANAPOLIS IN 46218

Approved 3/17/14
2014ADM044
3360 W 30TH ST
INDIANAPOLIS IN 46222

Approved 3/13/14
2014ADM037
5225 E 56TH ST
INDIANAPOLIS IN 46226

9487 BAY VISTA WDR
INDIANAPOLIS IN 46250

2014ADM039
9505 BAY VISTA WDR
INDIANAPOLIS IN 46250

Approved 3/11/14
2014ADM035 -- elevations
5303 STANLEY RD
INDIANAPOLIS IN 46241

Approved 3/6/14
2014ADM034 -- elevations
2100 E 71ST ST
INDIANAPOLIS IN 46220

2014ADM032 -- elevations
4747 KOLLMAN RD
INDIANAPOLIS IN 46241

Approved 3/4/14
2014ADM033 -- elevations
2800 BLUFF RD
INDIANAPOLIS IN 46225

Approved 3/3/14
2014ADM028 -- elevations
1300 N MICKLEY AVE
INDIANAPOLIS IN 46224

2014ADM029 -- elevations
6101 LEE RD
LAWRENCE IN 46216

Approved 2/28/14
2014ADM030 -- elevations
4133 MATHEWS AVE
INDIANAPOLIS IN 46227

Thursday, March 27, 2014

Big Changes for MDC and TIFs - Thanks to SB 118 - edited

The Legislature continues to chip away at the more flagrant abuses of TIFs.  This year SB 118 provides a lengthy list of changes in the oversight of the Metropolitan Development Commission (and similar entities throughout the state), calls for an in depth review of the work of these entities, and causes old TIF districts to get sunset dates.

Let's start with that last item, because it is immensely important.  TIF districts established before July 1, 1995, could have, but did not need to have, a sunset date - a time certain when the TIF district is dissolved.  With the passage of SB 118, we will now have a sunset date placed on all of our older TIFs - EXCEPT those that comprise the Consolidated Downtown TIF.  The biggest slush fund must be protected !  On July1, 2015, each old TIF (except downtown) will get a sunset date of either June 30, 2025, or the date of the last payment on any outstanding bond tied to that TIF district, whichever is later.  According to information provided to the TIF Study Commission, there are at least 11 TIF districts in Marion County do not currently have a sunset date.

Also of considerable importance, is the requirement that the City-County Council review many more aspects of the MDC's exercise of its powers than it does now.  These include review of its annual budget, purchase of property over a term more than 3 years or a price greater than $5 M,  and sale of property. [edited - the Indianapolis-Marion County City-County Council is the only legislative body that will not be able to review the budget of its redevelopment commission.  The City-County Council will only be able to approve or deny a property purchase of the MDC if the term of repayment is more than 5 years.]  The MDC must get Council approval to take on any obligation payable from public funds. [edited - the rest of Indiana's redevelopment commissions will be bound by this, but not the MDC] The Council must approve the term of any debt, the maximum interest rate, provisions for early payment of the debt, and any inclusion of collateralized interest. [edited - the Council already has the authority to review all bonds the MDC wants to issue.]

The Council approval will now have to be sought for the annual determination of how much of the assessed value of a TIF district increment will be treated as 'base' for the upcoming year.  If the taxes that would be generated are more than twice what is required for payment of debt in a given year, then the MDC will be required to get Council approval for how much of the excess is passed through.  The downtown TIF is so huge, the MCD regularly 'passes through' tens of millions of AV.  This provides a tiny bit of cushion to IPS.  Say next year the Mayor wants to horde every penny of the Downtown TIF and not let any of its AV pass through, well the Council can say differently and pencil in how much it thinks should be made available.

In the future, the MDC will have to submit to the Council one important piece of documentation sorely lacking right now, whenever it wants to establish a new TIF or expand an old one - it will have to document that any new taxes generated in the TIF would not have been generated if the TIF were not there.  As an example, the Broad Ripple parking garage could not have been included in the North Midtown TIF if this law had been in place for the last couple of years.  It is also likely that the Mass Ave TIF and most of the North Midtown TIF would be a no-go, since those areas were already seeing a heady rate of organic private investment.  This provision will put an end to the Mayor's practice of establishing TIFs in booming areas in order to create healthy slush funds.

The MDC will be subject to audit by the State Board of Accounts.  By August 1, 2014, the Department of Local Government Finance must submit a report on all redevelopment commissions, authorities and departments with the following items:
(1) The activities of each redevelopment commission, authority, and department throughout Indiana, including projects proposed and projects completed.
(2) The budgets for 2009 through 2013 for each redevelopment commission, authority, and department, including a summary of these budgets.
(3) The audit findings for 2009 through 2013 for each redevelopment commission, authority, and department audited by the state board of accounts, including a summary of these audits. 
(4) The actual increase in assessed values in redevelopment areas compared to the estimated increases set forth in the redevelopment plan. 
(5) The actual increase in assessed values in redevelopment areas compared to the increase in assessed values outside redevelopment areas. 
(6) Suggested changes in the law with regard to redevelopment commissions, authorities, and departments.

These are certainly improvements that can benefit the taxpayers.  It is also welcome news that there will be an actual review of the work of these redevelopment authorities; a review that includes data that can expose the usefulness of TIF districts to catalyze growth that would not have happened without the TIF.

But, mostly, I am so happy that almost all TIFs will be required to disband someday.  Next year, maybe the sunset provision will be extended to the Downtown TIF so that downtown can begin to give back to the rest of us.

Tuesday, March 25, 2014

TIFs - 2013 Legislative Changes Protect the Base & the Curious Case of the North Midtown TIF [corrected]

It has taken me a while, but I finally sat down with the forms filled out last August by the Marion County Auditor's Office, that evaluate the amount of base and increment in each TIF district we have.  These are the annual TIF neutralization forms that I've brought up before in this blog.

The forms for 2013 (pay 2014) are different than those used in previous years.  That is because of changes made just last year by the Legislature to reign in unsound practices that led to the base being eroded each year.  Now it is the actual aim of the form to let the base rise and fall due to changing market values, not due to the amount of tax money the increment took in the previous year.

As a reminder, each TIF district has its Assessed Value split between the base and the increment.  The base is supposed to be the value of the property before the TIF was created, and the increment is the new value supposedly created by the establishment of the TIF.  The taxes that flow from the base are always promised to continue flowing to the schools, city, etc., but we know full well that that promise was not an honest promise - until the 2013 changes were forced by the Statehouse.

Instead of getting to far into the weeds, let me just summarize by saying that the new forms ask how much new construction happened and allots that value to the increment, how much was demolished and allots that value proportionately to both the increment and the base, and, interestingly enough, how much value rolled off from abatements that year and allots it to the increment.  It takes any other increase or decrease in the AV, presumably due to actual rising or falling market values, and allots that proportionately to the base and increment.

In the big view, this change appears to be successful.  I had to make an adjustment for the new North Midtown TIF's inclusion for the first time this year - which was easy enough.  I would have done so for the new Bush Stadium Area and Mass Ave TIFs from 2012-13, but the component TIFs of the Consolidated Downtown TIF are no longer itemized.  Rather, the Downtown TIF and its 10 components are now reported as one set of numbers, as is the Consolidated Airport TIF and its 7 components. 

In the 2011 (pay 2012) TIF summary provided to the TIF Study Commission, the value of the base for all TIF Districts in Marion County was reported as $2.02 Billion.  By the next year, the base had been eroded substantially; in 2012 (pay 2013) the total base AV fell to $1.47 Billion - losing a quarter of its value as half a billion dollars was pushed into the TIF increment.  The latest figures for 2013 (pay 2014), show a stabilized base AV, coming in at $1.47 B, once again (after subtracting the new North Midtown TIF).

Half the TIFs lost value and half gained between 2012 and 2013, with a net growth of $170 M for a total TIF District (base plus increment) value of $5.83 B.  The Downtown TIF accounts for just over half the value of all TIFs in the County, but its growth accounted for the lion's share of the Countywide TIF increment value, adding $149 M.

The State Legislative Services Agency puts together annual reports on the impact of the tax caps.  In 2012, the LSA reported that Marion County TIFs collected $99 M in property taxes.  By 2013, that figure rose to $108 M.  The projected TIF revenue to be collected this year is $118 M.  The Downtown TIF is the big winner, with a projected revenue of $68 M.

The North Midtown TIF was established early last year, so this was the first time the base and increment were evaluated through the annual TIF neutralization process.  The form (p. 7 of the pdf) reports that there was no new construction, $286,300 worth of demolition, and $755,960 in previously abated property coming off the tax rolls.  You'd think that since there was no new construction, the base would continue to be 100% of the entire TIF AV. 

Nope. 

The abatements granted before the TIF was established are now generous donors to the increment.  The increment went from 0 to $469,707, in a year that saw no growth truly attributable to the creation of the TIF.  Since abatements tend to run 10 years and fall off the same fraction each year, one can guesstimate that the old abatements could award the North Midtown TIF about $4 Million over the next decade.  Not bad for just starting a TIF and having no new dollar investments to claim as having been caused by the TIF.  [These are the corrected numbers.  As Anon 10:50 pointed out, I had the incorrect order of magnitude previously.  I apologize for the added drama.]

I await brand new legislation regarding TIFs to get signed by Governor Pence.  I'll report within a couple of days some exciting new Legislative endevors to reign in rampant abuse of TIFs, especially here in Marion County.  They did a good thing last year, by solidifying the TIF base, so that at least one of the promises made when TIFs get created is a promise that stands a chance to be fulfilled.  The North Midtown TIF shows that the revamped system is not perfect, but much improved over the old way.  One step at a time.  One step at a time.



Monday, March 24, 2014

Administrative Approvals - Last 30 Days - February 19 through March 21


Here are the latest Administrator Approvals listed in the Citizen Access Portal on the DCE webpages:
    Here are those shown as having been submitted - but for which no decision has been made:
 

2014ADM041
4700 ENGLISH AVE
INDIANAPOLIS IN 46201 

6231 N KEYSTONE AVE
INDIANAPOLIS IN 46220 

2014ADM027 -- elevations
6081 E 82ND ST
INDIANAPOLIS IN 46250 

2014ADM018 - elevations
9201 W WASHINGTON ST
INDIANAPOLIS IN 46231 

2014ADM005 -- elevations
7745 SOLANA DR
INDIANAPOLIS IN 46240 

Approved 3/21/14
2700 S BELMONT AVE
INDIANAPOLIS IN 46221 

4650 W 86TH ST
INDIANAPOLIS IN 46268 

Approved 3/20/14
 
2014ADM040
6161 DECATUR BLVD
INDIANAPOLIS IN 46241 

Approved 3/18/14
 
2014ADM045
6901 ZIONSVILLE RD
INDIANAPOLIS IN 46268 

11725 FOX RD
LAWRENCE IN 46236 

3636 E 38TH ST
INDIANAPOLIS IN 46218 

Approved 3/17/14
 
2014ADM044
3360 W 30TH ST
INDIANAPOLIS IN 46222 

Approved 3/13/14
 
2014ADM037
5225 E 56TH ST
INDIANAPOLIS IN 46226 

9487 BAY VISTA WDR
INDIANAPOLIS IN 46250 

2014ADM039
9505 BAY VISTA WDR
INDIANAPOLIS IN 46250 

Approved 3/11/14
 
2014ADM035 -- elevations
5303 STANLEY RD
INDIANAPOLIS IN 46241 

Approved 3/6/14
 
2014ADM034 -- elevations
2100 E 71ST ST
INDIANAPOLIS IN 46220 

2014ADM032 -- elevations
4747 KOLLMAN RD
INDIANAPOLIS IN 46241 

Approved 3/4/14
 
2014ADM033 -- elevations
2800 BLUFF RD
INDIANAPOLIS IN 46225 

Approved 3/3/14
 
2014ADM028 -- elevations
1300 N MICKLEY AVE
INDIANAPOLIS IN 46224 

2014ADM029 -- elevations
6101 LEE RD
LAWRENCE IN 46216 

Approved 2/28/14
 
2014ADM030 -- elevations
4133 MATHEWS AVE
INDIANAPOLIS IN 46227 

Approved 2/27/1 
2014ADM019 -- cluster
7275 LAKESIDE DR
INDIANAPOLIS IN 46278 

Approved on 2/26/14
2014ADM026 -- elevations
4309 W 79TH ST
INDIANAPOLIS IN 46268 

2014ADM024 -- elevations
5694 W MINNESOTA ST
INDIANAPOLIS IN 46241 

2014ADM025 -- elevations
3710 N MERIDIAN ST
APT 000
INDIANAPOLIS IN 46208
 
2014ADM011 -- elevations
4225 E 82ND ST
INDIANAPOLIS IN 46250

Friday, March 21, 2014

City Pays Generously, If Surreptitiously, For Parcel

Just days ago, I blogged about the curious relationship between the City of Indianapolis and the Circle Area CDC (see "What Is True Role of Circle Area CDC?").  I mentioned the creation by the CA CDC of a company known as CAC 1440, LLC, where the CA CDC was the sole member of the LLC.  From CDC minutes of a meeting on 9/20/13, the only purpose for setting up the LLC was to buy a property at 1440 N. Meridian Street.  The City would provide the money.  This parcel is the preferred re-location site for the Indianapolis Red Cross; moving this organization is the final domino in the complex Mass Ave TIF and Fire Headquarters relocation deal.

I was unable to locate any Sales Disclosure Form for this property at that time.  Many thanks to Marion County Assessor, Joe O'Connor, and especially Director of Data Analysis, Brenda Erbse, for answering my many questions quickly and pleasantly.

It seems that the last two weeks of September 2013, were busy ones.  The CDC voted to establish the LLC on the 20th.  The LLC was established that same day.  And, it seems from an the Sales Disclosure Form available on the DLGF website, the property was purchased on the 30th, just in the nick of time, by the LLC.

The addresses 1440 and 1500 N. Meridian have been bundled into 1510 N. Meridian Street.  The former owner is William G. Mays.  The gross Assessed Value of the property is noted on the DLGF website as $735,600.

The purchase price from our generous folks at City Hall?  $1,600,000.

It seems the complexity karma that afflicts the Circle Area CDC, also afflicts this property.

Another Sales Disclosure Form from the DLGF, shows that Mays bought a bundle of 8 parcels from a 2010 Sheriff's Tax Sale.  The price tag for that bundle was $2,192,000.  Four of the 8 parcels are included in the purchase by CAC 1440, LLC.  The remaining 4 tax sale parcels are not part of the CAC 1440, LLC, purchase.  Property at 1516 and 1518 N. Illinois Street, and 1423 and 1450 N. Pennsylvania Street are still shown on the Marion County Assessor's website as being owned by Mays.  Those 4 properties have a combined AV of $1,086,300.

Again, I raise the questions.  What utility does the City find in using the Circle Area CDC as a middleman time and time again?  What could possibly justify moving money from the City through the CDC and to a nested LLC for the purchase of a property the City was going to buy for the Red Cross anyway?



Parking Meter "Windfall" - Profit - Or - Loss ?

I read and see reports of the jump in revenues the City collected from ParkIndy last year; amounting to some $3 Million (click here for one).  ParkIndy is the entity that we sold our parking meter assets to three years ago.  I'll just remind readers that the City could have invested $8 M to install the fancy new credit card reading meters itself, and keep ALL the money.  But, instead our Mayor Ballard and his cohorts wanted to sell it out from under us.

The news accounts sound good - the City's portion of parking meter proceeds amounted to $1.5 M in 2011, $2.5 M in 2012, and now $3 M in 2013.  The ParkIndy folks kept $3.5 M, $5.2 M, and $5.7 M, in the respective years.

Then the reports go on to say that in 2010, the last year the City ran the meters, the fees generated only $339,165. 

Nope.  Not correct.  Must be a misprint in the City's press release.

I gathered the actual numbers from the last few years when the City ran the meters from the City's budget ordinances.  Here's how the parking meter revenues and expenses actually worked.

In the 2008 budget, the City expected to take in roughly $2.4 M from the meters, $1.2 M from fines and penalties, and $90,000 from miscellaneous sources.  They budgeted $1.65 M for the operation. 

Net profit from meters: $2.0 M. 

That allowed them to transfer $0.4 M to the City General Fund and $1.75 M to the IMPD General Fund.  2008 city budget (see page 36-37 and 58 of pdf; parking meter fund)



In the 2009 budget, the City expected to take in $4.35 M total, while budgeting $1.69 M for operations. 

Net profit: $2.65 M. 

Again, the City General Fund and the IMPD General Fund were beneficiaries of the profit.  2009 city budget (see pages 20 and 53 of pdf; parking meter fund)



In the 2010 budget, the City expected $4.2 M gross and $1.69 M expenses. 

Net profit: $2.5 M. 

City General Fund and the IMPD General Fund both were recipients of the profit.   2010 city budget (see pages 22 and 56 of pdf; parking meter fund)



For the 2011 budget, the City expected $4.2 M gross and $1.6 M expense. 

Net profit: $2.6 M. 

Since they were also draining the year end balance, the IMPD General Fund got a tidy $3.8 M that year.  2011 city budget (see pages 22 and 59 of pdf; parking meter fund)



The last three years that the City operated the meters they saw a total profit of $7.75 M.  Now, after parking rates have doubled, the City got $7.0 M from ParkIndy over the last three years.

We are not privy to the profit to ParkIndy, but their portion of the revenues for the past three years total $14.4 M.

As was clear when Mayor Ballard sold off our asset, ParkIndy was destined to be the huge winner.  As for us taxpayers, we are still catching up to the profit we saw when it cost us half as much to park.









Wednesday, March 19, 2014

Administrator Approvals - Last 30 Days - February 16 through March 18


Here are the latest Administrator Approvals listed in the Citizen Access Portal on the DCE webpages:

Here are those shown as having been submitted - but for which no decision has been made: 

4700 ENGLISH AVE
INDIANAPOLIS IN 46201


6161 DECATUR BLVD
INDIANAPOLIS IN 46241


6231 N KEYSTONE AVE
INDIANAPOLIS IN 46220


2014ADM027 -- elevations
6081 E 82ND ST
INDIANAPOLIS IN 46250

2014ADM018 - elevations
9201 W WASHINGTON ST
INDIANAPOLIS IN 46231

2014ADM005 -- elevations
7745 SOLANA DR
INDIANAPOLIS IN 46240

Approved 3/18/14

6901 ZIONSVILLE RD
INDIANAPOLIS IN 46268


11725 FOX RD
LAWRENCE IN 46236


3636 E 38TH ST
INDIANAPOLIS IN 46218


Approved 3/17/14

3360 W 30TH ST
INDIANAPOLIS IN 46222


Approved 3/13/14

5225 E 56TH ST
INDIANAPOLIS IN 46226


9487 BAY VISTA WDR
INDIANAPOLIS IN 46250


2014ADM039
9505 BAY VISTA WDR
INDIANAPOLIS IN 46250


Approved 3/11/14

2014ADM035 -- elevations
5303 STANLEY RD
INDIANAPOLIS IN 46241


Approved 3/6/14

2014ADM034 -- elevations
2100 E 71ST ST
INDIANAPOLIS IN 46220


2014ADM032 -- elevations
4747 KOLLMAN RD
INDIANAPOLIS IN 46241

Approved 3/4/14

2014ADM033 -- elevations
2800 BLUFF RD
INDIANAPOLIS IN 46225


Approved 3/3/14

2014ADM028 -- elevations
1300 N MICKLEY AVE
INDIANAPOLIS IN 46224

2014ADM029 -- elevations
6101 LEE RD
LAWRENCE IN 46216

Approved 2/28/14

2014ADM030 -- elevations
4133 MATHEWS AVE
INDIANAPOLIS IN 46227

Approved 2/27/1

2014ADM019 -- cluster
7275 LAKESIDE DR
INDIANAPOLIS IN 46278

Approved on 2/26/14

2014ADM026 -- elevations
4309 W 79TH ST
INDIANAPOLIS IN 46268

2014ADM024 -- elevations
5694 W MINNESOTA ST
INDIANAPOLIS IN 46241

2014ADM025 -- elevations
3710 N MERIDIAN ST
APT 000
INDIANAPOLIS IN 46208

2014ADM011 -- elevations
4225 E 82ND ST
INDIANAPOLIS IN 46250

Approved 2/18/14

2014ADM023 -- elevations
1005 W 64TH ST
INDIANAPOLIS IN 46260


2014ADM022 -- elevations
4655 E 82ND ST
INDIANAPOLIS IN 46250

Sunday, March 16, 2014

What is the True Role of the Circle Area CDC?

Regular readers of this blog know full well I am not a journalist.  Just this once, though, I will try my best not to bury the lede.

Why is the City of Indianapolis funneling millions of dollars through an obscure group housed in the Indianapolis Bond Bank on the 23rd floor of the City-County Building?   Of what benefit is keeping this middleman's actions just out of sight?

I speak of the Circle Area Community Development Corporation.  I will tell you about grants from the Metropolitan Development Commission to spend millions of dollars that the MDC can easily spend on its own.  I will tell you about land purchases on behalf of the City.  I will tell you about transfer of operations for City assets to the group.  I will tell you about one documented instance of the creation of 'nesting doll' corporations, further removing the expenditure of public funds from accountability and transparency.  All that I will tell you has documentation that I will provide, should you want to review it for yourself.

This story is still developing.  At this point I am being actively pushed back from my requests for further documentation from the Circle Area CDC and the City that harbors, supports, and guides its actions.  My hope is some investigative journalist with better talent at navigating these warrens than I, will step forward and beat me to the rest of the story.  I will keep digging in any case.

1997 - Establishment of CA CDC and Purchase of Circle Block Parking Garage

The Circle Area CDC was set up by then Mayor Stephen Goldsmith in 1997, in order to purchase a parking garage near the Circle, primarily for the use of Emmis Communications.  This property is referred to as the 'Circle Block Parking Garage'.  I believe the reason for creating the CDC was because the City is barred from taking out an ordinary bank loan, but a CDC is not so barred.  Receipts from the garage were used to pay off the loan over the years.

The CA CDC has 5 board members, all appointed by the Mayor.  It is listed among the Boards and Commissions on the City's website.  Current board members include Nick Weber, former Deputy Mayor, who serves as the Board's President.  The By-Laws for the CDC are also posted on the City's website.

A series of filings about the CA CDC with the Indiana Secretary of State, show an initial Board composition including John Klipsch of the Department of Metropolitan Development and James Snyder of the Mayor's Office.  Beginning in 2000 a lineage of all the Executive Directors for the Bond Bank through today became integral to the organization -  Robert Clifford, Barbara Lawrence, Kevin Taylor and Deron Kintner. 

The principle office address is the same as the Indianapolis Bond Bank in the Secretary of State filings, on the City's Board's and Commission webpage for the CA CDC, and in the SOS filing last year that notes Nick Weber as President of the CDC.  The City's website reports that the Bond Bank is, in fact, the 'Administering Agency', just as DMD is the Administering Agency for the Metropolitan Development Commission.

The same address is also listed on GuideStar.org, which gets its documents from the IRS.  According to GuideStar, the CA CDC is registered with the IRS and that "the organization is not required to file an annual return with the IRS because it is an arm of a state or local government".

Even though it apparently claims to be an arm of government, it is not currently being audited by the State Board of Accounts.

2004 - Participation in Financing Conrad Hotel

According to an email from Deron Kintner, the CA CDC parking receipts from the Circle Block Parking Garage were pledged for the repayment of the 2004 bonds used to finance the construction of the Conrad Hotel.  That would have been during the Peterson Administration.

2009-2010 - Takes Over Operations of Market District Garage

In 2009, after a lengthy public debate on its wisdom, the MDC signed a lopsided agreement designed by the Ballard Administration, with Tadd Miller Enterprises to purchase an existing parking garage at 101 N. New Jersey for $18.5 M, which was the actual cost to Miller's organization for the parking garage plus the old Bank One Ops Center building plus the block that building sits on.  The parking garage, now know as the 'Market District' garage, was purchased by the MDC/DMD on July 19, 2010.  From one of only 4 sets of minutes of the CA CDC Board meetings that I have been able to obtain, the CDC voted on November 17, 2010, to enter into an agreement with the City to operate the Market District garage on behalf of the City.  According to the MDC/Tadd Miller Enterprises agreement, receipts from the garage were to provide part of the payment for the $1.85 M loan Miller arranged with a bank.  It is not clear at this point how the money collected by the CDC makes its way to the bank, or even if that method of payment was altered in a later agreement.
From the minutes, "Mr. Kintner also explained that the CAC [what I am calling the CA CDC] will not own this garage and will only be an intermediary".  And, "Mr. Kintner recused himself from voting on this resolution, citing that the Bond Bank has been working with the City on this deal and will be accepting a fee for consultation on this deal".

2011 - Purchase of 302 E. Washington St. Parking Lot, $600K Grant From MDC

At its July 26, 2011, meeting the CA CDC, approved the purchase of a privately owned parking lot across the street from City Hall, and directly south of the two MSA parking lots, at 302 E. Washington Street.  The purchase price was $4.34 M.  The Assessed Value of the property was half that; $2.2 M. 
The minutes report, "Mr. Bice asked how the purchase price was determined? Mr. Kintner stated that the price was based off of negotiations and the amount that the CAC organization could afford to repay."  And, "Mr. Pratt gave a brief overview of the financials for the parking lot and was confident that the parking lot would generate sufficient revenues to repay the loan for the purchase of the real estate." 

On April 5, 2011, the CA CDC approved a Resolution to
"allow the Circle Area Corporation ("CAC") to oversee the distribution of proceeds from the Metropolitan Development Commission in the amount of six-hundred thousand dollars for the PNC Bank and Indianapolis Arts Garden connector. 
"Bruce Donaldson explained that there will be a process put in place that would document the tracking of disbursements for the project.  The Bond Bank will oversee the tracking.
"Board Member Jennifer Pyrz, asked if the project would need to abide by City guidelines in terms of selecting contractors?  Mr. Kintner answered in the negative stating that since the CAC is administering this loan, the project is not required  to follow those procedures."

The MDC dispersed the $600,000 in the form of a grant to the CA CDC.  The MDC used TIF funds and passed it through to the CDC, presumably for the reason queried at the Board meeting - the CDC did not have to following rules governing competitive bidding and transparent selection of contractors; procedures that were required of the MDC.  The grant document does not require that the CDC report back, provide invoices, nothing except return any money not spent.  Here is the most 'demanding' paragraph of the grant:
"CAC hereby agrees to accept the grant of the Project Funds in the amount of $600,000 and to use such funds solely to pay or reimburse costs of the Project.  CAC agrees to enter into a project agreement with the owner or manager of the PNC Center pursuant to which CAC will disburse or provide for the disbursement of Project Funds only upon submission of proper evidence of work completed on the Project and the value of such work.  Any interest earned on the Project Funds shall be returned to the Commission.  If CAC has not spent all of the Project Funds on the Project by December 31, 2012, any remaining balance shall be returned to the Commission."

 

2012 - $9 M Grant From MDC

On April 2, 2012,  the MDC 'granted' the CDC money for the construction of two parking garages in City Way (aka North of South).  This grant was for $9 M.  This time, some review by DMD was required prior to spending the money. 
"CAC hereby agrees to accept the grant of the Project Funds in the amount of $9,000,000 and to use such funds solely to pay or reimburse costs of the Project upon receipt of DMD's approval of such payments or reimbursements.  Any interest earned on the Project Funds shall be returned to the Commission.  If CAC has not spent all of the Project Funds on the Project by December 31, 2013, any remaining balance shall be returned to the Commission."

2013 - Purchase of 131 N. Alabama Parking Lot and Creation of Nested LLC

On May 6, 2013, the CA CDC purchased two parcels with the common address of 131 N. Alabama Street.  This parking lot abuts the north side of the two MSA parking lots.  The financing for the development of the northern MSA parking lot goes to the City-County Council tomorrow night for a vote.  The purchase price for 131 N. Alabama Street was $1.08 M.  Assessor records show a combined Assessed Value of the parcels to be $1.103 M. Nick Weber signed for the CDC.

On September 20, 2013, at a Special Meeting of the CA CDC, they voted to authorize the creation of CAC 1440, LLC, for the sole purpose of purchasing property at 1440 N. Meridian, and potentially another parcel only referred to as 'the 1520 site'.  The minutes indicated that the City was providing the funds.  The City's complicated deal to create the Mass Ave TIF and relocate the IFD station and headquarters located there, hinges on relocating the Red Cross as the last domino to fall in place to make the entire deal actually work.  The desired new location was 1440 N. Meridian, but due to delays by the national organization, it was feared that the closing could not occur by the target date of September 30.  The site was referred to as the 'Norle site'. 

From the minutes:
"Mr. Fullbeck agreed that the situation was accurately explained.  He added that he has spoken to the Director of the Indianapolis Red Cross, who apologized for the delay and the need to take this step.  The Director has indicated to him that the holdup is simply bureaucracy and has nothing to do with the actual site.  The City of Indianapolis did originally ask for an extension from Norle when they learned of the need to do additional environmental work.  Norle said they would be willing, but asked for a significant sum of money in order to do so.  City feels that involving the CAC in the purchase in this manner is the more prudent option."

So, the CDC set up a nested organization, CAC 1440, LLC, that very day.  The CDC is the lone member of the LLC, but is not mentioned at all in the filings with the Secretary of State.  Why was it so important to remove the City from the purchase to an organization nested within the CDC? 

I have not found any evidence that the parcel was actually purchased by the City, the CDC, or the LLC.

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From simply glancing at the timeline of the history of the Circle Area CDC, one can see that its utilization by the Ballard Administration is novel and picking up speed.  Understanding why it is being used so heavily is another matter.  The CDC does nothing in concept that the City cannot do on its own and out in the open.

Perhaps the utility of the CDC lies not in what it can do, but rather in the polices and practices it can circumvent, and its ability to hide its actions from public view, that makes it so attractive to Ballard and his crew.  So, what policies does diverting City functions to the CDC avoid?  What public records laws don't apply to the CDC, but apply to the City?  What bidding processes can be avoided?  What hiring quotas required of the City, can be circumvented by the CDC?  Why go to the trouble of creating nested organizations?  (It sure looks like they were trying to cloud the trail to the real purchaser's identity.)  What accountability and transparency is sacrificed by the granting of public funds that the MDC could easily spend without employing a middleman?  Does it relieve the City of its obligations for due diligence and proper oversight of the expenditures of public funds?

I don't know.  But, something is going on that needs a whole lot of explaining. 

I'll keep trying to get documents.  All I have obtained to date are minutes from a mere 4 meetings of the Circle Area CDC Board.  Just look at the curious activity they revealed.  Imagine what might be in the rest of them.