2014 Zoning and Variance Decisions

If you could afford to file a rezoning petition for your property this year, you stood an 89% chance of having it approved.  If you could afford to file a variance petition this year, you stood an 86% chance of it being approved.


REZONING PETITIONS

Of all 100 zoning petitions decided in 2014, 89 were approved, 2 denied, and 9 withdrawn (89% approved, 2% denied, and 9% withdrawn).

Most rezoning petitions are assigned to the Hearing Examiner, with some going to the Indianapolis Historic Preservation Commission for their first hearing.  A small number are sent directly to the Metropolitan Development Commission by the HE for their initial hearing.  Any side of a contested petition can appeal the HE's or IHPC's decision to the MDC.

The HE made 77 decisions on zoning petitions in 2014 - 68 approved, 2 denied, and 7 withdrawn - otherwise 88% approved, 3% denied, and 9% withdrawn.

The IHPC cast decisions on 11 zoning petitions in 2014 - all were approved.

The MDC held initial hearings on 7 petitions and accepted the withdrawal of 1 petition prior to hearing.  All 7 were approved.

The HE's decision was appealed to the MDC 6 times.  One was withdrawn prior to the MDC hearing it (the HE had recommended denial).  Of three petitions which the HE had recommended denial, 2 were overturned by the MDC and 1 approved.  Of two petitions which the HE had recommended approval, 1 was approved and 1 denied by the MDC.

Overall, the MDC heard testimony on 12 petitions, approving 10 (83%) and denying 2 (17%).


VARIANCE PETITIONS

Of all 323 variance petitions decided in 2014, 287 were approved, 23 denied, and 23 withdrawn (86% approved, 7 % denied, and 7% withdrawn).   Looking at only those 123 petitions not on the expedited docket, 100 were approved and 23 denied - (81% approved and 19% denied).

Most variance petitions are assigned to the Boards of Zoning Appeals, of which there are three.  If a variance request is packaged with a rezoning or other type of petition that normally would be heard by the HE/MDC, then it is assigned to the HE and not the BZA.

BZA I had 111 petitions on its dockets in 2014.  71 were on the expedited portion of the docket, meaning Staff and any neighbors or neighborhood organizations recommended approval of the petition.  These are perfunctorily approved by the Board.  Additionally, 7 were withdrawn.  Of the 43 petitions for which BZA I took testimony, 29 were approved and 14 denied - otherwise 67% approved and 33% denied.

BZA II had 70 petitions on its dockets in 2014; 43 expedited, 7 withdrawn, and 20 for which testimony was taken.  Of the latter, 15 were approved and 5 denied - or 75% approved and 25% denied.

BZA III had 100 petitions on its dockets in 2014; 73 expedited, 5 withdrawn, and 22 heard.  Of those heard, 19 were approved and 3 denied - or 86% approved and 14% denied.

The HE got 34 variances; 30 approved, 1 denied, and 3 withdrawn.

The MDC got 11 variances (7 initial hearings, 3 appealed HE decisions, and 1 withdrawn).  All 7 for initial hearing were approved by the MDC.  Two of the appeals were approved and 1 denied.


This is actually better than I expected, having expected the mid-90% approval rate.  Still and all, the variances are supposed to be granted because of a hardship on the ground that sets that parcel apart from every other identically zoned parcel in Marion County.  It is hard to believe that such a standard was actually met for the number of approvals granted.

$3 Million of TIF Money (Taxpayer Money) Going To Enrich IndyStar

Resolution 2014-B-002 goes to the MDC for a vote Wednesday.

This resolution would float $5.5 Million in bonds as taxpayer investment in two projects - the "Pulliam Place" and "Millikan-On-Mass" projects.

The Pulliam Place project will take about $3 M of the money.  The agreement was worked out an unknown number of months ago, and has been wending its way through the MDC system - first being discussed at the Economic Development Committee meeting in early May, and then again by all of the Commissioners at their May 21 pre-meeting.

During this time, the Star failed to inform readers of its many editorials and opinion pieces that the deal was pending, a clear violation of the Code of Ethics as expressed by the Society of Professional Journalists.  Under "Act Independently", the third item on its Code of Ethics webpage, the SPJ says in part:

Journalists should be free of obligation to any interest other than the public's right to know.

Journalists should:

—Avoid conflicts of interest, real or perceived.
— Remain free of associations and activities that may compromise integrity or damage credibility.
— Refuse gifts, favors, fees, free travel and special treatment, and shun secondary employment, political involvement, public office and service in community organizations if they compromise journalistic integrity.
— Disclose unavoidable conflicts.

The Ballard Administration gift of taxpayer money would be repaid by revenues of the Consolidated Downtown TIF.

And what do you get for your gift?

 Some vaguely described improvements to N. Talbot, E. New York, and E. Vermont Streets, a dog park, and improvements of the existing Star building parking garage.

And how does this benefit you, the taxpayer?

Why the Pulliam Project is anticipated to create 49 new full-time jobs by mid-2017.  There is no mention in the resolution of the average salary of those positions.  And, there is no requirement that this number be reached.  That works out to a taxpayer investment of over $61,000 per job.  Of course the sales price of the Star building will rise concomitantly with the taxpayer gift.  One would also expect the time to sale would shorten with this sweetener, as well.

What also interests me is the last part of the resolution, where it states that the resolution to float the bonds will not be effective unless the Bond Bank "consents to and approves the adoption" of the resolution.  Anyone who follows City government knows that the person who envisions these projects is the same person to negotiates the taxpayer terms of these projects and is the same person who runs the Bond Bank; one Deron Kintner.  Why are they even pretending that there is any independent review of the taxpayer financing of these projects?

The taxpayers who pay attention to such things, are familiar with the extravagant accumulation of TIF funds and equally extravagant expenditure of the same, all while elected officials, including Mayor Ballard, seek tax increases to pay for basic services.  This one is different in that it calls into question the independence and integrity of the Indianapolis Star.

IndyStar Fails Journalistic Ethics Test

In two days, the Metropolitan Development Commission will vote on a $3 Million bond to enrich the Indianapolis Star owners by improving the existing Star building, thereby increasing its sales price.  Resolution 2014-B-002 bundles the "Pulliam Square" and the "Millikan-On-Mass" projects for a total of $5.5 Million in taxpayer dollars.  The project has already been through the MDC's Economic Development Committee and has been discussed at its Pre-Meeting.

The $3 Million gift from Mayor Greg Ballard to the Indianapolis Star has been in the works literally for months.  When approached by the Ballard folks about the gift, the Star could have said, "No thank you.  Such a handout would cloud the credibility we have built with our readers, and set up the perception of a conflict of interest."

But, they did not.

They also failed to alert readers of the many editorials and opinion pieces penned during these months, that supported Ballard or scolded those who did not agree with the Administration's policies, of Ballard's gift. 

The readers had an absolute right to know, and the Star had an absolute obligation to inform them, that they were awaiting $3 Million of taxpayer money.  Each reader had the right to decide for themselves if Ballard's gift was irrelevant to a Star position, slanted an editorial stance, or outright bought and paid for the Star employee's praise.  Each reader has the right to decide for themselves if this is an advance payment for another endorsement of candidate Greg Ballard in next year's run for re-election.

The Indianapolis Star failed its readers.  They also failed this fundamental test of its Journalistic Ethics.

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.

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.

--

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.

SB621 - The MDC Appointments

As I noted in my last blog entry, SB621, which has now passed through the Legislature and awaits Governor Pence's signature, would remove the ability of the County Commissioners to make two appointments and give one to each of the Mayor and the Council.

The law takes effect on July 1, 2013, presuming, as I do, that the Governor will sign it.

However, by state law, the appointing body gets to set the term of its appointments.

The President of the County Commissioners, and County Assessor, Joe O'Connor, informs me that when Cornelius Brown was appointed in September, 2012, it was for a one year term through September of 2013.  When Ed Mahern was appointed in January, 2012, it was for a 3 year term, which would expire at the end of December, 2014.

This is what the new law would say:

(d) METRO. The metropolitan development commission consists of nine (9) citizen members, as follows:

(1) Five (5) members, of whom no more than three (3) may be of the same political party, appointed by the executive of the consolidated city.

(2) Four (4) members, of whom no more than two (2) may be of the same political party, appointed by the legislative body of the consolidated city.

 

The new state law does not specifically terminate existing appointment terms.  Nor does it say which new appointing body would get to exercise its new appointment power. 

SB 621 - Additional Changes, and, Interesting Questions Arise About the MDC

SB 621, which tries to extend the life of Republican rule over Marion County, has passed out of the Conference Committee changed from the form it had when entering that body.  The body itself was changed, substituting Republican Senator Waltz for Democrat Senator Breaux, and Republican Representative Speedy for Democrat Representative Bartlett.  Having shed any semblance of bipartisanship, the all Republican group passed their version of a 'compromise' piece of legislation.

All sections of the bill now clearly apply only to Marion County.  As we all expected, the 4 At-Large Council seats are again to be eliminated.  The Controller can now 'only' change the budgets of all Departments and Offices if the revenues drop from the levels expected when the budget was passed and 'only' twice a year.  The County Commissioners still lose their two appointees to the Metropolitan Development Commission, but one is shifted to the Mayor and one to the Council, giving the Mayor 5 and the Council 4 appointments.  Lake and Allen Counties are struck from the burden of having to count all absentee ballots at a central location - now only Marion County must do so.  And, Marion County's Township Boards drop from 7 members to 5 at the next election.

Interestingly enough is the question of when the MDC appointments shift.  According to state law, the term of these appointments may be from 1 to 3 years, as determined by the appointing body.  Here is the law, with the MDC portion highlighted:

IC 36-7-4-218
Membership of commission; terms and removal of citizen members
Sec. 218. (a) When an initial term of office of a citizen member expires, each new appointment of a citizen member is:
(1) for a term of four (4) years (in the case of a municipal, county, or area plan commission);
(2) for a term of three (3) years (in the case of a metropolitan plan commission); or
(3) for a term of one (1), two (2), or three (3) years, as designated by the appointing authority (in the case of the metropolitan development commission). 

A member serves until his successor is appointed and qualified. A member is eligible for reappointment.

So, one outstanding question is, when the Marion County Commissioners appointed Cornelius Brown and Ed Mahern, for what term did they appoint them?

The new section regarding the appointing bodies takes effect on July 1, 2013.  But at what time would the Mayor and the Council get to begin taking over those two appointments?

The shift of MDC appointments has always been the worst of the Republican power grab, and will leave Indianapolis and it Citizens even more at the mercy of Mayor Vaughn and his rapacious appetite for giving away taxpayer money to favored developers, regardless of how many employee contracts he has to gut or how many cops and firefighters he has to lay off to afford doing so.

Zoning Hearing Call Down Gets Weird - part 3

Thanks to an alert reader of this blog, I have an update for all of you on that February 25th meeting of the City-County Council - in particular the calling down of a zoning matter at 460 Virginia Avenue (see "Monday Night Meeting May Include Zoning Hearing" and "Council May Review Zoning Matter - part 2")

It seems that about 5 minutes after the vote to call down the zoning case (meaning the Council would hope for a negotiated settlement, but plan for a full blown Council hearing on the petition) there was a vote to reconsider the earlier vote.  A vote to reconsider is extremely rare and I did not scan all the votes taken that night for such an eventuality.

Councillor Gray, one of the yes votes, stated that he voted incorrectly and wanted the record to reflect his true position.  The procedural decision was made that a vote to reconsider should be taken, and if successful, a new vote on calling down the zoning matter would be taken.  Here is the clip of this part of the Council meeting:

 

 

The vote to reconsider was 20 yes to 8 no votes (Councillor Brown was absent).  Democrat Councillor Lewis joined Republicans Cain, Freeman, Hunter, McHenry, Pfisterer, Sandlin, and Scales in opposing the new vote.

 

The new vote on whether or not to call down and schedule a public hearing for the zoning petition was 16 for and 12 against, as the earlier count had been.  BUT, those voting yes and no changed.  In the first take, three Democrats (Adamson, Gray and Mansfield) joined all Republicans in favor of hearing the zoning petition.  In the second take, Gray withdrew his support, voting no instead - and - Lewis switched her no vote for a yes vote.  She did not explain her change of heart.

The hearing was continued at last night's Council meeting.  It is now scheduled for April 22.

Monday Night Council Meeting May Include Zoning Hearing

I have been reviewing the Council agenda for Monday night and got sidetracked by an interesting zoning matter that was called down by Councillor Jeff Miller at the February 25th meeting, and set for hearing tomorrow night.

This matter is 2012-ZON-060, 460 Virginia Avenue, which went before the Indianapolis Historic Preservation Commission and the Metropolitan Development Commission; both of which approved the zoning change from heavy industrial to mixed residential/commercial.

The parcel is 0.67 acres and the developer has applied to the State for tax credits to help finance the construction of 50 apartments on the site.  The application for tax credits is highly competitive, with only so many dollars available in any one year.  Applicants are expected to offer lower rents due to the financial help to build the apartments in the first place.  The deadline for submitting the application apparently was last November, but the proper zoning must be in place before any application can 'win' the tax credits.  The deadline for the proper zoning to be in place was the end of February.

IHPC staff made clear that it was only approving the zoning change, and that any proposed apartment/commercial plan would have to return for review and approval at a later date.

By calling the case down, the Council has effectively caused the developer to lose out on the tax credits this year, and forced him to reapply for next year's funds - should the MDC's zoning decision not be overturned by the Council and the developer and property owners are still interested.

 

The staff report can be found on page 9 of the MDC's February 6 agenda.  This was the second day of testimony, the first concluding with a continuance so that the developer could review whether he could amend his tax credit application by dropping the number of units from 50 to 32, as suggested by remonstrators who opposed the zoning change due to density issues.

 

 

The MDC voted 7-1 to approve the zoning change.

 



Because of some technical glitch with Blogspot, I still am unable to post two different video clips on the same entry.  I will post the debate on whether or not to call down the zoning in the next entry on this topic.  Here's a link to part 2.

Reflections on Mid-North TIF Hearing Last Week - clip 2 included

continuing to post the various clips from the MDC hearing on the Mid-North TIF

Bruce Donaldson's take on what can happen to the base:

Reflections on Mid-North TIF Hearing Last Week - clip 1 included

I have a few thoughts lingering after last week's MDC hearing on the North Midtown TIF.  Of course, it went through with a 7-1 vote (Ed Mahern being the lone no vote).  But, there were some interesting points made that are worth noting.  You will see how the fairy tales about TIFs continue to be repeated - to folks charged with deciding whether or not to create them by folks considered experts.

First, let me say how outstanding it has been to work in concert with the good folks from Meridian Kessler Neighbors Helping Neighbors.  These folks (Clarke Kahlo, Paula Light, Ellen Antoniades, Terry Sanderson, and Doug Sherow) understand the connection between TIF proliferation and cutbacks in funding for basic services like police, fire, and schools.  They know the Meridian Kessler does not want for much, and presented the facts and figures that clearly demonstrated that the northern half of the North Midtown TIF should be removed from any consideration of a TIF.

Of concern is the fact that the only representatives of the City, who were in fact consultants, did not understand the wider view of TIFs beyond their particular focus of expertise.  I refer to Barnes & Thornburg attorney, Bruce Donaldson, and Crowe Horwath's Angela Steeno. 

Donaldson evidently writes up the documents that lead to the creation of  TIF districts, and likely does a masterful job with that.  Yet, when asked about erosion of the base by turning it into TIF increment, he was way off the mark.  He relayed to the Commissioners the mistaken impression that the annual filing by the County Auditor of a form known as the "TIF neutralization" form, only causes the base to float up and down with normal fluxuations of assessed values.  His lack of understanding of the actual effect of these forms is damaging.  He helps perpetuate the fairy tale that the tax dollars flowing from a TIF district the day before the TIF is created, will always flow to fund the schools and police, etc.  He had not heard anything about nearly half a billion dollars of base being converted into increment this past year.  (see "TIF Fact #2 --- $490 million of property value was transferred from the base to the increment this year" and click here to review the forms for yourself [edited to add - line 7 reports the old base assessed value and line 13a the new base AV determined through the form]).  I was given a few minutes to respond to his error.  Hopefully, the Commissioners will follow up on this matter with Deron Kintner so that they are fully informed on how this aspect of TIF districts actually functions.

One brief comment by Donaldson surely sent a chill up the spines of many of the proponents.  He told the Commission that they didn't have to do any projects in Broad Ripple (as a for instance) if they didn't want to.  They could, instead, use TIF revenue from Broad Ripple to fund projects in other parts of the district.

Steeno had a couple of interesting moments.  Her focus was on the impact of the Broad Ripple parking garage (that was paid for with $6.34 million of taxpayer dollars) on the amount of tax revenue that could be generated, the amount of bonds that revenue could secure, and the effect of its inclusion in the increment on the circuit breaker penalties tied intimately with TIFs due to the property tax caps.  She seemed unaware that the owners of the garage could appeal an assessment using the cost to build, by arguing that the cash it generates should instead for the assessment - and leading to a lower assessed value than she was predicting. 

More importantly are two numbers she reported, but failed to link together.  She stated that the garage should generate $317,000 a year in property tax revenue to the TIF.  She also stated that the garage would cause "only" about $200,000 a year in circuit breaker penalties throughout the County. 

This is important as it predicts the minimum effect of this TIF on cuts in property taxes that our various governmental units qualify for, but cannot collect due to property tax caps.

The minimum effect is that for every dollar generated in the North Midtown TIF district, circuit breaker penalties will rise by 63 cents.  That's pretty substantial.  So, if the TIF generates $10 million, expect penalties to rise by $6.3 million a year.  That's $6.3 million less in services - from schools, to the Library, to IndyGo, to police, and to fire - and more.

The failure of those in control of the money in our City to come to terms with the reality of how TIFs really operate, is likely to haunt our community for at least one more generation.  It is curious indeed, that those who promoted this TIF because of executives fleeing our more affluent Marion County neighborhoods, have likely exacerbated the underlying reason.  The reason families flee the county is not for a lack of commercial development, it is often because of the lack of good quality schools. Inappropriate TIF districts make the problem worse for schools, not better.

I am having technical problems loading more than one clip from the hearing.  I will attempt to added the other clips to subsequent posts.   You can view the entire hearing by clicking here.

Meridian Kessler Neighbors Helping Neighbors comments, plus my own.

 

Welcome to the Republican World

We are witnessing what happens when Republican elected officials get full reign in our Statehouse.

Don't like a Democrat running the White House ?  Call for a Constitutional Convention.

Don't like that a Democrat was elected to the State Department of Education?  Change that Department's authority.

Don't care for a Democrat majority on the Indianapolis-Marion County City-County Council and in County offices?  Change the rules to favor Republicans, in particular the sitting Mayor.

While all are important with detrimental ramifications, it is the last item that I want to address today.

Two bills were introduced, fashioned after a wish list made by Mayor Ryan Vaughn.  The totality of the bills is to increase the likelihood of a return to a Republican majority Council in the near future, and in increase in the ease with with our City coffers can be looted for those with 'special' connections with the Mayor's office.  Let's face reality - this is likely the last Republican Mayor to serve the City of Indianapolis.  They thought he would be a one-termer, and sold as many of the taxpayer's assets as they could get their hands on during his first term.  Now, they are setting about constructing new slush funds from which to reward their supporters.  Sadly, they are getting a lot of assistance from Democrats on the Council, a point to which I will return later.

The two bills are SB 621, by Senator Mike Young, whose district sits on the southwest corner of Marion County, and HB 1399, by Representative Cindy Kirchhofer, whose district runs from Beech Grove to the eastern border of Marion County.  SB 621 was approved by the Senate and has moved to the House.  HB 1399 has not had any activity.

All that is in HB 1399 was included in SB 621, which had one item amended out of it.  SB 621, however, contains a few items extra.  Both originally would grant the Mayor the authority to change, not just veto, any line item amount of the budget approved by the Council.  This was amended out of SB 621.  Both codify that IMPD would be under the direction and control of the director of public safety, which is what actually happens right now.  Both would remove the requirement that the Mayor's appointments for Director and Deputy Director positions in his/her administration be approved by the Council.  Both remove the authority of the Council to get a Payment in Lieu of Taxes (PILOT) payment from the CIB.  Both take two appointments to the Metropolitan Development Commission (MDC) from the County Commissioners and give them to the Mayor - making that body composed of 6 appointees of the Mayor and 3 of the Council.  And finally, both require all agency and department budgets be 'allotted' quarterly by the City Controller - essentially giving that person the authority to lower the budgets passed by the Council at his/her whim.

SB 621 also includes the elimination of the 4 At-Large seats on the City-County Council.  If they were eliminated today, the Council majority would shift to Republican control.  If SB 621 passes, there would not be another election for At-Large seats and 2015 would be the last year they serve.

SB 621 goes further, mysteriously dropping the residency requirement to serve as Mayor to 1 year (down from 5 years) and as Councillor to 1 year (down from 2 years).  It reduces the number of seats on the Township Boards from 7 to 5.  It tosses in a weird requirement that the method of choosing Judges to review any appeal of the Council district maps, be made a public record.  And last but not least, it throws in another opaque requirement that absentee ballots be counted in a central location instead of at the precincts, unless the Election Board unanimously agrees otherwise.

That's a lot of stuff.  Vaughn insists he didn't ask that the At-Large seats be eliminated, but that is as much effort as he put in to getting that section removed from the bill.

In my humble opinion, the most onerous aspect of SB 621, as it now stands, is the authority it would grant to the City Controller to amend the budgets after the Council appropriates the funds.  Currently, the Controller must sign off on any contract, stating that there are sufficient funds to pay the obligation.  Should tax receipts be lower than expected - a condition highly unlikely given the way the State Department of Local Government Finance (DLGF) already holds some funds back to ensure all funds promised are actually delivered - the Controller can simply decline to sign off on new contracts.  This line by line, quarter by quarter, ability to modify any department or agency's budget simply moves the actions out of the light of day.  We saw this year how vindictive Vaughn can be, when he slashed the Democrat controlled agency budgets, leaving the Republican controlled department budgets alone. To have that accomplished behind closed doors is to place a huge burden on democracy.  We elected Democrats to County offices.  They have a legal budget.  Now to let the Republicans unfettered access to vindictively slash their budgets, or threaten to do so for its extortion potential, out of the light of day, is an example of how far Republicans will go to subvert the will of the electorate in order to benefit the Republican party.

The At-Large seats are similarly being eliminated by SB 621, for the sake of the Republican party.  When UniGov was instituted, the At-Large seats were created to ensure Republican control of the Council.  Now that they work to the advantage of the Democrat party, the Republicans want to change the rules.   I would have had more sympathy on the At-Large issue, had the Democrats not pulled their own version of turning the will of the electorate on its ear with their drastic change in the composition of Council Committee membership - dropping the number of minority party members from one less than the majority party, to only 3.  These lopsided committees have caused less representation for those districts that elected Republicans.

All tit-for-tat aside, there should be a compelling reason to change the representation on the Council.  No real argument has been made to eliminate those 4 At-Large seats.  Until a compelling reason is brought forth, one would hope the seats would remain.  But, again, this is not about good government, its about the Republican party changing the rules to maximize its authority when the elections did not go their way.

The third aspect that should cause concern is the change in appointments to the MDC.  This would give the Mayor control of the Airport, the CIB, and the MDC.  The MDC is the body that creates TIF districts and controls how the revenue is spent - and who gets those contracts.  The County Commissioners are among the few who 'get it' when it comes to the negative consequences of unfettered TIFs and who see a reason to get analytical when it comes to reviewing them.  On their behalf, their appointee Ed Mahern, has asked tough questions and made tough statements.  This impertinence has angered Vaughn considerably.  It is not enough for Vaughn that he gets his way regardless, as many of the Democrats on the Council push for one TIF after another, even though the districts pull money from basic services.  This aspect of the bill is likely as much targeted for Mahern's removal as it is to Mayoral control of the MDC.  This is not in the best interest of the taxpayers.  But, it is being pursued not for the taxpayers, rather for the Republican party.

Removing the CIB from the list of municipal corporations that can have a PILOT levied against them is simply pulling the authority from the Council after it had the audacity to think for itself and not do what Vaughn told them to do.

Much of the rest of this bill is simply weird.  Why change the residency requirements or make a bit more paperwork targeting judicial review of challenges to Council district maps?  Five instead of seven Township Board seats is almost irrelevant.  As is the approval of Department heads by the Council.  And, why does Vaughn care where the absentee votes are counted?  Certainly the Election Board could count them at a central location right now, if it so chose.  But, the Democrats have two votes on the Election Board and the Republicans only one.  So, its time to change the rules.

As I noted much earlier, this is how Republican rewrite the laws when the voters have the temerity to elect Democrats.  Its not about good government, not by a long shot.  Its about Republican party dominance - by hook or by changing the rules after the game has begun.

City-County Council Meets Tonight

The Indianapolis-Marion County City-County Council meets tonight and there are a couple of interesting items on their agenda.

Being voted upon tonight will be Prop 33, which seeks to allocate $3 million of RebuildIndy funds for infrastructure improvements in the Avondale-Meadows area.  The intention is for this expenditure to substitute for a TIF district proposed earlier, whose stated goal was to entice a grocery store to locate and serve the neighborhoods.  This same proposal was voted on at the last Council meeting, but did not get a required 15 votes either up or down (final vote was 14-13, with two absent Councillors).

Several items to be introduced tonight caught my eye.

First is Prop 58, which seeks Council approval for the MDC to refinance a series of old bonds.  From the proposal itself, it is impossible to say if the bonds are part of a TIF district or not.  But several characteristics of this refinancing are more than interesting.  The effect of the proposal would be to retire old bonds from 1999/2002, when the principle was $29,365,000.  During the intervening 11-14 years, the City managed to pay less than $2 million in principle, leaving the current principle at $27,445,000.  The hope is to float no more than $28.5 million and sell bonds with a term ending in 2029.  So, while the City managed to pay less than $2 million over 14 years, they'll have to pay at least that each of the next 16.   Lots of questions arise in my mind about the fiscal stewardship exemplified here. 

Another, somewhat alarming, feature of Prop 58, is the indication that the City just might take out bond insurance on this beast.  Is our ability to repay these bonds in jeopardy?  Isn't the $80 million sitting idling in the 'Stabilization Fund' enough to ensure our City's full faith?

Keep your eye on Prop 58.

Second is Prop 60, which is to my knowledge, the first time the Council has considered granting a 100% 10 year abatement of taxes on equipment likely to have a less-than-10-years lifespan.  If approved, Prop 60 would allow Exact Target to avoid paying taxes on 'information technology' it intends to install.  I have requested more information on this.

Third is Prop 72, which would appropriate $11,630,000 in the CIB's budget to allow them to give the City 100% of this year's proceeds from the two recent tax hikes, as well as a $5 million shuffle between the CIB-City-MDC.  This shuffle begins when the CIB pays the City $5 million instead of spending the money on repairs of the Capitol Commons garage - the repairs will be paid for by the MDC with TIF money. So, bottom line is that the City will get $5 million from the TIF for public safety - which I expect is not on the list of allowed expenses of TIFs.

Its all about spending money, shuffling money, not collecting money, and avoiding paying obligations in a reasonable time frame only to find that doing so has penalties. 

Interesting Reading - SB325 - Would Increase Council Oversight of MDC Actions

It surely may have been discussed and I simply missed it, but SB325 is new to me and quite interesting.  Authored by powerful Senator, Luke Kenley, the bill's effect in Marion County would be to impose additional Council oversight of some actions of the Metropolitan Development Commission.  SB325 passed out of the Senate and now awaits action in the House.  The LSA review of the bill is also available.

If enacted, the legislation would require City-County Council review or approval whenever the MDC wanted to commit public funds for the payment of bonds, leases and any other 'loan' type obligation.  It would require approval in most instances.  It would require only review if the purpose was sale or acquisition of real estate for more than $5 million or for 3 years or longer term of payment - if less than either it would escape review and approval.

The bill makes the MDC budget subject to review by the Council and their books subject to audit by the State Board of Accounts.  Their meetings and documents would be subject to the State's open door and open records laws.

Of particularly strong interest to me was the provision that any obligation of TIF funds for bonds, leases, loans, etc., (unless for the purchase of real estate noted above) would require prior approval by the Council.  Also, for any TIF that generates more than twice the amount of money the MDC needs to pay the obligations of that TIF, the MDC would have to return the excess revenue to the regular tax stream, thereby going to help the schools, library, townships, etc.  Currently, the MDC can and does return some excess to the regular tax stream, but there is no threshold above which they must. The Council would have to approve the amount each year, AND, would have the authority to change the amount up or down.

I tried to find others who had an eye on this bill and found this statement from the Indiana Farm Bureau :

Indiana Farm Bureau supported the bill because it provides much needed checks and balances and much more transparency.

Absolutely.

Judge's Ruling Clears Way for Fast Park Facility in Ameriplex

On August 29, Superior Court Judge Michael Keele ruled against the Indianapolis Airport Authority's lawsuit that claimed the Metropolitan Development Commission lacked the authority to modify the land use plan for Ameriplex.  This ruling was unequivocal, ceding no iota of the IAA's arguments as holding legal water.

I uploaded the opinions to Google Docs (here and here)

By ruling against the Airport, Judge Keele has cleared the way for the construction (FINALLY) of the Fast Park facility that was the basis of the MDC's decision way back in February (see "Yesterday's Zoning Case - Its About Far More Than a Parking Facility").

The Fast Park has seen it's entry into the Indianapolis market greeted with legal maneuvers against it by Airport parking facilities who simple did not want Fast Park's competition.  First, Indy Park Ride & Fly over in Plainfield, hired attorney Brian Tuohy to try to shut down Ameriplex's land use petitions filed with the MDC.  The MDC's approval, by an overwhelming vote of 6-2, should have been the end of it.  But, by this time Tuohy had landed a client with even deeper pockets - the Indianapolis Airport.  They filed this lawsuit in March and we finally have a decision, reaffirming the February decision of the MDC and its authority to render that decision.

This is great news for Decatur Township.  I outlined in a five part series how the Fast Park facility will provide us with property taxes outside of the TIF district that consumes most of Ameriplex and will divert tax revenues until at least 2023.  (see "The 800 Pound Gorilla - Indianapolis Airport", "Decatur Township", "Ameriplex", and "Fast Park Project")

It is also great news for those who think the Airport should not use its unlimited resource of other people's money to squelch competition.  Its not even like it's hurting for money and needs the parking revenues from its own operations (see "Mike Wells, Indy Airport Board President, Misled Press and Public on Airport Finances").

Ultimately, it is great news for central Indiana residents who can use another option when deciding where to park their cars when on a flight out of town.  Yelp reviews of the Fast Park operation, in other cities where it is located, give it an average of 4.5 stars out of 5 for 652 reviews.

And last but not least, it must be noted that the Fast Park & Relax facility will be green - with canopies over every parking spot to protect the cars as well as reduce the heat island effect and for solar panels to be affixed to the top.  They capture and use rain water for irrigating their landscaping.  They will have electric charging stations for folks with those kinds of cars.  And, they will help show the way for local businesses to adopt a green approach while still building a business that works.  For, if a parking facility can do it, everyone can.

Its been a long road to reach this victory.  But, we have.  Now, time to celebrate !!!

Fast Park Project - (Part 5 - More Than a Parking Facliity)

Finally I wind back to the proposed Fast Park & Relax project itself, and how it all ties in.  As I mentioned a few posts ago, this is not your typical parking lot that serves the flying public.  It is a very green project that leads the way for others to follow.

There will be canopies covering every parking space.  This alone protects the vehicles from snow in the winter and sun in the summer, providing a convenience for the owner.  From an environmental point of view, the canopies protect the land from the 'heat island effect', which raises ambient temperatures.  Nearly all lights will be suspended from the underside of these canopies, minimizing light spillage into the night sky and toward nearby homes.  Atop the canopies will be solar panels; the electricity generated will go to the operation.

Additionally, rainwater is recycled for use on the landscaping.  The master drainage for the area is already engineered and will accept the remaining water - as Indiana is graced with fairly dependable rainfall.  The landscaping will be 4 times the depth required by ordinance so as to make the facility as appealing as possible.

The shuttles run on alternative fuels and there will be electric charging stations in the future.

All of these things are good examples of how green a business can be when the owners value such things.  Perhaps the Airport, which is rightly proud of its LEED certification of the new terminal, could look these measures over to see which they might want to emulate in their parking lots.

This green approach is a good fit with the efforts Ameriplex has put forth over the years.

Also important is the fact that this project would be outside of the Airport/United TIF and would not seek tax abatements.  It is estimated that the project would generate about $450,000 per year in taxes.  That may not be much for downtown, but it certainly helps fill Decatur's bucket, which saw about $21 million in property tax collections from real property in 2011.  It helps soften the tax cap impact, as well, by slightly lowering the tax rates.

Not discussed here yet, but of great importance is how this project helps counteract some of the 'lack of rooftops' problem Decatur has.  By attracting vehicles to the site, they will import visitors to Decatur.  Already Ameriplex has seen interest in locating modest retail in the next block; gas station/convenience store and restaurants.  Again, anywhere else in the County, this would evoke considerable yawning.  But, here in Decatur it adds significantly to our amenities.  These amenities should help the Purdue Research Park attract more high tech startups - startups who are interested in what the area can offer their employees.  They also will help provide Decatur residents with more leisure options - options that are sorely lacking.

This is not the end of our transition from rural to suburban, but it will definitely help.  This facility is innovative in this market, and is an excellent fit with the strengths and challenges facing Decatur Township.  Our community was won over and we showed up to the MDC hearing as proof of that.  We are elated that so many Councillors stood with us and that the MDC approved the project.

To my readers, thanks for your indulgence as I laid all of these pieces of the puzzle out over these last few posts.  The stories of neighborhoods around the County are all unique, but we share themes.  Now you know better the prospective from which I view the issues we all face.

[ Yesterday's Zoning Case - It About Far More Than a ParkingFacility, The 800 Pound Gorilla,

Decatur Township, Ameriplex]

Statehouse Considers Tighter Redevelopment Commission Debt Rules

Today's Star has posted a letter to the editor from former Carmel City Councilor, John Accetturo, regarding SB 25, which would provide oversight of Redevelopment Commissions (called the Metropolitan Development Commission here in Indy) when they determine to accumulate debt.  This would apply to TIF districts in particular, I should think.  I do not know of another means available for a Redevelopment Commission to go into debt.  If one of my fantastic readers can clarify, please add a comment.
Here is Mr. Accetturo's letter:

In Indiana, certain boards and commissions can create taxpayer debt without any legislative approval and accountability to the taxpayers. One of these is a city or county redevelopment commission. The majority of the members of these commissions are appointed by the executive and, unlike elected officials, are not accountable to voters.

The power to encumber future generations of Hoosiers with hundreds of millions of dollars of debt is enslaving and potentially destructive. Therefore, checks and balances need to be in place to ensure this authority is used responsibly and in the spirit of the law.

In 2010, an opinion of the Indiana Attorney General upheld the existing statute that provides that power to redevelopment commissions. This opinion has opened the door in several cities for redevelopment commissions to borrow millions without limitation or public scrutiny for projects that are questionably titled “redevelopment.” Default on payments by any redevelopment commission could have a devastating effect on debt rating and borrowing capability for all redevelopment commissions in Indiana.

Existing Indiana law grants too broad powers to local commissions to unilaterally create debt. We need to change the redevelopment commission law to protect taxpayers and development in Indiana. I believe that Senate Bill 25 will do that. It will protect the public interest of Indiana taxpayers from an executive who chooses to avoid the scrutiny and diligence embodied in constitutional checks and balances.

Redevelopment Commissions and other boards serve a purpose in municipal government. However, checks and balances need to be in place over them just like any other part of government.

Here is the digest of SB 025 (emphasis added and digest reformatted by me):

Redevelopment commissions and authorities.  

Provides that a redevelopment commission may not enter into any obligation payable from public funds without first obtaining the approval of the legislative or fiscal body of the unit. Provides an exception if the obligation is for the acquisition of real property and the payments are for three years or less or the purchase price is less than $5,000,000.  

Specifies that the approving ordinance or resolution must include certain items.  

Provides that a redevelopment commission and a department of redevelopment are subject to oversight by the legislative body of the unit, including review by the legislative body of annual budgets.  

Specifies that a redevelopment commission and a department of redevelopment are subject to the same laws, rules, and ordinances of a general nature that apply to all other commissions or departments of the unit.  

Specifies that a redevelopment commission, a department of redevelopment, and a redevelopment authority are subject to audit by the state board of accounts and covered by the public meeting and public records laws.  

Requires a redevelopment commission to provide to the legislative body of the unit at a public meeting all the information supporting the action the redevelopment commission proposes to take regarding the sale, transfer, or other disposition of property.  

Provides that if the amount of excess assessed value determined by the commission is expected to generate more than 200% of the amount of allocated tax proceeds necessary to carry out the commission's plan, the determination of the amount of the excess available to other taxing units must be approved by the legislative body of the unit.

Permits the legislative body of the unit to modify the commission's determination

One item in particular jumps out  to me in this list of improvements to the law, and that is the review of the redevelopment commission's budget by the legislative body.  In Indy those would be the MDC and the City-County Council, respectively.  During the time of the infamous 'interlocal agreement' between the MDC and the CIB that gave the CIB $8 million annually from property taxes gathered in the Consolidated Downtown TIF District, which the CIB in turn gave to the Pacers, the City-Council ducked its responsibility to review that agreement, saying it was not the fiscal body for the CIB or the MDC.  This would make it absolutely clear that the Council does have that responsibility.

SB 025 is certainly worth following through this short session.

Expansion of Downtown TIF District & Fall Creek TIF Moved To Council

Introduced to the Council last Monday night were two proposals to approve the MDC's decision to expand the Consolidated Downtown TIF District (Prop 15) and the Fall Creek TIF District (Prop 16). 

I have posted a document that has both MDC Resolutions, 2012-R-001 (related to the expansion of the Consolidated Downtown TIF) and 2012-R-002 (related to the Fall Creek TIF) on Google Docs - click here.  There are valuable maps included to help visualize the expansion areas.

For reference, I have also uploaded a map of Marion County showing all TIF districts.  Click here for that map.

The expansion of the Consolidated Downtown TIF will, miracle of miracles, bring that behemoth TIF district over to include Bush Stadium and its environs (see map on page 7 of the posted pdf).  You may recall how Mayor Ballard was going to pilfer at least $3.5 M from the Consolidated Downtown TIF for Bush Stadium area infrastructure improvements last June (see "Are They Insane, Stupid, or Totally Corrupt?  Had Enough, Indy?") even though it was a clear violation of State Laws regarding the used of excess TIF revenues in areas not within the TIF district.

If you are trying to track the Consolidated Downtown TIF on the Marion County TIF districts map, they are districts 140, 142, 143, 144, 145, 146, 153, and 157.

One clear question that needs asking is:  Why not create a new stand-alone TIF district?  A couple of possible reasons come to mind. 

1) they still want to pilfer money that already exists in the Downtown Consolidated TIF fund and this expansion just legalizes the effort. 

2) even after full development, the property taxes that would result in a stand-alone TIF aren't sufficient to pay off anticipated bonds. 

3) an expansion of an existing TIF would be governed by the existing TIF's rules and regulations.  In effect the expanded area, even though new, would assume the grandfather status of the existing TIF district and find protection from newer State laws designed to limit the life span of a TIF district.

Prop 16 and MDC Resolution 2012-R-001 also propose a second expansion of the Consolidated Downtown TIF district toward the northeast up Massachusetts Avenue, in two non-contiguous sections (see map on page 10 of pdf).  According to urbantimesonline.com this expansion is to fund the Mass Ave parking garage and future development of an 11 acre parcel now owned by IPS and the site of 'The Trail Side at Mass Ave', now under construction.  You may have seen mention of the potential for a million dollar plus commission for CB Ellis related to the parking garage in IBJ reporter, Cory Schouten's, article "Mass Ave deal's brokerage fee raising eyebrows".

These proposed expansions of the Consolidated Downtown TIF should be raising concerns for all taxpayers, since this are is already a 'dead zone' for tax collections and the rest of us have to chip in more tax money to cover vital services to the area.  Then they cry about the tax caps, which are the only protection we have from their tax-commandeering ways.

Prop 16 is an expansion of the Fall Creek Area TIF (see page 20 of the MDC resolution pdf and districts 148 and 154 of the TIF districts map). The existing Fall Creek Area TIFs are housing TIFs set up to spur new housing in what once was called 'Dodge City'.  This is widely considered to be a successful endeavour, with any negative opinions centering around the gentrification of the area to the exclusion of low income residents.  Unintended gentrification needs to be dealt with as a pulic policy at some time, so that safeguards can be put in place for future redevelopments.

What is curious from the outset is that the expansion being proposed for the Fall Creek Area TIF is at least a mile and a half from the other two areas. The expansion is just south of the intersection of Binford and Keystone, west of the State Fairgrounds and in the Meadows area. There has already been redevelopment proposed here, backed by Warren Buffet. As Scott Olson of the IBJ reported :

East Village at Avondale is a $27 million project with eight layers of financing, including an investment from Atlanta-based Purpose Built Communities, co-founded by Buffett.

The developer of the project is a joint venture of Chicago-based Strategic Capital Partners, Mishawaka-based The Sterling Group, Meadows Community Foundation, Purpose Built Communities and the city of Indianapolis.

Strategic Capital Partners received $19 million in tax credits that were sold to Chicago-based National Equity Fund to help finance construction of the 248-unit apartment complex. It is being built on about 15 acres of land that Strategic Capital put under contract in 2010.

The city of Indianapolis also kicked in $5 million in tax credits.

...

East Village at Avondale is the first phase of a larger, $150 million development that is to include additional housing—both apartments and single-family—and retail development fronting 38th Street.

It is not clear if the purpose of this expanded TIF is to secure funds for the initial phase or subsequent phases.

One also has to ask the same question as for the expansion of the Consolidated Downtown TIF.  Why not create a stand-alone TIF? Especially given the distance between the existing and expansion areas.  The two districts currently comprising the Fall Creek Area TIF are expected to net an extra million dollars in property taxes in 2012 beyond what is needed to service debt, or so says documents submitted to the State.  I have no information on the fund balances and do not know if there are ample funds just waiting to be plucked or if it is bone dry.  But, why is the City refraining from creating a stand-alone TIF? Won't it generate the investment and taxes that they touted at the ribbon cutting?  Or, are they trying to grandfather the expansion so it does not get a State-imposed expiration date?

Those of my readers who are concerned about, or even just interested in, the burden on taxpayers should remember the establishment of these TIF district expansion areas every time a politician crys about property tax caps.  There very well may be adequate reasons for all of these project, or just some, but they are tied to a bigger picture that reaches into every Marion County taxpayer's pocketbook.  Hopefully somebody on the Council will ask enough questions so that the public can have confidence that these TIF districts are absolutely necessary.

Comlux Hasn't Paid Property Taxes In 2011 Yet - Oopsie !

Now, if you or I didn't pay our property taxes, we'd be sweating each time the phone rang.  Hell, they got Capone on taxes.

But, if you are are a business in Indy and can make the right connections, the city will toss you a $6.5 million loan with the possibility that half a million of it will be forgiven if you manage to meet certain job creation targets. 

That's what happened with Comlux America, LLC, who will use the loan to help build itself a new, bigger, hangar on airport property.  The Airport also has a deal to acquire the hangar once it is built and lease it back to Comlux.  It apparently meant little that Comlux America, LLC, had not filed its required Form 103/104 to report its Business Personal Property (due by May 15, 2010) until after the May, 2011, property taxes were usually due.  Because of the late filing, the property taxes on the personal property are now due in November.  Presumably with a penalty added on.  Hopefully with a penalty added on.  As of today, the taxes remain unpaid.

As with all businesses that locate on airport property, they get a pass on real estate property taxes.  So, one might think that the City would at least require such a company getting a loan secured with TIF district proceeds to be current in the taxes it does owe.  Guess there really aren't any sort of minimal standards and there seems to be little due diligence on the part of the Ballard administration when it comes to handing out our money.  I am given to understand that at least some people knew of the unpaid taxes during the process to approve the deal.

The MDC voted in favor of the deal on December 5, 2010 (There are 9 voting members, but I do not have the exact vote).

The Economic Development Commission voted in favor of the deal on June 8, 2011 (There are 5 voting members, but I do not have the exact vote).

On July 13, the Economic Development Committee of the Council voted 5-0 in favor of the deal.  I even showed up to voice opposition to the use of TIF funds, but it never crossed my mind that they were behind in filing their business personal tax form, much less late in paying the taxes that would be due had the form been timely filed.

On July 15, the Indianapolis International Airport Board voted 6-0 to delegate authority to the Executive Director to approve the deal.

On July 18, the City-County Council voted in favor of this proposal (Prop 190, 2011) by a vote of 25 yes, 2 no (Councillors Ed Coleman and Brian Mahern), and 2 not voting (Councillors Doris Minton McNeil and Joanne Sanders).  While the minutes of this meeting suggest a somewhat extended discussion of the Proposal, nobody stopped to ask if the company was current with its tax filings.

That's a lot of people to get through.  Maybe it should become a standard question in the future, so that the overarching interests of the public are served.

Riveting Reading - Advance Indiana Reports From Plowman Trial

If there is a prize for excellence in reporting on blogs, I want to nominate Gary Welsh over at Advance Indiana for his riveting reportage on the Lincoln Plowman trial.

At this point, Welsh has a report for each of the two first days.  Day 1 ("Prosecutors Say Plowman Claimed He Controlled All Zoning Boards In Marion County")   Day 2 ("Plowman Trial Evidence Shows the Sleazy Side of Indianapolis Zoning")

I highly recommend you read them in their entirety.

As everyone knows, former City-County Councillor Lincoln Plowman is on trial for accepting money in return for helping land proper zoning for a strip club.  An undercover FBI agent was posing as the guy who wanted to open up the club.

The case is opening up a view from the inside of the Boards of Zoning Appeals and the Metropolitan Development Commission that I have never seen in the 15 or more years I have worked for my neighborhood group in zoning and variance matters.  It is the seedy side long suspected, though.

Plowman instructs the FBI agent on what is called 'board shopping'.  Variance petitions are assigned randomly to one of the three Boards of Zoning Appeals - specifically to derail board shopping.  But, you never know why a transfer to another Board is really being requested.  Here's this part of Welsh's report [note that references to "Cam" are to Cameron Clarke, who used to be a local zoning attorney, and who was recommended to the FBI agent by Plowman as a good choice for hire in the strip club matter]:

The agent worries that he's going to be spending a lot of money and wants some assurance the zoning matter will be taken care of. "Well, all the Zoning Boards are changing at the first of the year," Plowman said. "But you're going to know somebody?", the agent asked. "Oh yeah," Plowman reassured him. Plowman then said he would focus on just one of the three zoning boards and will "make sure that Cam gets it on that Board." Here's how Plowman explained it would work:

You know, for example, if--uh, there's three zoning boards. Say our friends are on board two--and, and , and your case gets assigned to board one, we need to clue Cam--now, first of all, even though we may have friends on board, zone board two, doesn't mean it'll be a sure thing. But, better. So, if he gets assigned to board one, he'll just say, you, I'm unable to make that day on board one, is there, can we go to board two?

Plowman explains to him that there are five members who sit on each board and three votes will be needed for a favorable zoning decision. "If I've got a couple of my buddies up there, or even if I don't, you know, a month, or a month or two before the--we know we're going to--you know, we'll know, there's going to be a timeline," Plowman explained. "So, a month or two before we go, I'll take one, I'll take them out to dinner, one at a time." The agent wonders if a dinner is going to do the trick. Plowman says it will help to have people testify in favor of the zoning request as well. The agent asks if Plowman's friend Jason Gaines will be able to help out. Plowman explained that Jason, who was sitting on the MDC, would likely be leaving the board at the end of the year because of how much time it consumed, even though "he likes the limelight" of serving on the MDC. The MDC would only hear the case if a re-zoning was required as opposed to a variance, in which case one of the zoning boards would hear the case Plowman explained.

Public trust is a fragile thing.  Public trust in zoning and variance matters is going to take a hit with the revelations coming out of the Plowman trial.