Brian Mahern's Curious Campaign Finance Report - edited

Not long after my last blog entry went live (see "Maggie Lewis' Curious Campaign Finance Reports"), an alert reader made me aware of the curious nature of City-County Councillor Brian Mahern's latest campaign finance report.

Covering all of 2013, the report for "Brian Mahern for Better Government" notes $6055.94 in contributions - all unitemized.  Since my husband and I made a small donation to Mahern's campaign last year, I know for a fact that at least one was reportable as an itemized entry.  [edited to add: another alert reader sent me an Indiana Code citation that says only donations over $100.00 need be itemized in campaign finance reports.  My donation was less than that.  While our names and addresses were available on the check, there was no legal requirement to report it.]

The purpose of campaign finance reporting is simple transparency of who gave how much, and where it went.  To ignore that, or worse to have something to hide, is not "Better Government".  With non-disclosure, the public is left to wonder why.

I have a great deal of respect for Mahern; respect that grew gradually as I saw him take one stand after another that demonstrated an expectation that government work for the benefit of the people.  That respect does not evaporate with this one omission. But, this one omission does sadden me.

All of Mahern's earlier campaign finance reports itemized contributions.  Whether Mahern took a 'screw them' attitude, couldn't locate his ledger containing the donors' names, had something to hide, or something totally different - I do not know.  Unless the online Election Board listing is somehow incomplete, this is one time Mahern did not hold the public interest in high regard, and that mars his record.

Why the D's Should Be Nicer to Brian Mahern

My friend Jon Easter penned a thoughtful piece over at Indy Democrat Blog, about the coup attempt by Councillor Brian Mahern at Monday night's Council meeting.  Lot's of comments.

Mahern began this term as Vice President of the Council.  I understand he ruffled feathers and some Councillors felt he did not play well with others.  What he did do, is what he has consistently done.  Stood on the side of good public policy and government expenditures that benefit the public.  He is a true believer and the real deal.

It was clear to all that he was looking to run for Mayor.  However, the powers that be could not continue to ride the gravy train if that were to occur.  The usual suspects didn't contribute to his coffers because it would not get them the coziness they can buy with contributions to other politicians of both parties.  He stopped running.

The Council leadership and their power brokers didn't like all that talk about being sensible with TIFs - nor, for completeness sake, do the Council minority leadership and their power brokers.

The Ds stripped Mahern of his Chairmanship, of his VP position - and just last week they stripped him of even serving on the coveted Rules committee. 

I would not be surprised to have confirmed, that once the State removed At-Large positions from the Council, the County Party decided that At-Large Councillor, Zach Adamson, would win the Slating contest for the local district held by Mahern - such is the integrity of the slating process and all.

But, the Ds should worry about continuing their harsh ways.  Mahern could do an Evans and switch party allegiance to the Rs.  What would he lose?

That one seat would swing the Council to an R majority.

They could cut millions from all Democrat-elected County office budgets - with abandon.

They could re-re-redistrict the Council seats and end the chance that the State Supreme Court would redraw the maps as they did a decade ago.

They could eliminate the homestead credit.  They could redraw the old IPD tax district.  They could increase the COIT and PST income tax rates to max.

They could reassign all members of standing committees of the Council, and taking the D lead, assign a lone D to each one.  Just for fun, they could assign Mahern to all the really nifty committees.

They could create as many new TIF districts in Republican held Council districts as they wanted.  They could continue to snub D Councillors and still not invite them to ribbon cutting ceremonies when key projects are commenced in a Democrat held Council district.

The Mayor's office could go back to ignoring them.

My god, they could even switch the side of the room they sit in.

Clearly, Maggie Lewis would not remain Council President if the Rs gained the majority.

Yup.  A little strategy might be a good thing here. 

Ethics Committee Tables Prop 28 With Intention of More Comprehensive Proposal To Come

The Ethics Committee of the City- County Council did indeed meeting this past Thursday to consider Councillor Mahern's Prop 28, which would require full disclosure by Council members when they or their family members received gifts, including tickets to sporting events provided by the CIB.  The meeting took less than 5 minutes to complete.

Councillor Mahern requested that this proposal be struck, with the intention that he would introduce a similar proposal that would include other elected City officials, including the Mayor.  The Committee tabled Prop 28 indefinitely, which has a similar effect as striking the proposal - it is dead.

Here is the clip of Mahern's testimony before the committee (in attendance were Councillors Robinson, Hickman, Simpson, Evans, and Shreve - so this committee continues to be in flux).

"Ethics" Committee Meets Tonight - One Agenda Item - Disclosure of Free Tickets to Sporting Events

Two Council committees will meet tonight, both beginning at 5:30 pm.  Public Works will get the big room and the live WCTY feed.  So, we'll have to wait for tomorrow's posting online and subsequent airings to see what the "Ethics" Committee does with Prop 28, which "amends the Code concerning ethics disclosure to ensure more transparency with respect to gifts provided to Councillors and their families".

This proposal was heard by the committee on Valentine's Day and can be viewed in the WCTY archives.  Only 4 of the 6 members showed up to discuss more disclosure to the public.  This is the minimum needed for a quorum.  There was much wringing of hands and gnashing of teeth, but no vote on the proposal.  The list online shows the committee to be chaired by Councillor Robinson, with other members being Simpson, Miller, Shreve (took over for Freeman who is still listed) - the 4 present.  Missing were Brown and Cain.

Councillor Simpson ended the meeting saying to the proposal's author, Councillor Mahern, "Let's really work on this", and "Good work, Brian".  The proposal was continued to the next meeting of the committee, which was to be March 14.

The is notice of a March 14, 2013, meeting of this committee, but no minutes or WCTY video are posted.  Prop 28 was the sole item on that agenda, as well.  An email exchange with SaRita Puckett, Ethics committee secretary, clarified that there was, in fact, no meeting held that date.

This proposal is pretty darned simple - on top of existing reporting requirements for gifts, it would also require that Councillors disclose receipt of gifts from Municipal Corporations (like the CIB).  It would require that dollar amounts be estimated for the value of gifts received.  And, it would require that gifts made to Councillors' spouses and dependant children be disclosed.  Not all gifts require disclosure in the current or proposed Code on ethics - only those valued at more than $100 for one gift, or an aggregate value of more than $250 in a calendar year.  So, a cup of coffee shouldn't tip anyone's scale.

But tickets to sporting events would definitely tip the scales.

Tonight we shall see if this Council would rather be open and above board in disclosing what tickets to what sporting events they and their family are treated to, or if they'd rather keep the public in the dark and guessing.  This committee will not bring forward a proposal that would embarrass the full Council by forcing a vote to strengthen the public's right to know, when that vote would be a very public and very accountable 'no'.  We shall see if Councillor Simpson and the rest of the "Ethics" committee really want to make this proposal the best it can be - or if they want to bury it.

Mahern Posts Letter To The Editor RE: Tully's Column

First, you have to know it is there, and then you still have a bit of poking around to find it online...  But, today's IndyStar has a letter to the editor penned by Councillor Brian Mahern in response to Matt Tully's recent column (see my take on the column in my last post, "You Can't Fix Willful Ignorance and Greed")

Here's Mahern's letter:

In his Dec. 21 column, Matt Tully sets out to examine possible threats to Indianapolis successfully competing with suburban counties for taxpaying residents. Instead of exploring possible solutions to the serious and vexing crime problem facing our city, Tully instead settles for a full-throated personal attack against me.
He accuses me of political partisanship and failing to offer alternatives to the Ballard administration’s policies and proposals with which I have I disagreed. The fact is I have raised legitimate concerns regarding tax increment financing economic development policies that I believe were overused by the last two Indianapolis mayors, one a Republican and one a Democrat. My concerns about TIF are echoed by fiscally conservative Republicans in Hamilton County.
Mayor Ballard proposed balancing the 2013 budget on the backs of homeowners by raising their property tax bills by more than $8 million, these being the very people Tully suggest we are in fierce competition with the suburbs for. I suggested instead that the Capital Improvement Board should finally pay something for the large amounts of public safety resources used during the conventions and Pacers and Colts games held in CIB facilities. That seemed only fair to me. In response, the CIB threated a lawsuit, citing it lacked money to share with the city, only to turn around and give yet another $10 million to the Pacers on top of the previous $33.5 million it forked over during the last four years.
It is not helpful to give short shrift to the crime problem in Indianapolis. We all need to thoughtfully discuss the impact of crime and the importance of public safety funding. My now months-old invitation to Tully to join me for a chat still stands. All he needs to do is pick up the phone and return my call.
Brian Mahern
City-County Councilman
Indianapolis

You Can't Fix Wilfull Ignorance and Greed

Its very unfortunate for Indianapolis that Matt Tully has an opinion column in which he can toss about misinformation and press for more of your tax dollars to be spent on his neighborhood's pet projects.  And its very unfortunate that he does that, not by providing well reasoned arguments, rather, by maligning one of the few elected officials still willing to stand up for sensible government that will not break our economy and who presses for sustainable funding for police, fire, libraries, schools, and other basic services that benefit all of us, rather than the few.

Tully is in love with the government giving your tax money to private developers and campaign donors, and he really evidences no concern with what that does to the public's ability to finance basic services.  He stood in favor of the Mass Ave TIF, that robs known tax proceeds to pour money into an area already building and thriving.  He stands in favor of the well to do in his own neighborhood and those neighborhoods nearby, to decide how THEIR tax dollars will be spent, while all the rest of us chumps can chip in to make sure his neighbors get police and firefighters to their door whenever they dial 911.  He cries a good game about the schools - but lets see where he sends his child.

But, the lowest point is reached when he maligns Councillor Brian Mahern, one of the last, if not the last, elected official willing to speak publicly of our need to be cautious about the use of TIFs, and who will acknowledge aloud that the more tax revenues we corral inside TIFs, the less money we have to fund basic services.

The pressure to frivolously spend, to ignore that each decision has pros and cons to be weighed, to follow the lead of those whose only goal is to feather their own nests, that pressure is great and has caused most who truly understand the impact of TIFs and corporate welfare to stand down and only whisper the truth among known allies rather than spread that truth further.

The sky is blue.  Water is wet.  And, like it or not, TIFs have consequences.

I had thought Tully was a reasoning person.  But, he has proven me wrong.  He just wants you to foot the bill for his basic services so he and his well off pals can give thier's to developers to make their neighborhoods more fun.

The old myths - that tax money before a TIF is established continues to flow to the schools and police, and that the bankrolled developments will spur free market development - continue to be pressed by those like Tully.  Meanwhile, the Mass Ave TIF and the Mid-North TIF stand on its head, the traditional use of TIFs to help struggling neighborhoods pull out of great need.  Now TIFs are to aid the well to do and to boost areas that are already seeing the free market work.

In the age of tax caps, unexamined TIFs and their unfettered use, will grind on our City's economy.  Then folks like Tully will leave because there are even fewer police and firefighters to cover our whole county, fewer tax dollars reaching the library and the schools and IndyGo.  And, instead of TIFs making his neighborhood more enticing to executives, it will make everyone more fearful of living anywhere in Marion County - fearful of crime as well as fearful of providing a very weak start in life for their children.

CIB Tapped For $15 Million PILOT

The Municipal Corporations committee of the City-County Council added a $15 million payment in lieu of taxes (PILOT) obligation to the CIB's 2013 budget last night, by a party line 5-3 vote.

You can watch the entire hearing by visiting the WCTY archives.

You can expect that unelected Mayor Vaughn (sitting in for Mayor Greg Ballard who is on a four year world tour) did not like the outcome. And you can expect that any action taken by the CIB in response to the PILOT, will be action dictated by Vaughn.

There was much legal wrangling during the meeting between Councillor Bob Lutz, Council Counsel Fred Biesecker, and CIB Attorney Toby McClamrock.  The bones of contention revolved around a) whether adding a paragraph requiring the PILOT was an additional appropriation (which is not allowed under state law), b) whether an assessed value made after March 1 can be used to levy taxes in 2013, or if they must wait until 2014, and c) whether ordinary tax procedures apply to PILOTs anyway.  McClamrock hoisted the flag of - we may not pay it anyway - to see who saluted, but no responses were made from either side of the aisle.

On the actual meat of the reasons for this PILOT, Councillor Brian Mahern kept bringing it back to the fact that the Mayor's proposed budget would let police and fire numbers drop even further.  He said there are already 100 fewer police than at the time of the merger and by not holding recruit classes, the numbers would drop even further.  He noted as well, that the CIB relies heavily upon IFD and IMPD services for the many events that are held in their facilities.

While Councillor Lutz primarily discussed the legal aspects, Councillor Cardwell brought up all the trickle down taxes that he said were due to the CIB, indicating that was more than enough help to the City.

Ann Lathrop mentioned "I feel your pain" and later said she had a fiduciary responsibility to the CIB "not to run it into bankruptcy".  Oh pah-leez on both counts.

The CIB has had more than enough cash to give $10 million for each of the last three years to the Pacers and at the same time increase its year end 2009 cash balance from $26 million to a year end 2012 cash balance expected to be $76 million.  They also have so much money that they are proposing that all of an anticipated $4 million gained from the sale of one of its buildings be simply given to the ICVA - over and above the $9 million the CIB usually gives them.

Unfortunately for the CIB, their believability index runs near the empty mark for much of the public and some elected officials as well.

Is this PILOT the perfect solution?  No.  But the Mayor isn't offering any solutions at all to the drop in IFD and IMPD counts that would be caused by having no recruit classes.  I'm very glad that someone is stepping up to the plate and getting some solutions in place.

In the age of tax caps, the city does have to rethink some of its own self inflicted revenue hits - especially not sunsetting TIF districts that are no longer in debt.  They should rethink the airport keeping hundreds of acres of land, that it does not need for aviation purposes, off the tax rolls.  With the Great Recession still upon us, the city budget has to make it through a few more years with services intact.  This year's challenges include the recruit classes.

The CIB is given special treatment each year because they are key to the ever sacred cow - sports.  IndyGo is running on bare bones and told to dig to dangerous levels in their cum fund to survive.  The Library has had to cut employees and hours over the last few years.  Its not asking all that much for the CIB to help out here.

The budget goes to the full Council Monday night.  Come January 10, 2013, when the PILOT is due, we'll see if the CIB pays up, or if Vaughn has them fight it out in court.

Muni Corps Committee Trims Airport Budget

As I mentioned in my last blog entry, this phase of the budget season is usually dry and boring.  What with split government this year, we are seeing an attempt by the Democrats to change Mayor Ballard's introduced budget in significant ways.  But, still I was expecting the Muni Corps committee meeting to be dry and perfunctory.  Figuring I'd save myself a needless trip and parking fee, I emailed Chairman Monroe Gray and asked if there were going to be any amendments introduced.  Yes, he thought Councillor Lutz would be putting forth something.

Councillor Bob Lutz is a Republican, so what's up?  Could he be fiddling with the Airport's budget?  The airport got an earful from the public and a polite note of disagreement from the Councillors when they presented their budget in committee last week.  A key spark was the fact that the Airport Board had just decided to begin an appeal of Judge Keele's ruling against them in their lawsuit that tried to stop a Fast Park facility from being built in Ameriplex.

Well, they got more than that this time.

Lutz offered an amendment to cut their budget by $100,000; the cost of the appeal.  In a $161 million budget, they won't be left wounded or anything.   Through this cut, the Council would be sending a message that the continuation of this lawsuit is frowned upon.

Lutz and Councillor Jason Holliday share the airport in their districts.  Lutz on the Wayne side and Holliday on the Decatur.

Between them they laid out some of the history of the airport/Ameriplex/Fast Park story that I had not heard discussed in public before.  And it is telling.  Both the developer and Ameriplex approached the airport as soon as they thought there might be a good match in locating a Fast Park facility within the industrial park.  They wouldn't go any further if the airport had a problem with it.  The airport didn't have a problem.  The Mayor's office didn't have a problem.

Fast forward to  when plans were coming to fruition.  Indy Park Ride & Fly - an off airport parking facility that moved out of Marion County and into Plainfield when the new terminal opened - had hired an attorney who went door to door in the abutting neighborhood.  That attorney is now representing the airport in its lawsuit.

Lets face it, this lawsuit doesn't have merit.  Never did.  The airport is simply using its deep pockets to make it too expensive and too prolonged for Fast Park and Ameriplex to continue.  They want to drive a legitimate business out of Decatur Township.  They don't want the competition.  This governmental entity wants to kill off competitors in a free market.

Long story short,  the committee voted 4-3 to amend the airport's budget by $100,000.  Voting with the Decatur community were Councillors Lutz, Holiday, Cardwell, and Mahern.  Voting against were Councillors Gray, Talley, and Osili.

They also voted to send it to the full Council with a do-pass recommendation.  I could see Gray vote no, but could not tell who else may have joined him.

This is an important vote for Decatur Township.  We overwhelmingly want the Fast Park to be built.  It is not your granddad's parking facility; rather it is so green that it can teach the airport a thing or two about being environmentally responsible.  It would be located outside the TIF and bring much needed tax dollars to our schools and help move us toward a more balanced tax base.  It will spark the development of much need commercial property that will benefit the community at large and help Ameriplex attract more high salary tenants to the Purdue Research Park.

I want to thank Councillors Bob Lutz, Jason Holliday, Jeff Cardwell, and Brian Mahern for standing up with us and standing up for us.  Your support means a lot to us.

For those who are interested, I've embedded that part of the committee meeting from the WCTY archives below - it runs almost half an hour:



Councillors Mahern and Adamson Stand Up for What is Right

Yesterday was a bad day for sense and sensibility in Indy government.  The Council voted 25 to 2 to pass Prop 15, which expands the consolidated downtown TIF by more than a square mile.

The only two who had the strength of their convictions were Councillors Brian Mahern and Zach Adamson.  Angela Mansfield appeared to be absent and Vernon Brown was excused from voting due to a conflict of interest. 

By my count, at least 7 Councillors, bent their principles and voted in favor. (Others were always going to vote the party line, the public interest be damned.)  Sure, their vote would not defeat the measure, but it would have sent a message that the ongoing community discussion on TIFs is necessary.  That conversation will continue.

Councillor Vop Osili made promises to folks living in the Riverside and UNWA neighborhoods.  The language he negotiated and inserted into Prop 15 fails to target those promises to those neighborhoods. 

Councillor Joe Simpson refused to amend the Mass Ave portion of the TIF to exclude 2 of the several parcels that are already slated for private investment.  This extension of the consolidated downtown TIF is merely being created as a slush fund for the Ballard administration, and Simpson is fine with that.  He and they are stealing revenue that would have gone to help teach the children of IPS, stealing revenue that would have gone to deliver poor relief in Center Township, stealing revenue that would have gone to IMPD, IFD, IndyGo, Health & Hospitals, Parks, and the libraries - and spending it on development that could and would have happened without the TIF.

I sincerely hope that a dye was not cast last night.  I hope we merely walked down the wrong path on a course that we can change before it is too late.  TIFs have consequences.  They are not free money.  At some point, we will cross a line that harms Indy's economy and the services we pay taxes for.

Councillors will feel the urge to get in line to get a TIF for their area, too.  By my count, the two that passed last night are just the first of 8.  I don't know where the line of economic harm is.  Perhaps it isn't even a bright line, but rather a gradual loss of services and quality of life for most of Indy's residents until drastic cuts in public safety and education become routine, and we do the best we can to wait out the 25 year lifespan of the TIFs.

The issue of TIFs is a hard one.  I have been happy to see the community trying to get on top of it, digest it, and decide upon it.  The conversation began in earnest about a year ago as key people in key groups began to understand there is no free ride with TIFs.  And the conversation will continue. 

Today I want to thank Councillors Mahern and Adamson for standing up for Indy, even when the powers that be tried to make them bow.  We need elected officials with spines and principles and who will fight for what is right and best for Indianapolis and its people.

The public good suffered a blow last night, but the fight continues.

Dust Up - For Reasons Unknown, But I Speculate Anyway

I have the greatest admiration for Councillor Brian Mahern, but last night he flubbed.

The Rules committee began their consideration of Prop 316, which would implement the recommendations of the TIF Study Commission.  After a thorough and really well done overview of the findings of the Commission, Councillor Bob Lutz introduced an amendment that would strike the very last part of Prop 316:

(d) Any proposal creating or expanding a TIF allocation area must be approved by a standing committee of the council before it can be considered for adoption by the full council.

The discussion, which actually preceded the motion to amend, revolved around current Council rules and how the proposed change would impact the ease with which the full Council could call a TIF proposal out of committee.  Currently, if a committee kills or votes down a proposal, the full Council can call it out of committee by the vote of a simple majority; or 15 votes.  This change would require the suspension of the rules in order to call a TIF proposal out of committee, which requires a 2/3 vote; or 20 votes.

After the motion and a second, Mahern refused to take a vote and asked to postpone the proposal until the next meeting of the committee.  He said postponing would allow time to discuss this amendment as well as one Councillor John Barth would be introducing.  He noted that Barth's amendment was only received that afternoon.  There was no second to his motion.  Mahern then tried to move off Prop 316 and on to the next agenda item.  After some brief, heated discussion, a recess was properly motioned and voted on.

After the recess a vote was taken on Lutz' amendment and approved by a vote of 5-1, with Mahern being the lone dissenting vote.  Then there was a motion and second to postpone further consideration of Prop 316 until the next meeting.  That vote was 4-2, along party lines.

I got no indication from the cheap seats why Mahern was so intent on getting the proposal to the next meeting.  While I would welcome a requirement for a super majority vote on any TIF proposal, it didn't seem to rise to the occasion of clearly violating parliamentary procedure in order to avoid a vote.

Barth's amendment was available at the Secretary's table.  This amendment would gut the entire proposal.  Barth is promoting his own TIF for his own neighborhood - Prop 291; the Mid-North TIF (see "The Mid-North TIF -- Developer Driven and Sans Critical Financial Details").  He introduced his proposal at the last full Council meeting.  Prop 316 was introduced at the same time.  One might expect, therefore, that any implementation of the recommendations of the TIF Study Commission would not apply to the Mid-North proposal.  But, Prop 291 was not placed on the Metropolitan & Economic Development committee agenda for Monday night, and it will not be until after the next full Council meeting that the committee would take it up.  So, as of yesterday morning it looked as if the TIF recommendations would indeed apply to the Mid-North TIF.  I can't read minds, but it is very suspicious that Barth introduced his amendment just hours before the meeting and that amendment would gut the entire list of recommendations contained within Prop 316.

Besides a technical correction, Barth's amendment would add one line to section (b) of Prop 316.  Here is (b) with the added sentence underlined:

(b) The factors set forth in subsection (a) [which enumerated the recommendations] are not exclusive, and the council may consider any other factors it deems appropriate in exercising its discretion to approve or disapprove proposals under I.C. 26-7-15.1(9)(a).  Likewise, the absence of any factor or part thereof does not limit the council's discretion to approve or disapprove a proposal.

With that last sentence included, none of the recommendations would be securely implemented.  The administration, or any that follows, could continue its pattern of withholding key financial information from the Council.  That information is necessary to a realistic look at the TIF being proposed.  Without that information the Council cannot make an informed decision and it cannot carry out its duty to review and vote to approve or disapprove as required by law.

TIFs do not generate free money, as many continue to believe.  TIFs have consequences, as many continue to avoid believing.  TIFs always caused increases in property tax rates.  Now they increase substantially the circuit breaker penalty caused by the property tax caps.  Property tax caps that were voted on by the people.

In this age of property tax caps, it is time for the Councillors to learn about the reality of TIFs. It is time to act as the fiscal body of our City that is different from the Mayor's office and that has a distinct role and responsibility.  It is time to demand full disclosure on proposed TIFs so that a reasoned decision about TIFs can be derived.  It is time to implement, not blow off, the Council's portion of the TIF Study Commission recommendations. 

Councillor Mahern Hits Homerun at Today's McANA Meeting

Councillor Brian Mahern, who conceived of and served on the TIF Study Commission, was McANA's guest speaker this morning.  He did an absolutely masterful job of conveying, in plain English, the breadth and depth of the Commission's work - from what a TIF district is, to what policy recommendations the Commission made for its establishment and operation.  Throughout the lengthy question and answer period, he folded in the rational for the Commission's recommendations along with how TIFs currently operate.  Not once did he get into the weeds - and this topic lends itself to getting mired in complicated details.

If you don't have the time, energy, or overwhelming interest in TIFs to watch all 24 hours of archived WCTY broadcasts of the TIF Study Commission meetings, or the time, energy, or overwhelming interest to read all 96 pages of their report plus all appendices - then the WCTY broadcast of this meeting may be just the perfect morsel that can bring you up to speed on the topic (forgive my mixed metaphors).

WCTY will begin showing the McANA meeting early this week - from past patterns begin looking for it on Tuesday.

Today's McANA meeting clearly demonstrates the public interest in TIFs and how the public wants them to operate within Indianapolis. Remember, TIFs consume your tax dollars, so you owe it to yourself to become somewhat conversant about the topic, as well as making your opinions known as the policy recommendations move toward adopted and implemented policy practices.

TIF Study Commission Wraps Up Its Work

With the 10th and final meeting, the TIF Study Commission wrapped up its work last night.  The vote was 5 to 2 to adopt proposed recommendations along with a very lengthy report that distilled the testimony presented.   To summarize this herculean effort effectively, I will cut this into three parts - the Commission itself, the ideas and facts collected, and the recommendations.

The 8 Commissioners were Councillors Steve Talley, Brian Mahern, Ryan Vaughn (and his replacement Jeff Cardwell), Auditor Billie Breaux (and her proxy Richard Hunt), State Representative Bill Crawford, MDC President Ed Mahern, City Controller Jeff Spaulding, and Bond Bank Director Deron Kintner.

All came to the table with their own perspectives, and the give and take was on the highest level - all to the gain of the public in this process.

The presentations were mostly in plain English, yet had an academic rigor to them. 

All of the meetings can be found archived on the WCTY webpage (click here and scroll down to the last category, "Special Events").  The 10 meetings are listed there.  I added up the time for all of the meetings and it came to 24 hours.  You can find all of the documents that formed the presentations on the TIF Study Commission webpage, organized by date.

Needless to say, all of the information from this 24 hours makes a thick document - even when distilled.  The draft of the Executive Summary has been posted online.  I'll put up a link to the final document when it is posted, as well.  The final document without the appendices comes to 86 pages.

I cannot finish this roundup of the Commission without paying respects to two members of the Council Staff.  First, Leslie Williams took copious minutes, which can be found on the TIF Study Commission webpage.  I think the amount of work involved in taking the minutes of a meeting, especially long ones, is often undervalued.  I know that is a job I studiously try to avoid doing in organizations because of the number of hours actually required. 

Second, Hope Tribble, the Council's CFO.  I cannot begin to guess at how many hours Tribble put into this Commission - along with doing her regular job.  It appeared to me that she invited the guests, set the agendas, provided presentation and agenda materials to all through email, got super quick responses to questions fielded through email, and wrote (and likely re-wrote numerous times) the report that is being issued by the Commission. She most assuredly was the secret weapon for this Commission and a key reason why it functioned at the high level it did.

From the last two meetings it was clear that there were two camps assembled on the Commission.  All seemed to agree to more transparency and more documentation for why a TIF District should be set up.  The camps were apparent when the discussion turned to recommendations that would put limits or more oversight on the use of TIF funds or would place time limits on the life of an existing TIF District.  The majority wanted to rein in the use of TIF dollars, provide more oversight, and limit the lifetime of existing TIFs so that more of these property tax dollars could flow to the various units of government to provide the services that have been strained due to the property tax caps that were implemented a few years ago.  The minority wanted to retain the 'flexibility' that the Ballard Administration now has in determining on what to expend any excess TIF funds and maximize the options for future Mayors to reactivate dormant TIFs - all with an eye to being nimble enough to remain competitive with other municipalities that compete for the same businesses.

The work of this Commission is the finest example of good government that I have witnessed in my years of closely watching Indianapolis' government.  Everyone who attended had to have learned something new, if not a lot of stuff that they did not realize before.  The meetings are archived on WTCY for review and the report is being finalized for release.  The recommendations of the Commission will need to be reviewed and acted upon by the Council, the Mayor, the MDC, and the State Legislature.  So, this is not the last you'll hear of the TIF Study Commission's work.  Like a rock thrown into a lake, the ripples will be around for some time to come.

Excellent job.  Well done all.

Big Night At Rules Committee

The City-County Council Rules Committee will be taking up some big issues tonight, including partner benefits for City/County employees, and an ordinance banning blackballing of hotel workers who preveiusly worked for a temp agency. 

While most people attending will be interested in one of those two, I do want to make mention of an additional proposal that,if passed, would seek a half million loan from the state and then increase your taxes in 2013 to pay it back.  Hmmm...
Prop 168 does not say what purpose the half million would serve, just that it would be deposited in the City's Cumulative Capital Development Fund.  According to the budget for 2012, this fund was estimated to have over $3.7 million fund balance at the end of this year.  They used this fund to handle some of the property tax circuit breaker credits, eating into the over $8.8 million beginning balance. (see p 82 and 33 of the pdf) So why they need to feed this fund with a loan and add to our taxes next year is not clear.

Prop 179, sponsored by Councillor Brian Mahern, would establish a new requirement for a hotel to qualify for its annual operating license from the City.  No hotel would be able to enter into a services contract if that contract contained a stipulation that the hotel could not employ a person who had previously worked for the services agency.  This practice traps people in the employ of these temporary agencies and their attendant low wages with no benefits.  The hotels were quite happy to hide behind the skirts of the maids and other hotel workers in petitioning for more and more taxpayer funds to flow to the ICVA and the CIB - then unceremoniously cut these workers' jobs in favor of these black-hearted outsourcing agreements.
Prop 213, sponsored by Councillors Mansfield, Adamson, Barth, Hickman, Lutz and Hunter, would make various benefits available to City and County government employees who are in domestic partnerships. To qualify, the couple would have to be living together for at least one year and file a Domestic Partnership declaration the Human Resources.  The benefits provided to the partner would be the same as those now afforded to a spouse of an employee - such as health insurance and pension benefits - and family/medical leave would be provided to the employee for situations arising with their partner.  Should the domestic partners cease being a couple, HR would have to be notified immediately.  All benefits provided to a partner would be taxable to the employee.

On Prop 213, all I can say is - about time.  The State refuses to allow same sex partners to marry, stripping these couples of many legal rights married couples take for granted.  The least we can be as a City is progressive enough to provide equal benefits for partners as we provide to spouses.

The agenda for the Rules Committee lists 8 items.  The meeting will begin at 5:30 pm in the Public Assembly Room.

TIF Study Commission Off To Rollicking Good Start

You simply must wonder what wrong turn your life took when you find yourself energized by the geeky, wonky, TIF-er-ific lecture/discussion that happened at last night's opening TIF Study Commission meeting.  That is the situation I find myself in this morning.

WCTY, our government channel was present, capturing it all for your viewing pleasure.  As of this moment, it has not been posted, but I'll post a link as soon as I see it go up. [Edited to add link to the March 27 meeting - click here]

The TIF Study Commission falls out of City-County Council Prop 70, which set its composition and broad agenda.  On the panel are Councillor Ryan Vaughn, Controller Jeff Spaulding, Councillors Steve Talley and Brian Mahern, Auditor Billie Breaux, Bond Bank Executive Director Deron Kintner, MDC President Ed Mahern, and State Senator Bill Crawford.  Kintner was absent last night and sent a 'proxy', but I am afraid I did not get her name.

Missing last night was the taxpayer perspective, which left me squirming in my seat and my head flooded with my own internal comments.

Much information was thrown out there.  Bruce Donaldson, Attorney with Barnes & Thornburg, gave a overview of what the law allows TIF to be set up for and how TIF funds can be spent as well as the process whereby a TIF district is legally established.  Deputy Mayor Michael Huber was up next, going through the TIF philosophy of the Ballard administration.  Jeff Spaulding joined in for more of the administration's perspective on why use a TIF over other means of economic development.  Taking up the rear and pretty much rushed due to the late hour, was the Director of the Department of Metropolitan Development, Maury Plambeck.  Plambeck went through examples of the variety of TIF districts we have in Indy.

More detail is assured for future meetings.  So, let your geek flag fly !

Here are some of my observations from the cheap seats.

Billie Breaux brought up one of the great points last night - since you can create TIF districts to help spark redevelopment or for general economic development - why do we seem to be doing mostly the latter?  This really struck me as pertinent.  There is evidence that using TIF for economic development only moves economic development from where it would occur organically, to a location of the government's choosing and profits a developer of the government's choosing.  It does not accomplish much more.  But, trying to turn around a truly blighted area, is a different matter.  We can identify and prioritize, if you will, the areas most in need of a catalyst to improve a blighted area.  For the rest, we all want development in our neighborhoods, and prioritizing is more open to political interpretation.

I mentioned it earlier and it bears repeating, missing was the taxpayer perspective.  A number of platitudes were uttered last night that we have all heard before.  They are the 'promises' of TIF districts that do not necessarily come to fruition and for which TIFs are not necessarily the best approach. 

Spaulding mentioned "a rising tide lifts all boats" - that is true up to a point.  The never ending TIF district, however, has built around it an imaginary retaining wall - so the 'tide' cannot escape to outside areas to lift the 'boats' found there.  Huber opined that expanding the consolidated downtown TIF to nearby neighborhoods is way to share the wealth within that district.  I say, pay off the bonds, dissolve that TIF and let us all partake in the wealth.

On the same topic, Huber said that the development in a TIF would not have happened without the TIF, so it benefits all taxpayers.  While that is debatable on its face, by ending a TIF you would definitely help all taxpayers.  It might be a few dollars per taxpayer, but the aggregate it stunning.  The TIF districts in  Marion County take in over $100 million a year in property tax revenue.  If those TIF districts were retired, it would set off some critical dominoes.  First, the tax rates throughout the County would drop.  This makes Indy more attractive to homeowners and business owners alike.  It also means that fewer people hit the property tax caps.  When fewer people hit the tax caps, more money flows to the taxing units like the schools, the library, IndyGo, and the City.  When more money flows to the taxing units, more services or higher quality services can be provided.  This increases the quality of life in Indy, again improving the attraction of our city for people to live and work.  And, lets not overlook the impact on the taxpayers for those property tax savings.  For some, it means a better chance to keep their homes or business, and for others it is disposable money left in their pockets that can be spent on restaurants or new equipment or new cars, etc, etc, etc.  Retiring TIF districts can fulfill one of the promises made when the TIF was created - that it will benefit everyone.  When you do not retire the TIF, it only benefits those within the district, since the rest of us are footing the bill for the necessary public services that they still enjoy but do not pay for.

Mentioned by Donaldson was the idea that the tax revenue coming from a TIF district before day 1 of the district, will continue to flow to the schools and library, etc, after the TIF is formed.  This is called the 'base'.  He noted one readjustment as the tax caps were initiated that allowed a new calculation for the 'base' of our TIF districts, so that the new laws would not impede the City's ability to pay off existing bonds.  He did not mention that this readjustment is done annually.  I have blogged on the base and the annual calculations that the Auditor must submit before (see "TIF Districts - Who Knew The Base Could Drop?") .  From 2010 to 2011, these re-calculations caused $43 million in property value to be moved from the base, into the TIF revenue.  That was likely due to the drop in property values caused by the bursting housing bubble and recession.  But, if you look at the forms, there is no way that the value will be returned to the base once the recession is over.  The forms leave you with a choice - either stick with the same base as last year, or let it drop to recover more money to pay the bonds of the TIF district.

So, dear reader, if you've gotten this far, I thank you for your perseverance.  Its geeky, nerdy, wonkish stuff to be sure.  But, TIFs can be a promise for a better future, or a drain on the rest of us, or a slush fund, or all simultaneously.  As taxpayers, as citizens of a City we all want the best for, we owe it to ourselves to get at least ankle deep in the topic and lend our guidance to our elected officials as they try to navigate the best course for TIFs in Indianapolis.

Brian Mahern Comments On Disaster Bonds for No-So/City Way

Today's paper had a letter to the editor from none other than Council Vice President, Brian Mahern.  In it he takes the Ballard administration to task for using disaster relief bonds for the North of South (aka City Way) project instead of for, well, disaster relief.  Here is part of what he had to say:

The City Way complex consists of a luxury hotel, high-end apartments and swanky retail shops. Its developers benefitted from two forms of disaster aid, which were created in response to extensive Midwest storm damage in 2008, despite no logical reason to do so. 

Both $70 million in low-cost disaster relief bonds and a $6 million disaster relief grant were used to fund the private City Way development at a site untouched by storm damage. Meanwhile, affordable apartments like Falcon Pointe on the Far Eastside are still being slowly repaired from tornado damage four years later without so much as a penny of disaster aid. 

Mayor Greg Ballard’s effort to funnel precious public disaster aid to a fancy Downtown development while ignoring the legitimate recovery needs in outlying neighborhoods is inexplicable and unconscionable. One can only hope that the next round of aid for the more recent tornado victims in Southern Indiana is used solely for their benefit.

TIF District Policies to be Scrutinized

Monday night also saw the unanimous passage of Prop 70, a proposal by Councillor Brian Mahern to form a commission to study TIF Districts in Marion County and report back to the Council with policy recommendations.

Not all appointments are yet known, but of the 8 study commission members, the Chair will be Councillor Steve Talley, with Councillor Brian Mahern, County Auditor Billie Breax, City Controller Jeff Spaulding, and Bond Bank Executive Director Deron Kintner as members.  Still to be named is one member of the Republican caucus of the Council, one member of the Metropolitan Development Commission, and one member of the Indiana General Assembly.

You can view Councillor Mahern's comments to the Metropolitan & Economic Development Committee of the Council by clicking here and moving to time stamp 1:21:00.

Briefly, though, he said that there are 30 TIF districts in Marion County, with a combined debt of about $1 billion.  These TIFs have taken in hundreds of millions of property tax dollars.  Although they are initially set up for a 30 year term, refinancing of the underlying bonds has caused extensions of their terms.  All of this is without a comprehensive view of how TIFs perform and how they affect other property tax revenues - especially the impact of tax caps on revenues received by the different units of government.  The commission is expected to issue an interim report by April 30 and a final report by June 30.

In what may be a coordinated effort, the two pending expansions of existing TIF districts (Prop 15 and Prop 16) have been tabled by the Metro & Econ Devel Committee.  It would, indeed, be better to understand TIF districts and how to safeguard the taxpayers as well as actual economic development, before moving forward with these extensions of TIFs.

Meetings of the commission will be public and public testimony will be taken.  More on the schedule once it is available.

Six Councillors Stand Up for the Taxpayers

On Monday night the full City-County Council took up the issue of whether or not the North of South (aka City Way) boondoggle warranted a Certified Technology Park status (see "Taxpayer Fleecing for NO-SO (aka City Way) Continues").  Six Councillors stood up for the taxpayers of Indiana and Indianapolis and voted 'no'.

The six were Democrats Adamson, Brown, Gray, Hickman, Mahern, and Oliver.

All remaining Councillors, with the exception of Hunter and Mansfield, who were not present, voted in favor of declaring shops, hotels, and a few apartments, with their attendant minimum wage jobs, the very high tech jobs we need to be attracting to our City.

To view the discussion, click here and then scroll down to Prop 66 under "all items".

Councillor Brian Mahern began with a statement, in which he clearly outlined the lack of an actual high tech component.  He also mentioned the $98 million financing for the City's loan to the developer was with Federal 'Disaster Relief Bonds', which just might have been put to good use in Southern Indiana about now.  Excellent point.

Councillor Zach Adamson, who voted against the boondoggle in Committee, also made a statement - saying outright that "Designating City Way a CTP is dishonest and would further add to justify the distrust the public has in its elected officials".  Exactly.

So, from one taxpayer, thank you to all six Councillors.

Proposal for TIF Study Group Gets Hearing Monday Evening

City-County Council Proposal 70 is absolutely what the taxpayers of Indianapolis need passed.  Authored by Councillor Brian Mahern, it proposes that elementary issues about TIF districts be studied and more.  It is so very important that our community engage in a conversation about TIFs as they have an immense impact on property tax rates, revenues available to our governmental units, and economic development in our City.  Last year was a watershed year for interest in the topic by regular citizens.  Now it is time to move that conversation forward.

It must also be said that it is the responsibility of the Councillors to have an understanding of TIF districts because so much that comes before the Council on economic matters has an interplay with TIF districts and visa versa.  How do abatements within a TIF district affect the ability to pay the bonds underlying the district?  How many poorly performing TIFs do we have and how does that affect the promises made when the TIF was set up - for instance the promise that all of the tax revenues flowing to the schools and fire departments and library and IndyGo will continue to flow after the TIF is set up (a promise more often broken than kept is my guess).  How long should a TIF exist - should it be retired as soon as possible, or should it be used as a long lived slush fund?

There are plenty of questions we all should be asking.  But, here is what Prop 70 would aim for as its core assortment of questions:

The Commission shall review and make recommendations on Indianapolis City-Marion County economic development policies and procedures related to TIF used in Marion County, including but not limited to, the following:

1) Policies and past practices used in Marion County for the establishment of TIF districts and projects therein;

2) Policies and past practices used in Marion County for the expenditure of TIF district funds and the issuance of debt backed by TIF district funds;

3) Current Marion County TIF districts and associated fund balances, debt obligations and past expenditures;

4) Need for new methods to increase transparency of Marion County TIF districts’ funds and the expenditure of those funds, including the establishment of an online database of TIF districts’ funds and expenditures and periodic reporting of TIF districts’ financial data to the Indianapolis City Controller, Marion County Auditor, the Indianapolis-Marion County Council and taxing districts impacted by TIF;

5) Need for new methods to increase accountability, including the establishment of new performance standards in the establishment of TIF districts to ensure targeting of TIF districts to revitalize blighted areas of Marion County and job creation;

6) Need for performance goals for private development that receives TIF and methods to provide consequences for the failure to achieve those goals.

7) Need for a comprehensive economic development plan to ensure the creation and development of TIF districts and projects therein in a coordinated fashion consistent with economic development goals of job creation and community revitalization;

8) Need for periodic review of established TIF districts and projects therein to ensure performance towards economic development goals

9) Impact of TIF districts on Marion County taxing districts that depend on property tax revenue and the need to mitigate negative impact to those taxing districts, including development of standards and methods to return excess TIF district funds to those units; and

10) Need to establish methods to dismantle TIF districts that are no longer needed and/or address projects therein that are not achieving economic development goals.

The study group would include:

The Commission established for this purpose shall be composed of eight (8) members, as follows: 

(1) the chair of the Council’s Metropolitan and Economic Development Committee, who will serve as chair of the commission;  

(2) the chair of the Council’s Rules and Public Policy Committee;  

(3) a member of the minority caucus of the Council, appointed by the Council  president;  

(4) the Indianapolis City Controller;  

(5) the executive director of the Indianapolis Bond Bank;  

(6) the Marion County Auditor;  

(7) a member of the Metropolitan Development Commission, to be appointed by the Council president; and  

(8) a member of the Indiana General Assembly, to be appointed by the Council president.

Preliminary findings would be reported back to the Council by April 30.

I cannot endorse this Proposal more strongly than I do.  Councillor Mahern has put together a well thought out plan of inquiry that can only improve our understanding of the real ability of TIFs to impact economic development and at the same time establish safeguards that will help protect the public from misuse of these complex tools.

The Committee meets in Room 260 of the City-County Building beginning at 5:30 pm.  The members of that Council Committee are:

Steve Talley (Chair)

Zach Adamson

Virginia Cain

Jeff Cardwell

Jeff Miller

Mary Moriarty-Adams

Vop Osili

Leroy Robinson

Are TIF Districts the New Slush Funds?

The recent action by the Metropolitan Development Commission to funnel $8 million a year to the Pacers, by way of the Capital Improvement Board, has brought a lot of attention to the consolidated downtown TIF district and how much money is actually there.

Last week, Francesca Jarosz, newly transplanted to the IBJ, wrote an article with a great deal of detail - some of it very unexpected ("Downtown tax district reaps unexpected windfall"). There is an accompanying map, showing that this TIF district consumes most of the mile square and much of the area bounded by I-70 and I-65.

Jarosz mentions that there is $576 million in debt, payment of which property taxes collected in this TIF area are directed, but still leaving an excess revenue stream of about $12 million annually. These excess moneys have accumulated in recent years. Jarosz writes:

By the end of this year, the city estimates there will be close to $91 million collected from the downtown TIF beyond what’s needed to make its debt payments. The money eligible to be spent would dwindle to about $24 million after factoring in a $9 million cushion for tax money lost to appeals or non-payments and another $58 million for the city to hold a reserve of 10 percent of its debt.

And that number likely will further dwindle to about $12 million, pending the issuance of bonds for the proposed development near Lilly and Clarian Health’s planned neurosciences center near Methodist Hospital. Those would increase the downtown TIF debt to more than $700 million and hike the amount needed for a 10-percent reserve to $70 million.

The staggering amount of money sitting in this one TIF district raises lots of questions. Jarosz quotes City-County Councillor Brian Mahern:

“We hear about projects here and there,” said Brian Mahern, a council Democrat. “It appears there’s more money than needed for [debt]. It only makes sense that there’s a broader discussion about where to use those dollars, and I don’t think that’s been the case.”

This is an excellent point. Most of us, even those who know what a TIF district is, didn't have a clue that so much money was accumulating. A community discussion on the use of those funds should be a priority. Instead, we see that Mayor Greg Ballard is lining up one use after another for those funds, without setting any forth any vision of what he is trying to accomplish with what appears to be a random and piecemeal fashion of awarding money to favored projects.

Cathy Burton, President of the Marion County Alliance of Neighborhood Associations, is also quoted:

“If there’s that much excess money, wouldn’t it be wiser to apply the funds to upgrading parking meters or helping to handle the infrastructure deficit or paying off the bonds more quickly?” said Cathy Burton, president of the Marion County Alliance of Neighborhood Associations.

Jarosz also quotes a Mike Shaver:

Mike Shaver is a Carmel-based community and economic development consultant who works with municipalities across the state.

He said it’s common for cities to collect excess TIF funds and use the money for other economic development projects, citing the towns of Seymour and Converse as examples.He said in those cases it’s important for government officials to have a highly public discussion about how the money will be used.

“What you have to do in that process is be very transparent about it in order to convince the public you’re not creating a slush fund,” Shaver said. "That’s a very real potential problem.”

Mr. Shaver hit the nail on the head. Because, from the cheap seats, it looks to be exactly the case that Mayor Ballard is indeed using excess TIF dollars as a slush fund.

The DMD Budget Hearing - Say What ?

The 'great catch award' goes to Councillor Brian Mahern for his persistence in questioning at last night's budget hearing for the Department of Metropolitan Development, on an item that turns out not to be in DMD's budget at all -- the $10 million gifted to the Pacers by the Capital Improvement Board for 2011.

The questioning and answering was dispersed throughout the budget discussion - so I noted the timestamp in case you'd like to fast forward to these segments -- timestamps 45:00 - 49:00, 50:30 - 52:40, and 1:00:50 - 1:05:50 on the Channel 16 broadcast (click here, then on 'video' for September 13, 2010).

Mahern was following up on an IBJ article by Scott Olson last month (see also my blog entry "CIB Says Its Budget Increase Isn't What It Looks Like") where it was first disclosed that $8 million in funding for the ICVA would come "from downtown-development funds", freeing dollars that the CIB usually sends to the ICVA. The CIB was then able to build a budget within which they could donate $10 million to the Pacers.

Upon reading that article previously, I had assumed this was money from the Sports Development Area, that was created, and recently expanded, to provide funds for the downtown sports and tourist industry. Wrong ! These "downtown-development funds" are actually coming from the downtown 'consolidated TIF' area. So, now we have expanded the footprint of the tax dollars being redirected to these endeavors that really should be self sustaining.

The information illuminated last night was that the Metropolitan Development Commission has the authority to dispense TIF revenue any way it pleases, as long as it abides by the parameters set up for that TIF area by the Council. It pleased the MDC, evidently, to send $8 million to the ICVA. (David Reynolds, City Controller, actually called it an 'opportunity' to fund the ICVA.)

Mahern made a particularly salient point, when he referred to last year's increase in hotel tax. He noted that the Council amended the ordinance with a provision that the hotel tax could not be used to enrich any sports team.

Mayor Ballard and that clever lot on the 25th floor, struck a deal with the Council to get the hotel tax increased, then quickly engineered a way around the deal, it would seem.

The municipal corporations committee, Chaired by Councillor Barbara Malone, will consider the CIB budget on October 11 at 5:30 in room 260 of the City-County Building. It is worth repeating, the CIB-Pacers agreement gives an out should the Council not fund that item in the CIB budget for 2011. The Council can just say 'no' to gifting the Pacers with the 2011 installment of $10 million. And they should.