Monday, May 14, 2007

Square Update

Government record poor with private ventures
http://www.fortwayne.com/mld/journalgazette/news/editorial/17223845.htm

Fort Wayne has chance to reinvent itself
http://www.fortwayne.com/mld/journalgazette/news/editorial/17223847.htm

27 comments:

Kevin Knuth said...

Ron Reinking's column is SO FULL of misinformation it is laughable.

Here are just a few:

1. The city will forgive an existing lease with Hardball Capital valued at about $3.2 million.

FALSE- The CITY does not have an existing lease wtth Hardball Capital- the COLISEUM does and that lease will need to be extended while the new ballpark is constructed.

2.Although full details are not entirely clear nor will they ever be fully known, it would appear that our managers are not Major League players.

FALSE- the final deal will be a public vote by City Council. All documents will be available as they are public documents.

3.At the present time, the city receives 30 percent of the concessions sold at Memorial Stadium.

FALSE- the COLISEUM receives that money- the CITY DOES NOT OWN MEMORIAL STADIUM.

4. Neither the city nor the Wizards has demonstrated any expertise or success in booking profitable events at Memorial Stadium. Is it wise to have them practice with taxpayers’ money at a more expensive venue?

FALSE- The city and the Wizards are NOT responsible for booking Memorial Stadium- Randy Brown and the Coliseum are. ONCE AGAIN- THE CITY DOES NOT OWN MEMORIAL STADIUM.

5.“What if the Wizards and the hotel developers go belly up? Won’t the city be on the hook?”- A review of the city’s record in hotel management would indicate this is not improbable but most likely automatic.

FALSE- The CITY is NOT managing this hotel.

6.“Couldn’t the city’s $64 million be spent on something better?”-How about police and fire protection, water and sewage systems, education, streets and roads, legal, justice and criminal administration and creating a more inviting living environment for Fort Wayners with less taxation?

FALSE- you can only use TIF and CRED money for specific purposes.

7.“What’s the rush? Why are Mayor Graham Richard and the city moving so fast on this?”-An informed and educated populace simply would not tolerate this folly. By rushing this through, the calculation is that opposition will be intimidated, uninformed and too disorganized.

FALSE- CRED funding will not be available after this year- driving the cost up another $15 million. Also, if a new stadium is not built, Memorial Stadium will have to have $6-12 Million invested in it to bring it up to standards.

I could go on- but you get the point.

If Ron Reinking is a CPA- I would not let him work on my taxes- his numbers clearly do not add up!

Anonymous said...

Kevin - You may be correct on CREeD, but you are dead wrong on TIF - See IC-36-7-14-39b-3 AS INDICATED TO YOU OTHER TIMES - yOU KEEP SPREADING THIS MISINFORMATION.
John B. Kalb

Kevin Knuth said...

John,

TIF is a tool we can use to grow our city.

You simply want it to go away- we will have to agree to disagree on that point.

EVERY city in the state uses TIF funds to attract development- we must do the same in order to compete.

Sounds like a good use of tax dollars to me.

However, you still have not explained away the rest of Reinking's errors......

Anonymous said...

Kevin - "Every city in the state uses....." And that is why our property taxes in this state are going up 25 % next year and almost all being borne by homeowners! We will, if we proceed on this course, end up with very little of our property taxes being paid by commercial entities - they will all be paying their property taxes into a TIF fund - so the homeowner is left to fund the cost of local government. Now, I was of the opinion that the jack-ass party was suppose to be for the "little guy" - what happened to you? John B. Kalb

Kevin Knuth said...

John,

New development, attracting new and better jobs- everyone benfits.

Democrats can support that idea pretty easily.

Jeff Pruitt said...

Well this Democrat certainly does not support expanding the TIF district. Continuous expansion of the TIF ultimately leads to less property available to pay for general services - this means rising property taxes for everyone. Seeing how property taxes are highly regressive I would argue that ALL Democrats should be against the TIF expansion.

The reality is that it's simply a political tool used to build something in the near term while pushing the payment into the future. This allows the government to tell people that "your property taxes will not go up".

And the idea of new and better jobs? I suppose part time retail positions are not my idea of better jobs. In fact I have seen nothing, including the economic impact study, to suggest that this project will lead to an addition of good jobs here in Fort Wayne. I know a lot of people CLAIM that will happen but to date I haven't heard a valid argument to support that hypothesis - lots of handwaving to be sure...

Anonymous said...

why are we talking about condos downtown. The midtowne crossing fiasco was a bust. Didn't the city pay for a study which said people would like apartments downtown but not condos. Midtowne Crossing at one point you couldn't give those away.

Anonymous said...

Knuth's comments regarding Reinking tempt a slander suit. You downtown boosters might want to curb your enthusiasm for vision and glory long enough to ask yourself how destroying reputations is going to make this a better place.

Anonymous said...

Kevin,

Please help organize a poll of all YLNI members with these questions in addition to the one question at the March meeting which asked whether you supported a mixed development downtown (note the question didn't say with private or public funds -- I mean, most people are not against private development. It is only public development that raises eyebrows from taxpayers):

1. How many of you that voted "yes" to supporting mixed development downtown will back your support by actually commiting to purchase one of the 60 condos in phase I (minimum cost for an 800 square foot condo being $180,000 up to $300,000)?

2. Are you willing to sign a pre-construction purchase agreement and put down a few thousand dollars as earnest money and provide a pre-qualification loan approval from a lender proving you are financially qualified?

How many twenty somethings, and for that matter, 30 somethings can afford to buy a $180,000 to $300,000 condo or house at Fort Wayne income levels? And if you can afford it, why would you want to tie yourself down with real estate downtown with the potential of taking a big loss if you have to sell to take a better job offer in a bigger city?

In addition, driving around downtown and even in the nicer suburban areas, I see a lot of empty retail space, empty new strip shopping centers. Are there any retailers with financial qualifications that have come out publicly and said they will lease new retail space downtown? How about the owner of the musical instrument supply business? He is a big public supporter of using public funds for developments typically reserved for private developers. Maybe instead of moving his business from Bass Road out onto U.S. 30/North American Van Lines area he should have moved his business downtown to support downtown re-development. Maybe he has so much money and makes such a high income he could care less if a failed publicly funded project ultimately ends up costing taxpayers with increased taxes. Maybe the local Bank president who has publicly supported Harrison Square can make a speculative loan for the new stadium to the Wizards owners, and give a loan to the hotel developer, and make 60 spec condo loans using Bank funds instead of public funds if he thinks these are acceptable risks.

The free capitalist market speaks the truth about supply and demand and markets. Matt Kelty is right, the government has a poor track record when it trys to play in the free market and force something on the free market. What's it called when a free market system's government interferes with the free market capitalistic system -- socialism?

Ronald Reagan

Anonymous said...

Thank you, Kevin for calling attention to the many errors in Mr. Reinking's "editorial." Of the things you pointed out, I also liked his reference to the convention center which he says "sits unoccupied." Hmmm, I have been to many events there after the expansion and it was far from unoccupied. I still find it hard to believe that the experts like Mr. Reinking who happen to drive by the Grand Wayne Center and see the outer lobby empty as they drive by on Jefferson (for 5 seconds)think that the facility is "unoccupied." But, what would myself an average professional citizen in his early 40s in support of downtown redevelopment know!

Tim

Anonymous said...

Mr. Reinking and SLVESTER!! get a couple letters behind their names and next thing you know they are experts on everything.

Mr. Reinking, whatever you do, dont let the facts get in the way of your argument.

Hey, at least Jonny B. Kalb agrees with ya.

barranda said...

Kevin,

Nice job pointing out the flaws. Perhaps a response editorial is necessary. Interestingly, Reinking presented at a Rotary meeting discussing the large amount of debt the city is accumulating. That is the two billion dollar number he refers to in his column. Part of his numbers include $160 million for Harrison Square. I asked him why he didn't account for the private investment. He admitted he made an "oversight" and cried mea culpa. A couple people (including myself) requested that he send the numbers from his power point. He said he would, but never did.

Reagan,

First, there's no such thing as a free market. That assumes the absence of external factor that already exist; and will never cease to exist. For example, the minimum wage is NOT part of a free market. Also, should the government play no role in a free market where companies can ship facilities to Mexico or overseas for cheaper labor? If they interfere, that is NOT a free market. "Free market"; ha, it's a nice buzz word, but it's really just smoke and mirrors. The best government is the one where the people running the show have the experience to run an efficient government, and make smart business choices. I'll engage in a healthy debate into whether H.S. is an efficient and good business decision...don't perpetuate the damn misconception about a free market that doesn't exist.

As for the YLNI poll; you are just wrong. The question didn't ask about the idea generally. It asked specically about the H.S. project that was presented to the attendees of the forum. Also, of those that responded to the poll; only about 30% were YLNI members.

Anonymous said...

On an unrelated note, I am not sure who was in charge of Mr. Kelty's finance reports (I dont think it was Mr. Reinking), I am really surprised that the Kelty campaign made it through the primary without somebody asking for more detail on the $150,000 loan made by Mr. Kelty to his own campaign. It is most likely 100% accurate, but it is a big enough number that I would want to confirm that it not come from some other donor which would be a blatant violation of finance laws.

barranda said...

I highly doubt that there's anything wrong with the personal loan. That said, one has to wonder how fiscally responsible one is to spend $150,000 of his own money on a campaign. Campaigns are meant to be funded by private contributions..."market driven" if you will. ;-)

Joe said...

whoever made the comment about Midtowne Crossing (anonymous), please do a little research. MC is at almost 100% capacity.

Anonymous said...

I didn't make the post on Midtowne Crossing, but I believe if you check it out,60 % of the condos there are leased - not owned by those living in them. Scott Glaze sure isn't living in his!! His home is in Roanoke - not even in Allen County! John B. Kalb

Anonymous said...

Hey Mr. "There is no free market":

There is no completely free market because nothing is perfect. For example, we have socialists who pass minimum wage laws, causing small businesses to lay off workers who would otherwise keep a job.

So, since we do not have a perfectly free market you think its okay for a government to continue to make our capitalistic system less and less free? And okay to risk taxpayers money in what is a private developers area of expertise? Two wrongs don't make a right. When private developers shy away from an "opportunity" it means the market (I'll drop the word "free" to appease you), as efficient as it can possibly be, has determined the rewards do not justify the risks. So your beloved government thinks they are smarter than expert private businesses and developers? Let me guess, you are on the government payroll looking forward to your undeserved pension at taxpayer's expense.

Are you going to buy one of the condos? How about the cheapest one, only $180,000 for 800 square feet and the opportunity to have ballpark lights shining in your windows and fireworks for your listening pleasure, and don't forget the nice evening walks downtown with the winos. Stop in at the McDonald's and mingle with the upper crust.

Okay, so only 30% of the respondents at the March forum were YLNI members...you miss the point. So how many of those 30% are going to commit to buying a condo? How many of the remaining members of YLNI are going to commit to buying a condo? How many of the remaining non-YLNI respondents at the forum are going to buy a condo?

Maybe some people or businesses are benefiting from H.S., that's why they are all for it, selfish reasons. Certain insurance salesman are strongly for the project in hopes of writing the insurance....

Regarding another individual's comments jumping for joy that Midtowne Crossing is fully occupied. Wow, it only took fifteen years! And those condos are selling because they only cost $60,000!!! Which indicates what the "free market" says a condo is worth downtown!!! A bit of a difference from $180,000 to $300,000 wouldn't you say?

Ronald Reagan

Anonymous said...

The housing "free market" in Fort Wayne is obsessed with cutting out corn fields and putting in cookie-cutter suburban McMansions. Just because the "free market" is content with doing the same thing over and over again doesn't mean it's the best choice.

Hardball Capital is putting up the money for the retail and condominiums. They believe the rewards justify the risks. Isn't this "market driven"? It didn't take an RFP to bring them here, the market did.

Anonymous said...

I can shed light on Midtowne as I have owned condos there for 16 years, lived there for 6 and have served on the board. Midtowne is 100% sold. Yes, some of the units are renter occupied but so are many suburban homes! Midtowne took a couple of years to take off because it was a stand alone project and the region was in the middle of a recession then (1990-1992).

Anonymous said...

Anonymous who owns & lives in Midtowne - If Midtown is such a great success, why are 90 % of the first floor "retail" spaces empty?
The people that live there prefer to shop in Jefferson Pointe & elsewhere? John B. Kalb

Anonymous said...

90% of the first floor space at Midtowne is vacant? Really? Catalyst Marketing, Allen County Bar Association, Downtown Cards & Gifts, Roebel Law Office, Midtowne Professional Center, Higher Grounds, and Double Dragon beg to differ!!! There is only ONE vacant commercial unit (on Washington Blvd.) in Midtowne, and I believe it was recently purchased by Catalyst. While the current occupants might not all be retail in nature, the property owners have invested substantial dollars to purchase and renovate the properties. As more people visit and live downtown, the commercial properties will become more attractive as retail/restaurant space.

The April 29 Journal Gazette article http://www.fortwayne.com/mld/journalgazette/business/17153704.htm) shows there is interest in downtown living. If no one wants to live downtown, how do you explain greater demand for the Midtowne's residential units (more of which are becoming owner occupied), the interest in three bedroom units (Midtowne only has one and two bedroom units) and the amazing rise in Three Rivers' occupancy from 60% to 94% in one year?

Anonymous said...

There is more interest in Midtowne because the condos are outright cheap and speculators are banking on further appreciation due to H.S.

If Harball Capital is "putting up all the money" build 60 high cost spec condos downtown, then all power to them. Or will they be seeking a construction loan from a lender who will tell them "no" not until you have the project pre-sold to some extent and to personally guaranty the loan. Then Hardball can save face and scrap the condo project and blame it on "conservative lenders", and happy that they got what they wanted, a $40MM new stadium for $5MM.

Anonymous said...

Some of the increased interest in Midtowne very likely is due to speculators willing to bet the prices go up. But that still doesn't explain the increase in owner occupied units (it's reasonable to expect speculators to rent out rather than occupy units) or the 50% increase in Three Rivers Apartments occupancy.

Anonymous said...

Maybe you should buy one of the new condos.

Anonymous said...

Maybe the big increase in rented units at Three Rivers is due to upgrades? Or higher interest rates for home loans? What's average monthly rental rate? What will be the average monthly mortgage payment or monthly rent at H.S.?

Anonymous said...

Anonymous - I posted that the ground floor store-fronts in Midtowne were EMPTY not unoccupied. Take a good look as you go by on your way to Glenbrook or Jefferson Pointe. John B. Kalb

Anonymous said...

Although the first floor of Midtowne looks empty, there are people conducting business in each space (except the very small unoccupied space along Washington blvd) every business day. Like the Grand Wayne center, just because you don't see activity as you drive by doesn't mean it's not occuring.