Will the City of Sioux Falls & Lincoln County work together to get the 85th Interchange completed sooner rather than later?

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As I told a couple of journalists the other night, I could give a flying monkey circus whether the project gets done or not in 2016. We need another retail park area in the Sioux Falls like we need (figurative) holes in our heads.

But there are some hurdles.

The benefits of the city annexing this land with the project proponent’s timeline could mean millions in sales tax revenue. The bad part is we have to pay for the infrastructure upgrades. A city official said to me the other day;

“So does the state want Sioux Falls to build infrastructure at the new proposed Foundation Park or at this project?”

He made the assumption that the city doesn’t have the money to do both projects at once and that is why the timeline for annexation was extended by the city. I guess that is understandable, but I am a bit skeptical, especially when you have Erica Beck from the Lloyd Companies stating that the 2018 timeline change to 2020 literally in a couple of days. Makes you wonder?

There is also a deep distrust of another CID in South Dakota. Dakota Dunes has been nothing but a pain in the ass of state and federal taxpayers. A bunch rich folk tax dodgers set up a community on a river bottom that is infamous for flooding . . . A LOT! Then they come running to the taxpayers and the National Guard to bail their asses out. I guess they want all the benefits of being a responsible taxpayer, they just don’t want to pay for it. I still think that FEMA and the National Guard should have sent them all a bill.

This brings us to a similar issue at this location. Though the environmental studies still have to be conducted, the same city official I talked to said there may be issues with ground water and low lying land. Which can be solved – WITH A LOT OF FREAKING DIRT!

Now let’s talk about the ‘political’ aspects of the project. First off, we know the GOED office and The Mayor’s office are not exactly a ‘winning team’. After Foundation Park was announced a different city official said to me;

“Foundation Park is getting done IN SPITE of Mayor Huether”

In other words, the state really had to reign him in, or basically leave him out of the process. Don’t know how much of that is true, because I find city and state officials bickering to be useless pitter patter, but if you are expecting the state, the county and the city to get all on the same page and timeline on this matter, well, you are a dreamer. But hey, isn’t our Mayor’s motto, “Sioux Falls, we are getting things done!” (as long as I can take credit for it).

Then there is the developer side of this story. They could care less who gets credit as long as they are rolling in the dough, the problem is, there are more than one big wheel in town, and a couple of those wheels were NOT at the meeting on Tuesday. Of course the Big ‘L’ made an appearance, but I didn’t see anyone from Bender or RMB. Maybe they were helping the proposed Southside move dirt or something. It is no secret that some people in power with the city have made investments with some of these big wheels, and it seems some of these projects get on a fast track quicker than others. Quinky-Dink? Perhaps, but I wouldn’t bet on it.

So there you have it, questionable land, questionable funding, questionable politicians and developers and all kinds of ethical and priority issues. If this gets done by the end of 2016 (as a county/city partnership) it will be nothing short of a miracle, but hey stranger things have happened, we got a new Events Center built in record timing (just watch for the falling siding).

85th & I-29 Interchange presentation

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Watch all the fun HERE, and my rough PDF document of the slides: 85thex-1-29

It seems a lot of fun stuff came from this, including an ever changing timeline by the city (jumped from 2016, to 2018 to 2020 city participation timeline in 2 short years).

I also seem to think this is kind of strange we would be passing up sales tax revenue by not deciding to annex this until 2020. Can you imagine having several big box stores in an area where no municipal sales taxes apply? So when you go buy a $3000 television you only pay the state’s 4 pennies instead of the city’s 6 pennies? Why would the city pass on this opportunity?

I will tell you why. Pissing matches between developers and those who butter our mayor’s bread. There was a laundry list of big wigs in government and development in the crowd today, guess who was missing? Michael Bender and Michael Huether . . . . Hmmm.

Why is our local newspaper endorsing a TIF?

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How does that old saying go about ‘Fair and Balanced’ reporting? The Argus Leader Editorial Board and columnist Jodi Schwan both have endorsed using a TIF for the Washington Square project, something I would expect out of Stormland TV news (who is always sucking up to city subsidized projects) but I found it to be a little strange for our local newspaper.

Then there is the tired old argument that TIF’s are needed for any of these projects to succeed;

But it all comes down to public-private partnerships.

“They’re not important. They’re absolute. They’re critical. You can’t do it without them,” he said. “If you’re setting out to do something transformational for your city, it’s impossible to do it with only private money. You need at least a third of the money … to come from the public sector.”

Let’s think about that. The Houwmans are looking for less than 15 percent of their financing from TIF with no other public funding. Stark is saying one-third is justifiable.

While I am all out opposed to TIF’s, especially when big developers make ridiculous statements about them being the lifeblood of redevelopment, let’s say for a moment I supported them. I think a TIF would be fine for the utility work and cleaning up the alley between Main and Phillips Avenue, but 15% of the total cost? I don’t think so. There seems to be this movement by developers (and investors) in Sioux Falls (who have already seen record growth over the past several years) to feed at government’s trough. While a TIF is certainly not a handout, it is a rebate on property taxes (and they are requesting the rebate for 10 years). While the County struggles to make ends meet (they are considering another opt-out) we want to give another private development millions in tax rebates.

Worst of all, they have suckered our local paper into believing that somehow we need more parking in that area (that can only be used at night and weekends).

I think this project should sink or swim on it’s own. No pulling strings behind closed doors in City Hall or at our local paper. If we really want Downtown to be successful in development we need a stronger concerted effort of helping private homeowners and apartment owners surrounding downtown with fixing streets, infrastructure and community development grants and loans. Neighborhoods and districts are built by individuals helping each other. A couple more condos at 12th & Main in no way should be funded partially through property tax rebates, and shame on the Argus for getting in the middle of the fight that is between the developers and our local government.

UPDATE on the Phillips/Banks project

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Besides the hilarity of the bossom buddies screwing up another press conference and making announcements before final deals have been cut . . .

“There’s no deal,” Haugo said Wednesday from his home in Arizona. “No money has been exchanged and there’s no signed agreement. This was a case of the mayor and (development director) Darrin Smith overdriving their mouths.”

Well that mayor’s mouth has been on overdrive ever since he decided to run for mayor, I’m pretty sure it runs off a Hemi 440. His mouth was certainly in overdrive Tuesday night when he decided to get up from his chair and chew Kenny Anderson’s ass for not ‘controlling’ the city council discussion at the meeting, but you won’t see that tidbit on SIRE since somehow it mysteriously got edited from the video. Rex Rolfing likes to remind people to remove their hats during public testimony because of ‘decorum’. If we want real decorum at our council meetings maybe we should remove the mayor?

I digress.

Back to the $40 million dollar project that may or may not happen. I asked a committee member with the RFP the other day what proposals are being thrown out there (and these are very, very preliminary)

-The project would request $10 million from the city (taxpayers) to build the ramp. The city would own the ramp, and lease space to the hotel and apartment dwellers.

-The project may also be asking for a TIF.

I say one or the other, but not both. I like the idea that the city would own the ramp, but with such a large project ($40 million total) I don’t like the use of a TIF. I would want the remaining $30 million in private investment to be paying the FULL property taxes when the project is completed so that we can recoup our parking ramp expense. I would also be willing to throw in FREE use of the landfill if the other buildings need to be demolished.

I don’t thinking building a ‘boutique’ hotel is a wise choice of TIF money, and since the city would be ponying up $10 million already, I think the gift giving should end there.

What will the downtown Sioux Falls ‘Banks’ project cost taxpayers?

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While the media and the city have been busy showing us pretty pictures of the project, there are still a lot of unanswered questions.

What we do know is that the project is projected to cost around $40 million, it will have 600 public parking spaces, it will have a partially public rooftop park and it will require demolition of a few buildings to construct.

Questions,

-What kind of reimbursement will the city receive for the façade it paid for in 2007 for the building that is being demolished?

-How much money will taxpayers be putting towards the project? Will it be a loan, a TIF or a one-time payment (rumored number is $10 million)? Where will the money come from? Reserves? Bonds?

-If we are giving 25% towards the funding of the project, will the city actually OWN 25% of the building (for instance, the parking ramp portion)

-How will property taxes be assessed if we own a portion of the building? Or will we lease? And if we are leasing, why would we help fund the project?

-What is the real economic impact of the project? Besides the few hundred temp jobs it will provide in construction, how many permanent jobs? Or mostly low-paying hospitality part-time jobs?

Too often we find the ‘Devil is in the Details’. Remember the supposed $4 million dollar TIF Dunham requested for the COSTCO project that quickly got reduced after all the facts came out? If we move forward on this project like our fine mayor, planning department and community development departments usually do in a non-transparent manner – the taxpayers of the city may be getting the shaft at the end of the day.

I encourage the city council to study the options closely, and make sure the taxpayers of this town are not once again handing out money and tax breaks like candy to the developer welfare class of our community.