I thought one of the reasons we gave Warren Buffet $27 million was to build a new switchyard and storage outside of town, but that hasn’t stopped the RR from storing cars in downtown. I took these pictures of more than 30 cars (including petroleum) around 13th and Cliff and more cars going North and South over the bike trail bridge.
We have spent $27 Million of Federal taxpayers money to move train storage and switching out of downtown, but it hasn’t happened. The RR redevelopment was negotiated very poorly, just like the downtown parking ramp. The taxpayers got stiffed.
As predicted the parking ramp passed by 6 votes tonight. Stehly voted NO and Pat Starr abstained by saying ‘Present’ during the vote. Which put the Mayor in a tizzy. It was determined by the city clerk and city attorney that he could not abstain unless he left the room before the vote. So Starr walked out. Council chair Kiley went out after him but Starr refused to return until all the items were voted on concerning the ramp. The mayor, of course, took the opportunity to shame Starr for not playing the reindeer games. I applaud Starr for taking a stand and not participating in this fiasco. In fact several of us clapped during the meeting.
Starr I believe was frustrated because the mayor cut off public testimony after an hour in which Starr asked for more time and the mayor denied it.
The discussion was actually very interesting, besides the President of DTSF and a pastry chef that owns a downtown business nobody else testifying thought it was a good idea. In fact a couple of the people even mentioned if the developer was paying more towards the project they would support it.
Three of us raised concerns about Legacy and the Hultgren construction connection. I said it was a liability. Stogeez and Eastwold Smokeshop owner Tim Kant said he is embrawled in a possible lawsuit against Legacy over his building being torn down and an attorney representing Emily Fodness warned about doing business with Legacy due to liabilities also.
Besides Stehly offering an amendment about the 2nd penny there was ZERO discussion from the rest of the council before voting on it.
This was a very shameful night by the council, they let a developer with a bad reputation take the taxpayers to the cleaners.
Sadly, I don’t think this is over. I have a feeling there will be repercussions for the city, which means we will all be paying for the very bad decision made tonight.
Questions not gaining any discussion in the new proposed Sioux Falls downtown parking ramp is who is paying for the foundation, why and how much. The construction of any building requires a foundation to anchor it to the ground. The much touted 2014 Walker Parking Study reported a parking ramp in downtown on the very same “fractured” quartzite stone would cost about $9 million. Why does this building all of a sudden have fractured stone problems?
According to city parking staff and studies, parking ramps have a 50 year life. What will happen to this ramp in 50 years with an 80 year building lease on top of it?Â
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How do we pay for upkeep when our reserve funds are all used up? We will be using all our reserve funds to build this ramp. The more we put our numbers together, the harder it is to see how it can pay for itself.
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A $1million dollars for 80 years lease? No inflation factoring? No future value of money put into a formula? Using history (I know dangerous) as a guide, $1,000,000.00 in 1937 had the same buying power as $17,245,142.86 in 2017, the annual inflation over this period was about 3.62%. An example from savings.org tells us a conservative inflation rate of 3% over the next 80 years would be $10,640,890.56.
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What’s a million bucks going to be worth in 2097? We know our mayor’s version of bucks is not likely to be the same as ours but we must consider real money and not the funny money of a subprime credit card salesman.Â
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What will the future residents of Sioux Falls accuse us of when the lease ends? How are these residents suppose to fund the implosion of this building when the lease ends? Why is there no discussion of this in the grand plans for the parking ramp? Every longterm rental agreement has inflation adjustments and site cleanup, why not this one?
So many questions and no consistent answers. The story changes every time there is another question not fitting the city narrative.
Of course this is no surprise the Chamber supports corporate welfare and handouts, and has to attack the detractors on the council and from the public;
It remains clear that Councilor Stehly is adamantly opposed to this public-private development and Councilor Starr has some critical observations as well. While we will not predict the final vote, most councilors seem to view this project and the public-private aspect as an outstanding opportunity to achieve two goals – more public parking and a significant private investment in downtown. Further, they view it as consistent with the 2025 Downtown Development Plan.
As a rhetorical strategy in this political debate, some who oppose the project predict an incredible backlash against the city if the project is approved. They maintain lots of people are talking to them against the project. Proponents say they are hearing the opposite and their contacts and conversations are much more supportive of the possibility of leveraging a public investment with a private development to improve downtown in a manner consistent with the Downtown Plan.
First off, I do NOT oppose DT parking expansion, and I also do NOT have an issue with a private/public partnership. The issues are clear; Cost and Investors.
The cost is clearly TOO high when you compare to other similar projects across the country and if you read our own consultant’s report.
The investors are a secret.
It is also true many in the community are mad and more so puzzled by the high cost of the project. Proponents are obviously not listening to the public just the rich talking heads in town that salivate over corporate welfare and handouts.
This was from a March 24, 2017 presentation Dan Letellier did at Democratic Forum (FF: 26:00 in the below video).
Notice they are getting 1,100 parking stalls for about $20-22,000 per stall. The Downtown parking ramp is proposing 525 stalls (over a 100 will be leased privately and not for public use) for $40,500 per stall.
Now if the DT ramp’s cost was even just a little bit more, I wouldn’t balk, but the proposed DT ramp is TWICE as much per stall than the airport.
As I have said, industry standard for building parking ramps is about $25,000 per stall. When this high cost for the stalls was brought up to the Community Development manager Daren Ketchum yesterday, he blew it off and said that he wasn’t concerned about the ‘stall’ cost. WHAT!?
It is pretty common in the parking ramp construction business to price parking ramps per stall. That’s just how it is done. Secondly the airport ramp is a very fair comparison because both ramps are being built on land that is already owned by the builder and the airport authority will be paying down the bonds using user fees. It is apples to apples.
Where this deal gets even more curious is that the developer of the hotel will be paying a one-time 80 year lease to the city of $1 million. This comes to about $1,042 per month for a 120 room, 13 story hotel. You can’t get a decent downtown loft for $1,000 a month.
So why so much? Well let’s start with the obvious. This is a taxpayer subsidized welfare to a developer, and mind you, a developer who was involved with the Copper Lounge collapse, which OSHA is still pending their investigation.
So why an extra $10 million to build this parking ramp compared to the airport ramp? Besides the obvious welfare, I speculate, it is because the ramp is on the bottom of the structure and will have to be extra reinforced to support the PRIVATE hotel construction. In other words we are subsidizing the hotel construction by $10 million.
I support downtown growth and a parking ramp. I do NOT support getting hosed by a private developer. The city needs to build this ramp for $10 million or build a ramp twice the size at a different location.
