Dayton tax dollars being donated to the rich

The Talbott Tower is owned by Allan Rinzler. He’s not exactly hurting for cash- he can afford to donate enough money to have a sports complex named after himself at Wright State. The Talbott tower is one of the higher occupancy towers left in downtown- in fact, I remember Mr. Rinzler telling me it’s one of the only ones to not go into bankruptcy/foreclosure.

And this is probably one of the reasons why:

The corporate headquarters for YMCA of Greater Dayton is moving to an office building across the street in downtown Dayton.

The YMCA is finalizing a lease at the Talbott Tower for 9,000 square feet for its corporate headquarters. The organization’s headquarters are currently in an 8,000-square-foot space in the 111 W. 1st St. building across the street. The deal will keep the group’s 30 employees, with a total payroll of $1.25 million, in downtown. Those employees will continue to support downtown retailers, and pay Dayton income taxes.

“We were presented with a great opportunity and we’re excited to go over to the Talbott Tower,” said Dale Brunner, president and CEO. “We’re excited to sign it and stay part of the downtown area.”

The city of Dayton on Wednesday morning approved a $75,000 neighborhood grant to help the Talbott Tower fund about $150,000 worth of renovations in the new space, in order to keep the YMCA in downtown. That decision reflects the fact that nonprofits are now among the most dynamic office users in downtown, and the most sought after by office tower landlords looking to fill their vacancies.

Bob Grabringer, property manager for the tower, will act as the construction manager and will hire subcontractors with whom he already has a relationship.

Source: Dayton YMCA to move HQ into Talbott Tower – Dayton Business Journal

That’s $75K of your money- enough to pay a cop or two for a year, or mow an awful lot of empty lots- or tear down a few abandoned homes. If you were the owner of the building across the street that the Y was moving away from- you could use that money to try to keep the Y in your building, but that’s not how it works in Dayton. We take care of those who take care of those who run for office.

This isn’t the first time Rinzler has been on the receiving end of a good taxpayerfunded deal- he was one of the partners that owned the old Sears building downtown, along with the Feldmans (our former county administrators family), Mr. Sandy Mendelson, Mr. Jason Liff and Irvin Moskowitz all got a nice bit of action to make sure that the county could put a fountain on a tiny bit of that parcel. Bought for $200K and sold for over $8 million.

There are lots of other developers who have gotten support from the city- and still ended up in bankruptcy. Your tax dollars contributed to the Arcade, the Arcade Tower, the former CitFed, 5/3rd bank and now Premier Health Tower, all of which failed.

Don’t you wonder if all the money that’s been squandered on “economic development” had been spent on cleaning and repairing streets, safety forces, better schools, parks- and getting out of the way of developers- we might never have taken a dive. Or if we hadn’t raised our income tax over that of every other community- since it was collected from non-residents- who have now all voted with theit feet to the mecca of tax-free income (if you are a white collar employee only) at Austin Landing.

Tax dollars that are spent in pursuit of tax dollars are dollars a lot like a certain cartoon character who used to say, “I’ll gladly pay you Tuesday for a hamburger today”- but, Tuesday never seems to come to Dayton.

Dayton makes another mess of “economic development”

Eric Segalewitz isn’t a bad guy. In fact, he’s a good guy, who invested a lot of his money, time and labor buying almost the entire block of houses across from the former DMHA shithole Cliburn Manor. He did this without any assistance from the city, CityWide or anyone else. Most people thought he was crazy- why would you want to invest or live across from a drug infested, crime den public housing project?

He did it- because he had the foresight to know that eventually Miami Valley Hospital and UD would surgically remove the neighborhood cancer- and then his real estate would be valuable.

He’s not the only one who had some vision of profiting from their grand plans. Jimmy Brandeis of Jimmie’s Ladder 11 held out for his sweetheart deal to move Jimmie’s Cornerstone across the street, with a parking lot, a huge patio, and double the space.

Fred Allen, a local slumlord, sold two of his shit-hole houses for $150K each, way above market value.

There are still a few holdouts- the antique store at Oak and Warren, which was at one time owned by South Park Social Capital won’t sell out. Neither will the Krafts who own the last two remaining homes on Warren’s West side.

Some people think Segalewitz is trying to fleece the city for their incompetence. But, if we look at the cast of characters revealed in today’s Dayton Daily news article- it’s the same incompetent crew that’s driven the cart off the road before with impunity:

Aaron Sorrell, Dayton’s director of planning and community development, admitted the city erred but questioned Segalewitz’s legal right to the land.

He said the city has no plan to fork over a big payout for administrative oversight.

“We’re not going to unduly enrich somebody for a mistake,” he said.Segalewitz, 50, who owns the company Upscale Realty, a few years ago applied to purchase a vacant lot next to his home at 32 Alberta St.

Segalewitz applied for the land through Dayton’s Lot Links program, which allows people to buy abandoned, tax-delinquent properties for a relatively small fee.

Segalewitz’s request was approved, and he paid about $650 for the property, which was transferred in March 2012.

The lot belonged to the city of Dayton, which had purchased it from Greater Dayton Premier Management in December 2011, as part of a larger land deal.

The city acquired the side lot and 5 acres across Alberta Street for about $340,000, or its appraised value, city officials said. The two parcels were part of the same deed.

The five acres was the former site of the Cliburn Manor housing projects, which were demolished in 2008. The city wanted the land to support redevelopment efforts near South Park and Miami Valley Hospital.

But when the deed was written to transfer the vacant lot to Upscale Realty, it also unintentionally contained the Cliburn real estate, Sorrell said.“We made a mistake with the deed and inadvertently put both pieces of property on the deed, and not just the one he wanted,” Sorrell said.

The quit claim deed was signed on Feb. 27, 2012, by Assistant City Manager Shelley Dickstein and Assistant City Attorney Jonathan Croft.

Segalewitz said he only learned he owned the deed to the Cliburn property about six weeks ago while preparing to sell his Alberta Street home and the adjoining lot.

Source: City redevelopment tract mistakenly sold

Sorrell was the one who also said “Oops” when Rauch Demolition mistakenly tore down the back part of the historic Cox building at Fourth and Ludlow. He’s also the one who signed off on tearing down the Schwind building for the “Student Suites” deal which isn’t happening due to a deed restriction that was well known.

Shelly Dickstein was the braintrust in charge of the development deal for the Wayne Avenue Kroger where the city jumped through hoops for over 4 years- with no contract in place, which was well documented on this site. The city had no problem paying over $800K for the burned out Ecki building and then demolishing it to make an empty lot, despite the building being an eyesore and owing taxes.

The real question is why does the city insist on buying real estate at all? Why did they spend over $100,000 long ago to buy the lot now known as Garden Station? Why did they buy the building behind it (which I did a FOIA request on – and got no answer). Why did they buy the old Supply One building and 601 E. Third for $450K each?

And the “We’re not going to unduly enrich somebody for a mistake,” line sure is funny. Go back to when a group including the family of the former County Administrator Deb Feldman purchased the Sears building downtown for a mere $200K. When the Riverscape fountain plan was released, the County hadn’t secured the tiny outlot attached to the Sears property. In a battle of testosterone and threats of using eminent domain, the price escalated from the initial offer of $3.2 million to over $8 million for that piece of land. Segalewitz just isn’t related to the right people apparently.

The fact that Segalewitz didn’t get a tax bill for his windfall- is because CityWide and MVH don’t pay taxes- nor does the city. And the city will grant a sweetheart tax break to Oberer/Greater Dayton Construction for building whatever they come up with on the property. Segalewitz is one of the little people- he’s expected to pay taxes unlike the connected few.

It’s time to do a full investigation of city land purchases, real estate investment, and money to CityWide development. A full detailing of the investment in Tech Town and the “Entrepreneurs Center”- and the actual returns might be a good starting point.

While we don’t have money to cut the grass in City parks, but do have the money to buy swath’s of land for our friends is a criminal diversion of tax dollars. Segalewitz is not the bad guy. The bad guys are on our payroll.

 

Uh, no. You still don’t get “economic development” Dayton

Earth to dumbasses the geniuses on the Dayton City Commission, sorry, too little too late.

Sure, your brilliant idea to turn the temporary tax hike into a permanent one seemed like such a brilliant idea- as you watch the last of your victims of taxation without representation move to the tax-free haven of 2nd story jobs at Austin Landing (only the little people on the first floor pay income taxes there).

It wasn’t just the 2.25% income tax, or the fact that they have to pay to park, but, then you had to add a Special Improvement Tax to pay for the “Downtown Dayton Partnership” which hires a Kentucky company to do what building owners used to do for themselves, and cities used to do as part of the general tax. Oh, yes, and then there was the issue of the kids running the streets- during “Urban Fights” – I mean, “Urban Nights” and the general issues around the bus hub. Oh, and, the fact that you let the feds shut down almost every downtown exit on 75 for years- forcing detours and slowdowns to get to downtown- while Austin Landing has that ridonkulously overpriced new exit. You know- the one you tacitly approved of in your “partnership” with ED/GE- another tax funded slush fund that takes hard-working taxpayers’ money and gives it to private corporations- or “invests it” to help out the rich and powerful.

Here’s the “story” from the Dayton Daily news:

While residential real estate in downtown Dayton booms, there is a different tale with commercial development, as entire high-rises remain vacant and workers continue an exodus to suburban office plazas.

Now, after years of losing downtown jobs, the city of Dayton has a new strategy for fighting back.

The Dayton City Commission last week approved a sweeping change to its existing ordinances on property tax breaks in the downtown district that — for the first time — will make incentives available to proposed commercial/office and industrial developments. Those breaks could be 25 percent or higher.

The city will negotiate the breaks with the developer along with the Dayton School Board, which must be consulted by law. The breaks will be allowed in other Community Reinvestment Act areas in the city as well….

Said Mayor Nan Whaley: “We need these tools to be aggressive in attracting business to downtown.”…

Also part of the city’s changes:

Source: New strategy: Commercial developers to get tax breaks

How about this instead:

  • Stop all tax dollar incentive for private businesses that aren’t available universally for job creation- i.e., no single company benefits. Either you meet the payroll criteria or not. This would be countywide.
  • Eliminate all tax-free zones in the county. Flatten the income tax rate to 1.5% on all wages above $24,000 per year per person. Distribute it to each jurisdiction based on numbers of people according to the latest census. No more overhead for small business in trying to figure out payroll per employee per location worked per tax rate.
  • Eliminate any tax support for outside organizations involved with “economic development” forcing all tax dollars to go to actual public services. End support of CityWide Development, The Downtown Dayton Partnership, ED/GE, the Dayton Development Coalition, the I-75 whatever you call it, and even MVRPC. Tax dollars go to projects for taxpayers- cut out middlemen, cut out slush funds, and eliminate overhead.
  • Put a moratorium on new construction unless you buy and demolish an equal number of units/square feet in the county. Get double construction credit for rehab/restore/repurpose of any structure over 50 years old.
  • Until we’re back to pumping at 80% capacity- give away water to large business users in exchange for jobs and investment. The costs of flooding basements is higher.
  • Grant tax breaks for people who work downtown and live downtown to eliminate parking problems. Grant them a break on the first $50,000 of income.

That’s how you can begin to address your problems. Cutting funding for schools is the absolute LAST thing Dayton needs to do right now, that is if you don’t want to see an exodus of the last remaining victims of your bad stewardship of Dayton and its resources for the last 50 years.

 

Slush fund, Architect and Developer: the three ring circus of public/private partnerships

The very first slide started with an oops, another oops, and another oops.

Up steps Steve Budd of CityWide Development (the slush fund) with a slide of the holdings of CityWide, Miami Valley Hospital and maybe even the University of Dayton between 35 and Wyoming Street along the Brown/Warren corridor. And, no, we won’t mention the words we used to call this development (Mid-Park) because we know it ticks off the people we’re talking to (South Park) about our little circus.

The map with the yellow line was showing “all the property we own” except for the little antique shop at Oak and Warren according to Mr. Budd. Except he quickly was asked if he owned Jimmie’s Ladder 11, Spin City- and oh yeah, the two houses that are left on the West side of Warren- where the powers that be haven’t made an offer with enough commas in it yet.

Aerial view of Warren Street

The “owned” area in yellow- the red, added by me, is the stuff that’s not owned by the developers including Spin City, Jimmie’s Ladder 11, the Antique Shop and the two houses on the west side of Warren

I’ve marked the known “not owned” in red- inside the yellow border of “owned” for clarification. No mention was made of the fact the city had “misdeeded” some of the real estate in question in a lot links deal- and someone may be holding out for another pretty paycheck.

Why they were talking to the neighborhood at all is a really good question. At no point have they come to us, the neighborhood, and actually asked what we want- just what we want to see as tenants in their grand building plans- you know, the norm- a grocery store, a hardware store, a book store…

The parcel in question came into their hands when DMHA/GDPM gave up on their “projects” off Warren which were part of the 60’s 70’s “urban renewal” programs- where they tore down perfectly good housing stock that had lost its luster and replaced it with crap construction of ugly buildings dropped out of the sky into our ‘hood. The promise then was that it was going to be “senior housing” – the only thing senior about it, “Cliburn Manor,”  when I moved into South Park in 1986 was it looked like it was near death.

So the slush fund has to make sure they have another success story in the portfolio of mismanaged tax-dollar aided projects, and is bequeathed the federal property to manage. They seek out a developer, who is willing to take a “great risk” building something in the city of Dayton- so they promise to make them whole, no matter how silly the project scope and scale is.

In this case, the developer is Oberer. The same people who did the funky deal on the Dille Farm, where they built a Costco in Centerville, but expect ambulances from Sugarcreek Township- as once again, government had inserted itself unnaturally in the middle of a real estate deal. They have hired, at considerable expense, some research firm to tell them that there is a market for the 200 plus units they’ve plotted and planned for the aforementioned area. Of course, they are going to do this deal with OPM (other people’s money) and are guaranteed by the taxpayer-funded slush fund that they won’t lose a dime- since we know we’ll make income tax go up while you build it- and who cares if anyone actually comes. They just have to “git ‘r done” and have something rise from the green space. Filling the space won’t even fall back on them. Look at how CityWide still hasn’t found a ground floor tenant for the old Elder Beerman/ReyReyTAC building downtown.

If you need an example of another project that was done like this, go study the history of One Arcade Tower/One Dayton Center/Fifth/Third Center– or whatever they call it at the corner of Third and Main. The one that wasn’t supposed to be built until 33% of it was leased- but, we ignored it and built it anyway…. and lost our butts.

In our third ring of the circus, we have the architect. While an equal player at this point- he’s really going to end up the ringmaster later, once construction begins, but for now, he’s just another part of the distraction engine that’s trying to divert attention from the fact that Dayton is looking at these new construction projects like the Cleveland Browns do when playing the Patriots- let’s keep throwing Hail Mary passes because we’ve already lost 8 of 12 and aren’t going anywhere.

The architect, in this case, Jason Sheets of Moda 4, is a super talented guy who makes cheap look chic, and clean and classy. The only problem is, we’ve already got a few examples up Brown Street that make anything look like an improvement- namely the horribly ugly and dysfunctional “University Place” that Miller Valentine built at the corner of Stewart and Brown- which still isn’t full- years later- and almost every restaurant has taken a year to build out- because of poor planning by the “architects” – and then the other Miller Valentine embarrassment- the heinously ugly mishmash finish Caldwell Street housing that replaced the irreplaceable Frank Z building on Brown. His role in this is to keep billing while everyone else argues about the plan.

Moda 4 just completed the Goodwill Building across from Coco’s- the one with the expansive parking lot- and the stark cold exterior. Not exactly a good match for eclectic South Park- but, we’re trying here.

We’ve already got a CityWide case study up in Fairgrounds- where the Genesis Project built a whole bunch of funky houses and row houses for “DINCS” and hospital employees and UD Profs- that was promised never to become student housing (they lied). Where roofs are leaking less than 10 years out, taxes are kicking in at the same time, and what was supposed to be full of homeowners- is now in flux.

As the homeowners filed out, wondering if what they’d been shown was anything like what will be built, one after another in the Goodwill parking lot- looked across the street at Marvin Gardens, which is owned by St. Mary Development Corp.- and thought- why can’t they build something that looks like that?

Marvin Garden Apartments on Warren Street

Marvin Gardens Apartments as seen from Goodwill parking lot

So as neighbors sat and looked at the presentation, with mouths agape, wondering what planet these people were from, they were serving their ultimate, yet, unrevealed role they will be used for in the future.

As the project sputters and spurts, the three-ring acts will be able to point at the neighbors and blame them for the delays, mistakes and failures that are to come, as the city shirks its responsibility to do what it’s supposed to- mainly sweep and repair streets, provide public services and safety forces and keep the lights on.

The only question that really needs to be answered is why the property wasn’t just sold off to the highest bidder and let them do as they please?
In the end, the results will probably be about the same.

 

Kettering resorting to corporate welfare

End Corporate WelfareIf I didn’t have an important neighborhood meeting on Tuesday, May 26, I’d be at the Kettering Council meeting asking them to vote no on this corporate welfare scheme:

The city of Kettering will contribute a record $3.6 million incentive to Kettering Health Network for its new $49 million cancer facility.

The cancer center will add 80 new jobs to the existing 3,600 Kettering Health Network jobs now in the area, said Kettering Economic Development Manager Gregg Gorsuch.

“The reasoning behind the incentive is to ensure Kettering Medical Center continues to grow and thrive in the community. They are the largest employer and revenue producer, and we want to make sure they stay in the city of Kettering and this continues to be their flagship operation,” Gorsuch said.

Source: City giving to cancer center

I’d also be calling for Gorsuch to go.

Take his salary, hire a better ice rink manager. Spend some money on advertising the ice rink properly. Invest in something that makes Kettering a better place to be- don’t buy future tax revenue.

On paper this sounds great- spend a little to make a lot- except it’s inherently unfair. The same opportunity isn’t given to every business in Kettering- and the ones who don’t pay their CEO over a million a year are probably in greater need than KHN.

The fear factor of KHN taking this building elsewhere is exactly what will happen eventually if the city keeps doing these kinds of deals. Once you open the floodgates- soon you’ll be like Dayton and have forgotten how to plow the streets, or pay your cops and teachers.

This is the redistribution of wealth- pure and simple. Those tax dollars that you are fronting to KHN were earned by people working minimum wage jobs and they deserve to get the best possible government back with them- not to help rich corporations get a break.

Kettering shouldn’t go down this rabbit hole. Just say no to corporate extortion and focus on what makes Kettering a great community.

This isn’t economic development- it’s criminal.

El Rancho Grande opens- a year late

There is a story here. I don’t know what it is.
I’m sure there is one pissed off small business owner.

El Rancho Grande is now open at the corner of Stewart and Brown Street. I wish them the best of luck. How a business can make it after paying rent for a year without a single dollar coming is a monumental achievement.

An investigation should be led by city leadership how our permitting process went wrong- and how did we let a building get built that somehow can’t get businesses open faster. This is not the first business in this building to be delayed- Shish Wraps, Fusian, Cassano’s all had delays.

Once again- congrats to El Rancho Grande for making it through the maze of codes and rules and hoops and smoke and mirrors that Dayton seems to put in the way of every small business.

Confessions of a rink rat

This was published today in the Dayton Daily News, responding to an earlier article where Kettering Council is deciding the fate of the Kettering Ice Arena. They’ve hired a consultant, to help decide whether to invest more money in the rink- or possibly change it’s use and eliminate the ice.

After school and Friday nights, Sunday afternoons, I spent on skates going round and round the ice rink.

There were pretty girls in figure skates twirling around in the center, and the hockey jocks showing off their wheels before the guards cautioned them to slow down. We all disliked Frank, the rink manager, who insisted on playing waltzes during public sessions off the big reel-to-reel tapes, complete with announcements of reverse skate, couples skate, and ladies choice.

It was at the rink that I made many of the longest lasting friendships. Some of them surviving 40-plus years and hundreds of miles. I watch on Facebook as little Wendy Grace had her own sons playing hockey at the very same rink. Thurmond, who was a rink guard and the driver of the green AMC Hornet that we had so many adventures in, had his son live with me for a while as a UD sophomore.

And then there was hockey, the sport that I’m still playing at 52 in an over-30 league called “Huff-n-Puff” at the Kettering Rec Center. It’s no checking, but not without contact. We’ve got Charlie who flies all over the world for his work with UD, still playing at close to 70. His wife comes to watch every game in his raggedy Toyota with the NY Rangers bumper stickers. For a long time Bob P. was playing. He stopped at 73 to focus more on riding his bicycle. Some of the guys who were in their forties had called him coach when they were 15. There’s Bob M., who’s the skipper of the Dayton Dragons — we’ve let his kid play with us, despite Mike being way too fast for any of us to catch and being well under the age limit — starting at about 16 — so father and son could play together. This year a full-bird Colonel joined us — with her pony-tail, M.D., and a license to fly an A-10- but don’t call her ma’am on the ice.

If you realize that guys drive in to play at 10 p.m. on Thursday nights from as far away as Springfield, Troy, Springboro — and most of these guys have been playing in the league for years — you understand what a special place the Kettering Ice Arena is.

Now we hear that there is discussion about its future. The options: to repurpose the space for something else, to reinvest in the current rink, and even possibly double down by adding a second rink with seating enough to hold minor league hockey games.

A “consultant” has been hired to provide the options so the powers that be can decide the fate of this community amenity.

Arguments that less than 15 percent of Kettering’s residents use the rink ring hollow to me. The same could be said about libraries, public schools, swimming pools, skateboard parks, BMX tracks, soccer fields and the Fraze Pavilion, give or take a few percentage points. The fact that Kettering makes an effort to provide such a wide variety of things to bring people together is what makes it what I consider the best run, most forward thinking community in the county. I’ve often said if Kettering was in the center and the largest community in the county, regionalism would have happened long ago.

As to the rink losing money and being poorly run, what price do you put on keeping kids off the streets in a safe and healthy environment? And, even though I didn’t like the way old Frank ran my rink growing up — there was a lot to be said for reverse skate, and couples skates — he knew more than I gave him credit, even if his taste in music sucked.

That KRC is the only publicly owned rink in Montgomery County makes Kettering a place people want live in and to visit. Wonder what happens when a city loses that ability — look at Dayton where I live.

More than likely the consultant will come back with either shut it down, or double down. For Kettering’s sake, and for the sake of a bunch of old Huffing-and-Puffing hockey players, and for kids who may one day become Olympians — I hope that Kettering realizes what a gem they have.

David Esrati is a middle aged rink rat and mediocre hockey player.
Source: Confessions of a rink rat | www.mydaytondailynews.com

Note- there is another publicly owned rink in Montgomery County- the bastard Riverscape rink, that’s 3/4 size and useless for anything but curling, broomball and a very few public session skaters. That they didn’t build a full-size rink (after already upgrading from a half-size) was stupid. They don’t make 3/4 size Zamboni’s either.

I’ve gotten quite a few notes from people on this piece. The reality is, when the consultant comes back to advise Kettering, we’re going to have to look closely at the recommendations, and then mobilize forces if the answer isn’t to keep it.

There is only one person in the area that would benefit from closing it down- and that would be Randy Gunlock of Austin Landing fame. He has wanted to build a rink in the complex- and bring a minor league team to the region- but, he’s competing with KRC and South Metro Ice rink- right near his location. South Metro doesn’t hold a candle to KRC- and if KRC shut down, there would be a whole bunch of people looking for ice time somewhere in the area.

Hara Arena would also lose if KRC built a second sheet with 1000+ seats- as the Dayton Demonz would probably move. No one should think the Federal Hockey League is a very good investment, but, if the Demonz leave Hara, there wouldn’t be much left to justify keeping the ice going there. It’s really hard for private rinks to compete with publicly funded ones.

There had been plans to build an ice rink on the original Wright State master plan, but it never happened. The Bombers had to spend a ridiculous amount of money to get the ice into the Nutter Center- something that could have been taken care of for a lot less, had the original man behind the Nutter Center, Tom Oddy, listened to a freshman who visited his office on his second day on campus. I made a pitch to put ice in, or at least set it up for ice- for the future. Oddy said he’d just bring in portable ice- and that took the retrofit price from a few hundred thousand to a few million.

The best location for a new rink for Dayton would be at the Fairgrounds- or on UD land along Stewart. With a ton of college kids from the East Coast who already know how to skate- we could see more family friendly reasons to come eat on Brown St and then take in a game or go skating. Throw in a small Cineplex and Dayton might start to see a nexus of accessible family fun. Toss in an indoor skatepark and bike track, and lookout.

There is one other thing to consider- Dayton spent $23 million to build the stadium for the Dragons in the name of “Economic Development”- and very few Dayton kids have every played a game on that field of dreams. Ice rinks aren’t like that. When the pro’s aren’t playing, anyone else can go skate on the very same ice. If Kettering understood how many people came to Kettering- and got a positive feeling about their community just because of that facility- it’s all money well spent.

Why, besides the obvious reasons, is BradyWare moving to Austin Landing

The exodus of professional firms from Downtown Dayton to Austin Landing continues.

From the Dayton Business Journal:

The company currently has 55 employees in its 15,000-square-foot office. The move will be felt downtown — losing income tax and some of its daytime population — and at the Fifth Third building at 1 S. Main St. where BradyWare is among its longtime tenants.

Yet its relocation further solidifies Austin Landing as the new financial hub of the Dayton region, with other top local firms such as Merrill Lynch, Clark Schaefer Hackett and Wells Fargo. The location is said to be advantageous for firms looking to draw clients and employees from the Dayton area, as well as the Cincinnati region.

The city of Dayton will take a big hit in the lost income tax from all of the employees who live outside the city, many of whom stand to get a de facto 2.25 percent raise if they live in a township or city without an income tax. Unless the new office is on the first floor of a building in Austin Landing, employees are not subject to the income tax of the Joint Economic Development District at Austin Landing.

Source: BradyWare confirms plans to move from downtown Dayton to Austin Landing – Dayton Business Journal

However, the inside scoop is that apparently, BradyWare had set a meeting with Dayton Mayor Nan Whaley to discuss staying another five years, but she didn’t show up for the meeting. Of course, part of the problem is that we have a City Manager form of government, and this should have been something the City Manager was doing. Of course, it would have just resulted in one of those tax rebate deals- where in exchange for keeping X jobs in Dayton for X years paying at least X dollars- we’ll throw you back some money. A finger in the proverbial broken dam.

Throw in the cramped parking that costs in the basement of the old Cit Fed/5/3rd tower Arcade garage, and the lack of food options, why pay that Dayton payroll tax?

Note- the 1 Dayton Center/5/3rd building at the corner of 3rd and Main- was built with tax dollars, despite not being pre-leased at the level required, and the building has been a financial flop since day one.

The giant sucking sound of the illegal JEDD at Austin Landing continues as a tax haven for the white-collar “2nd floor” types. Only the “little people” on the ground floors of Austin Landing pay taxes, and it’s costing the City of Dayton dearly.

Unfortunately, the idiots the people of Dayton elected to the City Commission like to accept big donations from developers and their friends – and in the end, all the voters got was the best politicians money could buy, while the developers are laughing all the way to the bank.

Dreams of selling pot brownies out of City Hall’s building

The City of Dayton is the worst real estate speculator in the region. They also aren’t very honest about what “they” own (I say “they” because it’s the taxpayers that foot the bill). Recently there was an article about a building at 15 McDonough St. behind Garden Station that they owned and leased part of to Gosiger. I did a FOIA request on when the city purchased the building, for how much- and to see the copy of the lease with Gosiger and got nothing back. They are selling the building for “$10 to Bacon Street Properties LLC, which lists Gosiger’s headquarters at 108 McDonough St. as its mailing address” yet- somehow, “City Properties Group… (also) is involved in the project.” They are the ones from Louisville that have the old Supply One building next to Garden Station.

A long time ago, a local developer managed to get a printout on greenbar computer paper of the entire listing of city owned properties. With one property per line, the folded stack was several inches high. There was, and is, something fishy about that. But, on to other issues.

You may remember when a local entrepreneur tried to lease the old Chin’s, Elbo’s, Sa Bai from the city to have a Food truck kitchen, teaching facility, rental hall. Tonia Fish was paying rent, and then the city decided to kick her group of small businesses to the curb- which was part of a prior article on Esrati.com:

The Great Thanksgiving Day Food Truck Massacre

It started on Tuesday, when Tonia Fish told me that her temporary lease on the old Chin’s/Elbo’s/Sa-Bai space at 200 S. Jefferson St. may not be renewed. A meeting of some sort had been held in City Hall and the decision was coming. Mayor Leitzell had told me that in the executive session last week, where this matter was being discussed, Nan Whaley wasn’t prepared to vote on it and it was tabled. Had they had another illegal meeting of the commission to discuss this lease? There wasn’t an announced session- and since Executive sessions have to be done either as an emergency and announced- or gone into from a regularly scheduled meeting- what had happened?

via Explaining irrational behavior in Dayton, Ohio – Esrati.

The building sat vacant for over a year. Zero rent. Of course, no one in City Hall is going after Sa-bai for breaking their lease, or back rent.

Instead, we’re giving the space away, again:

Bethany and Aaron Horn, who own Cheeky Meat Pies, have agreed to a five-year lease with the city of Dayton for 200 S. Jefferson St.

The building will feature a breakfast and lunch establishment called Cheeky Cafe and Bakery, as well as a casual dining joint called Weeds Diner, likely featuring “farm fresh” food and alcohol, including craft beers.

“The cafe side will be more comfort food, and the Weeds side will be more seasonal based,” Bethany Horn said about the 5,786-square-foot South Jefferson Street property, located across from the Dayton Convention Center.

Sai-Bai closed in 2013 after accruing more than $60,000 in unpaid rent and taxes, which resulted in the city starting eviction proceedings….

Horn said the cafe should open around May, and the diner hopefully will open by August….

Under the terms of their contract with the city, Horn Food Enterprises will pay no rent through the end of this year, but will be required to pay $14,518 in rent and parking in 2016 (or $2.25 per square foot).

The Horns will pay $15,965 in rent and parking each year for the remainder of their five-year contract (equal to about $2.50 per square foot). They have a trio of renewal options to extend their lease for an additional five years.

Horn Food Enterprises are not being charged rent for the first nine months because the owners will make considerable improvements and renovations to the space, especially the kitchen, which will become the property of the city of Dayton, city officials said.

“If we wanted to make the space reasonably leasable or rentable, those would be expenses we would have to incur,” said Joe Parlette, Dayton’s director of recreation and youth services.

Parlette said the city in the last two years reviewed probably 15 business plans for the site, but the Horns’ proposal won out partly because they had capital and were ready to move forward.

Parlette said the new agreement means all of the city’s leasable space in that area is occupied. The city also owns property that is rented by ThinkTV, Gilly’s and Drake’s Gym.

“Anytime the city can avoid a vacancy downtown is a win for the city and its neighborhoods,” he said. “It will give citizens another unique option to enjoy downtown.”

via Two restaurants to open in downtown property | www.mydaytondailynews.com.

Why the director of Parks and Rec is doing property management is the first question. The second should be is why was the space no longer usable after SaBai left? Maybe because they took everything they put in, including the washroom sinks and left the city with a mess. No one is being held accountable for that.

And, considering Ms. Fish was in, and paying rent of $850 a month for a space that wasn’t “reasonably leasable” – the taxpayers went without 2 years of potential rent and tax revenue because, well, why?

The last laugh may be on the city, when it turns out the real business plan according to confidential sources is that the “Weeds Diner” is planning on selling marijuana edibles as soon as the laws allow it. That should just go over fantastically with the fine folks of Dayton. We already saw how fast Moraine backpedaled on their land lease to potential pot growers.

What we really have is questionable business practices by a government that can’t figure out how to plow snow, sweep streets, or get a cop to a Family Dollar while an assault is taking place in less than 10 minutes. Why our city is so focused on other people’s business instead of running their own is a major question.

When you realize these people at city hall spent at least $4 million to get a Kroger to Wayne Avenue and failed. They also tore down the Schwind, the Dayton Daily News and part of the historic back- for student housing that’s not coming thanks to a HUD deed restriction that they should have known about. The list goes on. Who in City Hall is qualified to review “15 business plans” and make this decision? The same one who spent $450K on 601 E. Third St?

Maybe it’s time to divest the city of all its real estate holdings that aren’t directly used for providing taxpayer services? Or maybe, it’s time for the rest of us to start eating pot brownies so we can be just as high as the fools we have managing our real estate holdings.

UPDATE

5 April 2015. As if I needed more evidence to prove to you that the city is an incompetent property manager, this was in the morning paper.

DAYTON —Hundreds of thousands of dollars in infrastructure and equipment was removed from a vacant industrial building owned by the city of Dayton.

The security officer at the McCall Building, 2333 McCall St., filed a report Friday night on a breaking and entering, according to the Dayton police report.

Wiring, electrical equipment, copper pipes and generator equipment was listed as missing, an estimated $500,000 loss, according to the report.

The building is listed on cityfeet.com, a website that markets available commercial space.

The 348,000 square-foot building, valued at $1.5 million and available for rent at $58,000 per month, is listed as one of Dayton’s economic development sites.

via Thieves strip $500K in material from city-owned building | www.daytondailynews.com.

Another half million that could have been spent providing government services wasted.

Fire ratings for renovation

In my last post about the City and inspectional services I mentioned the insane requirements forced on rehabs for fire rating separations and costs of sprinklers. It’s something I’ve had to hear about from people working in the city for years. My friend Bill Rain sent me something he’d written long ago, looking at ways to work some compromise into the system, so I’m sharing it here with you:

With any legislation, you need to predict what groups will be for or against. From our discussions, it sounds like your meetings with fire marshals’ have been positive. My experience has been that the fire unions and any groups representing fireman and inspectors tend to support any code changes that they view as “protective to firefighters”. The same for the AIA (American Institute of Architects) as they like complexity in the building code to support their members. Groups in favor will be builders, developers, ICMA (Mayors and Mangers), etc. As we discussed, I would structure legislation to effect buildings of a certain size (number of stories, height, square footage) as this will garner more support with small to large cities as they both have the same problem, what to do with small multi-story buildings.
Our discussion earlier was around the requirements for 2 hour fire rating. If you take a step back and look at what requires existing building owners to add 2 hour rated walls, this is usually triggered by a “change of use”. I have never liked the concept of change of use as it only looks at the last use. I have bought historic buildings that had residential on upper floors but was abandoned and when we wanted to bring residential back, was told by the chief building official that the building use is commercial and that mixed-use will be a change of use and triggers updated code compliance. As we discussed, 2 hour rating is not the issue if only drywall is required (less expensive). The bigger issue is 2 hour rating with full suppression (sprinklers). Current building code pushes sprinklers for everything. The problem is that most existing buildings don’t have the water infrastructure to support sprinklers. There is the economic feasibility from a cost prospective. These cost include new water service and tap fee (usually minimum 3 inch and a new, more expensive meter and billing rate), splitting the service for both fire and domestic, 2 new back flow preventers, the physical cost to install the sprinklers (anywhere from $1.5-$3 per sqft) and disruption to the existing ceiling and cost to repair.
My recommendation would be a new section to the building code that gives chief building officials flexibility to deal with these EXISTING buildings (new construction is different). The job of the chief building official is to protect human life. I have used the phrase “is someone going to die if we don’t do XXXX”. If the answer is no, then they should have flexibility. The biggest cause of fires in older building is faulty electric and fire started by vacancy. If you want to make a building safe, make them feasible that someone will use it. The new section of code should require 2 hour DRYWALL separated uses and primary egress, new electrical service or existing that has a UL rated panel and MC, romex or vinyl clad interior wire and 2 means of egress. Egress is a big issue. There are multiple issues here. Old stairs usually don’t meet modern rise and run requirements. If space allows, new WOOD stairs should be allowed to be built to meet the primary egress requirements. If space does not allow, the chief building official should have flexibility to look at the new upstairs use. If the use is owner occupied residential space then there should be a contractual way to shift liability to the owner/user. Primary Egress should be treated different if it is commercial and will have clients coming to the space. This does not get into ADA requirements but there should be relief if it is for owner occupied, non-commercial use. For second means of egress, stairs are not always feasible in many buildings. The code should allow for the use of fire escapes or fire ladders.
These changes should allow for many small buildings in downtown areas to be reused. I know your time line is tight so wanted to get some ideas into your hands.

The key thing to think about is are we protecting people or property with these regulations? And, if we’re talking about fire safety- an empty building is always a bigger risk of fire than an occupied one. Let’s focus on keeping and maintaining the stock and making it at least as safe as when it was built- instead of putting unreal expectations. By requiring modern electric service, up-to-code gas lines and mechanical systems, you are decreasing the risk of fire much more than by having empty buildings waiting for an arson. Never mind the fact that occupied buildings generate tax income, whereas vacant ones just create tax burdens overtime.

Practical solutions to protect our community are up to us. If there was one place where we should be evoking home rule- it’s to protect our downtown historic buildings before too many more succumb to the wrecking ball.