Faulty Fairgrounds math

“Fairgrounds $15M purchase approved” is the headline on the front page of today’s Dayton Daily news. This is what we would now call “alternative facts,” or in the past- an “F” in math.

No worries, because no matter how much you sell the Fairgrounds for to “Meds, Eds and Feds” you keep the most valuable piece of undeveloped, virgin land in Downtown out of the category of contributing tax entity. No money generated to the schools, and- with this latest plan- which is really no plan, no idea of the number of jobs that will be created- the normal excuse for the public financing of private institutions (otherwise known as either corporate welfare or screwing the little guys).

UD and Premier will redevelop the property after market analysis and community input, according to a news release from the county…. The closing is supposed to take place no later than 15 days after the end of the due diligence period, which can be extended to the end of March if the buyers choose. UD and Premier will take possession of the property no later than Oct. 1, the letter states.

UD and Premier agreed to try to retain the historic roundhouse and incorporate it into their redevelopment plans.

In exchange, the county will provide them with a $2 million credit at the time of closing, which will be applied to the first and smaller of the two payments.

“We’re very pleased that as part of this deal the county is going to be able to contribute money to not only to keep that building where it is, but to improve it,” Commissioner Foley said.

Under the agreement, UD and Premier will not be required to renovate the building by any specific date.

The institutions also can decide that the roundhouse should be taken apart and reassembled at a suitable site somewhere else. But the building has a historic designation and, if moved, would have to be reconstructed to meet historic rehab standards, officials said.

Foley said he’s confident the development will create jobs, reshape the neighborhood and support two major anchor institutions.

“We’re excited that this next step has been accomplished. We look forward to working with our partners to develop plans for future,” said Premier Health in a statement.

The purchase agreement also says the city of Dayton will work to approve a memorandum of understanding outlining how it is prepared to participate in the construction of the infrastructure to benefit and support the redevelopment project.

The city also would be expected to take ownership of the title to the fairgrounds property to make the development eligible for tax increment financing incentives.

As for the financing, UD and Premier are expected to each pay $5.25 million of the sales price.

About $2.5 million is expected to come from a state grant that was previously awarded to the Dayton-MontgomeryCountyPort Authority. And the remaining $2 million is from the county.

Source: Fairgrounds’ $15M purchase approved

As far as this math challenged writer can figure, the Fairgrounds was sold for $10.5 million- making this the steal of the century.

And, the “historic roundhouse” isn’t worth much more than a pole barn, which is all it was then and now. If we are worried about preserving buildings in this town, let’s start with ones that have taxpaying people in them, that we’ve been tearing down faster than Trump tweets.

This after, two developers probably invested hundreds of thousands of dollars to develop a real plan with measurable returns on investment to the community, that were tossed out, so we (the taxpayers) could basically donate this property to two institutions that already don’t pay a lick of property tax- and cried like babies when told they’d have to pay an assessment like the rest of us for new streetlights based on a democratic formula based on street frontage.

And remember, Premier/MVH had plenty of money to spare, as did their top, grossly overpaid executives to donate to Issue 9 to RAISE their income taxes .25% just a few months ago. How much they donated isn’t even fully known, because the mystery Political Action Committee that funded the campaign never filed their post election report. After it passed, one of the first things Premier did was to end support for the two Community Based Police officers they had funded for South Park and Rubicon Mill (the neighborhood FKA Fairgrounds).

Of course, Dan Foley seems to be the only one talking about this donation. Foley has been searching for a post commission job for years. First he’d hoped to be hired by the Dayton Development Coalition, and now, it looks like he’s looking for a job with UD or Premier – hopefully as sweet as what former County Administrator Deb Feldman landed over at Children’s Medical Center where she makes a cool half million a year plus (up from around $200K a year). Foley was also behind the latest failed regionalization push- which crashed and burned, where he made enemies with every black democrat thanks to Nan Whaley’s scare the west side meetings that were a total farce (the poison pill to block the plan was already well in place).

Foley likes to think of himself as some kind of visionary leader, but, he gets nothing done. Maybe this is because he’s never held a real job in his life outside of either patronage jobs through the party, or elected jobs because he’s was born into the party (his Daddy was a judge, and this is how we take care of the friends and family in the Monarchy of Montgomery County). He’s a very nice guy, but that’s really not why we should elect anyone. Voters are getting sick of the same folks getting elected over and over and doing nothing- he almost lost to Jan Kelly last time (she’s now the Republican in charge at the Board of Elections) despite outspending her and being the incumbent, and Debbie Lieberman came within a hair of losing to Gary Leitzell last time out, despite outspending him 100 to 1. If you need any proof that no elected position is safe from incompetence, just look to the White House.

This deal to give away the real estate should be stopped. Without a contract in place specifying the investment to be made and the return on investment, the property should just be kept in holding. Anything else is criminal.

As to the lie of $15 million, that’s what happens when the only reliable news source in a city has to be published by a political gadfly who the party and the paper tried to minimalize from the very first time he ran for office over 25 years ago. You’re welcome.

 

 

Fairgrounds to Premier and UD- or how stupid is the public?

There are the Illuminati, the Tri-Lateral Commission and the Montgomery County Fair Board as three of the most misunderstood secret societies on the planet. And, then, there is the government intervention by the Monarchy of Montgomery County and their benefactors in the transfer of the Fairgrounds to the patron saints of politics in the county.

If the two developers who invested considerable time and money in the rigged competition to buy the Fairgrounds for their private developments don’t sue- you know there were payoffs made.

There is no logic to this deal, there is no math that backs it up, there is no rationale that would pass muster- even on the TV show “Are you smarter than a fifth grader.” In this case, you could probably make the threshold third grade and still be ok.

The Country Fairgrounds didn’t deliver any property tax, or real economic impact in the county. It is prime, unpolluted real estate in the heart of what’s now being referred to as “Mid-Town” (which is laughable- since “Downtown” has become mostly a joke since Austin Landing, The Greene, and Pentagon Parkway have stolen so much from the city core).

The conditions of the sale, or rules of the game, to acquire this gem in the Gem City were to pay for the fairs relocation and to show a plan for a royal flush- jobs, housing, retail, i.e. create a success story that could compete with development at…. Austin Landing, The Greene, and Pentagon Parkway.

And while none of those generate income taxes (the exception of course is Austin Landing with its reverse Robin Hood TIF/JEDD tax on only the little people who work in retail and fast food in one-story buildings) ostensibly, the Fairgrounds would bring in plenty of income tax to Mayor Nan Whaley’s new 2.5% income taxed Dayton, tied for the highest with Oakwood.

There will be no property taxes on this prime real estate to pay the Dayton Public Schools- who are funded, unconstitutionally, solely on property taxes (and state and federal handouts).

Premier Health and UD will now own the property, be able to do as they please with it, and not pay taxes- as they don’t pay on their deals now- including UD’s sweet deals for Emerson, GE, Midmark etc.

Listen to the “unlogic” in the mouthpiece story by the Dayton Daily, if it’s news, it’s news to us, News:

The university and health care system on Monday announced they have reached a $15 million agreement to purchase the 37-acre South Main Street site, which comes less than two weeks after a pair of proposals to remake the property were rejected for not meeting certain criteria and asking for too many public dollars.

UD and Miami Valley Hospital officials said the purchase is an investment in the future that ensures that new development on the land is compatible and complementary with investments they have and will continue to make in that area.

The University of Dayton and Premier Health will redevelop the fairgrounds by starting with “a blank piece of paper,” said UD President Eric Spina.

“Hopefully, we’ll leverage the assets and create opportunities for our faculty and for our students,” Spina said. “I mean, that’s really the key. This is a long play.”

Dayton and Montgomery County leaders emphasized the historic relevance of the announcement and how much work it to took to reach this point. They said they are confident the property will become a high quality mixed-use development.

“(This) opportunity now gives us the time to do the really good work to make sure this is a development that lasts the ages,” said Dayton Mayor Nan Whaley.“Congratulations to everyone who has been working on this the past 100 years.”

On Nov. 30, the city of Dayton, Montgomery County and fair board officials announced they rejected two proposals to redevelop the fairgrounds from Dayton-based Miller-Valentine Group and Indiana firm Thompson Thrift.

The proposals failed to meet certain criteria and originally sought more than $20 million in public infrastructure assistance, officials said. The minimum bid price for the fairgrounds was $15 million to help move the annual fair.

Within 48 hours of the announcement, city and county leaders met with representatives of Premier Health and UD to discuss the future of the property. On Monday, the groups held a joint press conference to announce the purchase plans, which are expected to be finalized in coming weeks, with financing coming from multiple sources, officials said.

The county fair and a horse show will take place as scheduled next year. The property is expected to fully change hands in the fall. The purchase agreement is expected to be completed in about a month.

Both Spina and Miami Valley Hospital president Mark Shaker said they have not decided what they will use the space for as the deal came together quickly.

“When the thing fell apart, well we had to step in,” Shaker said. “It was the right thing to do.”

With UD and student residences being just a few blocks away, Spina said it would make sense to extend some of campus to the fairgrounds location.

Shaker said Miami Valley Hospital, which is part of Premier Health, is landlocked and would benefit from having some room to grow.

On Monday, Spina emailed staff and students to tell them the fairgrounds purchase is a “strategic decision consistent with our history and character, and supports the future of the university.”

Spina noted the fairgrounds’ proximity “to GE, Emerson, the Marriott and other university holdings” at Patterson and Stewart, two blocks from UD’s student-centered investments on Brown Street.

Spina admitted the land will likely see some expansion of UD’s campus or Premier Health’s Miami Valley Hospital.

“Ultimately, I think this area will have some university opportunities and it will have some hospital opportunities,” Spina said. “Probably the vast majority of it will go to development of one kind or another.”

UD said its involvement began in October when Miller-Valentine asked for support of its redevelopment proposal. When the city, county and fair board rejected that plan, UD and Premier took an active role in acquisition talks.

“It was highly likely that if action was not taken quickly, this opportunity would have been lost and the fairgrounds would have continued to deteriorate, or it could be developed to the detriment of the university and the investments in that area,” Spina said in the email.

Premier Health President Mary Boosalis sent a letter in support of Miller-Valentine’s overall site design and planned uses for redeveloping the fairgrounds.

But UD and Premier said they will take their time to figure out the best uses for the property and will create a plan from scratch.

The development will have to go through the city’s planning and zoning process, and it should achieve the community’s desired vision for the property as a high quality, mixed-use urban environment, said Dayton City Manager Shelley Dickstein.

UD and Premier will be committed partners whose role in redeveloping the fairgrounds will be much deeper and more significant than if an outside developer was brought in to transform the site, said Whaley, who noted that the property is an important piece of real estate.

“It would not be fine with the city of Dayton if the people waited for 100 years for a strip mall to go on this property — that’s not OK with us,” she said.

Whaley said she and county leaders have discussed relocating the fair and selling the fairgrounds for at least three years, but interest in that happening dates back at least to John Patterson, who publicly declared his support of the move around the turn of the previous century.

Montgomery County Commissioner Dan Foley said the announcement was the result of behind-the-scenes work, and there were times that the obstacles in the way of moving the fairgrounds seemed insurmountable.

“I thought maybe it was an idea whose time was not ready — but I am glad it is,” he said.

Miller-Valentine and Thompson Thrift declined to comment for this article.

Source: Deal struck to sell county fairgrounds

The only true statement that’s highlighted belongs to Foley- that behind the scenes skullduggery and large donations to political campaigns (like the recent Issue 9 tax increase- that got huge donations in the first reporting period from Premier– masked through their partners in the crime we call racketeering- but they call duopoly health care).

Why did the real estate have to be turned over at all without a plan? Or why didn’t the city and the county just hand $15 M over to the fair board, since the fair board isn’t allowed to just do what any other property owner would do and sell it to the highest bidder?

If the deals from Miller-Valentine and from Thompson Thrift weren’t acceptable- how is no plan from UD or MVH? How many times can the people we elect lie to us?

Is there any doubt as to why there were only two companies stupid enough to bid on a proposed project in this den of inequity we call Montgomery County- where it all depends on who you know? Crawford Hoying, the new darlings of Nan Whaley, were probably warned off not to bid, knowing this was a sham competition to begin with. Steiner Properties– who developed The Greene had no interest after their last attempt ran into Whaley blocking – to do The Greene on the old Parkside homes property- which is still prime real estate sitting fallow.

The cost to development in Dayton is relatively low compared to other places in the country- and there are developers like Simon who have no limits on their ability to pay their own way to develop large projects- but, kingmakers like that, prefer to work in fiefdoms where the local lords don’t overestimate the size of their britches, or have bottomless back pockets.

And that’s why we just sold the primest piece of real estate in the county for a vague I. Maybe. Owe. You.

Did something change on the GE deal?

When the school board passed the 30-year tax abatement on the GE Power building under pressure from the “economic development” folks who claimed GE wouldn’t come to Dayton without the tax break, the deal for the building and tax abatement was to an LLC. The tax break was for 30 years- yet, now in today’s paper, the building is owned by UD, and GE only has a 15-year lease.

Employees are moving into the new $51 million GE Aviation electrical power research and design center near the University of Dayton main campus.

The presence of employees in the building at 111 River Park Drive is a milestone in this young joint venture between the company and the university. The intent is to use the building to attract more business to GE Aviation and more students to the university…

Owned by the university, the building — called the Dayton Electric Power Research Lab — “gives us the ability to compete at a higher level in electric power on aviation platforms,” Vic Bonneau, president of GE Electric Power Integrated Systems. said.

GE has a 15-year lease on the building with an option to extend the lease, said Derek Bus-boom, project manager during construction.

via GE moves into $51M aviation research site.

Now it seems that the citizens of Dayton just subsidized a building for a private university, at a huge cost to our schools, which are struggling to pay rising health care costs, rising textbook and technology costs, and serve a student body, most of which can’t afford the luxury of an airplane ticket.

General Electric is still one of the most notorious tax evaders in the United States, and UD doesn’t pay property taxes the same way churches avoid them- 5709.07 Exemption of schools, churches, and colleges.

If the GE lease is only 15 years, shouldn’t the tax abatement only be 15 years and renewable? This is not an educational building anymore than the Dragons’ field is a place that hires Dayton Public School students (one of the promises made in the final deal by then Mayor Richard Clay Dixon, to let the taxpayers pay for a facility owned by the team).

It’s time to re-evaluate what this GE facility should be eligible for in terms of tax breaks, and closely monitor employment and wages paid to see if they match the agreement.

The opportunity costs of subsidizing Midmark’s move

On Wednesday, I went to the city commission meeting to speak against handing over tax dollars to a private corporation. As usual, I was working with somewhat faulty information that I’d received from the “Dayton Daily news” in that the money was being approved by the City Commission, but was actually ED/GE funds which are from the County sales tax collections. Either way, it’s tax dollars collected to provide government services being taken from our pockets and put into the pockets of a private corporation. Here is the basics from the PR run in the DDN:

Midmark Corp. will relocate its corporate headquarters to Dayton by July.

The medical, dental and veterinary health care equipment provider said Thursday it has completed lease negotiations and will move the headquarters, to be renamed Midmark Center, to the 1700 South Patterson Building on the University of Dayton’s River Campus. The building once housed NCR Corp.’s headquarters….

Midmark received $100,000 in economic development funding from the city of Dayton to move the jobs. The estimated payroll of the employees moving to the city is $10.8 million, which will generate about $242,000 a year in taxes for the city, according to the agreement between the city and Midmark.

The new headquarters will take up more than 23,000 square feet on the fourth floor of the 1700 South Patterson Building.

via Midmark base coming to Dayton.

Originally, the city had hoped to put Midmark into one of the empty buildings they built via CityWide Development in “Tech Town”- another squander of tax dollars on subsidies of a few private businesses with money that should have been spent on providing best in class services to all citizens. That deal fell through- but UD stepped up, by offering even cheaper space in the NCR HQ building they got for a song when NCR bailed on Dayton. There are unanswered questions about how much UD pays in property taxes vs what NCR paid in property taxes on this property, but that’s something for a paid reporter to investigate.

There is the interesting sidebar to this story, that Midmark’s CEO & President Anne Eiting Klamar also serves on the UD Board of Trustees, making this yet another sweetheart insiders deal.

But before I share my speech, let’s take economics 101. Opportunity costs are the costs of actions not taken, now, and over time. While the five year payback in “income taxes” received sounds wonderful on the $100,000 “investment”- let’s look at the real costs that have already gone into that process.

We’ve paid a myriad of “economic development” people good money to go out and sell out city primarily by whoring tax incentives and deals, instead of selling on our inherent value that we offer. In turn, the money that we’ve wasted on them, and these deals (most of which had no real penalties or clawback provisions and many went far south of positive for the city) has cut our ability to pay for essential government services- like road paving, leaf collection, safety forces, parks and recreation programs, thus making Dayton a less attractive place to live and less safe of an investment- thereby sending a message that we’re a poverty riddled city, much like the ugly girl offering to pay and let a boy have his way with her so she can go to the prom.

Maybe, if we had invested the hundreds of millions we’ve squandered on these “ED” projects over the last 20 years, which benefited a few, at a cost to the many, NCR wouldn’t have left in the first place?

While Midmark may not have any direct competitors in the region, there is also the undemocratic aspect of giving to one company while not giving to their competition- since there are no open competitions for this money, with a guaranteed equal opportunity for all. Banks can’t lend to homeowners with out following the rules of equal opportunity, but our government seemingly gets to pick and choose who to favor. This should be illegal. It reeks of payola to friends and family and political donors much more than it creates wealth. We know that it doesn’t work, because we’ve been losing payroll and investment in the city for about the same amount of time as we’ve been practicing this voodoo juju in the name of good government.

Here is what I said. I was rudely interrupted by the Clerk of Commission as I was finishing up, because the City Commission isn’t really there to hear or respond to citizens at their “public meeting”- they are there to have the shortest possible meeting, so Nan Whaley can get back to her fund raising. For the record, Joey Williams and Dean Lovelace were not in attendance at the March  20, 2013 meeting where this was given:

People often say government would be improved if it was run like a business, but they never take the time to really discuss in depth what business the government should be in.

Apparently, now, the citizens of Dayton are in the medical cabinetry and furniture business- since our tax dollars are about to be invested in Midmark corporation. The payback is supposed to be increased employment and tax revenue for the city- and while that sounds just fine and dandy, it makes me wonder why we chose Midmark- over, well, anyone else?

You see, the tax dollars that are being handed over to Midmark, came out of the pockets of people who are working two jobs just to make their house payments. And their house, well, it’s worth less now because the house a few doors down went into foreclosure and is now occupied by a bunch of dope using thieves, who keep breaking the law and causing the police to visit, oh, 22 times a year on average.

Now those hard working residents, have to buy security cameras, replace the chainsaws that have been stolen out of their garage (twice) and they have to buy new bikes for their kids, a new lawnmower, you get the picture…

Why do hard working Daytonians pay taxes? To hire police officers to stop thieves? To pick up leaves or sweep streets? Apparently not. We pay taxes to invest in Midmark Corporation!

Not only are we spending money on this Midmark giveaway, we pay our hard earned money to hire a staff of “economic development specialists” who seem to believe that they are worth considerably more than a police officer on the street protecting citizens. What if we took those salaries and instead, made sure that Dayton was a safe place to live, where our investments in things like bicycles, lawnmowers, chainsaws were protected?

Maybe it would be easier to live in Dayton and take care of our property, and someone would want to live near us that didn’t engage in crime on a daily basis? Crimes against us.

You see, the criminals stealing my property, aren’t much different than what you are about to do- you are taking my hard earned tax dollar and handing it over to someone else- someone who may even be a business competitor of mine. You are also robbing me of additional police resources- the stuff that I thought my tax dollars were going to be used for.

This isn’t the first time the City has thought they were in a different business than providing services to their residents- I recall a recent initiative to bring a Kroger to the corner of Wayne and Wyoming. Millions of our tax dollars went to acquire options, and property for a grocery store that never came. Just imagine, instead of spending over a million dollars to own an empty lot, you’d spent it on doing the peoples business- police protection, I still might have my bicycle and my chainsaw and my lawnmower- and I wouldn’t be down here wasting my time trying to get the city to stop engaging in “economic development” and try doing the business of the city- which means making our neighborhoods safe and our city an affordable place to do business.

You could probably even cut your income tax rate- if you stopped doing “business” that isn’t any of your business, nor is it mine.

The way you help Midmark is by not getting distracted from what the business of Dayton is.

If you personally want to help Midmark- take your salaries to  the stockmarket and buy stock in Midmark- but that’s the only acceptable thing you should do for Midmark with my tax dollars.

After I sat down, Mayor Leitzell made the lame response, one that reeks of the weakness of vision of our City- “If we didn’t do it, someone else would.” He told me later, everyone on the commission doesn’t like these deals, but fears not doing it. Of course, if everyone else is doing crack, that’s no excuse to do it too, at least, that’s what my momma taught me (well, almost, since crack didn’t exist when my momma was teaching me the difference between right and wrong).

I have an audio recording that’s 7 minutes long, which starts part way into Mr. Down’s explanation that this is County money, and then my talk.

Play