Thursday, June 19, 2008

Still worth reading

A few weeks ago, I recommended the BGR's 2003 report on tax increment financing. I failed to mention it before, but the five year-old report deals with many projects that are still being discussed, including TIF's in New Orleans East and development plans for the World Trade Center -- with an entire appendix devoted to the latter.

As I've indicated before, I believe that the city needs to get out of the habit of committing future revenue, that should go into the general fund, to specific projects that sound good now. Judging by recent reports, Arnie Fielkow doesn't share that concern:
In addition to the one-time payment, Full Spectrum must make what is essentially an annual property tax payment. The building is technically tax-exempt because it is owned by the city, but the developer has agreed to pay 60 percent of the taxes that would be assessed if it were privately held.

Howard labeled that provision a "tax break" and said the council should demand a 100 percent payment from the developer. The Bureau of Government Research has long taken the position that projects involving luxury condominiums, as this one does, should not receive any sort of tax abatement.

Howell Crosby, an attorney for the World Trade Center, noted that the office building currently does not generate revenue for the city in the form of hotel-motel or sales taxes, both of which would be generated once the development is complete.

Council members agreed to take up the lease at their next meeting, on July 10. Councilman Arnie Fielkow said the body should not delay a vote beyond that date because the $24 million the Building Corporation is set to receive under the lease arrangement provides startup money for Reinventing the Crescent, an ambitious plan to redevelop the riverfront.

"Without that seed money, I question whether that project would get off the ground," Fielkow said.

If that quote seemed unnecessarily long, read the BGR report -- at least Appendix B. Also, note the following from City Business:
The 99-year lease would allow New York developer Full Spectrum to put a hotel, condos and a cultural center or museum in the city-owned building in exchange for a one-time, $24 million fee and an annual payment in lieu of taxes.

The annual payment would be used for improvements to the public riverfront that surrounds the 33-story, mostly empty office building.

I'm not trying to take gratuitous shots at Fielkow, and I don't mean to imply anything by noting a disagreement. However, he has called for a "comprehensive and articulated policy" on the use of tax increment financing districts, but he wants a vote on what seems like a TIF by July 10. Actually, Stacy Head called for the same policy, and she's also getting impatient. Of course, the WTC deal has been fugabooed so many different ways for so many years, that the impatience is almost understandable. Almost.

If one of the names mentioned above sounds familiar, it's probably because of this. Frankly, I'm not sure how much I'd make out of the coincidence that the head of the corporate section of the state's oldest law firm has had two clients in the newsrecently.

Comments: Post a Comment

<< Home

This page is powered by Blogger. Isn't yours?

Old Favorites
  • Political Boxing (untitled)
  • Did Bush Take His Ball and Go Home
  • Teratogens and Plan B
  • Foghorn Leghorn Republicans
  • Quote of the Day
  • October's News(Dec.1)
  • untitled, Nov.19 (offshore revenue)
  • Remember Upton Sinclair
  • Oct. Liar of thr month
  • Jindal's True Colors
  • No bid contracts