Monday, August 13, 2007
City needs objective criteria for incentives
From the RoundTable blog
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Brian Wishneff and Sherman Lea
Wishneff and Lea are members of the Roanoke City Council.
As readers know by now, Roanoke City Council voted 5-2 last week to give an $880,000 grant to the developer of the former Grand Building on Campbell Avenue. We were the two no votes and we wanted to give you our reasons for voting no.
During our council meeting, Brian Townsend, assistant city manager, said he had been asked by Ed Walker, developer of the Grand Building, if the city would provide him with an $880,000 grant for his project.
Townsend said the developer told him that even though 35 to 40 percent of his project cost would be paid for from the sale of federal and state historic tax credits, he still had a gap of $880,000 and that without a city grant of $880,000 the project would not go forward.
City council was not handed one piece of paper documenting the need. We saw no analysis (slight or vigorous) by staff verifying anything to do with the request. Nor did anyone on council, except us, even ask to see the developer's numbers.
We were asked to simply trust the staff. As stewards of the public's money, is that what we are supposed to do? Of course not.
Instead, we argued that if the city was going to contemplate helping this project financially, it should be done though an incentive program for downtown. Further, such an incentive program should be available to any development that meets a prescribed set of criteria. That method takes out the total subjectivity that exists today.
We turned down a request last month from a developer on a project in downtown. The request was for a grant of about the same size yet it had three times the number of apartment units and three times the private investment of the Grand project. Why did we turn that project down and not the Grand?
We have no idea. But the answers one could speculate about are not very pretty. Does the city give out grants based on the number of jobs created? The size of the investment to be made? The amount of local taxes generated? Or is it based on who you know? Who you supported in the last council campaign?
Why even go there when it is totally unnecessary? Take out a large part of the current subjectivity in our decision-making and make it more objective. Leave the subjectivity for council when there is a special set of circumstances, like a company is considering moving downtown and bringing 200 jobs with it. Then it makes sense for council to consider an incentive beyond the policy.
Otherwise, what separates the 55-unit apartment project from any other residential project downtown?
In the newspaper last week there was a comment by a city staff person that the action by council was similar to the grant the city made for the 8 N. Jefferson St. apartment project.
What that city staff person who made that comment forgot is that the 8 N. Jefferson St. complex is owned by the Roanoke Redevelopment & Housing Authority, not a private individual.
We have been called by many developers over the past several years complaining that city staff promised one thing in one meeting and something else in the next. Why create an atmosphere that leads to such bad feelings?
What we proposed last week was that the city create an incentive program, fund it with a serious amount of money, and give it out on a first-come, first-served basis. Creating such a program would also allow a public debate about the type of projects we want to include in our incentive program.
If we created such a program there would be serious discussion about what type of projects we want to provide incentives for with our limited dollars.
Would an apartment project rise to the top of the list of priorities? We do not know.
Sadly, we never got to discuss whether $880,000 on an apartment project was the best use of our limited dollars. With no information available to anyone on council, we just voted to give the money away. There was no real verification of need.
In other "normal urban cities" there would have been months of scrutiny, analysis and discussion.
