Indy Tax Dollars

Which are you?

If you are a developer or a professional sports franchise owner, grab a large container and head for City Hall.  There is about to be another deluge of public dollars for you.  If you are an individual taxpayer, grab your wallet because the deluge is going to come out of that container!

Three separate items in this morning’s paper tell us the story.  We won’t go into great detail.

The top headline in the second section of the paper says "MASS AVE. DEAL NEAR."  This one involves moving Red Cross headquarters and various fire department properties.  There is reference to city acquisition of the Red Cross site with no financial information disclosed.

The next to last paragraph of the article reads as follows: "The city is aiding the project by essentially giving the land to the developers and moving the IFD buildings.  A new fire station is expected to cost the city $10 million to $11 million.  (Our emphasis.)

The second item refers to a proposed development in Broad Ripple.  It will have retail space, 88 apartments and 400 parking spaces.  (Presumably there will be an express bus stop nearby so that people can park their cars and ride the wildly popular proposed mass transit.)

Again, we quote the next to last paragraph.  "They plan to ask the city for money from a local tax-increment financing district to help pay for improvements at the site."  (Our emphasis.)  We’re not sure what the use of the word "local" means here.  The newly established TIF district gives the appearance of weird gerrymandering, extending from near downtown to Broad Ripple with much of its width seeming to be a maximum of 5-6 blocks.

The third item is a column, warning us that the local basketball franchise will be in the taxpayers’ pockets for years to come.  The author claims that the team had "leverage" when they were losing and that the "leverage" is even greater now that they are winning.

We admire the imaginative use of the word "leverage."  It’s like saying we have "leverage" on the author because we have a picture of him coming out of a bank with a heavy briefcase - at two o’clock in the morning!  A more accurate definition would call it extortion.

There is also a list of seven items which the city would "lose" if the team were to leave town. We thought the sixth was the most interesting. "It would lose the main tenant in a building that is still 15 years from being paid off."

When the tenant is not paying one thin dime toward the debt, we think it is at least in bad taste even to mention that part of the equation.  We find it difficult to mourn the loss of a tenant which takes all revenues from the building and, for all practical purposes, is actually being paid for using the building.

We guess it is unnecessary to point out that none of the three items makes any reference to, or asks questions about, this continuing policy of corporate welfare in the face of severe municipal budgetary problems.

It’s Friday o’clock in Wonderland, and all’s well!

 

A depressing Saturday

The first of three items to hit the eye was the front page headline on the IBJ reading, "Development may spawn TIF tug of war."  Seems a new proposal for action a block or two north of the newly completed parking garage in Broad Ripple is under consideration for taxpayer subsidy.

The first deputy Santa Claus downtown, also known as the "deputy mayor for economic development," tells us "...it would be a very challenging site to develop without TIF dollars."

We have questions.  The city just donated 46% of the cost of building the parking garage - said garage needed because of the crowded, extraordinary amount of economic activity in the area.  Why were municipal tax dollars ever involved to begin with?

What ever happened to the concept of "risk and reward?"  Does it never occur to anyone that a project which is risky should be financed by those who will reap the reward?  How have we arrived at the point that any Tom, Dick or Harry (or politically connected developer) who wants to put one brick atop another feels entitled to expect taxpayers to furnish the mortar between them?  

The article goes on at length about other possible uses of TIF funds.  There is, unfortunately, no mention of problems aggravated by lack of funds for Broad Ripple High School, for instance, while the TIF operation cannibalizes all new property tax revenues in the area.

The second item catching our eye was the editorial in the same edition of the IBJ - this concerning the mass transit boondoggle.  The author recommends that proponents of the proposal continue to "...respectfully and patiently reiterate what they’ve touted all along:...."

He then gives us eight "bullet points" of suggestions most of which are the obvious repetitions.  But it was the seventh such suggestion which really caught our attention.  It reads, "Locals can be trusted to handle transit details."  (Our emphasis.)

While watching the city administration wasting millions of dollars - dollars originally intended for infrastructure rehabilitation - on a pie-in-the-sky dream of making the city an internationally famous center for the game of cricket, it makes one wonder whether the editorial was written as a joke.

Of course, the editorial writer may not consider the properly prioritized handling of a billion plus dollars, the estimated cost of the transit project, a very important "detail."

Based on historic precedent, we think it likely that the entire billion might be spent on a high speed, elevated train - from Stadium to Palladium - with another tax increase enacted upon completion to finance operations!

OK.  So that’s a little over the top.  But not much more than leaning on "local handling" of details as has been the case for many years in this city.  In fact it occurs to us that expansion of the project to a multi-county area may be a forethought about future expansions when Marion County finally becomes one large, consolidated TIF district.

The third item was the announcement that Governor Pence actually approved the "Ballard power grab" legislation passed by the legislature.

We are extremely disappointed in the governor.  This appears to be a "cave in" to the Indianapolis Republican power base, the members of which are more than likely totally opposed to the governmental philosophy of Pence.  Considering this to be a party line division is, in our opinion, a huge mistake.

The statement issued by Pence reads as though it could have been written in Ballard’s office.  With reference to the first two items discussed above, one sentence of that statement really caught our eye.

He says he is signing the legislation because, "...it serves the public interest..." by granting the mayor "...the authority to manage the city’s finances in a manner that protects the taxpayer...."  (Our emphasis.)

Governor, you are not paying attention.  Building a cricket pitch instead of repairing crumbling sidewalks and streets does not protect the taxpayer.  Using the TIF process to divert property tax funds from legitimate city functions for the benefit of private developers does not protect the taxpayer.  Spending millions of federal transportation dollars to turn Georgia Street into some kind of seldom used playground while insisting on new local taxes for actual transit purposes does not protect the taxpayer.

All of these things, plus direct subsidy of professional sports franchises, are going on while city budget makers struggle to eliminate future deficits.

The phrase "protect the taxpayer" has not existed at city hall for decades.  We see absolutely no reason to suppose this new law has any chance to reinstate it.

Truly a depressing Saturday!

A personal farewell

In January, 1949, as a 1948 graduate of IU, I made my first of many years of appearances at the Indiana General Assembly as a registered lobbyist - that time for the Taxpayers Federation, Inc., a now defunct organization.  In subsequent years I represented various business organizations.  (For the first three or four sessions, at least, the term "lobbyist" was pretty much a fictional designation!)

In January, 1957, Doctor Otis R. Bowen made his rookie appearance as a member of the House of Representatives.  Recognized by his fellow members as an appropriate leader, he was elected to manage House deliberations.  After serving as "Mr. Speaker" in the ‘67, ‘69 and ‘71 sessions, he decided to run for governor.

Having made that decision, he called together a group of a dozen men - representing primarily various business organizations - told them of the decision, and asked for their support.  It was my distinct honor and privilege to be a member of that group.

He was elected governor in 1972, on the same ballot which approved a constitutional amendment allowing a governor to serve two consecutive terms.  He served those two terms, during which the same group of men worked with him in his efforts to reform property taxes in Indiana.

In all those years, he was addressed as Doctor, Mr. Speaker, or Governor.   But among the group of men, he was always "Doc." The group eventually started to call itself the "1288 Club."  That came from House Bill 1288 in the 1971 session, which was "AN ACT to amend IC 1971, Title 6, concerning taxation."  (One of his earlier efforts which had been vetoed.)

As governor, once a year Doc and Mrs. Bowen had dinner with the "Club" and their wives.  Also once a year, he and his wife had dinner with me and my wife, on his schedule obviously.  This led to an occasion showing his basic personal character.

One year that dinner was set with my having overlooked the fact the chosen date was also our youngest daughter’s seventeenth birthday.  When I called and asked for an alternate day, his response was, "Bring her along!"  And he and Mrs. Bowen both brought small gifts for Sharon.  It was an evening still fresh in our memories.

I last saw Doc when he and Mrs. Bowen came to our retirement community apartment three or four years ago and had lunch with us.  Recent contact with her had let me know that he was in failing health.  The announcement of his death was not a surprise, but still very sad news.

I saw Otis R. Bowen as a true "gentleman."  In his personal, individual relationships, he was always "gentle."  In his chosen career as a politician with awesome responsibilities, when the situation called for it, he was always the "man."

Governor Bowen was the speaker at the 1980 annual meeting of the Indiana Manufacturers Association, held near the end of his second term.  Normally the chairman of the board would have made his introduction.  The then holder of that position very graciously granted my request, as president of the association, to be allowed to make that introduction.

I said that it was an honor I had never in my life expected, to have the opportunity to introduce to a distinguished audience a man, a friend, of such distinction and integrity, and for whom I had the greatest respect and affection.

After twenty-three years, I have not changed my mind.

Bad news-good news-bad news

The first "bad" news referred to a reference in the media to a "World Sports Park" on the east side of town.  We are a long way from seeing everything we ought to see, but we were upset with ourselves when it was announced that the mayor was selling a "cricket pitch" at this locale.  (Or was he pitching a cricket "sell?"  We’re a little mixed up here.)

He’s talking about a $6 million project in an attempt to bring the world to our doorstep to watch a national championship in a sport most Americans have seen only in some old British movie.

But the good news - if it really can be called that - was that we were not alone.  It turned out, for the members of the City-County Council (CCC), that the cricket suggestion was not the only thing new.  They didn’t know about the park either.

The next bad news concerned the financial aspects of the situation.  An original estimate of the cost was approximately $6 million, with the funding to come from money originally designated for general municipal infrastructure care.  Apparently, later figuring has boosted that to something around $10 to $15 million.  We have not seen any reaction to that from the CCC.

We have to add another "bad news" here.  Unfortunately, not an unexpected one.  The morning paper’s leading cheerleader for unlimited municipal expenditures gives us a column headed "Expert: Indy’s on the right track, but more is needed."  (Our emphasis.)

Her question about where more "investment" is needed includes "Soccer and cricket stadiums?"(Sic)  The reader will note her use of the politically correct term of investment as opposed to plain old spending.

She has talked with a "...national expert in urbanist trends..." who, - surprise!, surprise!  -  says the thing which would bring us into the  21st century is "mass transit."

This same wizard tells us "...any city that doesn’t have a transit system within the next five to seven years..." has little or no chance of becoming "...a great American city...."  (Gotta hurry up and do it now, folks, before we blow the money on public safety or some other trivial city function!)

It seems our local experts have been miserably mid-guided. We’re not sure about the comparative value of "great American" as to "world class," but we’ve tried to become world class by blowing about a billion dollars on two sports palaces.  Not to mention ongoing annual subsidies.  We even threw in a lousy $12 million fixing Georgia Street so visitors wouldn’t get lost between the two.

Have we lost the chance to be "great American" by ignoring IndyGo in favor of professional sports?  Would it help to make certain an express bus line would serve a new cricket stadium?  Or are we going to hang on to our miserly Hoosier ways and reject spending another couple of billion tax dollars so that we can become a "great American world class" city?

We do hope so!

 

Language use

Or abuse, if it can be called that.  This morning’s Sunday paper carries a story headed "SOLAR FARMS TAKE OFF."  They’re popping up all over the state.

It’s a very long story.  We tried to measure it and we figured, including artwork, the space used is the equivalent of nearly 120 column inches.  A little over one full page?

There are several uses of the word "incentive(s)" but fairly careful reading of the entire story does not reveal the word "subsidy."

The gist of the article reads like a brochure selling stock in the business.  In all fairness, we have to admit that two paragraphs totaling about three column inches are given to opposition views.

The first one reads as follows: "Some experts and activists question the cost and efficacy of solar, but it does offer several benefits."  The second one is equally impressive.

We get close to the truth of the whole story when the author says the future of the operations depends on "...two of the factors that made it possible: incentives from the government and utilities such as IPL, and the decreasing cost of solar panels."

For some reason, the author apparently separates direct "incentives" to the user and "incentives" to the manufacturer.  The taxpayer is subsidizing, separately, the manufacturing and the using of solar panels.  That is the only thing making the systems even close to financially feasible.

We’re told that solar works better in Indianapolis than other alternatives.  "...it’s hard to build the tall turbines in the city.  Biomass, which sometimes involves extracting methane from animal waste, also hasn’t worked well here because there aren’t many farm animals in the city."

Well, they got us there!