Monday, October 13, 2014

Carmel Diverts Money from Roads and Maintenance to Finance Mayor's Corporate Welfare Projects

The Indianapolis Star reports:
Struggling to pay both debt and ongoing costs associated with one of the nation's most sustained suburban building booms, Carmel has systemically been reaching for money or limiting budgets intended for city services.

An Indianapolis Star review of budget documents reveals that in the last five years the city has slashed funding meant to repair and repave crumbling roads, diverted money intended to pay for sewer work, and delayed plans to extend Illinois Street and fix public
Carmel Mayor Jim Brainard
amenities such as the reflecting pool at City Center.
For the first time, Brainard will ask the council to pass potentially tens of millions in bonds backed by the full faith of the city for use by a private developer. He believes commercial property taxes paid over time and other financial guarantees from the developer will cover the expenses. If those funds fall short, however, property taxes ultimately will back the bonds.

Carmel-based Pedcor, the city's main redevelopment partner, is asking for the bonds to build a parking garage and other infrastructure for a $100 million continuation of City Center. And, to the north, Old Town Development is considering a similar financing proposal to build a parking garage and public plaza in a $150 million project at Midtown.

The new development boom would have the usual Carmel flourish. The last wave brought the Romanesque Palladium. The new wave would bring an architectural nod to Rome's famed Spanish Steps — a $500,000 flower-laden decorative staircase at City Center.
The lengthy and well-researched article goes on to talk about Carmel selling off property and borrowing more to service its every-growing debt generated chiefly by the Carmel Redevelopment Commission, Mayor Brainard's vehicle used to bypass the Council in order to pass out corporate welfare to developers:
Debt has been a debate in Carmel since the City Council backed most of the commission's debt in 2012 with property taxes. On the verge of insolvency, the commission no longer could pay its debt without the bailout. The council's backing allowed it to refinance at lower interest rates, saving $55 million over time.

And now, even as it prepares for another round of expensive development, the commission is going to great lengths to avoid tapping those property taxes.

There's cause for concern. The commission's tax-increment financing districts will fall $43 million short of paying the $486 million it owes through 2037, according to Umbaugh, the group's financial adviser.

So the commission, with the Council's approval, diverted money from two other taxing districts — collectively called Parkwood — to pay back debt.

The Parkwood tax districts were created to pay for projects in an entirely different part of the city — in a Duke development at 96th Street and College Avenue. The work long-ago completed and now paid off, the city could have closed both districts. That move would have lowered taxes throughout Carmel. Instead, the money is being spent to pay for development outside the districts.
Carmel Mayor Jim Brainard is building a city made of gold.   Unfortunately that gold is fool's gold.  It's not like the people of Carmel haven't been warned about the Mayor's reckless spending and borrowing, that eventually the bills would have to be paid and that would mean much higher taxes and people and businesses leaving the city to avoid those taxes. Yet Carmelites continue to re-elect him.   Congratulations to the Star for an excellent of the fiscal shenanigans of Carmel city government.  Now if we can just get the Star to take a look at what's going on just blocks away in Indianapolis city-county government.


goodneighborsam said...

where is carmel vs. the cap?

Unigov said...

"where is carmel vs. the cap?"

i got that info 2-3 years ago, and as one might suspect, carmel is under the cap. there's two reports - the city itself, and the redevelopment thing. (even though the redevelopment thing is labeled on its report as being a branch of the city government).

everything in carmel is BS. much of it is choreographed by pedcor.

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