Tuesday, January 14, 2014
City-County Council Committee Postpones Vote On Subsidized Luxury Apartment Building To Ensure More Kickbacks To Minority Firms
The Metropolitan and Economic Development Committee last night heard Proposal 366, which authorizes the issuance of up to $23 million in bonds by the downtown TIF district for the construction of a 28-story, $81 million luxury apartment building by Flaherty & Collins. When you factor in interest costs on the borrowing and the value of the free land the city is donating to the politically-connected developer that stuffs a lot of money in the politicians' campaign committees, taxpayers are essentially funding at least 45% of the $81 million cost. The City's economic development guru, Deron Kintner, told the council members that unless taxpayers made this minimum contribution to the developer's project, the building could never be constructed because the downtown market doesn't support high enough rents to generate sufficient revenues from apartment rental to justify a luxury apartment project of this scale. In other words, a city like Chicago has a market for high rise luxury apartments with rents of at least $5,000 a month, while Indianapolis is lucky if it can find a sufficient number of tenants who will pay $2,500 a month for high-rise luxury living downtown with comparable amenities. If the market can't support a luxury apartment building, then why are taxpayers forced to fund the project? And these are the same assholes that keep complaining that there isn't enough money to fund public safety because we aren't paying enough in taxes.
Interestingly, Kintner pointed out that the land in question, the former site of Market Square Arena, is not within the downtown TIF district since it has been owned by the Capital Improvement Board and no property taxes have been paid on the parcels for decades. Although the downtown TIF district is responsible for repayment of the bond debt, Kintner told the council members that it is so cash rich that it can afford to repay the debt even though the new property tax revenues paid on the luxury apartment building will be allocated to other taxing districts. A suggestion by the committee that the city's contribution be converted to an interest-free loan rather than a grant was a non-starter according to Kintner. Eventually, the committee chose to postpone action on Proposal 366 only because my council member, Vop Osili, didn't believe the private developer was utilizing minority hiring for at least 40% of the project, a goal he had written into the TIF ordinance when he successfully pushed for the expansion of the downtown TIF district a year ago. Taxpayers should know that Osili, an African-American, owns an architectural business that makes money from compulsory set-aside work for minority firms. Presumably, the extra time afforded before a vote is taken by the committee may help certain individuals ensure that certain businesses get their share of the work on Flaherty & Collins' latest project being built courtesy of Indianapolis taxpayers.
It's hard to believe any of this is legal. Only in Indianapolis are taxpayers expected to provide substantial subsidies to virtually every major development project that occurs within the city limits. The city's taxpayers have given away billions of dollars to private developers over the past several decades. Countless number of pay-to-play contractors have been made multi-millionaires thanks to this corrupt policy adopted by our city leaders, which prosecutors turn a blind eye towards. I would highly encourage corrupt developers to relocate to Indianapolis from other cities like Chicago where you can grease the right palms and get public funding for your projects that require the taxpaying public to shoulder all the risks so you can live the life of the top 1% without fear of being prosecuted for crimes that are prosecuted almost anywhere else in this country. It's pretty disgusting that I'm represented on the council by someone whose only concern with the public subsidizing a luxury apartment building to this extent is that it include the compulsory hiring of a certain percentage of minorities. Detroit South is becoming a more appropriate name for Indianapolis with each passing day.