$83,000 in Carmel Redevlopment Commission projects delayed by council

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By Adam Aasen

An ordinance to approve $83,897 in City Center area improvement projects by the Carmel Redevelopment Commission turned into a much larger discussion about the CRC’s budget at the most recent City Council meeting.

Sharp

Sharp

The bill is for funding for various contracts involving American Structurepoint. Projects include:

● relocation of Duke Energy lines from Third Avenue SW to Pedcor Property

● improvements to the Monon Trail adjacent to the Lofts development

● building a trail connection between the Monon and Third Avenue SW

● building a pocket park to surround the Monon near the Lofts development

But as the ordinance was introduced, Councilor Rick Sharp raised pointed objections, asking whether the CRC was going to delay some projects due to its limited budget. As a result, he suggested delaying approval.

Councilor Sue Finkam said she thinks certain council members are just playing politics with the projects. She called their actions “damaging.”

“I think it was either politically motivated or being really conservative,” she said. “When we delay these projects and we can’t get them done on time, it makes Carmel look bad.”

The city council maintains oversight of the CRC finances after the commission needed help to restructure $184 million in debt in 2012.

It was released during the March 18 city council meeting that the CRC ended 2013 with $7.6 million in balances with $5.4 million in TIF money. But after paying $5 million in bond debt, the CRC had about $400,000 left in TIF money to work with. This has caused some city council members to ask during a recent meeting whether the CRC has enough left in its bank accounts considering the expenditure would exhaust about 20 percent of its remaining funds.

Even a week after the meeting, Sharp said he still doesn’t feel his questions have been answered about the project, so the delay is necessary.
“I asked, ‘Can you pay for this and can you pay for the underlying costs?’ And that was never answered,” he said. “They come to us with $83,000 of bills and I have to ask questions about that because we could find ourselves in a position where we would have to bail them out again.”
Sharp emphasized how important it is to carefully look at every penny spent by the CRC, especially given the budget problems in the past.
“We bailed them out to the tune of $184 million and we are not going to go back down that road again,” he said. “We asked the simplest questions and we get people stumbling over their answers. I just asked if they could afford to the project and all I heard is that ‘We are obligated to,’ What kind of answer is that? If you can’t afford to do the work, why proceed to do the work? They come to us after they already made financial obligations. That isn’t fiscal oversight.”

Carmel Mayor Jim Brainard disagreed with that assessment and said, “The bottom line is the city is in great financial shape.”

After the meeting, Brainard expressed frustration that so many criticisms were leveled at what he thinks it a very simple deal. He was asked if there was money available for the project and he said there was.

“The projects have been approved,” he said. “I don’t understand the problem.  These have been in the works for a while. The council should have done their homework before the meeting.”

Ultimately, the council decided to delay voting on the ordinance to give councilors more time to look at the situation.

“I just want to make sure we are doing this the right away and I would like time to see that,” Councilor Carol Schleif said.

Councilor Luci Snyder expressed concern not at the specific project or the amount of money, but that so many other council members are concerned about the CRC budget at this time.

“I would have voted on this this evening, but I support the chair in delaying this matter,” she told the council. “It is money and it is dollars.”

Brainard said the delay isn’t the end of the world, but that it is unnecessary and could cost more money. He said it is important to keep these projects on schedule so as to not incur extra costs.

Since the next city council meeting is canceled due to Spring Break, project approval could be delayed by four weeks.

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5 Comments

  1. While, as expected, mayor supporters call this “politics at its lowest”, I believe it is both prudent and accountable for the council to make certain the CRC does in fact have funds to pay for it. The Council repeatedly asked if the CRC had the funds to pay this. The answer was always “It is budgeted.” Mr. Engleking finally, when asked if the money was in the bank, mumbled yes.
    But, it seems to me, looking at the CRC actuals to date as of 2/28/2014, they have appropriated exactly ZERO dollars for this (and they do not even begin accumulating funds to pay for these contracts until April).
    Given that the CRC’s own financial advisors (Umbaugh) project TIF will be down again in 2014 (by $3+million) and they have not put any money into a Contingency Reserve Fund to pay for any lawsuits (of which they have already lost one and don’t have the funds to pay for it until June/July and then only 1/3 of the settlement), the bigger question is not did the CRC approve the work; rather it is was the work done with no funds to pay for it? That, to me will make Carmel look ‘bad’ far, far worse than the council doing its due diligence.

  2. Councilor Sue Finkam said she thinks certain council members are just playing politics with the projects. She called their actions “damaging.”

    “I think it was either politically motivated or being really conservative,” she said.

    “When we delay these projects and we can’t get them done on time, it makes Carmel look bad.”
    —————————————————————————————————————————–
    This is an excerpt from the 1999 State of the City. Did the mayor make Carmel look bad by not executing City Center and the Museum on his initial optimistic time frame? How does the rest of what he claimed look a decade and a half later?

    “The plans for our largest partnership, Carmel’s City Center, have been developed during the past
    two years. This project, in its third year, will show a rapid increase in building activity.
    Our successful bidder for the residential section of the center, AMLI, came in forty-three percent (43%)
    above our bid request.

    They are not alone in their belief in this project. Several local developers are in discussions about the office and retail sections of the Center. And, earlier this year, I met representatives from the Gallery of French pre-Impressionist Art who are interested in housing their collection in the Museum building in City Center. In addition, we’re working on a plan that will get the Performing Arts Center underway in the year 2000.

    The success of the tax incremental financing, or TIF district, we created to build this project was
    based on the tax revenue from 700,000 additional square feet of commercial construction. We currently have more
    than 3 million square feet proposed. This is far more than we had envisioned being built in the
    next 10 years. As a result, this growth will allow us the opportunity to use the property tax revenue
    from these projects to begin construction on our Performing Arts Center and Museum years sooner
    than we had originally anticipated.”

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