Mayoral Announcement on Renaissance Square
Posted by Jeff Pruitt - 6/23/09 @ 3:50 pm - Filed Under Featured, Local Politics
You can read the full press release here if you desire, but let’s take a look at a couple of quotes from the release:
“We explored all the options,” observed Henry. “Our space needs demand action. 200 East Berry Street represents a unique and inclusive solution, a one-of-a-kind opportunity that will allow us to bring together all city departments and make the best use of our resources. The time is right. The price is right. And the long-term benefits for both the city and county are outstanding.”
The price is right? Hmmm…
The economics of the opportunity make it a highly desirable deal with all financial projections supporting it. The building will be purchased for $7.3 million from Renaissance Square, LLC. Renovations and furnishings will add approximately $7.2 million to the budget for a total cost of $14.5 million. The purchase funds will come from County Economic Development Income Tax dollars.
By any chance did we offer less than $7.3 million? Was this the same crack-staff that negotiated the Harrison Square deal? And using CEDIT dollars for this? Is that really the best course of action here?
The administration is using a potential $500k/year in cost savings to justify the purchase but even if you believe those numbers would it not be even better to pay less than $7.3 million? It’s not like the building has been a real hot commodity…
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28 Responses to “Mayoral Announcement on Renaissance Square”
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What will it cost to buy land and build a brand new building? Building brand new might be better then trying to upgrade something from the ’60s.
We can only hope the City Council realizes the stupidity of this idea and knocks it down.
“We can only hope the City Council … knocks it down.”
No, that will not occur for about five or ten years when the City realizes their push to revitalize downtown has hindered development in other areas of town.
It will be torn down and rebuilt on the north end of town under the logic that building something brand new and expensive will cause many thousands of people to visit the Fort.
I would suggest calling your councilman and complain,and then get family members,friends and neighbors to do the same.The one thing all politicans can do is count.
So the administration proposes an idea that SAVES taxpayers money…and the readers of this blog are against it?
Strange.
Knuth - How do you come up with savings on this? We are city and county taxpayers! Just how do you expect the county will make up the loss of income from the city on the City/County Building AND the attached joint parking garage operation? Do you believe that money grows on trees - oh, sorry, I forgot you are one of those who are running this country into fiscal purgatory hopeing that our greatgrandkids can pay our way out. I am having real problems in understanding your logic.
Kalb,
The County can consolidate their numerous offices in ONE building- selling the left over space. I would suspect that the Keystone building alone would be VERY attractive to several law firms- one short block to the courthouse! Do you really think that the Sheriff can build a new building for $3 Million? I don’t. And even if he can he will have officers at the Courthouse and the justice center (and these operations are the BULK of his force). OR, he could locate in the CCB and be in the CENTER of the action. Which makes me sense?
Consider for a moment, that the city is right, and the County is the problem.
Perhaps the city’s move will FORCE the County into some fiscal restraint.
On a side note- are you aware that most ELECTED COUNTY GOP officials have received big raises in the past 3 months? Are you also aware that the County is considering asking all EMPLOYEES to take time off without pay to save money? Where is your OUTRAGE over that? Raises for the cronies and the working stiffs get stiffed.
Kevin,thank you wormtongue.
Knuth,
Moving people from one or more buildings to another building only creates more empty space downtown. Once again, you make NO sense.
Honest Abe,
Moving people from a downtown building to another downtown building does not create new empty space. It simply rearranges the existing empty space.
Kevin,
The City may in fact be spending less money in the long run as a result of the move. The controversy lies in the purchase price of the building. If you a subcompact instead of an SUV, you would certainly save on operating costs. But it still would be foolish to pay $25,000 for a $12,000 car.
Cost analysis can be misleading sometimes and when done by politicians, you must look at what they did very carefully.
The mayor said they wanted to make sure there was no increase in taxes. Sounds good, but does no increase in taxes refer to just city taxes or county taxes or both? We know the city pays the county $1 million a year. When the city pulls out the county is short $1 million. They need to make this up or raise county taxes. If they raise county taxes we are paying for office space we are not using while on the city ledger we will be paying for space.
There is also the cash flow aspect of the proposal. Borrow $ 7.3 million to buy a building. Borrow more money $7.2 million to renovate it. Then there is the parking issue (everyone with common sense has already identified this)for a total outlay of $14.5 Million. At 4%, we are looking at $580K a year in interest. Then you need to set aside 2% for maintenance of another $290K a year. Then you need to pay for utilities. Now add in cleaning staff and I bet you there is no cost savings at all.
More debt? Is this not led us into the current economic plight we are in? What politicians fail to realize is that everything they spend comes out of our pockets. If you truly want to save money, you make things last longer. Keep driving that old car till it drops dead. In the case of a building, be more efficient on utilization of space. Instead of reducing debt, living within one’s means, we have the city council wanting to leverage the taxpayer more.
As Yogi Berra said, its deja vu all over again. A few years ago Becky Hill craters the Wells Street YWCA. Next thing we hear is her friend Wendy Robinson proposing to buy the complex to house the FWCS administration overflow on South Clinton Street. Becky then gets elected to the school board with money and endorsement from the teachers union. But when budget cuts force staff reductions, Wendy declares administration reductions off limits and teachers get laid off instead. At least this time the union got its just desserts.
But the bullshit just never stops.
The fundamental question to be asked is what’s more important, a) the city consolidating all of its main functions under one roof OR b) the city and county having some frequently visted offices in the same building.
If I’m the Mayor, I go with “a”. If I’m the county, I say “b” because city residents are also county residents.
Regardless of the financial issues involved, shouldn’t there be more public input as to whether “a” or “b” is more important to the taxpayers before this is brought to City Council in July? This seems like an awfully big decision to move so quickly.
Stanley,
I think you bring up a valid point- but my counter to that is how many people have to visit BOTH city and county offices on the same day? I am thinking the number is pretty darn low.
One other thing that is being overlooked- WE NEED MORE SPACE FOR THE POLICE DEPARTMENT. Funny how everyone wants to complain about the costs of this proposal, but NONE of you are offering a solution to the space problem.
Kevin-the City is buying 220000 sq ft because the police supposedly need an additional 42000 (total of 80). I don’t think it is rational to say we are scraping by with 38 but we need 80 !! Lease 40000(or so) in 3 other bldgs in other areas of town so the response time is better. Space is available for $6-10 per sq ft which would cost $240000 -400000 and the current Bowser bldg can be updated with new windows,new HVC units ,new paint,rewiring as needed for a heckuva lot less than the 14+ million for the Ren. option.Like all political projections the total cost will be much more not even counting the interest costs.This is another fuzzy math Harrison Square type waste of the City and County taxpayers money so Tom and Greg can leave their legacy(and lounge in the luxury of the Lincoln Life extravagant offices). When all the details are made available there will be a thorough analysis done on this proposal and it will be clear that once again our City Admin.is not interested in saving money but in costing the taxpayers more so they get their pet projects.
Buying Renaissance Square will help to consolidate city\county government? Huh?
OK… I have a great idea! I am going to “consolidate” all of my canned vegetables by relocating all of the carrots to a new outdoor shed. Then I can fit extra green beans in the pantry. It will only take me 30 years to recoup the cost of the shed. I ignore the extra trips back and forth. I ignore logic. The time is now. I am a brilliant man.
Lockwood- Response times are not relevant- these are not precinct houses, our police are on patrol when they are on their shift. The issue is space for records, management, etc. Spreading that out over several buildings does not make sense.
And your solution is to rent- assuming we can get the space for $240,000 per year- what do we OWN after 20 years? Nothing. How much have we spent? $4.8 Million. If we get space at the $400,000 mark- $8 Million. Be sure to add that to your analysis of this proposal!
Kevin-I am not sure about the number of our police force but seem to recall it is about 500. How much management effort and space does it take to manage this number of people? Has anyone looked at the possibility of streamlining the management structure and reducing costs? If record storage is a big need ,we should digitize and then store the records in warehouse space which would be much cheaper as an alternate.We need to think outside the box and make a serious effort to reduce the size and cost of government on ALL levels!!
There is also an issue of opportunity cost. Somehow the City has concluded that it can lawfully use County Economic Development Income Taxes to fund expanding office space for government. Maybe it can.
But those are dollars that won’t be available for, oh, economic development. Even under the very low standard set by Harrison Square, where each dollar of public investment yielded, maybe, someday, several pennies of private investment, Renaissance Square is a failure.
It should be embarassingly easy to generate a dollar of private investment for each of those CEDIT dollars. But in Fort Wayne, increasing the size of government infrastructure IS economic Development. No wonder the hospitals, Vera Bradley, Sweetwater, etc keep locating outside the City limits.
In fact, if the CEDIT money cannot be used to leverage meaningful private sector investment, like two or three or four private dollars for each CEDIT dollar, then we ought to do away with the tax rather than let it be divied up among the well-connected friends and supporters of politicians. And if the economic development future is that bleak, we are not going to need the expanded space for government.
As long as I’m rambling… What, for example only, if we took those same 14 million (20 or more with interest on the bonds), went to St. Joe Hospital and said:
“You are extremely important to our downtown. You provide high-paying jobs and a very valuable service. You are an anchor for our city and you make living downtown more attractive/thinkable. We hope you will stay downtown, grow and prosper.
We have 20 million dollars over 20 years that we are willing to invest in you, provided you make a further investment. We’d like 3 dollars or more from you for each of our dollars. We want to announce a 100 million expansion. Maybe make your regionally acclaimed burn center nationally acclaimed. Whatever you think.”
Of course, the owners of the deteriorating white elephant that is Renaissance Square wouldn’t benefit. And we still have to figure out how to buy that Omnisource land, cough, gambling, cough, cough..
What bothers me most is not the VooDoo economics that come up with “cost savings” on this obvious waste of taxpayer funds. The bigger crime is both the City and County thumbing the nose at all the groups that have tried to get those entities to consolidate government services. Once the City and County get into separate buildings, forget about any type of coorperative effort to save taxpayers money on consolidating.
L.Marine,
Your number is fairly accurate. http://www.fwpd.org/discussion/viewtopic.php?t=17668
mark,
I think you make the point very well that the way our city spends and invests money is not likely to lead to much development at all. However, when you say “And if the economic development future is that bleak, we are not going to need the expanded space for government.”, you contradict yourself.
The bleak economy is likey to cause crime to sky-rocket, thus producing the need for an expanded police department.
If FWPD has 450 officers (150 per shift) and they all had to be in police headquarters at the same time, the well-conceived plan for 80,000 sf dreamed up by Rusty York will provide 500 square feet of space for each officer on shift . . . that is a 20′ by 25′ office. By any stretch of the imagination - who is kidding who?
This is almost as silly as the Mayor claiming he will save the Fort Wayne taxpayers a million dollars per year by not paying rent to Allen County.
I think the police are tired of “living” in a crappy neighborhood, and that is the main reason they want to move.
And I think Mayor Henry just wants something shiny and new, and it’s not his money he’s spending, so why not make it something really extravagent.
Regarding the Allen County Sheriff Department limits of funding recently. There is a little unknown fact that the politic pundits can overthrow if it done it correctly. Approximately $250,000 is raised every year in alcohol traffic stops in Allen County. The funds go to the Drug and Alcohol Consortium of Allen County who uses the funds to pay staff for prevention activities, and at organizations at Boys and Girls Clubs, Southeast Youth Council, and more. The factor is that the organizations, if they really wanted to business savvy, can obtain the money from supporters not government funds. Then, the alcohol traffic stop money can be utilized by the county by the ACPD/FWPD. Think $250,000 can supply the funds and benefits for approx. 4-6 officers each year.
To overturn this we must overturn Indiana State Law. Let’s overturn this, and stop this craziness. Think most counties in Indiana has $10,000 in these funds w/ Allen Co. and Marion Co. leading with $250,000 or more. One needs to realize that this gross misappropriations of funds fleeces taxpayers out of $1,000,000 per year. Join me in overthrowing this in justice.
Why does anyone think this is a good use of CEIT dollars?
How on Earth does this project count as Economic Development?
Mike Sylvester
because that is how government works. You put a pretty name on it and no one ask questions. It’s like rainforest instead of jungle. That’s why Al Gore named in global warming. If you continue to repeat it people will buy into it.