The vote was 6 - 1 with only Councilman Cromartie voting no. (*If you have cable, watch this very confusing Council meeting currently running on Channel 2; also see media links below.)
On the positive side: our expanding list of over 950 concerned citizens willing to speak up; your emails and phone calls in opposition; and our 12 united Neighborhood Associations had a real, if limited, effect. We had requested that Council look for alternatives to the Kenny’s project as proposed to meet the needs of the neighborhoods, Five Points businesses, and the taxpayers. Changes to the deal and our questions and concerns are summarized below.
CHANGES TO THE DEAL
While the outcome was not what we hoped, the deal approved yesterday had the following significant changes:
- Reduced the initial $1M payment to $500k, lowering the cost from $29,000 to $26,500 per parking space.
- The Five Points Association Board agreed to negotiate a 3-year contract to rent 100 spaces from the City at standard City rates.
- Contract changes - Because the structure of the deal changed, Mayor Coble moved that a clause be inserted into the contract requiring the developers to come back before Council to show the viability of the project prior to receiving any payment from the City. Other changes and clarifications made to the contract include approval of contract conditions by Council, not staff; presentation of alternatives if the condos are not feasible; and possibly others.
KEY CONCERNS
From a superficial “first blush” standpoint, these changes seem positive. Because they were made on the fly, however, there are many questions raised by Council members and by neighborhood leaders. Some of the questions and concerns from the changes to the deal listed above are the following:
- Reduced payment:
A. The $1M payment, usually referred to as “air rights,” was changed to “condo costs” in the Council meeting. The term “air rights” is not used in the contract and the rationale given by Councilman Rickenmann for this reduction was based on the soft economy of the condo market. What is this payment really for and how was it negotiated in the first place?
B. If the developers could live with less, why was the original deal represented as “the best deal” for the City?
C. While we have always wanted a successful project that brings life and vitality to Five Points, we have also emphasized concern over this expenditure of public funds.
· On the one hand, as both Council member Cromartie and Mayor Coble asked, “What does reducing the $1M payment by ½ do to the viability to the project?” We do not want to invest in a project that Council must salvage with more money down the road.
· On the other hand, the impact of taking away the entire $1M payment possibly saving even more money should have been considered, especially if this payment is based on the condos being built and they are abandoned.
This fundamental restructuring of such a complex project should have been deliberated and the public given an opportunity for input. Council member Cromartie was right to vote no.
- Five Points Association's parking space rental – is the offer credible?: Because Councilman Finlay represented the Five Points Association (“FPA”) offer as key to his vote change, this offer should be established as viable and reduced to contract immediately.
· According to an email sent by Don McCallister, President of the Five Points Board, after the Council meeting, “We are going to explore just how to [pay for the parking spaces] within the various legal, tax, and financial environments that a 501(C)6 such as the FPA operates to determine if we can do this, afford to do this, etc. I don't have all the answers yet and it would irresponsible to pretend that I do.”
· Appropriate vetting of this offer should have taken place prior to the vote.
We will work to get the information to verify that this offer is credible.
- Contract changes: We met with Council members as late as Monday morning presenting unacceptable risks in the contract and sent an email to all Council members outlining USC Law School Professor Phil Lacy’s concerns (to obtain a copy, hit “reply” with your request). We agree that the contract needed strengthening but have no access to the version voted upon and will seek to acquire a copy. We agree with Mayor Coble that Council must determine that the condos are viable prior to the $500,000 payment, especially given this market and the lack of financial assurance from the developers.
OTHER CONCERNS
1. Although we applaud the opportunity to save the public $500k (if there is no negative or future monetary impact), our position is that building a garage under these circumstances is an unjustified public expense of $5.3M (over $8M with interest).
· The price of $26,500 per parking space is excessive. Five Points’ need for 200 spaces doesn’t justify a parking structure. According to John Spade, Columbia Parking Director, “parking structures are usually not economically efficient if they provide less than 250 spaces.” The new Lincoln Street Parking Garage has 675 spaces. The City currently operates five garages representing nearly 2,900 spaces. If Five Points’ parking need had justified structured parking, the economies of scale would have brought down the per space cost.
· In the case of Five Points parking, there exists no proven need for a garage, no credible pro formas, no comparables, existence of cheaper alternatives (satellite/perimeter parking lots hidden behind retail significantly cheaper; Claussens offer of $22k per space; Yesterday’s offer of land at no cost), other unknown and unexplored options, and the fact that this procurement began with a “no bid” selection (price was not negotiated in a competitive environment).
2. We believe that all public dollars should be handled in a fiscally responsible manner.
· It has been stated on numerous occasions that the money used is “just from the parking fund; the money is there and must be used.” These limited public funds should be used to meet a variety of needs across Columbia, not an unjustified expense on a garage in Five Points.
· The parking fund is healthy, we’ve been told, however the city’s parking fund was recently rated BBB+ by Standard and Poor’s. BBB+ means the fund has “adequate protection” but is more susceptible to adverse economic conditions and changing circumstances than funds with higher ratings.
· Given this disappointing rating, we want to ensure that the fund is not burdened by decisions that are not financially responsible.
3. If the condos aren’t built, the mixed-use basis for the original PUD approval and zoning exemption is absent. Additionally, the project is not in compliance with PUD approval. In addition, if the condos aren’t built, the tax base is lowered and, due to these and other changes, the RFP responses should be reassessed. (RFP awarded points based upon an estimated higher tax base as compared to the Claussens proposed project).
WHERE COUNCIL MEMBERS STAND
Voted yes:
Anne Sinclair: Chief advocate and proponent of project on City Council who represents a portion of the Five Points village and many of the objecting neighborhoods. Opposed the request from her successor Belinda Gergel that the vote be delayed until she takes her seat.
Daniel Rickenmann – Says that he has no problem with the building height or style (thought it was "neat") or the contract (stating that the City doesn’t have a perfect contract but if it did, there'd be no need for lawyers). Previously stated the process used by City was a concern. Main concern is fiscal responsibility. Responsible for the reduction of $1M payment to $500k.
Kirkman Finlay – Only Council member previously voting no (“an island of no,” according to Finlay). With the changes made in the Council meeting, he states that he has no longer has fiscal concerns. Also, not concerned about the height/mass of building. Seemed to express disapproval of neighborhood involvement. (“Neighborhoods cannot write the final chapter.”)
Bob Coble – Questioned whether additional negotiations might be able reduce the building’s height and insisted that the Council have authority over the contract’s final deed, construction loans, and the feasibility of the project, which will require additional votes before Council.
Tameika Isaac Devine – Has been supportive of the project in prior votes and of Councilwoman Sinclair’s role. Expressed concern at the meeting about not knowing of Rickenmann’s discussions with the developers. Now open to a four-story compromise.
Sam Davis – Only known concern is City liability “if deal goes south.”
Voted no:
EW Cromartie – Believes the building is too tall - stated his concern about height and the 2 floors of condos. Supports parking at the Kenny’s location over the Claussens site. Has a concern about viability of the project without the $500k. Strong reaction to the last minute changes and lack of deliberation by the Council. “This is not the way the legislative process is supposed to work.” Voted not to approve the contract.
If you wish to express your opinion on the vote, here is the contact info:
· Mayor Bob Coble,
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, 545-3075
· Anne Sinclair,
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, 545-3065
· Tameika Issac-Devine,
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, 254-8868
· Daniel Rickenmann,
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, 799-9477
· EW Cromartie,
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, 254-7243
· Sam Davis,
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, 754-0525
· Kirkman Finlay,
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, 748-1090
In spite of all of the confusion and many concerns, our goals have always included making sure that an appropriately vetted project is successful and that Five Points remains healthy and vibrant. We are disappointed with Council’s actions, however, given the level of public involvement with this project and our commitment to remain involved no matter what happens, there may still be an opportunity for Council to find a compromise that better meets the need of the neighborhoods, the businesses, and the taxpayers.
Thanks again for your active involvement in this critical public issue.
Caroline Watson
*See more on the story:
http://www.thestate.com/local/story/412241.html
Click here: The State | 05/21/2008 | Parking OK’d for 5 Points project
Five Points Parking Garage Project Moves Forward
http://columbiacitypaper.com/News-Commentary/News/Five-Points-South.html
