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John Nephew

Maplewood City Council Policy & Politics


Gladstone: The TIF Tiff

What's going on with Gladstone and tax increment financing? The council majority is sending contradictory signals to two different groups. On the one hand, some citizens who oppose the use of TIF have been reassured at various times that it's off the table. On the other, the development plan for the Lake Phalen Estates (the former site of the Saint Paul Tourist Cabins) is structured around a significant amount of TIF money, and the council has been unwilling to come out and tell the developer to draw up plans that don't assume some public money.

Someone is being misled. Is it the citizens or the developer?

Last summer, council member Erik Hjelle voiced a clear position on TIF. He wrote (you can find this in the council packet of the 6/26/06 workshop, page 97):

Tourist cabins. I will not support any TIF for this project. A builder/developer should not need any enticements to build on lakeshore that is 10 minutes from downtown. This is not negotiable for me.

In an August 8th commentary in the Maplewood-Ramsey County Review, Hjelle rejected claims that Gladstone redevelopment was in limbo. He touted the plan for the cabins site as “a proposal to build a 150+ unit Class A development at the St. Paul Tourist Cabin site with $0 public financing.” And again Hjelle touted the no-public-subsidy aspect of the project in the City News of September 2006.

At the Mayor's Forum on February 3rd, one of the mayor's supporters asked if there would be a taxpayer subsidy for this development. Mayor Longrie said there was no tax increment financing approved for it. City Manager Copeland said an application for TIF had been received, and would be reviewed at an upcoming council workshop.

I made a data practices request to the City of Maplewood to get a copy of the audio recording, to make sure I got her words right. Here is what she said:

He can certainly apply. I mean, we haven't said that nobody can apply. I mean, anybody can apply. But one of the guiding principles of the Gladstone redevelopment plan was indeed that TIF was not encouraged or looked upon favorably. So that was one of the guiding principles that the council also voted on, so I mean that gives you an idea of, I mean, there's always, with anything there's always, you know, people can present proposals, and we look at our guiding principles that we've already enacted and what is our public policy. And certainly I can tell you that my public policy, from my perspective, is that I think being ten minutes from the capitol – gosh, that's prime land all by itself. It doesn't need my help. But that's just me.

(You can download an audio clip of the mayor saying this — it's an MP3 file, about 1 MB).

While she parsed her words very carefully, the mayor left forum attendees with a sense of reassurance that TIF was not going to be used on this project. At the least, she implied that she opposed TIF for this specific development.

Two days later, the developer in question was in front of the council for a workshop. Numerous times and in several different ways, the developer and city staff gave the council an opportunity to express their principles and public policy philosophy when it came to TIF and this project. Each time, the mayor evaded the question. She repeatedly said that the council doesn't take action at workshops, but what the developer wanted was not a decision but rather a frank discussion of the public policy values of the council members in this open meeting.

Someone is being misled. Either it is the citizens, who are being reassured that taxpayer dollars won't be spent to subsidize this project on lakefront property so close to the heart of the metro; or it's the developer, who is being asked to invest thousands in a study and much more in planning, working from a blueprint that assumes some level of assistance from TIF.

It seems to me that this is the wrong way to govern. If you have concluded, a priori, that a plan on this site should be able to succeed without TIF, why not be straight with the developer? Tell him the truth up front, and let him build his financial plan around that reality. Don't lead him to waste a whole lot of money preparing a course of action that would require you to violate your policy principles.

On the other hand, if the council majority is truly open to TIF — as opposed to just worrying that if they say no, they might scare the developer away and lose the $1.8 million Met Council grant they are so proud of, or the park fees from the development that are earmarked for the Gladstone Savannah — then they should spend some time acting like leaders, persuading the public that it's an idea worth considering. Then, if they do decide to create a TIF district, it won't come as a shock to people who have been promised that it will never happen.

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