6:16 AM on April 20, 2011
Have fun taxpayers. This is just the tip
of the iceberg. The City is going to spend, spend, spend(your money) to
make their downtown what the councilors peersonally want it to be.
7:27 AM on April 20, 2011
What's being "spent" here is revenue that
wouldn't be there if this wasn't approved. The TIF money for this is the
difference between what the property taxes are now and what those on the
updated building are.
7:30 AM on April 20, 2011
And that's so different than North Liberty
or Coralville, right?
10:32 AM on April 20, 2011
Rupert, how about we let Moen (who is a
multi-millionaire) throw in his own money for this private project and
then we can get the updated tax revenue without kicking in city money.
If you expand on your house your tax bill will go up. Do you expect the
city to pay for the extension because they will eventually recoup their
6:17 AM on April 20, 2011
This is hard to believe. I don't see how
the people of Iowa City would approve of this very risky plan.
7:29 AM on April 20, 2011
They wouldn't approve a plan to update
a building that's in poor shape?
10:54 AM on April 20, 2011
The bank won't approve it so why should
we as taxpayers?
7:13 AM on April 20, 2011
This is getting to be absurd...
7:51 AM on April 20, 2011
If they want to provide this money, there
should be very specific deliverables. And not just a nicer looking building.
Minumum tax payments and jobs created. Otherwise, we are helping to finance
someone to make more money. Not justifiable in the current economy. This
is not economic development without job or income (for the city-not just
the person) requirements.
7:52 AM on April 20, 2011
They're got $250,000 in City taxpayer money
for what is basically corporate welfare, but they weren't sure a month
ago if they had enough money to another fire fighter.
7:59 AM on April 20, 2011
I don't know about you, but I would much rather the city spend $250,000 on a potential business venture that will generate more taxes than spend it on, say, a bunch of affordable housing or pointless search committee's that don't really contribute to the city economy in a substantial way. How many other city expenditures are projected to increase the city budget by $30,000+ a year? This is tangible investment in Iowa City, not a social-services hand-out or mis-guided squandering of funds.
If Moen does manage to get a name-brand
retailer into this space and they do well, I personally think it could
be the start of a big push into downtown IC by non-alcohol-related businesses.
Just like with the bars: one bar makes a huge profit, others want to follow.
If the right retailer
moves into this space and makes a big profit, others will want in on the action.
8:20 AM on April 20, 2011
I agree that this is a good thing if it
leads to new business and employment for the city in the near term. But
if it does not? Why not put requirements on the money that create positive
income for the city? Otherwise, we are "granting" him money to help him
make money. This is
what is causing the political and economic divide.
9:20 AM on April 20, 2011
I could not agree more...
10:34 AM on April 20, 2011
The problem I have with this is that Moen already has a lot of money. Why do the taxpayers have to kick in money? He even said himself that this is a high-risk project. If the banks won't give him a loan for it, why on earth should the city government. I would rather see this money to go a local small business owner who needs it. Not some aristocrat sipping champagne in the plaza towers.
Furthermore, how much outcry do you think
there will be if this National retailer comes in and puts a local business
out of business?
8:02 AM on April 20, 2011
And do you think anybody other than a very-connected
rich guy like Marc Moen is going to get a sweetheart corporate welfare
deal like this one?
8:27 AM on April 20, 2011
I wouldn't call this a sweatheart deal
- Moen is taking a ton of risk here. The history of luring name brand retailers
to the ped mall has been a disaster. It will be nice to have a renovated
empty building instead of an empty bar i guess....
8:35 AM on April 20, 2011
Any research on how much TIF money Marc
Moen has been awarded?
8:44 AM on April 20, 2011
I can't believe Moen is actually going to get the city to foot some of the bill for one of HIS projects. The IDEA is good, but the city helping to fund it is not. What exactly does he need taxpayer money to accomplish this?
I heard about this plan about a month or so ago. The plan is actually for him to buy as much as he can on that "block" from Vitos, east. There have been talks about Moen buying TCB (former College St) and doing something similar to it, but from my understanding, the current occupants of TCB and Moen have yet to come to an agreement since that business is viable.
I just can't understand why the city feels
the need to help fund this project. Anyone who knows Moen knows that this
is a project he would take on with or without would taxpayer assistance,
because it makes sense is his development model. But of course, he is going
to sell it to the city that he needs help from the city to make this a
viable deal for him. And of course, Hayek, Wright and Champion are going
to have the wool pulled over their eyes and not see a problem with this
because when a decision has to be made, 90% of the time you can count of
those geniuses to make exactly the wrong one.
10:58 AM on April 20, 2011
I think it's pretty apparent that the city
council now has tunnel vision with downtown Iowa City. They want to believe
that the 21 ordinance was a good thing and they will stop at no cost to
prove this, even if it means using tax payer money to renovate privately-owned
businesses. This has to stop now. I am a pretty liberal guy but we cannot
keep using money to convert every former bar. Let private businesses foot
the bill. If they won't then that ought to tell the council something.
Of course they will never let this happen because they do not want anyone
telling them "we told you so."
11:21 AM on April 20, 2011
I couldn't agree more. The stupidity absolutely baffles me.
Don't get me wrong, I would love for downtown to be reinvented and become an awesome spot to and enjoy a day or night out. And I certainly think that since the city council was responsible for the demise of the downtown landscape, they should be held responsible to find creative ways to fund/attract new business development downtown. But there is nothing creative about handing out free money to people and then raising everybody's taxes to pay for it. Especially when nearly half of the city didn't want them to enact the 21-ordinance to begin with. If I wanted to help pay for someone else to buy a building, I'd write them the check myself. Better yet, I'd buy it myself. But I'm not interested in either.
This one instance obviously isn't going
to reshape downtown, so I expect in the future, the city will have to be
involved in some way, shape or form in assisting development. There aren't
too many people right now (though there are some) who want to take the
risk of developing a new
business downtown. That is, unless you can convince the city to give you a sweetheart deal in order to accomplish it.
So here's the question Markus and city
council: Are you going to figure out a creative way to attract new businesses
downtown or are you going to do it on the backs of taxpayers by handing
out their money? Because if it's the latter, you are going to quickly find
that you are going to have some problems.
8:49 AM on April 20, 2011
I realize this isn't how business normally operates, but maybe they could attempt to secure tenants before throwing money at the renovation?
They say they want to attract a large brand-name
retailer... Who, and what type of retail? The vertical they pick up would
need specific storage space, building layout, technology installs, etc...
Instead of just throwing money into it and hoping it works out, couldn't
they do some leg work and get a commitment?
9:18 AM on April 20, 2011
Let me get this straight:
A homeless guy, asking for 50 cents is illegal on the ped-mall, but a multi-millionaire developer asking for a quarter million dollars is perfectly acceptable?
Elections are in November, people. Just
one more reason to clean house.
11:56 AM on April 20, 2011
All Men are created equal, some more equal
8:05 PM on April 20, 2011
"Steal a little and they throw you in jail
/ Steal a lot and they make you king." - Bob Dylan
9:25 AM on April 20, 2011
The city leaders are such suckers. I look
forward to doing business with them.
9:44 AM on April 20, 2011
It's too bad we're losing bars and replacing
them with non-bars.
9:50 AM on April 20, 2011
"Moen has his sights set on luring a name-brand retailer to occupy the main floor, but it will take time, he said. His hope is for the store to open in 2012"
AHAH.... Moen won't say what retailer he is dealing with, perhaps when its all said and done it will be another liquor store? or Resturant/bar?
after he has the money in place he will
do as he sees fit? with the TIF $$?
9:55 AM on April 20, 2011
They'd make our money back a lot faster
if they just fixed up the bar.
10:34 AM on April 20, 2011
The private sector has proven what works
in the downtown and the city council killed them with their 21 only ordinance.
Development and the risks should be left up to the private sector. If private
developers are unwilling to risk capitol for downtown development, why
taxpayers? Big name retailers are not going to set up downtown.
10:40 AM on April 20, 2011
Everyday the P-C is reading more and more like The Onion. The only problem is this news is actually real. I read about this in the Gazette on Sunday morning and was totally shocked. There are so many things wrong with this that I don't know where to begin. Lets look at what lead up to this:
1. 21 Ordinance enacted
2. A few bars (businesses) go under because of the new law which cuts their business
3. A wealthy private investor wants to buy a closed down bar.
4. The project is so high risk that banks will not give him a loan so he goes to the City.
5. The city hates bars so agrees to give him tax money.
6. We have no idea what retailer will go into this area, but since we know its not a bar it must be good.
If this was anyone else asking for the
money would they get it? Mike Porter owned Vitos. If he had went to the
city and said he wanted money to convert it into a non-bar business would
they have given it to him? Rich guys are always getting corporate welfare
in Washington. I never thought it would happen in Iowa City though.
10:56 AM on April 20, 2011
Didn't they just have an article up about
a family-friendly sex shop? How funny would it be if THAT went in there?
11:06 AM on April 20, 2011
Porter had already borrowed money from
the city and he didn't repay it, I think that would have been a pretty
good reason for the city to not give him money. He only leased the space
but he wasn't paying rent, and yet he still managed to go belly up....and
this was prior to the 21 ordinance.
11:05 AM on April 20, 2011
Many of the business owners that I have spoken with over the past couple of days are astonished that the city is ponying up a quarter mil for Moen. It's essentially down payment assistance. Their , "I wish I could get 25% of city money so I could buy another property". It's asinine.
The city chose to erode the current landscape and economy of downtown, so I agree that they should have a plan in place to try to reshape the downtown area. That part I applaud. What is crazy is to try and fund this development on the back of taxpayers. Adopt a TIF plan like Coralville , or have some sort of business building incentive to attract new development downtown. But handing out a quarter million dollars for someone to purchase a buiding and remodel it, and THEN having the guts to raise taxes in order to pay for that is stupidity at its finest. And all this for a guy who certainly more than has the financial assets to pay for this himself. Did the new restaurant going in where 808 was get 25% assistance? NO. Cheeba Hut? NO. How about where the Fieldhouse relocated? NO. Any of the other now defunct businesses get a chance at 25% assistance to re-invent themselves and change there business model before they had to close their doors? OF COURSE NOT. So the question is: WHY MOEN?
If I didn't know any better I'd think that
with all these hand outs to rich people we had Republicans running our
city council, instead, we just have a bunch of idiots.
12:00 PM on April 20, 2011
The council took a page from George Bush's
playbook. When Baghdad fell there was no plan for rebuilding. When the
21-ordinance was enacted, there was no plan. What do both of these have
in common? The solution was to throw money at it!
12:30 PM on April 20, 2011
Did any of your "examples" ask for money
or make massive updates to a building in poor shape? And you want the city
to use TIF...even though this IS using TIF...?
1:31 PM on April 20, 2011
Porter put over a million into the Summit
2:39 PM on April 20, 2011
Rupert - if a building is in poor shape,
shouldn't it be on the landlord to keep it updated? Why should the taxpayers
pay for it? My2sensenow is simply stating that there are much more worthwhile
uses for TIF money. I don't think giving a quarter million to a wealthy
landlord to bring in an unknown store is money well spent.
5:10 PM on April 20, 2011
Rupert-I noticed I wasn't real clear
on the whole TIF thing. I don't have an issue with the TIF approach per
se to attract new business. We've seen Coralville use it fairly successfully.
My issue is that this appears to be way too much of an isolated incident
as opposed to a broader method or approach to developing downtown. If the
city is going to adopt this approach, then make it available to qualifying
businesses to locate, improve, etc. (whatever criteria that may be). But
here is one isolated instance where the wealthiest and most prominent and
successful real estate developer in the city gets the benefit of public
financing. Is it possible that this opens the door to a broader economic
development policy? Sure it is. But if this is simply an outlier, it just
seems a little off to me.
11:20 AM on April 20, 2011
Another property off the tax rolls for
8 years. Nice job, morons.
12:26 PM on April 20, 2011
Untrue statement. But thanks for trying
to spread misinformation
11:48 AM on April 20, 2011
It is interesting when people rage about
entitlements, and then we collectively recognize that large, wealthy developers
and corporations are the biggest recipients of entitlements.
12:49 PM on April 20, 2011
I'm not seeing an inconsistency. People
seem to not agree with either.
12:30 PM on April 20, 2011
How about we wait a year or two and see what happens to downtown Iowa City as a result of the 21 ordinance - before we start throwing tax payer money at the problem that may not exist.
This is exactly what is wrong with TIFs
- well connected developers get TIFs to develop areas that are not blighted.
There is nothing to support the idea that the development wouldn't occur
without the TIFs.
12:44 PM on April 20, 2011
Actually (and unfortunately), I'm pretty
certain the City is thrilled about these rush products. If they get new
commercial business in place of the closed bars, no bar/restaurant can
pretty much ever get back in that space, due to the ordinance they passed
a while back about limiting liquor licenses within a certain distance of
each other. So rather than take the risk that a new bar could open up,
they're shutting the door as soon as possible. Sad.
1:21 PM on April 20, 2011
I feel like Moen mad a mistake. City council
and U of I are so against bars downtown he could of asked for half from
the city and half from the university and they would said heck yes. What
a sham. Taxes in Iowa City are going to skyrocket in the next five years.
I don't think anyone
understands how much revenue these venues generate for the city. So either we all pay through the nose in taxes or all the stuff that makes Iowa City such an awesome place( Jazz fest, Arts fest, ETC.....) will disappear. A big thanks to all of our elected officials for that.
2:11 PM on April 20, 2011
There is NO WAY that a private venture
should be funded by public money. I don't care if this guy is anyone at
all. He has no right to ask for taxpayor money for his potential profit.
Tax payor money collected by the City is meant for essential city services.
This is NOT and essential service.
5:22 PM on April 20, 2011
So, you're on record saying that every
single TIF is a bad idea?
6:36 PM on April 20, 2011
Not in this economy with IC cutting police
and fire positions to pay for pet projects along with over-designing, over-building,
and over- paying for "Taj-Mahal" projects. In addition to committing public
funds for park shelters, animal shelters, and U of I deals. These people
just don't know how to stop spending money that belongs to US.
5:20 PM on April 20, 2011
First step: Mark Moen gives the new City
Manager a place to live at a reduced rate. Payback: A quarter-million in
Moen's pocket a few months later. I guess we can say that we do have transparent
government - they don't even attempt to hide their deals!
5:30 PM on April 20, 2011
This is a good strategic investment in
downtown. If Moen makes money on it...great. The city needs someone to
initiate this sort of speculative venture if downtown has a prayer of changing
for the better. Someone could have purchased the dump and continued the
bar tradition with much less investment or risk.
6:20 PM on April 20, 2011
Yes they do. That is why there are banks.
10:43 AM on April 21, 2011
The banks have expressed no interest. There's
more for you to learn about the situation prior to making you knee-jerk
5:53 PM on April 20, 2011
Lets say The city manager gets his wish.
Anthropologie opens up. The business is successful, they sell hundreds
and thousands of shirts, dresses, and shawls, all made in a variety of
sweat shops around the world. They hire 35 part time employees at 10 dollars
an hour, they profit 2
million dollars and that money goes straight to Urban Outfitters in New York. Sounds good to me. Now that is how you develop a local economy.
But wait, first we should partially pay
for them to come. Good Plan.
5:56 PM on April 20, 2011
One more thought, if a bar or restaurant,
as Moen says is not a risky investment, then I would love to know who he
banks with. (besides the tax payers of Iowa City).
8:16 PM on April 20, 2011
Is there actually anyone in Iowa City who wants a chain retail store competing with the independent stores trying to keep their economic feet in this fiscal climate? Is there anyone in Iowa City who genuinely prefers mall stores (many of which are owned by currently bankrupt and increasingly unstable umbrella firms) to places like Real Records?
Well, I shopped at Real. And Vortex. And Fun Zone. And I still shop at Murphy Brookfield and Home Ec if I have money to spend. And I don't want Mark Moen to use my tax money to remake Iowa City in Coralville's image (except with expensive apartments on top of a more spread-out mall, all half empty, like Coralville's mall, no doubt).
Let him appeal, as all real small business owners do, to his customer base: potential renters. If they aren't even signing up for the space yet and the bank doesn't want to fund the risk, let him look for a private investor to help him with his investment.
I want fire control, school maintenance,
library funding, snow removal, repaired roads, and all the other things
that the City is supposed to provide. I also want my indies - the main
reasons I choose to live in Iowa City - not to suffer because the city
pays some guy to bring in competitors.
8:22 PM on April 20, 2011
So we're laying off 22 teachers, but paying
a quarter million dollars to remodel Vitos because the City ran them out
of business. Yep, that's real improvement for our community, Mayor Matt.
10:53 PM on April 20, 2011
If this property is potentially better
or more profitable as a retail store a business would do it themselves
and the city would not have to step in. Businesses go where money is able
to be made. If money is not there they don't go there. The city still hasn't
realized that free enterprise
happens naturally, not forcefully. That is why there are several vacant retail units under newly built apartment buildings.
# # #
Morelli, "Leaders defend ped mall project,"
Iowa City Press-Citizen, April 19, 2011:
Iowa City leaders say using public money to help repurpose a former bar into retail and office spaces is a worthy investment.
The city plans to chip in $250,000 through tax increment financing toward an estimated $1 million conversion of the former Vito's building into a site for a national retail franchise on the first floor and one or more "class A" office units on the second floor.
"We would like to see some of the large bar spaces converted to retail and offices. We think it is better for downtown," said Jeff Davidson, Iowa City director of planning and community development. "The bottom line is, the only tool the state allows us to foster economic development is tax increment financing, and we feel in Iowa City we use it responsibly."
An economic development committee endorsed the project with a 3-0 vote on Tuesday, and the project will come before City Council on May 3.
On Friday, downtown developer Marc Moen closed a $1 million deal to buy the building at 118 E. College St. It housed Vito's until it closed earlier this year in the wake of the controversial 21-only law.
Moen and city leaders say this type of project -- retail and office -- meets city priorities for diversifying downtown. At the same time, they are much riskier than a bar or apartments, and banks are less willing to provide funding, they say.
Moen said the project is "higher risk, higher cost and lower reward."
If approved, the financing would take eight years to repay, and the new building will generate $31,250 more in property tax revenue per year than it currently does, according to city documents.
Moen has his sights set on luring a name-brand retailer to occupy the main floor, but it will take time, he said. His hope is for the store to open in 2012.
The "substantial renovation," which includes gutting the building to its core and restoring the original façade, will begin immediately, Moen said.
City manager Tom Markus said the added retail and office space and upgrading a dated building will be good for the city.
"From that standpoint, I think we're starting
the process of rebuilding the downtown. Marc is a known quantity in terms
of doing quality work," Markus said.
Morelli, "Leaders defend ped mall project," Iowa City Press-Citizen,
April 19, 2011: Iowa City leaders say using public money to help repurpose
a former bar into retail and office spaces is a worthy investment. The
city plans to chip in $250,000 through tax increment financing toward an
estimated $1 million conversion of the former Vito's building into a site
for a national retail franchise on the first floor and one or more "class
A" office units on the second floor. "We would like to see some of the
large bar spaces converted to retail and offices. We think it is better
for downtown," said Jeff Davidson, Iowa City director of planning and community
development. "The bottom line is, the only tool the state allows us to
foster economic development is tax increment financing, and we feel in
Iowa City we use it responsibly." An economic development committee endorsed
the project with a 3-0 vote on Tuesday, and the project will come before
City Council on May 3. On Friday, downtown developer Marc Moen closed a
$1 million deal to buy the building at 118 E. College St. It housed Vito's
until it closed earlier this year in the wake of the controversial 21-only
law. Moen and city leaders say this type of project -- retail and office
-- meets city priorities for diversifying downtown. At the same time, they
are much riskier than a bar or apartments, and banks are less willing to
provide funding, they say. Moen said the project is "higher risk, higher
cost and lower reward." If approved, the financing would take eight years
to repay, and the new building will generate $31,250 more in property tax
revenue per year than it currently does, according to city documents. Moen
has his sights set on luring a name-brand retailer to occupy the main floor,
but it will take time, he said. His hope is for the store to open in 2012.
The "substantial renovation," which includes gutting the building to its
core and restoring the original façade, will begin immediately,
Moen said. City manager Tom Markus said the added retail and office space
and upgrading a dated building will be good for the city. "From that standpoint,
I think we're starting the process of rebuilding the downtown. Marc is
a known quantity in terms of doing quality work," Markus said.