Council discusses blackmailing the school district out of $400,000



Back in 1996 the City went to the citizens and asked them if they could convert the privately held water company to a City owned utility.  As part of that takeover, the City and the School District came to an agreement where the School would support that effort if the city continued to pay property tax on the land.  The City verified that agreement by passing legislation stating they would continue to make payments to the schools at the same rate as if the property were being taxed.  In that legislation, the city committed to keep paying this rate until both they and the school district agreed to the city should stop.  


A couple years go by and we end up with members of council that believe they have no obligation to past commitments and can unilaterally back out of that agreement by passing another piece of legislation repealing the agreement. 

Tuesday night Council got into a discussion about road improvements for the west side of Chambersburg road.[1]  When council was presented the numbers[2] they were told that the proposed non-school TIF would only cover a portion of the costs.  Instead of fully discussing other funding options[3] or accepting that the lane widening happen in stages – like what is being done on the East side of Chambersburg - council instead set their eyes on taking $5 million dollars of school money that could be used to pay for busing all high schoolers for the next 10 years.  In order to drive the school board to the negotiating table, where council plans to strong arm the School Board into signing off on a TIF that takes school money, council directed staff to daft legislation for Monday night that withholds the funds council agreed to pay to the schools. 

Watching this discussion, I could not help but wonder if I should draft a strong mayor proposal that includes the ability for the first strong mayor to remove and replace the current council.  If you have a better suggestion for stopping these kinds of tactics, I would appreciate hearing them.

What should council have done?  They should have stuck to the discussion on what the non-school TIF could provide.  They also should have discussed the details more.  Timing is a very important factor when creating a TIF.  Again, Mr. Campbell started in the right direction.  Because this type of TIF expires 30 years after it is created,[4] predicting the development schedule is very important.  Mr. Campbell correctly asked staff to quality check when the development was most likely to be able to build houses.  For this reason, the city definitely does not want to TIF the Quail Hollow property now.  If they did and no houses were to be built for five years, then the first five years of the 30-year TIF would produce no TIF revenue.  The timing of the Lexington Place TIF is much trickier.  Council should have demanded good numbers. 

The next detail they should have required from staff would be to see good estimates of how much of the road could be accomplished with the projected revenue.  If this went all the way to the entrance of the Stoney Creek development this might be a good start.  They should have also continued with the discussion on applying for the same type of funds that are being used to fund the East side of Chambersburg road.  It might make sense to created the TIF now, start building funds, and wait until this other funding source comes through with the other 60%.

We were cheated out of all the possibility of a good discussion that could lead to smart decisions with our tax dollars.  Instead, we got a thoughtless discussion on how to force the school board to use school money to build city streets. 

Strong Mayor anyone?

 
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[1] You can watch the entire discussion on the city website.  The first 23:50 are painful because of all the missed opportunities.  The blackmailing discussion started with the comments in the above video.  This occurred about 23:50 seconds into discussion.  
[2] Note the read ahead material does not contain the spreadsheets.  This is a foul.  Even though there are no members of council that demonstrate the ability to understand financial numbers, those of us that can deserve the opportunity to quality check the calculations.
[3] Mr. Campbell started out strong by asking about the application process that funded the East side of Chambersburg road improvements.  But he failed to suggest to staff they should make a similar application.
[4] TIFs like the I-70 TIF do not have this limitation.  The TIF collections start when the property is developed and continue for 30 years after that. 
 
998 - City Council Minutes Jan 1996 –  Snipet for posting.PNG
Minutes from Jan 1996 Combined School Board and City Council Meeting 
 
998 - City Council Resolution 1996 –  Snipet for posting.PNG
From the Feb 1996 resolution.  Click on picture to see entire resolution. 


Original First Paragrapgh - I re-rewote the first paragraph because after looking at the date of the minutes of the combined meeting and the passing of the legislation the supposition that the agreement was made for the ballot measure does not match.
Back in 1996 the City went to the citizens and asked them if they could convert the privately held water company to a City owned utility.  As part of that effort City Council went to the School district to get their support.  As a result of those discussions, the City and the School District came to an agreement where the School would support that effort if the city continued to pay property tax on the land.  The City verified that agreement by passing legislation stating they would continue to make payments to the schools at the same rate as if the property were being taxed.
 

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