Friday, January 18th, 2019

Waukesha’s TIF tiff resolved

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Waukesha Freeman 9/17/2015 Page A5 Opinion

Waukesha’s TIF tiff resolved

Strange non-debate stops condo loan

Well, it only took two meetings. The Waukesha Common Council voted Tuesday night against amending a tax incremental financing district to allow a $1.6 million loan to the Sunset Homes condominium association.

It was a strange non-debate. Despite a packed house, only three people (including the Lovely Doreen from Waukesha) spoke during the public comment portion of the meeting against making the loan. Only one person, the condo association attorney, spoke in favor.

The attorney tried assuring the Common Council that this was not a risky loan, and that no condo association had ever gone bankrupt. On the other hand, if you were looking for a possible precedent setter, this would be the one.

Open records requests revealed that the contractor for the condominium repairs estimated repair costs at $3.8 million, much more than the $1.6 million the city was prepared to loan. The condo owners had previously told the Common Council they turned down a loan for $500,000 because it would have been just a “Band-Aid.” After seeing the $3.8 million estimate, including the statement that it would not fix everything, we have to wonder how they thought $1.6 million was enough.

However, a memo from Community Development Director Jennifer Andrews to the aldermen helpfully explained, “The staff has also considered the possibility that a bank may make a community reinvestment loan to the condominium association, but the City would likely have to guarantee the loan through TID 22.”

So in addition to making a loan, the city could also have guaranteed a private loan to the condo association using revenue generated by the TIF district.

In addition, as I reported in my column last week, some condo owners would be able to tap into $200,000 in Community Development Block Grant money that was originally targeted for loans for lower-income homeowners for home repairs in a completely different part of the city. The county approved the reassignment of funds contingent on the city making the $1.6 million loan.

Adding to the controversy was the email from City Attorney Brian Running explaining that the collateral for the loan was the homeowner dues and not the condos themselves. Throw in some public pressure and it’s not surprising that aldermen were reconsidering their last vote on the subject.

Alderman Adam Jankowski moved to reconsider the amendment. He explained it was so aldermen could get more questions answered. That easily passed and debate was allowed to begin again.

But the only comment from any of the aldermen came from Vance Skinner. In an effort to save the amendment, he reminded his colleagues that they weren’t voting on the loan itself, just the amendment allowing the loan.

The rest of the aldermen must have felt that any questions they had were answered. They voted 9-5 to kill the amendment, stopping (for now) any loan from the city to Sunset Condos.

Two aldermen, Kathleen Cummings and Daniel Manion, changed their votes from last time to join the winning side. Alderman Andy Reiland also voted against the amendment. He presided at the last meeting and was unable to vote.

Interestingly, Jankowski voted for the amendment even though he was the alderman that requested the approval be reconsidered.

All this came on the same night the Common Council voted to create another TIF district near the county airport, the site of the old AMF bowling alley. In this district, the city agreed to give $1,150,000 as a grant to the developer, and an additional $500,000 as the TIF generates revenue.

You might not think of the site as what we would typically consider “blight.” In fact, it’s hard to believe that any incentive would be needed to develop the site, so close to the airport and the freeway. But they assure us that “but for” the TIF the proposed manufacturing plant will not happen.

Meanwhile, we learned during the Sunset Homes debate the city is already taking revenue generated by TIF districts and making loans to individual homeowners. This leads us to question if Waukesha is really using TIFs for what they were intended, and whether state Sen. Duey Stroebel is correct when he says the state Legislature needs to take another look at the law.

(James Wigderson is a blogger publishing athttp://www.wigderson.com and a Waukesha resident. His column runs Thursdays in The Freeman.)

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