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Dear Editor:
In a 567-word, fact-less page one bit in this newspaper (Developer-backed bonds are a win-win, Sept. 1), Carmel city councilor Adam Aasen repeated the shopworn cliches other progressives have used to cover for the failed policies that have run up a $1.3 billion debt.
He vows the debt won’t be paid by residential taxpayers but by businesses. He forgets that businesses are people making business payments that otherwise would directly fund city services. Instead, they fund bond repayment. Every dime of developer-backed bond repayment won’t begin funding schools, parks, road improvements, public safety and more, as Aasen says they will, won’t kick into the city coffers until after the bonds are paid in full – 20 to 30 years from now.
He builds his case on “guarantees” from private developers conveniently ignoring that “guarantees” by Pedcor Cos. to build 10 new structures in congested City Center by 2019 but building only four or five. So much for guarantees.
Aasen speaks of retail spaces and offices galore, ignoring the facts daily documenting a nationwide collapse of local retail and the work-from-home success. More and more companies are canceling leases on big office boxes and encouraging workers to be productive from home or “virtual offices” outside high-rent spaces like those in Carmel. Nor does he provide facts concerning the money lost to local merchants unlucky enough to try competing with city-backed stores and entertainment venues.
This year the progressive schemes are on the hook for $67 million in principal and interest due. The Carmel Redevelopment Commission’s own budget calls for $28.5 million for debt service from its $33.5 million receipts. Looking ahead, “businesses” are the primary repayment source for more than three dozen bonds but the secondary sources are the city’s share of state income taxes and property taxes.
Finally, Aasen omitted the history of the first progressive scheme – Merchants Square. City planners borrowed funds to redevelop the square. Take a look at what they’ve accomplished. Empty store fronts. Vacant parking lots. Failed businesses.
This is “truly a gift for residents of Carmel and future generations as well,” as he concludes his platitude prose. It’s a lose-lose gift born out of a municipal economic Afghanistan. Speculating on the wildly volatile commercial real estate market is not appropriate work for municipal governments.
Aasen once wrote, as a reporter, of the unanswered debt questions then. He has the answers now but won’t share them. Perhaps he agrees that betting the future of the city on commercial real estate speculation is a lose-lose.
Bill Shaffer
Carmel