consultants are sandburs

Thursday, May 24, 2007

A tremendous idea. Verbatim meeting transcripts - voting and worksession council meetings.


Why be in the dark?


This is a new proposal. Or new to me. But it makes all the sense in the world.

Minutes are elastic, James Norman had been the one having them prepared and signing off, after council approval was voted.

Having SEARCHABLE online verbatim transcripts of council meetings and finance committee and public works committee meetings would have uncovered the infamous PORT AUTHORITY mischief and nipped it in the bud. But we lacked it, and the Port Authority thing prospered during the Elvig finance committee chairmanship.

And the objection - cost?

That's a shibboleth, a mantra, "It will cost too much." It's false. Court reporters are not all that expensive, and a court reporter could transcribe a meeting with near flawless skill and accuracy. They do it every day, for a living. And they do not overcharge.

More money's been spent on El Tinklenberg and Mike Mulroney than would be spent in years of doing what's right - verbatim transcription with a verbatim SEARCHABLE online record to boot. We enter our search terms, a ranked list of hits, we read, we learn, we scrutinize, we judge. We are empowered.

I commend whoever thought of the idea. It is SUNSHINE. It counters obfuscation and deception to have verbatim records of what's done when, by whom.

It is not just a good idea. It rocks.

Dissembling again. Any councilmember can put any topic on an agenda. It traditionally has been a council power.


Every citizen in Ramsey was greatly insulted by the mayor in the mayor-council input session at the meeting televised tonight. This individual, Thomas Gamec, said people in Ramsey are too stupid to tell a worksession, televised, from a voting meeting, televised; and for that cooked up phony "reason" he wanted to quell the responsible suggestion that work sessions be televised.

What a crock. What a total manufactured bunch of nonesense. He wants to hide the process and the two new members, either of whom would be a better mayor than the mayor, want reform. Gamec wants to dissemble, bloviate, and keep people treated like mushrooms. It is offensive. It is a disgrace.

Second point, any councilmember, traditionally, can put an issue on any agenda. It has traditionally been a perogative of the office. Hendriksen frequently exercised that perogative; Goodrich did not render any legal opinion to the contrary; and the charter is silent. If Thomas Gamec has any authority in the resolutions, ordinances, or charter - let him please come forth and present it. The days of James Norman are over. The days of untelevised meetings should be. The power of councilmembers should be acknowledged to be as great as tradition has had it.

TELEVISE THE WORK SESSIONS. IT HAS BEEN AN ONGOING INSULT TO HAVE HAD THAT EFFORT ENDED SINCE THE 2002 ELECTION AND THOSE VOTED ON COUNCIL THEN, WITH HOLDOVERS, ENDED WORK SESSION TELEVISING. KURAK, SHE VOTED TO CONTINUE TELEVISING THEM. OF THE CURRENT HOLDOVERS WHO VOTED BACK THEN, ELVIG, THE MAYOR, OLSON AND JEFFREY, TO MY RECOLLECTION, WERE INSTRUMENTAL IN KILLING THE EFFORT.

TELEVISE THE WORKSESSIONS. TRANSPARENCY IS GOOD. SECRECY IS BAD. ANY F0OL KNOWS THAT, MAYOR OR OTHERWISE. OTHER FOOLS WILL ADMIT IT. THAT'S THE ONLY DIFFERENCE.

SUNSHINE IS THE BEST DISINFECTANT. JUSTICE BRANDEIS SAID THAT BACK IN 1914. IT REMAINS TRUE TODAY. IN RUSSIA THEY PROBABLY DO NOT TELEVISE WORK SESSIONS. THIS IS AMERICA.

JEFFERSON, MADISON, HAMILTON, WASHINGTON - THEY WOULD NOT HAVE BEEN AFRAID OF SUNSHINE ON THEIR ACTIONS. AND TO NOT ONLY OPPOSE IT BUT TO OPPOSE IT VIA BLOVIATING NONSENSE - WE DESERVE BETTER. END OF STORY.

Friday, May 18, 2007

I agree with my friends.

I am still collecting my thoughts for posting about the May 4-5 weekend session for RAMSEY3 and I think the city [here and here] and the RAMSEY3 websites are doing the same. Please let me know if either has posted any synopsis of the session work product - the poster charts and write-up sheets. And, is it just me at an older workstation with DSL, or do others find that RAMSEY3 website to be slow as molasses in January, and kludgey? It does not have to be.

I understand the city is not controlling the RAMSEY3 effort, that it is a private citizen initiated approach but with Patrick Trudgeon a key participant in ways the McKnight funding people like. I was encouraged to see planning and development staff at the weekend session, participating and not managing, and some of the councilmembers. I understand the suggestion was that anyone on staff residing in Ramsey should attend primarily as a resident with personal feelings and beliefs, and not primarily as a representative of city staff. I did not notice either the mayor or Metropolitan Councilmember Steffen at either of the days when I was there. Perhaps they showed up after I left on Saturday or I overlooked them. Olsen, Jeffrey, Look and Strommen were there much of the time, both days. Dehen was there Friday and Elvig showed up briefly. I expected the mayor and Steffen to be there; each resides in Ramsey, in a home on a nice large lot with private well and septic system; not in shared-wall or urban-sized circumstances on city water and Met Council sewer. Interesting.

More on impressions of that weekend in anoter posting. This posting, as follows, is a continuation of staying the course at Town Center.

I sent an email to Councilmember Strommen [who presently heads the City's finance committee] and to City Finance Director Lund, asking the following primarily fiscal question:

I emailed Bill Goodrich about the lein position priorty of the city, and that's his area, not yours. However, the article says $42.3 total owed by the LLC [not distinguishing if taxes and assessments are part of that or not], $35 million to Minnwest Bank [not saying if there's been any partial amortization].

I can see most of that for the land - 315 acres at $95,000 per acre would be $29,925,000 up-front land alone. That leaves over $5 million in balance on the loan proceeds. The article said $13 million is owed beyond that borrowed amount (borrowed apparently mainly for buying the land). I am sure the parties to the bankruptcy are following the money, quite carefully, and that's not my request.

What I am asking: Could you give a quick to the nearest $0.1 million, the present city's assessment and back taxes position against the property [if easier you can break out any taxes owed on unsold units where the LLC's already sold the land and it's been built out, etc. - or give totals, what's easiest for you, but just let me know whether anything's broken out separately or not, as not an RTC LLC
responsibility]?

And the garage and city hall is wholly separate money.

Just the assessment total outstanding, for infrastructure investment the city made up front [keep the Ramsey Blvd and 116 road work separate also if easier, unless that's assessed on the land and easier to include]. Separate State or County leins are not a point of inquiry.

And, is Ramsey paid current, or if not what's the arrearage?


Lund replied:

[Re] the City's assessments on RTC and the foreclosure. The City's assessments are not impacted by the foreclosure.

The amount of outstanding assessments, which totals approximately $6,164,000, needs to be paid in full by February 22, 2008.


First, that fits the article. Beyond the approximately $30 million of borrowed money the LLC appears to have spent purchasing the raw land, there is five million outstanding debt on the lender's committment spent wherever the parties in the bankruptcy proceeding track it down to have gone. Add the $6.1 million owed the city, and that looks to be the $13 million over and above the cost of land, in the $43 million total debt owed by the LLC that the Business Journal news article reported.

Strommen's reply was not regarding the fiscal detail as much as the policy question - here is where it appears we are, where do we go from here?

I was encouraged by her thinking it best to stay the course and not cut any special breaks or special deals to give the lender a windfall opportunity to make more on its foreclosure. It took the risk lending, the deal was cut, and just because the first guy at bat struck out is not cause to change the strike zone or move the pitching mound further away or first base closer. The rules of the game should remain. The original deal for the City, certainly it might have been better - but there's no cause to dwell on that nor to make it worse because the first batter did not hit a home run.

Here's the gist of what Strommen wrote in reply:

I do agree with you 100% that we must be aggressive in asserting the City's financial position as well as patient and prudent with respect to development of the Town Center. To me, a true failure would be to compromise if there are other options. Given that Ramsey Crossings (a more traditional big box) also has been affected by the slow market, I don't see that changing the plan for Town Center offers any magic bullet.


Strommen made the point that this appears to not be her sentiments alone, but rather her beliefs backed up with a continuity in position from the past council to the present:

We passed a resolution to that effect last September or October (I can't recall exactly when), and that sentiment was re-iterated again this year by the majority of the council at at least one worksession.


While I have been critical of council decisionmaking in the past; this time I agree.

But please, please reconsider the change from City Administrator structure to City Manager. The department heads and the interim city administrator seem to be moving better with a less centralized system than was ended Jan. 1, 2007 with the departure of James Norman. That was a blessing, the staff has prospered, and there appears little cause to reinstitute anything even resembling such a tightly centralized regime as his.

Friday, May 11, 2007

250 out of 2400 is 10.4 %, and now the market's bad. But stay-the-course seems best.

It would be wrong to cut-and-run, right? Not Iraq, the Ramsey Town Center situation.

The Business Journal has news about the impact of the Nedegaard bankruptcy, and likelihoods. Here's an excerpt [without the articles hotlinks]:

Bankruptcy plagues Ramsey Town Center
May 4, 2007


Two days before he died of colon cancer last November, Bruce Nedegaard was forced into bankruptcy by the bank that gambled on his dream.

A new buyer would either have to take up Nedegaard's development agreement with the city or negotiate a new one.

Nedegaard owned a number of construction and development-related businesses in the Twin Cities, among them a limited liability company called Ramsey Town Center LLC (RTCLLC) that was the master developer of the project with the same name.

Nedegaard launched the Ramsey Town Center project in 2003, and the 322-acre, mixed-used village was hailed [by some] as innovative and a model for high-density suburban development [... but there were skeptics from the very beginning].

By late 2006, with 125 developable acres left under his control, RTCLLC was in default on a $35 million loan for the project with Minnwest Bank. Nedegaard had a personal stake in the deal, so he was on the hook, too.

On Nov. 28, [i.e., within weeks after the 2006 city council election] Minnwest filed a petition to force Nedegaard into involuntary bankruptcy.

Nedegaard's interest in RTCLLC is not worth the $42.3 million in debt it owes to Minnwest Bank and a slew of other creditors, so the U.S. Bankruptcy Court-appointed trustee overseeing Nedegaard's bankruptcy has opted to abandon his interest in RTCLLC.

Minnwest Bank has taken preliminary steps to foreclose on its loan covering the RTCLLC real estate, said Frederick Dudderer Jr., Minnwest's attorney.

Minnwest can decide whether it will chop the 125 acres up into parcels or sell it as a whole. Whoever buys the land will have to assume Nedegaard's agreements with the city to pay for tens of millions of dollars for parks and infrastructure.

If the new developer wants to renegotiate those agreements, it could be an uphill battle as a majority of City Council members want to keep the plan as is.

However, Matt Look, a new council member, thinks the project will have to be changed to lure developers. "The project has to be completed," he said. "If that means we need to change the plan when the bankruptcy is resolved, I'd be in favor of making a more financially feasible plan."

At least some of Ramsey Town Center's woes can be tied to a slumping housing market. Some observers say that the project will be well-positioned for a quick rebound when the market picks up.

Of the 2,400 proposed residential units, only 250 have been built.

Bill Oelkers, a real estate agent with Re/Max Results in Plymouth, is trying to market 12 townhomes in Ramsey Town Center. Even after dropping the price of the homes by $50,000 per unit (they now range between $159,000 and $240,000 per unit), none have sold. Other builders in the development, K. Hovnanian Homes and DR Horton, also cut their prices.

Whatever the feeling, many observers will be watching closely for clues about where Ramsey Town Center will wind up.

$42.3 million owed, with the main mortgage position at $35 million. 125 acres remain of a 322 acre total. Looking at the vast empty spaces, it appears a larger percentage than 39% of the land still remains vacant. I suppose the planned "parks" and other reserved land is a part of the present vacant appearance. But what's been promised was promised, and should the promise change? Let's put that question off for a moment, as the second of two big questions.

The First Big Question: Actually there's a bunch of related questions. Where's the city's security position in a bankruptcy foreclosere sale? Foreclosed, or in front of the lender's action as an assessment against the land? [I have an email inquiry sent to the city attorney and can expect a prompt reply for an update posting] And what amount of city debt exactly must be serviced via taxation in the interim [and later into the more distant future] for about how long of an interim basis before the thing sorts out? That depends upon when and how much the housing market for that shared-wall suburban sector rebounds; and how aggressive the Metropolitan Council is in wanting to sell flushes in Ramsey, ASAP. They have a say on the city's 2008 Comprehensive Plan, the one we all have hypothetically discussed and wondered over, and more than a say, they hold a hammer. With the Guv having political ambitions and the summer GOP dog and pony show in town [aka the "convention"] possibly Met Council might be more restrained than they were with Lake Elmo. Natalie Steffen has yet to shed any public light on things other than to say it is unlikely "any radical change" will be accepted [i.e., retrenchment is unlikely within the total growth quotas and expected build-out rates Met Council imposes (they say "recommends" but that appears to be false terminology when they can simply disapprove anything not fitting their staff's starting, announced quota package, three-to-five units on average per buildable residential acre - per non-wetland, non-road, non-commercial, non-park, acre; and let's start giving them three on average, as within "three-to-five")]. The "three-to-five units per acre on average" quote was stated by Steffen and Met Council staff and reported within April 2004 city council worksession minutes.

The Second Big Question - Stay the course, be patient as "a majority" of the council is said to favor; or do as Matt Look says, cave in, cut-and-run to lessen the most immediate tax impact but possibly have a worse ultimate citizen subsidization worry?

Hey, I agree with my friends. Don't we all?

Actually, here, I think that patience and prudence is the best course. Do not renegotiate - and give that notice clearly up front before the bankruptcy sale. That way, you guard your turf, and if the primary lender and the participants get a lesser foreclosure sale price because notice has been given, that's how Capitalism works, and it's best that any potential buyer will have notice and no cause to say, "Well, I paid thinking it was a clean slate ...".

Giving notice before the foreclosure sale is the important thing. It is fairness to potential buyers; fairness and transparency in the market. Making things clear to those who the city will have to work with in the future. Let the bankers accept it if that's what the city wants. Do not let anyone's potential future dealings with the same lender, if at all a factor, poison what is objectively seen as best for the citizen-taxpayers.

It would be wrong to waffle. My call, and it's a guess, it would be wrong to act as if there's a "distress sale" mentality. It the entire thing sits for years, ultimately, then the market teaches its lesson.

But do not let Met Council cash flow needs or other extraneous factors cause the original deal, as unfavorable to the citizens as it is, worsen and become even less favorable. A bad deal up front should not get worse because the land speculators reaped a big profit and the risk-taking entrepreneurial developer-interest lost on a market downturn and a liquidity trap. That's the nature of entrepreneurial risk.

Next batter up, take your swings, hit a home run or strike out.