consultants are sandburs

Wednesday, March 27, 2013

RAMSEY --- Who are you dealing with, and what's the deal?

Asking for half a million of Ben Dover's dollars, to benefit rental housing speculators:

MWF Properties, LLC

-and-

MWF IA3, Limited Partnership
MWF IA3, LLC

Ben Dover, the Ramsey taxpayer.
With a limited partnership and a pair of LLC's out of the same building, it sounds as if tax sheltering is being bought and sold, with them asking for Ben to pony up half a million bucks to smooth their way.

Bold. Brazen. Poor sore Ben.

Another question, raised by these "MWF" enterprises, what do they do Tuesdays and Thursdays?

A bigger question, who are the limited partners, and how did they come to think of Ramsey as an easy mark? For all I know, Darren Lazan could or Ryan Cronk could be limited partners, or Flaherty. What kind of background check do you suppose the city officials did before advancing this hummer? And what did they find out before presenting it to council consideration? And last, read that staff write-up and it is more about ways to maybe make it happen, vs. whether it should happen at all.

_____________UPDATE_____________
Talk about cherry-picking location, location, location.

click the image to better read it
would retail be a higher, better use?
would they expect dedicated ramp space?
what's it do to lessen Ben's taxes?

I missed the meeting. Reader help is welcome, as to what the council did with this.

____________FURTHER UPDATE____________
Is this some deal the cat (or Darren) dragged in? At that same address, these Secretary of State entries exist:

TWIN CITY CHRISTIAN HOMES FOUNDATION
Twin City Christian Homes Services Company
Twin City Christian Homes Management Company, Inc.
TWIN CITY CHRISTIAN HOMES, INC.
Prime Associates
Weis Builders, Inc.
TUSHIE-MONTGOMERY ASSOCIATES, INC.

Also there, Franklin Square Apartments LP‎, where no Secretary of State filing for the Limited Partnership was found. The site is a block or two north of the Lyndale - Hwy 494 overpass-intersection looking to be an unprepossessing commercial attachment onto a most unprepossessing [i.e., ugly] apartment bloc:



As to whether this operation has the gravitas to buy Town Center land and complete a building, I have no information either way, but a half-built thing within a half-built Town Center is not an appealing prospect, regardless of how [un]appealing subsidizing these adventurers might or might not be, (in the abstract and presuming sufficient gravitas to finish a job once started).

That many interlocked business ventures, or possibly independent - someone would need to pin that down - suggests, with two limited partnerships sited there, that tax sheltering of deep pocked cash may be at play. Tax sheltering may be a cottage industry there. Possibly not so deep pockets, but pursuing shelter in any event, where it cannot be said what's up from what was found online.

There are questions. The biggest, why do it at all on a Town Center site having retail as its clear highest and best potential use?

Moreover, without a lot price mentioned in the city's synopsis, would the sought half-million dollar subsidy more than dwarf the return on a sale of land?

Big IF's. BIG. Why do it?

_________FURTHER UPDATE__________
From two on council I have learned the matter was tabled; i.e., kicking the can down the road. I did not attend or watch the broadcast, but I have cause to believe the council was not single minded on the matter. One council member has indicated a disenchanted will to "absolutely fight this, even if I have to send mailers to my constituents on my dime;" and even if others on council may be mesmerized by the idea. While the can's been kicked, it most clearly has NOT been kicked aside, just down the road -- so stay awake and aware.

Half a mil is half a mil.

Not pocket change to be handed beggars.

However, smile as Ben does, regardless ...

____________FURTHER NOTE____________
As the city's website homepage says in one place, "Click here to Webstream City Council Meetings". I think I understand the gist of the issue, but others interested in the issue can and should use that link as part of thinking for themselves and understanding the thought processes explained by our decision makers. The City Clerk posted the streaming video link on another city page which readers might wish to bookmark.

____________FURTHER UPDATE___________
A tiny voice within me says, "Might there have been some concession, promise or deal in the past to get Met Council grant money or otherwise to do log-rolling, one that commits the City to having to locate low income housing in Town Center, one which has been insufficiently exposed to sunshine and instead largely kept in the dark; or, is there a fully clean slate on the question where the Council now has full discretion to yin and yang any ways the majority will take it?"

I wonder if Ben is thinking the same way.

Has some past deal or commitment been made, perhaps even going back to Gamec - James Norman days, and if so, is this the spot for it in Town Center, or is that particular spot better held for retail to benefit ALL OF US?

____________FURTHER UPDATE____________
Low income housing is one thing, subsidized by Ben and you to the tune of half a million is another thing. If it ends up being tax money routed from some other pocket, it still is tax money, and paid for by, again, Ben and you.

Beyond that, has Flaherty and his folks weighed in on this second opposite-end rental and what impact its being in the oven, on simmer, might have on renting out the big ugly?

Since the City stung itself for much over half a million on that deal, nothing to quell the renting out is wise, for now before there is any track record for Ramsey Rental by the Rails, good, bad, or ugly.

Finally, existing Town Center homeowners have a Ward 3 rep to talk with, and I expect some owners' association to weigh in on what might boost their market values or move the location, location scale the other way. Have they had fair notice and a reasonable chance to voice opinions? This is all more complex than a simple yes/no, and who are these adventurers who are pressing for a prompt decision - as if there is a legitimate urgency? City Staff's agenda item for this tax shelter adventure states troubling things:

The Developer is also seeking City financial participation as part of an application to the Minnesota Housing Finance Agency (MHFA) for Section 42 tax credits, a competitive financing opportunity also known as the Housing Tax Credit (HTC). According to the MHFA website, the Housing Tax Credit is a reduction in tax liability to developers and investors in exchange for providing affordable housing. This is not assistance given directly to a tenant. The Housing Tax Credit is part of the Internal Revenue Service (IRS) Tax Code, and not a City funded program.

The Developer is requesting a local contribution of $510,000. [...]

Staff discussed the Metropolitan Council's Livable Communities Act (LCA) as a potential funding source. The Developer has stated that they are somewhat concerned about timing of this program. The City could also consider utilization of the Anoka County Housing and Redevelopment Authority (ACHRA) [tax] levy as a potential funding source. The Developer also inquired as to whether the City would be interested in assisting through Tax Increment Financing (TIF). In addition, the Developer also inquired if the City would be willing to waive certain application, license, or development fees or fast track approval processes.

[emphasis added] It seems brash for newbies to come in with that, "why not fast track, us while bending your rules," attitude. With their hand out. It unpins the Bullshit meter, that stuff.

They likely will present problems down the line if entering with a big chip on the shoulder saying, "Decide it yesterday, we have 'timing' concerns," or the functional equivalent.

Again, who cooked up this idea, the tax shelter adventurers alone, or with local input? Few on the council have the tenure of David Elvig, who must remember his chairing the Town Center Task Force boosterism thing, with the promise of tax base growth and keeping the growth near the Highway to preserve the "rural feel" of Ramsey while providing a plethora of shoppes and restaurants [that spelling of "shops" going back to a particularly pretentious early Town Center drum beater]. So, with tax base a key selling point, is this tax shelter adventure boosting Ramsey's tax base in any fashion in proportion to its up front asked-for cost -- a big hand thrust out saying, "Cross my palm with silver"?

Or is it all cost, no benefit?

Staff's agenda presentation avoided any such nitty-gritty detail. Surely Tim Gladhill does not think such concerns are irrelevant or immaterial. He's not a turnip, after all. So, where is that analysis of cost/benefit, should the city even think of doling out half a million tax dollars to tax shelter mavens.

OKAY: Shut the post down on that update, and if there ends up more to write it will be in a new item with its own headline.

No comments: