Mayor Yoder's Cozy Deal

[Mike_Walter]

By a predictable vote of 5-1 (with one member absent), the Auburn city council last night approved giving $10,950 to the DeKalb County Economic Development "Partnership" to "certify" two industrial sites -- one of them owned by Auburn Mayor Norman E. Yoder -- as "shovel ready." The DCEDP wants the money for surveys, soil tests and environmental assessments in order to prepackage the sites for busy industrial site selectors who don't have time to shop around. Mayor Yoder claims that he will not benefit in the slightest from this. That is transparently sanctimonious claptrap, say I.

According to Mayor Yoder, economic development has become such a fast track that we just can't afford to do things the "old way," by which he means, I suppose, letting buyer and seller negotiate the costs of these preliminaries between one another. Well, even if that's so, just what is the case for making the taxpayer foot the bill for a microwaveable frozen dinner approach to selling real estate?

"Jobs!" say Mayor Yoder and his faithful acolytes. "Nothing's more important than jobs, and we should be grateful (grateful!) to self-sacrificing property owners who are willing to help us sell their ground so that jobs may be bestowed on the community. Let the dogs bark, our wagon train must roll on!"

"Woof!" say I, "Shouldn't the taxpayers of Auburn be reimbursed for covering these up-front costs once the ground is sold?"

"The benefits would be 1000-fold immediately," Mayor Yoder was quoted in The Star as saying: which I guess means that anyone who suggests that trying to recoup the $10,950, even without interest, is just a hopeless bean counter who sees the world through a green eyeshade.

Well, let's look at the high-resolution image here: 1) Mayor Yoder (and some other property owners, too) are getting the rest of us to pay for something that makes their land more marketable without any hint that we will be paid back in hard currency; 2) a Democrat (me), objects that this is a case of government picking winners and losers in violation of free-market principles and that as the deck is currently stacked taxpayers are the losers; and 3) at least five Republicans Whiggishly agree with Mayor Yoder that this is something that the private sector can't handle by itself and that the generous, open hand of government is required.

Okay, Fence Posters, that's how I see it: a cozy deal for Mayor Yoder and a raw deal for the taxpayer. Your comments, please.

[HoosierHelen]

By a predictable vote of 5-1 (with one member absent), the Auburn city council last night approved giving $10,950 to the DeKalb County Economic Development \"Partnership\" to \"certify\" two industrial sites -- one of them owned by Auburn Mayor Norman E. Yoder -- as \"shovel ready.\" The DCEDP wants the money for surveys, soil tests and environmental assessments in order to prepackage the sites for busy industrial site selectors who don't have time to shop around. Mayor Yoder claims that he will not benefit in the slightest from this. That is transparently sanctimonious claptrap, say I.

According to Mayor Yoder, economic development has become such a fast track that we just can't afford to do things the \"old way,\" by which he means, I suppose, letting buyer and seller negotiate the costs of these preliminaries between one another. Well, even if that's so, just what is the case for making the taxpayer foot the bill for a microwaveable frozen dinner approach to selling real estate?

\"Jobs!\" say Mayor Yoder and his faithful acolytes. \"Nothing's more important than jobs, and we should be grateful (grateful!) to self-sacrificing property owners who are willing to help us sell their ground so that jobs may be bestowed on the community. Let the dogs bark, our wagon train must roll on!\"

\"Woof!\" say I, \"Shouldn't the taxpayers of Auburn be reimbursed for covering these up-front costs once the ground is sold?\"

\"The benefits would be 1000-fold immediately,\" Mayor Yoder was quoted in The Star as saying: which I guess means that anyone who suggests that trying to recoup the $10,950, even without interest, is just a hopeless bean counter who sees the world through a green eyeshade.

Well, let's look at the high-resolution image here: 1) Mayor Yoder (and some other property owners, too) are getting the rest of us to pay for something that makes their land more marketable without any hint that we will be paid back in hard currency; 2) a Democrat (me), objects that this is a case of government picking winners and losers in violation of free-market principles and that as the deck is currently stacked taxpayers are the losers; and 3) at least five Republicans Whiggishly agree with Mayor Yoder that this is something that the private sector can't handle by itself and that the generous, open hand of government is required.

Okay, Fence Posters, that's how I see it: a cozy deal for Mayor Yoder and a raw deal for the taxpayer. Your comments, please.

My first reaction Mike is to that 'shovel ready' term. I am so SICK of hearing it. Frankly, nothing described as 'shovel ready' has really met the true definition. It seems to me that if that were really true, the surveys, soil tests and environmental assessments would have already been done? So...the land is really NOT 'shovel ready'.

Why would a true Republican who doesn't desire government involvement in their business ventures, are requesting of our taxpayers to pay for preparation of their land for sale to be paid for by our taxpayers? Honestly, it seems like preferential treatment being offered to those involved in local politics and who are marketing their personal lands to possible new businesses to the community.

Are they willing to offer the same benefits to any other land owners in the area who choose to offer their land for the same commercial/manufacturing development? Maybe they are and I just am not aware?

I happen to own private property on State Road #1 in DeKalb county. IF I should want to change the zoning to commercial, I'm pretty darn sure that expense would be on me. Am I misunderstanding something here Mike?

Helen

[matt_s]

Maybe there is a loophole in Indiana law for doing this, but I'm pretty sure from my time in Michigan, that at least there, public funds for these kinds of projects could only be spent on property owned by the city/county paying for the improvement. I think that it is improper to spend money like this on private property.

I don't have problem with the shovel ready concept. It helped on two projects the EDC I was working with at the time, responded to. In one of the two, it was one of the deciding factors. But in all of those cases they were properties owned by the city, within our Industrial Park and TIF district.

[HoosierHelen]

Maybe there is a loophole in Indiana law for doing this, but I'm pretty sure from my time in Michigan, that at least there, public funds for these kinds of projects could only be spent on property owned by the city/county paying for the improvement. I think that it is improper to spend money like this on private property.

I don't have problem with the shovel ready concept. It helped on two projects the EDC I was working with at the time, responded to. In one of the two, it was one of the deciding factors. But in all of those cases they were properties owned by the city, within our Industrial Park and TIF district.

My thoughts are that if a property is 'shovel ready' for development...these bases would have already been covered and approved.

[jennyk]

My thoughts are that if a property is 'shovel ready' for development...these bases would have already been covered and approved.

From what I understand, the reason they are spending the money is to make the property "shovel-ready" by doing the tests, installing the utilities and having the information ready for any company that is interested in building there. They're not spending the money because the property is "shovel-ready" - they're spending the money to make the property "shovel-ready." At least, that's how I'm reading it, though I wasn't at the Auburn meeting and don't have any other information on the sites in Auburn than was in the paper.

[HomeyG]

My question is "Is this a first, or have they done this with other properties?"

[hairypumper]

And yet they will all be re-elected. Auburn is a town with eyes wide shut.

[HoosierHelen]

From what I understand, the reason they are spending the money is to make the property \"shovel-ready\" by doing the tests, installing the utilities and having the information ready for any company that is interested in building there. They're not spending the money because the property is \"shovel-ready\" - they're spending the money to make the property \"shovel-ready.\" At least, that's how I'm reading it, though I wasn't at the Auburn meeting and don't have any other information on the sites in Auburn than was in the paper.

Thanks Jenny for that clarification. My point here is these properties are not yet ‘shovel-ready’, so the owners are looking to the taxpayers to improve their properties and front them a credit line to pay to make these properties meet the ‘shovel-ready’ status.

That indeed is an artful and creative ways to build one’s fortune using other people’s money. If you can pull it off….the profits are in the owner’s pocket.

I am wondering about what happens with the investment of this credit line given to the property owners by our local taxpayers? Will they be repaid for their investment in making this property marketable? Are we expected to believe that our repayment will be the future jobs that will come into our area?

Jobs are indeed critically needed in this area and I am thankful that our local government is recognizing this. When I go to the bank and ask for a line of credit to pursue a business endeavor, the bank doesn’t wave my repayment if my endeavor brings new jobs to the area.

IF this property was owned by the city or county, I would not have a problem with taxpayers being asked to improve the property to bring jobs to our area. IF the property is owned by a private citizen who just happens to be holding a public office, I expect that private citizen to repay the good taxpayers for his line of credit to promote the sale of his property (at the very least).

[Night Owl]

the Auburn city council last night approved giving $10,950 to the DeKalb County Economic Development \\"Partnership\\" to \\"certify\\" two industrial sites -- one of them owned by Auburn Mayor Norman E. Yoder -- as \\"shovel ready.\\" The DCEDP wants the money for surveys, soil tests and environmental assessments in order to prepackage the sites for busy industrial site selectors who don't have time to shop around. Mayor Yoder claims that he will not benefit in the slightest from this. That is transparently sanctimonious claptrap, say I.

The city is giving the county money to develop private property owned by the city mayor? Something smells fishy.

The city more or less awards a grant to make the mayor's property more favorable than other properties available. Real estate is moving extremely slow right now, and commercial ground is probably moving even slower. Were other property owners permitted to apply for this award, or was there even an application process?

Being private property, owned by an elected official, I believe the award should be paid back with interest at commercial loan rates once the property sells. Once paid back, these funds could be awarded once again to other property owners to develop their properties to be shovel ready, and they pay back with interest.

I would think the property owners would be happy to reimburse the funds, with interest, after the property sells. The taxpayers helped them to finally dump the properties they have been sitting on for a while, and the improvements increased their property value and market appeal.

One exception - if the property was donated to the city/county for economic development, then it need not be paid back. (This would be self sacrificing.)

Job creation is important, but elected officials should not personally benefit from taxpayer money.
Private landowners benefiting from these kind of tax dollars would seem questionable.
To have an elected official benefit should send up red flags, in my opinion.

Keep barking Mike, and dont stop with a "woof," it needs a little "grrrrr."

[john40]

And yet they will all be re-elected. Auburn is a town with eyes wide shut.

You are so right.

[michael medeski]

wow! big surprise. it's amazing how often stuff like this gets overlooked. it happens all of the time, in every community.

i think there needs to be some law where people with business interests in the community can NOT hold public offices or be on city payroll in any way. how is it not a conflict of interest?

[john40]

Mike what I would like to know are these decsions made in council chambers or in the meetings held in a local pub to which you are not invited?

[michael medeski]

Mike what I would like to know are these decsions made in council chambers or in the meetings held in a local pub to which you are not invited?

i believe the way they do it here is....the chambers are for meetings. the pubs are for "fundraising". i'm sure decisions get made at both places though.

[Mike_Walter]

1. About the term "shovel ready:" It puts me in mind of a corpse.

2. About the legality of spending City funds to improve the marketability of private property: I believe this to be illegal unless there is a written obligation for reimbursement of the City, preferably with interest, once the property is sold. The Indiana Economic Development Corporation requires that "certified sites" (http://www.in.gov/iedc/files/shovelreadyfactsheet.pdf) "should be owned or optioned by local economic development organization, local unit of government, developer, end user or utility;" and according to Mayor Yoder the DCEDP paid him $100 for an option. But that's just an entry-level requirement for participation in the IEDC program: it says absolutely nothing about who funds the certification or whether the funding individuals or entities have used the money lawfully. As for the "conflict of interest" issue raised by michael medeski, of course it's a conflict of interest in any moral or practical sense of the term. It's just that Indiana law on the subject is very thin gruel. Therefore, the issue is more political than legal.

3. jennyk is right: the money is being spent for things that will make the site "shovel ready."

4. I would definitely like to "grrrrr" a little more, Night Owl, but I don't hold the gavel at council meetings. It would be satisfying if the public, armed with the information that I try to bring out at the meetings, would do some growling; but public outrage seems more easily directed at remote figures in Washington than at well-known locals who are perceived as having the power to strike back.

5. Although the "meeting before the meeting" back in the break room and the "meeting after the meeting" over at The Retreat (referred to by john40) probably contribute to majority-party solidarity, I've reached the conclusion that the majority attitude is to support the Mayor in any and all circumstances whether they've been briefed in advance or not. What's important to the majority is to be the majority, not to fret over inconvenient details. With the possible exception of Marilyn Gearhart, I think that nothing terrifies the GOP members of the council more than the thought of being cold and lonely in a minority.

6. If the key to majority thinking is how to avoid being out of the herd, there are two things that usually guide my voting . The first is the theory of loyal opposition: that my job is to show the flaws in the Administration's positions and to show the public the possibility of alternatives. The second is how I might explain my vote if asked do do so under oath in a court of law. Mayor Yoder has often scoffed at that first principle, which is fundamental to parliamentary democracy; but I think that the second one scares the living daylights out of him. It should.

[HomeyG]

1. About the term \"shovel ready:\" It puts me in mind of a corpse.

2. About the legality of spending City funds to improve the marketability of private property: I believe this to be illegal unless there is a written obligation for reimbursement of the City, preferably with interest, once the property is sold. The Indiana Economic Development Corporation requires that \"certified sites\" (http://www.in.gov/iedc/files/shovelreadyfactsheet.pdf) \"should be owned or optioned by local economic development organization, local unit of government, developer, end user or utility;\" and according to Mayor Yoder the DCEDP paid him $100 for an option. But that's just an entry-level requirement for participation in the IEDC program: it says absolutely nothing about who funds the certification or whether the funding individuals or entities have used the money lawfully. As for the \"conflict of interest\" issue raised by michael medeski, of course it's a conflict of interest in any moral or practical sense of the term. It's just that Indiana law on the subject is very thin gruel. Therefore, the issue is more political than legal.

3. jennyk is right: the money is being spent for things that will make the site \"shovel ready.\"

4. I would definitely like to \"grrrrr\" a little more, Night Owl, but I don't hold the gavel at council meetings. It would be satisfying if the public, armed with the information that I try to bring out at the meetings, would do some growling; but public outrage seems more easily directed at remote figures in Washington than at well-known locals who are perceived as having the power to strike back.

5. Although the \"meeting before the meeting\" back in the break room and the \"meeting after the meeting\" over at The Retreat (referred to by john40) probably contribute to majority-party solidarity, I've reached the conclusion that the majority attitude is to support the Mayor in any and all circumstances whether they've been briefed in advance or not. What's important to the majority is to be the majority, not to fret over inconvenient details. With the possible exception of Marilyn Gearhart, I think that nothing terrifies the GOP members of the council more than the thought of being cold and lonely in a minority.

6. If the key to majority thinking is how to avoid being out of the herd, there are two things that usually guide my voting . The first is the theory of loyal opposition: that my job is to show the flaws in the Administration's positions and to show the public the possibility of alternatives. The second is how I might explain my vote if asked do do so under oath in a court of law. Mayor Yoder has often scoffed at that first principle, which is fundamental to parliamentary democracy; but I think that the second one scares the living daylights out of him. It should.

Mike,

Thanks for answering some of the questions. However, mine was not answered and perhaps it was just overlooked. Anyway, my question was "Is this a first, or was it done for other properties."

[Mike_Walter]

Mike,

Thanks for answering some of the questions. However, mine was not answered and perhaps it was just overlooked. Anyway, my question was \\"Is this a first, or was it done for other properties.\\"

This is a first, but there's one more property west of I-69 that's in the pipeline for TIF money to be used for the same purpose.

[HoosierHelen]

This is a first, but there's one more property west of I-69 that's in the pipeline for TIF money to be used for the same purpose.

Are the minutes from these meetings posted publically? If so can you tell me where and when? Thanks again Mike.

[flatbird1]

Yes, it is a conflict of interest and more. It fits my definition of insider trading which, upon conviction, would get him prison time.

[HomeyG]

Yes, it is a conflict of interest and more. It fits my definition of insider trading which, upon conviction, would get him prison time.

Insider trading??????

[HoosierHelen]

I had missed this article covering this meeting. James was kind enough to direct me to it.

Council pays to certify mayor’s land

BY LINDSAY WINSLOW BROWN lindsayb@kpcnews.net
Wednesday, 17 February 2010 00:40


AUBURN — Citing a conflict of interest, Auburn Councilman Mike Walter Tuesday voted against paying $10,590 for industrial site certification of two properties, including one belonging to Auburn Mayor Norm Yoder.

Other council members listened to Walter’s concerns, asked questions and voted 5-1 to pay for the certification of Yoder’s property.

Cities throughout the state are working to attract new industries by getting sites ready in advance through zoning, installing utilities and conducting environmental studies.

Yoder said he has owned 65 acres of property on C.R. 29, south of the CSX railroad tracks for over 30 years. The property has been zoned industrial and has access to water, sewer and electric utilities.

The DeKalb County Economic Development Commission paid Yoder $100 to have access to his property for three years and to conduct environmental studies, soil borings and a certified site survey.

“In no way will I benefit from those things personally,” Yoder said.

If a company decides to purchase Yoder’s land, Yoder can sell the property at a predetermined price.

Yoder said his focus is to bring jobs to the area and he feels that by offering his property, he would help create the opportunity.

He indicated that Auburn owns no land and has no other open industrial sites adjacent to the city.

Walter wrote in a letter to Yoder, “The City of Auburn is a unit of government, not a real estate agency.”

Yoder said the way site selection is done today is different than in the 1980s and ’90s and added that not many companies buy land or buildings through private sales. Instead, companies are looking for certified sites, with utilities and proper zoning.

“The reality is that’s the way the world’s working today,” Yoder responded.

Walter replied, “This is setting a bad precedent. It’s not an appropriate use of public funds.”

DCEDC director Galen Eberhart said Yoder is being treated the same as other property owners working with his nonprofit organization.

Walter added that the city has no contractual obligation to pay for Yoder’s — or any property’s — certification.

Councilwoman Marilyn Gearheart said there are long-term advantages for cities to certify sites. She said a business would create a “ripple effect” that could increase revenue for local businesses and through taxes.

“That’s highly speculative,” Watler said. “Let’s have a guarantee we can get this money back. … The government should not subsidize individual property transactions.”

“The benefits would be 1,000-fold immediately,” Yoder said.

City attorney Erik Weber said “there is no conflict of interest from a legal standpoint. He is not being treated differently. He was the property owner long before he was mayor. He just happens to own the property.”

“It doesn’t look good,” Walter said.