Dismal Retail Outlook

A recent ABC News report paints a dreary picture of the retail industry.

Should all this time, money and effort be devoted to Cedar Center?

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Please see other related posts at South Euclid Oversight:

• Is Retail The Answer?

• Too Much Retail Space?

• Port Authority Balks At Retail Projects

• University Square For Sale

• Adverse Indicator

• Insightful Perspective

Public Debate!

Public discussion and debate have been a rarity among these Council members. However, at the South Euclid City Council Meeting held on December 22, 2008, Council members Ruth Gray and Robert Hartigan not only debate, they stood their ground and voted against the majority.

• time: 7 min. 55 sec.

The First Step

City officials have taken the first step by disclosing some details about Cedar Center. This information was brought to the public eye when a Key Bank representative acting on behalf of South Euclid, made a presentation to the Cleveland Heights/University Heights School Board on December 16, 2008.

South Euclid officials have responded to "observers" by posting "Cedar Center Information" on their website as of December 29, 2008.

We would like to see more informational generosity in the New Year, and with the price tag attached, please.

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Please click on the following link to view financial information:

• http://www.cityofsoutheuclid.com/data/Images_Additional/cedar_center/cedar-2.pdf

Waiting For The Financial Timeline...

The Sun News repeatedly and consistently portrays the Cedar Center project as being a “$40 million” development. Applications for funding submitted by South Euclid to Cuyahoga County indicate the project amount at nearly $69 million. This information and supporting documentation had been made available to the Sun News many months ago.

In The Sun Messenger article below, Keith Benjamin, Director of Community Services states, “Despite the challenging times and the many challenges presented by the economy, Cedar Center is moving forward, that’s the main point.” No – the main point is – how much is this costing the taxpayers? And for how long? It was presented to the public as being purchased and developed by the private sector.

The citizens NEVER got the memo that they were footing the bill to the tune of $56,083, 729.00! And that's just for the construction. That does not include the previous accumulated expenses to date, such as property taxes paid, interest on current debt financing, legal expenses, property surveys, studies and evaluations. Why would a financial commitment of this magnitude not require a vote?

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Please click on the following link to view the entire text of the "COMMERCIAL REDEVELOPMENT FUND - PUBLIC ENTITY APPLICATION", as submitted to the County by the City of South Euclid:

• http://www.scribd.com/doc/3322061/CommercialRedeveopment

Please click on article to view full size.

Below is an article which appeared in The Sun Press, December 25, 2008 edition. The financial circumstances regarding the project in Euclid suggests an eerie pattern emerging, although Mayor Cervenik doesn’t appear willing to commit any public money.

It is perplexing as to why the Sun News did not publish this article in The Sun Messenger, as well as The Sun Press. The citizens of South Euclid may find this information interesting.

Please click on article to view full size.

The video below contains relevant clips from the Cleveland Heights/University Heights School Board meeting on December 16, 2008. Jeff Rink, Director, Public Finance, Key Bank - "sells" the idea to the Board members. To view the entire presentation, please see, Failure To Communicate .

A reporter from The Sun News was in attendance at the School Board meeting during this presentation. It is unknown why there was no mention anywhere in their publication, regarding the announcement of such a significant financial commitment, and the TIF proposal.

• time: 9 min. 26 sec.

Please also see:

• Irreconcilable Details

• Crunching The Numbers

• Failure To Communicate

• Political Will?

Political Will?

• time: 0 min. 51 sec.

The truly noble and courageous action to take right now would be to come clean about Cedar Center. Open up the books and let’s see how the money is being spent.

When did "buy the property and sell it to a developer" turn into a "partnership" between the City of South Euclid and The Coral Company?

When will our elected officials decide to reveal their financial strategy to the taxpayers? If there wasn't a clearly defined strategy in the first place, as noted in The Plain Dealer, that's simply inexcusable.

Please click on the link below to view Resolution /Ordinance 57-08 and Resolution / Ordinance 58-08:

• http://documents.scribd.com/docs/oowtt62z7f4rxxoqzfb.pdf

Please see additional posts regarding Cedar Center:

• Failure To Communicate

• Irreconcilable Details

• Cedar Center Facts

• Crunching The Numbers

Citizen Generated Content

Below is an excerpt from "The Diane Rehm Show" broadcast on National Public Radio. The topic was, "The Newspaper Industry and The Future of Journalism."

This particular "video" is audio only. Included below is a short description in print of the 4 minute 56 second audio clip.

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• time: 4 min. 56 sec.

Failure To Communicate

• time: 0 min. 24 sec.

On December 16, 2008, the current developer of the Cedar Center project, Peter Rubin, President and CEO of The Coral Company, gave a presentation to the Cleveland Heights/University Heights School Board. His presentation was followed by Jeff Rink, Director, Public Finance with Key Bank. Mr. Rink presented a basic overview of the 30 year "Tax Increment Financing" proposal.

The following links provide a definition of "Tax Increment Financing" from various sources:

• Wikipedia - Tax Increment Financing
• Ohio Development Services - Tax Increment Financing

It could be viewed as peculiar, the first acknowledgement of significant financial responsibility, a 30 year long encumbrance, did not take place in a South Euclid venue, but at a school board meeting in another municipality in front of their residents.

It is most unfortunate that the financial circumstances surrounding the city owned properties have yet to be revealed to the taxpayers of South Euclid. The Plain Dealer published rare commentary from South Euclid city officials concerning the use of taxpayer money at Cedar Center. Those statements were extremely vague, inconsistent, and admittedly ambiguous.

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City officials have not yet revealed the amount of money they intend to request from the CHUH School District. According to applications submitted by South Euclid for public funding requests to Cuyahoga County, $13 million was the estimated "minimum."
It is unclear why the Mayor, or any city official, did not attend to address the Board personally, or participate in the presentation. Law Director, Michael Lograsso was in the audience but was non-participatory.

Please reference the following link to view the full text of an application for public funds submitted by South Euclid to Cuyahoga County:

• http://www.scribd.com/doc/3322049/BrownfieldApplication

A number of questions come to mind:

• How is it possible that the City of South Euclid and The Coral Company entered into a development agreement which presumptuously uses “Tax Increment Financing” as a significant factor of their financing equation, without having secured approval from the CHUH School District first?

• What will happen to the financing plans if the CHUH School Board members turn down the proposed TIF arrangement?

• If the CHUH School Board agrees to a 30 year commitment of a minimum $13 million for the construction of a shopping center in another city, how will the CHUH taxpayers respond the next time a school levy increase is needed?

• Exactly how much public money has gone into this project thus far?

• What is the total amount expected to be spent including all financing obtained from public loans, grants or other funds, plus, legal fees, interest on loans, property taxes, heating, electric, snow plowing, landscaping, maintenance, etc..........

To view evidence of significant financial undertaking, please see:

• Irreconcilable Details

Below:

Peter Rubin, President & CEO of The Coral Company presents his financing and development considerations to the Cleveland Heights/University Heights School Board:

• time: 9 min. 55 sec.

Below:

Jeff Rink, Director, Public Finance, Key Bank gives his preliminary pitch, minus any actual dollar amounts, to the School Board and the people of Cleveland Heights and University Heights. This video clip is in a two part format:

• time: 9 min. 48 sec.

• PART 1

Below:

Continuation from video above.

• time: 7 min. 45 sec.

• PART 2

A Slap In The Face

City officials held a “public” meeting with South Euclid landlords/property owners on Wednesday, December 3, 2008. The meeting was called due to the highly contested change in fees and requirements for the issuance of a “Certificate of Occupancy” for rental unit dwellings. It is unclear as to how and when this meeting was advertised. The city did not contact all landlords/property owners to inform them of this meeting.

The meeting was inconveniently held at 10:00 A.M. on a Wednesday. According to one eyewitness account, the attendees of the meeting were irate. Sources reported that some individuals were prepared to face jail sentencing in defiance of the unreasonable rate hike and intrusive new processing procedures imposed by the city.

There was further discussion on the matter at a Committee Meeting and City Council Meeting on December 08, 2008.

In the video below, Housing Manager, Sally Martin reads a prepared statement at the Committee Meeting.

• time: 7 min. 12 sec.

Below:

Mayor Welo cites the "Good Neighbor Committee" as being the impetus for Ordinance 55-08, increasing the fees and requirements for "Certificates of Occupancy."

Welo speaks as if the “Good Neighbor Committee” is an arm of the city government. This group is not sanctioned by voter approval, nor do they have any legal power. Is it possible that people were selected and appointed based on their willingness to promote this administration’s policies?

1. Who exactly comprises the “Good Neighbor Committee?”

2. How does one go about being “appointed” to the Committee?

Also on the video, Councilwoman Ruth Gray gives her opinion.

If Mayor Welo would have attended the Committee Meeting, she would have realized that no one from either her Administration or City Council raised the issue of the “Good Neighbor Committee” playing any role in the decision to enact Ordinance 55-08. Both the Administration and Council members present at this meeting laid blame on increased costs of running the program, including manpower for inspections.

Welo gives the impression that the legislation was hatched from a movement of residents fed up with run-down rental properties. If this scenario is to be believed, the new policy would basically be the imposition of punishment.

Is it possible that a third explanation exists? Could this simply be one more revenue generating scheme aimed at already overburdened taxpayers?

• time: 6 min. 28 sec.

Below:

Disgruntled landlords/property owners voice their concerns to city officials:

• time: 6 min. 24 sec.

Deceptive Account

The Sun Messenger has conveniently left the financial details out of their article below. This leaves the wrong impression with the reader. Here are some facts.

The City of South Euclid has obtained $1.8 million in loans from Cuyahoga County to pay for the demolition of the Cedar Center properties. According to sources at the Cuyahoga County Department of Development, these loans are 40% “forgivable.”

There have been several unconfirmed explanations given to the media by city officials as to how the other 60% of that money will be repaid. In one scenario, The Sun Messenger reported that the money will be reimbursed by the developer, Peter Rubin of The Coral Company. In an article printed by The Plain Dealer, the repayment of the public funds borrowed from the county Department of Development are supposedly being paid back by a different source, the Cuyahoga County Port Authority, also public money.

In either case, there has been no transparency or effort on the part of anyone at South Euclid City Hall to explain these costly details to the taxpayers. It is unclear as to why public money is being poured into the scheme to build further unneeded shopping and housing in these unstable economic times.

Please click on the following link to view another scenario where The Sun Messenger account does not reflect the facts: A Shameful Saga

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Below is a page from the November/December 2008 South Euclid Update. We made one slight change indicated in red.

Keeping You Informed!? Give us the full financial details on how much this fiasco is really going to cost the taxpayers!

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Perceptive Analysis

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• Please see related post: A Sad Reminder

Outrageous Opulent Spending

• time: 6 min. 07 sec.

In these troubled economic times, was a taxpayer funded trip to Orlando, Florida justified? Councilwoman Jane Goodman is the only member of council who suggests that a junket to Florida wasn’t a prudent move on the part of city officials.

The public is entitled to know:

• Airline ticket cost and dates of travel for each individual attending the NLC conference in Orlando, Florida.
• Hotel cost per person including: dates, room service, movie rental and telephone charges.
• All rental car expenses either submitted for reimbursement or charged on a city credit card and all parking fees.
• Individual expense account forms submitted for reimbursement.
• All records of city issued credit card purchases associated with this seminar.
• Cost of paid registration fees and a complete list of seminars and events attended for each individual at the “Congress of Cities” conference.
• Was this travel limited to city officials or did this travel include any spouses, family members or guests?

To view further information regarding the National League of Cities conference, "Congress of Cities" held in Orlando, Florida, please also see: Fun In The Sun

• Northeast Ohio City Council Association: http://noccassoc.org/