Lakewood Village Trustee Paul Serwatka tells what happened at the recent Tax Increment Financing District meeting, required by law.
Reporting On The Lakewood TIF Review Board Meeting
A quick update regarding the January 26, 2017 Lakewood TIF Joint Review Board Meeting:
This was a relatively short meeting, with no official action being taken or voted upon and an equal amount of time was spent addressing a couple of critical resident questions which I’ll cover below.
(The entire board packet, including all figures below, can be viewed HERE.)
Some takeaways from the meeting:
Fiscal Year 2015 TIF Expenditures:
|Legal Fees: Zukowski, Rogers, Flood & McArdle||$ 48,839|
|S.B. Friedman||$ 30,869|
|Catherine Peterson||$ 198|
|Shaw Media||$ 2,569|
|Alan Coulson PC||$ 4,075|
|Baxter & Woodman||$ 32,574|
|TOTAL 2015 TIF EXPENDITURES||$119,374|
Fiscal Year 2016 TIF Expenditures:
|Zukowski, Rogers, Flood & McArdle||$ 3,094|
|Baxter & Woodman||$37,570|
|TOTAL 2016 TIF EXPENDITURES||$45,964|
** Total TIF Expenditures To Date:
|TOTAL TIF EXPENDITURES TO DATE:||$165,338|
** Important to Note:
Above expenditures only include those directly related to the creation of the TIF District/documents, themselves.
More than $600,000 of additional Lakewood Taxpayer Dollars was also spent to purchase a portion of the land needed in speculation of developing this TIF District.
The $165,338 in TIF expenditures listed above, are additional Lakewood Taxpayer Dollars spent in speculation of creating this TIF in the hopes that the Sportsplex (or other) developers will in fact develop within the TIF District area created near Rte 47 & 176.-
A Quick Explanation of “TIF”
TIF (Tax Increment Financing) is a public financing method that is used as a subsidy for redevelopment, infrastructure, and other community-improvement.
Through the use of TIF, municipalities divert future property tax revenue increases from a defined area or district, toward an economic development project or public improvement project in the community.
In diverting these taxpayer dollars, tax dollars that would otherwise have been allocated toward things like schools, police, fire protection, emergency medical services, etc., a shortage is created. This in turn causes taxpayers to pay more, to make up this shortage.
A brief example of this is demonstrated below.
A Concern (One Of Several)
One of the notorious concerns (but certainly not the primary concern) with TIF’s, in general, is the questionable, and sometimes even fraudulent, expenditures that often seem to be included and paid for with these diverted tax dollars that are referred to as “the increment” or “revenue“.
In Lakewood, past FOIA (Freedom of Information) requests have uncovered a number of very concerning communications between current board members, village staff and principles of the Sportsplex regarding this very issue.
In an email dated 3/3/15, Deputy Manager Andrews advised SportsPlex principle, Jack Porter (who apparently had submitted for some non-qualifying reimbursements) to “re-
And, we haven’t really even gotten started yet!
Development has not yet even begun, but If and when it does begin, there will be potentially TENS OF MILLIONS OF DOLLARS in this “Pot-o’-Gold” slush fund!
An email from Geoff Dickinson of S.B. Friedman (The Village TIF Advisor) to former Village Manager Catherine Peterson asked that Lakewood commit $10 MILLION – BEFORE the TIF would even generate revenue (diverted tax dollars) anywhere near that amount!
Other communications estimate that our village would need to commit to borrowing $6 to $12 MILLION for road improvements before any development occurs!
And, in yet another email, from Karen Walker (who I believe is involved in the financing end of the Sportplex) – to former Village Manager Catherine Peterson – she stated: “The TIF was expected to cover 100% of the project’s TIF eligible costs – estimated at $58 million”!
Suffice it to say, the extensive FOIA Documents we reviewed are replete with these types of very concerning communications…
[Getting Back to the TIF Review Board Meeting]
Revenue (Diverted Property Tax Dollars) Generated
No revenue (also referred to as “increment” ) was actually collected within the 2016 period to report for fiscal year 2016, however, $8596 in “increment” tax dollars was generated by increased EAV (Equalizes Assessed Value) of properties within the TIF District and will be diverted and reported in the next quarterly TIF Review Report.
What this means is that even without any development having yet occurred, $8,596 in Lakewood taxpayer dollars, that would otherwise have gone toward schools, Police and Fire Protection, etc., was diverted away to be allocated toward the $165,388 in expenditures incurred thus far.
This $8,596 that is no longer “in the pot” now equates to a shortage in that amount, which will be replenished by YOU AND I paying more! And again, as is historically the case with TIF Districts, this is just the tip of the Iceberg as we haven’t even really gotten started yet!
IMPORTANT Resident Questions to the Review Board
The Review Board ended by giving residents a chance to ask questions.
The majority of this time was spent addressing one concern expressed by two residents. Their concern was the Intergovernmental Agreement between the Village of Lakewood and Woodstock School Dist-200.
This Intergovernmental Agreement is probably my single greatest concern of all, putting Lakewood Taxpayers at an unfathomable risk. I have spoken of this agreement, at length, and will cover it again, in greater detail, in a future newsletter.
But, know this:
This Intergovernmental Agreement – supported by every current member of this board of trustees, EXCEPT myself – guarantees to Woodstock School Dist-200 that if residential homes are built within this TIF District (and there will in all likelihood be some residential development) Lakewood Taxpayers will be on the hook to guarantee an amount of $9000 per student/per year (adjusted annually for inflation) for every child residing within this TIF District!
Conservative examples, which I painstakingly demonstrated to our board, would potentially put Lakewood taxpayers at risk of a 50% (or greater) increase in our annual property tax levy!
And keep in mind, this $9000 per student/per year will be paid to Woodstock School District-200 which benefits NONE of our children whatsoever!
I will write much more about all of my concerns regarding the TIF/Sportsplex debacle, as well as this Intergovernmental Agreement, in a series of upcoming newsletters.