Follow the Money

Thanks to Council questions and the public's concern, an Executive meeting has been called for Mon Aug 27 at 7pm to discuss the purchase price of Miles Carter's LLC's parcel, the old Alexanders. After reviewing public documents leading up to the purchase for $900,000, I can’t help thinking I’m watching a Cups and Balls magic trick. In the famous trick, there are 3 balls and 3 cups. Eventually all 3 balls end up in one cup. The secret to the trick is one cup has an extra ball that the audience does not see. Without the extra ball, the trick can’t work – check it out in the Secret to Cups and Balls.

Before I explain, I encourage you to read Councilman Langman’s latest post on Wd 7 Blog to understand how the purchase process normally works. 

Ready for the trick now? Here's what Law Dir. Frey, CS&ED Dir Pietravoia and Mayor Cervenik focused Council’s attention on (keep your eyes on the balls, now):

BALL #1- McDonalds: In the fall of 2011, rumors surfaced that McDonald’s was moving to the Alexanders parcel. A set of plans was to be presented at the Nov 2011 Planning & Zoning meeting. The Development Dept was working with McD to get the project plans in front of P&Z asap. By then the City had an idea it might need the parcel, but still thought it could improve the Wastewater Treatment Plant (WWTP) without Alexanders.

BALL #2-the EPA: In January of 2012, the City presented a plan at the Jan 18 Service Committee meeting. That’s when it was revealed to Council that the residential properties abutting WWTP would have to be acquired. A furor erupted. By the time the Mayor met with affected residents on Feb 23 a whole new plan was in place. This new brilliant plan would not only save their homes, but in the long run, it would reduce the City’s expenses. Of course, it would be a lot more expensive to implement and now the City would need the Alexanders parcel. Focus shifted from City siezure to EPA approval.

BALL #3-the Appraisal: Sometime early this month, Council heard from the City that EPA approved the new plan. The City’s need for Alexanders caused Carter’s deal with McDonalds to fall through. Just prior to the Aug 8 meeting, Council learned that two appraisals had been done – one for the vacant parcel ($715,000) and one for the land assuming a McDonalds lease was in place ($900,000). In short, because McDs was ready to move on a lease/purchase, Frey told Council that Carter should be recompensed $900,000.  

Now I told you at the beginning that the success of the trick requires a 4^th ball that the trickster hides from the audience. Here’s what an examination of public documents shows:

BALL #4- The Inside Track: The first discussion of the City’s need for the Alexander’s parcel was in late 2009-early 2010 prior to the March 2010 submittal of a plan to the EPA. The Alexander’s parcel was not part of the submission, but the City was prepared to go that route. In Dec 2010, Miles Carter’s LLC purchased the Alexanders parcel for $600,000. Three months later in March 2011, Carter contributed $1,000 to Mayor Bill Cervenik’s re-election. Prior to that the last donation I could find from Carter to Cervenik was $50 in 2003.

By Summer 2011 the City knew the EPA would not accept the City’s original plan. It also knew it would have to acquire the Alexander’s parcel. In Sept 2011 Carter contributed another $500 to Mayor Cervenik’s re-election. Through Dec of 2011 the City continued the pretense that McDonalds was a done deal. It continued the pretense that EPA was leaving the City in the dark. Late in 2011 the City hired an appraiser. At this point, Carter probably knew more about the City’s plans than Council did.   

Now remember, for the trick to work, attention must be focused on the three visible balls while all the while, the fourth ball is controlling the outcome.

EXECUTION: At the Aug 8 Special Council Meeting, Law Dir Chris Frey did his magic trick before seven Council members. He kept Council focused on McDonalds, the EPA and the Appraisals they had not seen. Four Councilpersons applauded the trick by voting YES to the $900,000 price – President Holzheimer-Gail, Wd 1 Caviness, Wd 5 McLaughlin and Wd 6 O’Hare. But three Councilpersons wanted a closer look at the Cups and Balls trick and voted NO – Wd 2 Scarniench, Wd 3 Jones and Wd 7 Langman. 

Dir. Frey’s Cups & Balls trick would have been a complete success had Wd 8’s VanHo not left the meeting prior to the vote. With no super-majority, that forced the legislation to go from an ‘emergency’, executed immediately, to a 30-day wait before the Mayor could sign off and the purchase agreement be executed. There’s still time for Council to put legislation on the Sept. 4^th agenda, rescind its vote and put the purchase price on hold. Should Miles Carter be fairly compensated for the Alexanders parcel? Absolutely. Should the price be more than he paid? Absolutely. But Council owes it to the rate payers who are financing this deal to honor the process and negotiate the best deal on their behalf. Hope to see you Monday night in Council chambers.