MICHIGAN CITY – The proposed civic plaza for the city’s downtown district spurred a contentious debate between the Michigan City Redevelopment Commission and several members of Organized and United Residents of Michigan City on Monday.
Despite OURMC’s opposition during a public hearing on the decision to seek funding for the plaza, the RDC voted 3-1 to secure up to $8.8 million in bonds – which will cost the city about $11 million in total repayment over 20 years.
"The resolution before you finds that the lease rental is fair, reasonable, and that it serves public purposes for the city and the citizens of Michigan City," attorney Phillip Faccenda explained.
But more than a half-dozen members of OURMC disagreed.
They raised concerns about the impact of the plaza on downtown parking and traffic, and listed numerous ways they felt the money could be better spent, from improved sidewalks and public transportation to youth programming and free childcare.
“Nobody is taking $9 million and … really assisting any people who are vulnerable at all,” said Amy Straka. “It seems like the city is reluctant to go out on a limb for things like that, but will pay $9,000 to bring someone from another city who has a plaza to tell us how nice their interactive water features are."
Straka was referring to when, just prior to the public hearing on plaza funding, the RDC approved payment of $9,400 for Dan Senftner of Destination Rapid City to travel on two occasions to Michigan City to discuss ways in which the central plaza in South Dakota has helped that community.
“This plaza is a complete waste of money,” Sarah Johnson said. “This is not a neighborhood public park, like Gardena Park or Pullman Park, that's created or intended for Michigan City residents. This is a public-private partnership intended to create revenue and cater to investors and out-of-town tourists in order to drive foot traffic to the downtown businesses...
"Until every single person, adult and child, in this city has a safe and affordable place to lay their head, you should all be ashamed for even asking for $9 million for a 'living room' for our downtown."
"The point I'm trying to make, though – this is not a burden on community residents," said RDC president Don Babcock. He called on financial advisor Andy Mouser to explain.
Mouser said current TIF collections total about $4.3 million per year. However, the RDC’s total debt service payments – including all outstanding and the potential plaza financing – would only be about half that amount.
“And those TIF collections are based on things in ground currently,” Mouser said. “[The amount] doesn't assume any future development or any future increases in property values. So, for every dollar of debt service, you really have two dollars."
City Planning Director Craig Phillips said he would make sure to address concerns more thoroughly during the RDC’s presentation to the City Council on Tuesday.
“It's clear to us that we need to further explain what this project consists of, and the public benefit, and the specific elements of this project that are exactly what you're calling for," Phillips said.
“…These projects are not done for tourism; they're done for our own community. We've listened to the members of our community and what they wanted in this project, and we've incorporated a large number of those things into this project. … there obviously is miscommunication or misunderstanding" about some of those things, he said.
Allison Warkentien responded, “Just to make sure everyone's clear, we're not complaining about what the plaza is going to actually do. The reason we don't want the plaza is that it's $11 million. It should be spent on something the city actually needs, not just a fancy thing on the north end. Because the way that you're talking, Craig, is that we're having logistical issues with what specifically is going in the plaza. We don't want a plaza at all. We want $11 million to go towards something like free childcare, sidewalks and transportation."
But multiple redevelopment commissioners pointed out that TIF funds to be used to pay for the plaza could not be used to fund any of the alternatives suggested.
Mayor Ron Meer, who appointed himself to the commission last year, said, “Several of these issues that we've talked about tonight would be great to address, but we can't legally use TIF dollars to address those.”
“When we're talking about where tax money goes, I'm speaking in opposition to what a TIF/RDC is and what it does,” said Rob Johnson of OURMC. “Because you're correct – you cannot use TIF funding to build sidewalks in Eastport, it's not possible. But why would you design a city that deliberately segregates its fiscal funds and makes them stay in an area? … I'm saying that's a bad way of running a government."
The RDC and various consultants will present their final plan to the City Common Council at 6:30 p.m. Tuesday at City Hall. At that time, it will be up to the council on whether to allow the RDC to secure the $8.8 million in bonds it is seeking.