The implementation of paid parking in downtown Fayetteville is getting expensive. Not only are you going to have to pay to park downtown in the near future, you’re going to have to pay back hundreds of thousands of dollars in unanticipated debt so that Fayetteville can implement paid parking enforcement.

If you want to read all about it, download the attached file.

Here’s the cliff-notes version:

Parking Deck Delays = Lost Revenue

Fayetteville doesn’t yet own the new parking deck downtown. The reason is that we’re not building it ourselves. We are buying it from private developers, once it is finished. Then, we’re leasing back most of the spaces to those same developers.

The deck is more than a year late. Therefore, we haven’t been able to rent out the spaces to Prince Charles Apartments, Woodpeckers employees, etc.

Thus far, according to the City’s numbers, we’ve lost $352,369 in projected revenue as a result of the delay:

In the meantime, the cost of the deck has increased by $3,446,095.

I have more good news: once the deck is finally finished, you, the taxpayer, will be paying a private company to manage, clean, and operate the deck, even though you will not get to use the vast majority of the spaces.

Need Money = Borrow It

So what’s Fayetteville doing to make up for these losses? Borrowing more money:

Now we are taking out a $500,000 loan to install electronic parking meters and equipment. Note that this was all supposed to be “cash funded” from parking revenues we already had.

Keep in mind, we’ve already taken out $14,842,032 in bond money to pay for the deck. The voters didn’t approve this by the way. The City went around the voters using a legal loophole called Synthetic Tax Incremental Financing. It’s great, assuming your tax projections pan out. They haven’t thus far.

Bad Business

The City of Fayetteville has already proven it is lousy at the parking business. It can’t decide what it wants to do, and it once it does, it has to take the taxpayers further into debt to get there.

Moreover, what’s the goal here? The end result of all this is a significant burden on downtown businesses. Less people are going to shop and eat downtown if they can get the same amenities elsewhere in town without having to pay to park.

The short of it is this: Your City government has taken you into debt so that they can charge you money to park on City property.

It’s pretty much a lose/lose. But don’t worry, City staff says that downtown parking will pay for itself, one day, when the deck is finally finished.

Despite the money shuffle, it’s pretty obvious where the problem lies.

In what is becoming an early-Spring tradition here in Fayetteville, City Manager Doug Hewett went on local radio this morning and defended the parking deck project downtown.

It’s making me a bit nostalgic…

I first published my concerns about the project in April of 2018. It must have struck a nerve, because Hewett immediately went on the radio and criticized my take. Since then, the contract’s been amended multiple times, costs have increased by millions of (tax) dollars, and the completion date continues to be pushed back.

This morning, Hewett assured listeners that the deck would be completed “soon,” and that the “big crane” would be returning in April to begin construction on top of the deck. Everyone loves a big crane. Hewett was hopeful that a few floors of the deck would open to allow Woodpeckers employees and Prince Charles residents a place to park.

Notice that the deck will be paid for with public funds (17+ Million). Also notice that the public won’t be parking in the deck when it opens.

But that’s O.K., Fayetteville, because after all this time, we’re still in love.

Love is Patient

The deck was supposed to be finished a year ago. Hewett said the City is still deciding whether it will enforce the $1000/day penalty provisions of our contract with the developers:

Hewett’s not being truthful here. He knows his office won’t push for enforcement. The city has not enforced a single term of this contract in the past. Why would it start now? Instead, the City Council and Mayor will be asked for patience and understanding, and they’ll give it.

Love is Kind

And why would we make our development partners pay us money, especially days after we were ready to pay them nearly $200,000 in interest income?

“Just Because” 😉

The council postponed the vote on the Assistant City Manager’s “interest income” proposal last week, waiting until after Valentines Day to give away your interest earnings to their development partner.

But look at the irony in that. We should be charging these developers over 300k in late fees ($1,000/day from March 15, 2019 to present). Instead, Doug Hewett’s office wants the council to pay them $186,095, for no reason at all. If that’s not love, I don’t know what is.

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Hewett also explained in the interview this morning that the parking deck is being built by “Hay Street Development Pad” (LLC), and not “Prince Charles Holdings” LLC. Hewett said many of the investors are the same, but technically, it’s two different companies.

Remember, we just have to take Hewett’s word for it on this. The public doesn’t get to know the identity of our development partners. It’s not a public record.

So while City Hall and these investors continue their tango into 2020, they’re asking the public to love a ghost.

And by “love,” I mean they’re asking the public to throw millions of tax dollars at a ghost.

If you look hard enough, you can almost see your money floating away…

I have to make a (bad) joke about it because it’s such an inherently awful way to conduct city government. We should not be receiving assurances on the radio from an un-elected city employee about a public-private development deal with secret investors.

It’s way past time to shine some sunlight on this romance. Local media won’t dig into it, and it’s clear you’re not going to get a straight answer from City Hall.

It’s up to us.

Thanks for reading.

Back in November, I wrote a post about Prince Charles Holdings’ request for more money for the parking deck that they are still building in downtown Fayetteville. I predicted the Fayetteville City Council and the Mayor would fund the company’s request. They did. I ended the post this way:

When they ask for more money in a few months, I’ll change some numbers around and re-post this article.

https://crosscreekdivide.com/2019/11/21/1-4-million-more-tax-dollars-downtown-parking-deck/

Well, Prince Charles Holdings has asked for more money. This is about the fifth time they’ve done so. It’s not as much a fulfilled prediction as it is clock-work at this point.

But the details of tonight’s City Council Agenda and exactly how they are going about the latest increase has me riled up. So you get about the 15th parking-deck-post on this site. My apologies in advance…

Investment Income

Apparently, the City of Fayetteville earns interest on the millions of dollars in bond money we borrowed to finance the baseball stadium and purchase the parking deck downtown.

All of the money we borrowed hasn’t been spent, yet, in part because Prince Charles Holdings can’t seem to finish the deck on schedule. It was supposed to be finished in October, and we don’t have to pay for it until it is finished, so the millions we borrowed to pay for it are presumably sitting in an account somewhere, earning interest. Apparently, we’re earning a lot of interest: $189,063 to this date, according to the city’s numbers.

“Great!,” you might think to yourself. “The city’s at least getting some money back. We can use that to offset the cost of the project and save the taxpayers some money!”

But…

…then the powerful forces of the Fayetteville bureaucracy go to work, and suddenly it’s not so great anymore.

Instead of giving this investment income back to the taxpayers or using it to lower the principal on the debt the taxpayers owe, our City Council and city managers want to give all of it to Prince Charles Holdings. They will vote to do so, tonight.

Are you even surprised anymore? Yeah, me neither.

Keep in mind that the initial cost for this deck was 7 Million Dollars. It’s now pushing 18 Million. 2.9 Million is being transferred out of the general fund to cover the overage. This means that other city services will have to be cut if we don’t raise taxes.

Segra Stadium Standards

Perhaps we could have used some of that $186,095 to offset the cost of our new baseball stadium which is also over-budget? But that’s too easy and too obvious.

Today, the Observer published an article stating that our new stadium already has cracks and water leaks. Fayetteville has hired an engineer to analyze and document the defects. This is a good thing. It’s smart government. Why? Fayetteville is battling with the contractor, Barton Malow, over the total cost of the project. Fayetteville can now use these structural defects as leverage to negotiate the final cost of the project and save the taxpayers money.

This is responsible city management. This is how it’s supposed to work.

So why the double-standard?

Despite the fact that our leaders sold the parking deck and the stadium as a package deal, they now refuse to treat these projects the same way even though it is in the city’s interest to do so. It’s baffling, really.

I don’t know who invested in Prince Charles Holdings. It’s not public record by the way, and the city won’t tell us. I do know that they are very powerful behind the curtain.

Do you know of any other entity that is treated this way by the City of Fayetteville? City management goes out of its way to enrich these people. Our elected leaders gladly vote “yes” to repeated cost increases and waive penalties for missing construction deadlines.

Several months ago, Mayor Colvin had an apt analogy when Prince Charles Holdings asked for more money for the deck:

I actually agree with him. Any bank would keep the interest that it makes on its own money for itself.

We’ll just give it away.