Is the redevelopment of the Stevens School a good idea? Yes. Should the city provide financial incentives? Some, yes, if done strategically. Is the council’s “if we build the road, we sure hope they come” approach a good one? No. Why not? Because, the city unnecessarily assumes all the same market, affordability, and financial risks as the developer while forfeiting more efficient means to promote redevelopment over the longer term.
Is there a better approach? Yes. Beginning in 2016 numerous suggestions were made for a subsidy strategy that involved less risk and lower cost for the city and with more generous incentives.
Were any these ideas considered seriously? Apparently not. It appears the City Council committed to borrow to pay for the roads at Stevens in 2016 long before the formal process began. This commitment was made despite a city ordinance that requires a developer to build and pay for roads in their project — something many Hallowell developers have done.
Is combining six distinct projects occurring in different parts of the city into a lump sum, take-it-or-leave-it borrowing question a good idea? No.
The City Council’s one-loan vote is an example of a classic political calculation. Fearful that the justifiable discontent with the council’s approach to subsidizing Stevens School would jeopardize passage, the council decided to pair it with the more popular Water Street reconstruction hoping Water Street would carry the day.
That same concern prompted the addition of $535,000 for road work in rural areas ostensibly to accommodate a temporary increase in commuter traffic and more closely connect the western part of the city with downtown. This move is clearly designed to garner votes from parts of the city farther from Stevens School and Water Street.
Added to that is a $330,000 down payment for more downtown parking. If the Dummer House is moved to make room for more parking, the cost will rise. The need apparently is neither acute nor immediate. A city official quoted in the Kennebec Journal said, “We have our share of (parking) issues and woes, but most of the time it’s not that hard to find a parking space in Hallowell.”
Then, there is another $220,000 down payment for repairs to the existing fire station’s hose tower and foundation in aid of some future uses involving additional costs.
Add a few odds and ends and before you know it you have $2.36 million in new debt with a 20-year cost to taxpayers of about $3.4 million. Interestingly, the total cost of borrowing is not mentioned in the city’s voter information brochure or in an earlier piece in the KJ in favor of this new spending.
Why is information about the total cost important? Because property taxes in Hallowell are rising fast and unsustainably. More future spending associated with these projects and others, a new fire station and trucks and even more for parking, for example, will push taxes up even higher.
Between 2016 and 2017, the mil rate went up 7.39 percent, three times faster than the core rate of inflation. Joan Sturmthal’s generosity will mitigate somewhat the upward move over the next two years; nevertheless the longer term trend is strongly toward higher taxes.
Hallowell is renowned for its community cohesion, tolerance, and respect for diversity. The one-bond approach does nothing to bring the community together. Indeed, no matter how the vote goes on April 28, it divides residents, setting the stage for more polarization and discord.
How much better it would have been to split the bond into at least four questions grouped by like kind and to ask the voters to set their spending priorities. If not for the council’s political calculus, driven by the concern that given a choice the voters might set different priorities, none of this disagreeable process would have been necessary. What to do?
Vote no and return decision making on borrowing for distinctly different infrastructure projects to the voters as required by the new city charter. Lumping these six projects into one bond defeats the purpose of having voters decide on any borrowing over $250,000.
Will a no vote torpedo any potential project, Water Street, Stevens? No. In the event the one bond question is defeated, the City Council will separate the projects and schedule a new vote ASAP. It might even improve the Stevens subsidy. A second vote may cause some small delay, much of which could have been avoided had the council decided on this course in mid-April.
Ken Young is a former Hallowell city councilor and director of School Administrative District 16.