Trade center funding plan likely to draw tough Tuesday questions

City Administrator Fred Russell is likely to face some tough questions Tuesday on his plan to build the Reynolds Street trade, exhibit and event center while stimulating redevelopment in inner city neighborhoods, a plan that involves a total $92.5 million in projects, $35 million in bonds and a new development authority.


Mr. Russell presented his proposal in detail last week, and it’s on the agenda for possible approval at Tuesday’s commission meeting.

Several commissioners said today that they’re skeptical about various aspects of the plan.

Betty Beard – whose district includes downtown and who got $750,000 per year from a $1 hotel fee set aside for inner city redevelopment in the compromise that approved the TEE center in 2007 – said she’s concerned about the city’s ability to pay back the bonds, considering the troubled economic times. She said this may not be the best time to move forward with the TEE center, and had the vote happened now, it wouldn’t have been the right time to approve revitalizing the Laney-Walker and Bethlehem neighborhoods.

Mr. Russell’s plan involves issuing $9 million in bonds, $2 million of which would be from the city’s tax allocation district, to kick-start inner city revitalization.

“What type of exit do we have if these things don’t work out?” Ms. Beard said. “A lot of it is going to be whether I feel comfortable financing this right now.”

Commissioner Joe Bowles said he has questions about forming a new five-member Urban Redevelopment Authority to issue the bonds, though he’ll support it if it will save money. He wants to know if there would be a time limit on the authority’s lifespan and how much power it would have.

Mr. Bowles said he’d also like to see that $2 million in TAD bonds put somewhere else.

“Two million could go a long way on Gordon Highway,” he said.

Another lingering question is why the city’s existing Downtown Development Authority can’t issue the bonds. Mr. Russell said attorneys who helped formulate the plan said a new authority was the cleanest way to go about it.

DDA Executive Director Margaret Woodard said there’s no reason why the downtown authority can’t do it; Bethlehem may not be in its territory, but that would be easy to fix. The authority just incorporated Harrisburg into its territory about a month ago, Ms. Woodard said.

DDA Chairman Steven Kendrick said he’s trying to get clarification on the reasons for bypassing the downtown authority.

“Basically, it may just be a cost-cutting measure,” he said. “On the other hand, the DDA feels like if we can be a part, we certainly want to be a part of it.”

Commissioner Calvin Holland and super district Commissioner J.R. Hatney wouldn’t talk about the plan today.

“Right now, I’m not for it,” Mr. Holland said. “I’m somewhat skeptical right now, I’ll just say that.”

Super district Commissioner Don Grantham said he’s on board, though. It’s time to build the TEE center, which voters approved in a special-purpose sales tax package in 2005.

The new authority would be created and appointed by the commission for funding purposes only, he said, and that aspect of the plan may need polishing.

Mr. Grantham said the city wouldn’t have trouble making payments on the bonds. Hesitating because of the recession would be a bad idea, he said, because the city “can’t stop the wheels from turning” or it will be at a disadvantage when the economy improves.

“We’ve got to think forward,” he said. “We can’t just sit on our hands.”



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