A stalled parking garage management deal that triggered a call for an outside forensic audit moved forward Tuesday, with assurance that the landowner will donate the land beneath the new parking deck free of liens to the Augusta Land Bank Authority.
A motion by Mayor Pro Tem Joe Bowles to enter into the management agreement – for a shorter, five-year term, so long as the land is transferred – passed 6-3-1.
Augusta Commission members Corey Johnson, Alvin Mason and Bill Lockett opposed the motion, with Mason and Lockett stating they learned of the potential donation only Tuesday night. Commissioner J.R. Hatney abstained after asking for written assurance that the donation was approved by the bank holding the lien.
Bowles said that under his motion, the city can’t enter into the agreement unless the land is transferred and the lien released.
Questions surrounding the new parking deck go back years but came to a head in recent weeks, when commissioners learned that a promised donation of land on which the deck was to be built hadn’t occurred and that the land not donated also has a bank lien on it.
The questions prompted six commissioners to vote in December to seek a forensic audit of the deal assembled by City Administrator Fred Russell and by city special counsel Jim Plunkett with Augusta Riverfront LLC, the firm that will manage the Trade, Exhibit and Event Center (which will be known as the Augusta Convention Center) and parking decks, and landowner 933 Broad LLC.
Both Augusta Riverfront and 933 Broad have ties to management of Morris Communications, which owns The Augusta Chronicle.
Community questions persisted Tuesday, with former mayoral candidate Lori Davis and Lincolnton, Ga., businessman Al Gray speaking out against the commission continuing with the deal. Davis asked the commission to fire Russell and Plunkett, who she said “hammered out” the “deceptive deals.”
Building on air rights allowed the city to issue tax-exempt revenue bonds for construction while allowing 933 Broad to retain a floor of spaces for its use, Plunkett has said.
Donating the real estate to another government entity, however, was an acceptable solution that allows 933 Broad to keep the spaces and the city bonds to keep their tax-exempt status, Bowles said after the meeting.
He said that Commissioner Jerry Brigham came up with the solution earlier that day and that it passed muster with bond counsel.
“The reason for the air rights was all in order to provide the parking that was promised (to 933 Broad) and to be able to issue the tax-exempt bonds which saved basically $2 million to the taxpayers,” Bowles said.
Paul Simon, the president of 933 Broad, said he has had a letter from the bank holding the lien agreeing to release it when the deal is final since as far back as July 2010. He said he expected no problems in transferring the real estate to the land bank.
“This way, another third party will own the land, and we’ll have perpetual rights to park on the ground floor,” Simon said.
The solution “makes it more complex for the lawyers,” Plunkett said after the meeting, “but it makes it easier for everyone else.”
Did Al Grey and Lori Davis make presentations to the Commission?
It appears someone felt the pressure and the "just kidding" donation had to be made good.
Did anyone attend the meeting (from here)?
I'm going to wait to say more until we can hear from Lori and Al, but I think the meeting was carefully orchestrated. 5 Commissioners were given info about the upcoming donation of the land Friday. I bet they also met at the pizza place at Daniel Village Friday.
Al and Lori were great and you are right, the 5 appeared to already have the info that the other commissioners did not have before the meeting. The taxpayers have been taken for another ride once again. Wait for it.......watch the next thing passed will be the Mayor's ball park now that he has gotten this deck thing passed.
It is totally ludicrous to speak of decorum and practice or passively participate in deceptive behavior.
When Brad Means suggested to Mayor Copenhaver that he should just ask the owner of the land to go ahead and give it to the city, the Mayor became visibly upset and began criticizing those on the internet who review Commission minutes, "making trouble." It seems like there was a change of heart by the owner. I wonder why?
But explain to me how the bank is going to allow this without the $7 million being paid? Is the owner going to pay the loan off? Or is this simply kicking the can down the road?
By the way, my sources say Grady Smith was the lone white commissioner missing from the Friday secret meeting at Daniel Village.
Mr. Gray's remarks of earlier...
Mayor Copenhaver and Gentlemen of the Commission, thank you for allowing me to speak tonight.
Mr. Mayor, I like you have always loved the economic development that comes with mega projects, having served for a quarter century on manufacturing sites from California, Washington, Florida, to Pennsylvania. I say this to offer that my focus is not anti-development, just anti irresponsible spending and fraud.
I rise before you tonight to speak in opposition to two agreements for the conference center and Reynolds Street Parking Deck. This comes from having spent years in crisis management mode for companies whose projects went horribly wrong, but it comes even more from Augusta experiences. I once proposed doing a cost recovery review to administrator Randy Oliver that might have reformed Augusta. He was interested, but then he hit a patch of turbulence and concluded it wasn't possible in Augusta – the influence of the connected was too great. I went on to gain new corporate clients, just not in Augusta.
The saga of the Tee Center over the last 5 years has been a twisting, turning affair from its start. The last chapter should not be written tonight. The irregularities, the failures, and evidence which are legion scream “STOP!”
We in the 12 counties destined to be coupled with you by the TSPLOST are a watching, nervous, and perhaps unwilling bride. We see $50 million in buildings built on land you don't own, undisclosed liens of various description, land to be donated turned into air, a bribery trial involving this very project, controversy going back to 1998 with this partnership, and finally that you find yourselves hostages tonight to threats of those liens. These things pose a dire warning for associating ourselves with you.
While these are strong words they are directed in a sense of hope, a profound desire to make this the night that everyone of you can recall with enormous pride, the night 10 men and a mayor who have feuded relentlessly came together and started accomplishing that which predecessors of the last 40 years could not. I would be proud to help.
First we have serious issues to address. Gentlemen you simply cannot ratify this proposal tonight, offered under duress and a myriad of questions, without the most serious of consequences for this community. This outpouring of the people bears witness to that. Yes, the building is built and no, no one wants this mess during the Masters, but you must stop and make sure that these people are protected by the strongest of audit rights, open record access to, and an immediate review of the past, current and future operations under the management of these private partners.
I cannot imagine the consequences if you proceed. I would not want to be in your shoes should you vote 'yes.'
You see, if this body in its wisdom does not embrace a comprehensive program of reform, sound financial controls, and contract enforcement, beginning tonight, the sledgehammer blows from revelations of stunning irresponsibility, indeed Fraud will rip apart this community. I do not refer to the transaction currently at issue, but others that we have identified throughout this government in recent months. Mr. Brigham was concerned about spending $30,000 on an audit. Well we can get that much back with 2 phone calls. There might be millions salvageable, based upon my preliminary review.
Mr. Jackson and others seem to have bought the administrator's assurances that there is security in the work of $500 an hour bond attorneys. Is there? In Jefferson County Alabama the county administrator and 4 county commissioners are now in the penitentiary because of the spawn of bond attorneys. There is a national scandal unfolding around the municipal bond market. It pays to keep up with these trends, lest you become the next victims.
Several of the people in this room may have made some the biggest misjudgments or miscalculations of their lives. You have a vote to make. I hope it is not one in which you join them.
Mine got gobbled....River, you know where the truth lies.
Susan McCord said, "Questions surrounding the new parking deck go back years but came to a head in recent weeks, when commissioners learned that a promised donation of land on which the deck was to be built hadn’t occurred and that the land not donated also has a bank lien on it."
At least we are now all agreeing that the donation of the land was promised. So they were just kidding about the just kidding. Heh.
There are things in there that the commishes did not give a darned about reading......now they will be reading them
Riverman, about your 11:59 post — excellent catch. Fred (What, me worry?) Russell told the commissioners that Riverfront was going to donate the land before they ever approved going ahead with the bond issuance. Then, when construction was nearly complete, he told the commissioners, "Just kidding, the land will not be donated."
We now see reason number 3,257 why Fred Russell needs to be fired for malfeasance, dereliction of duty, and undependability. These are causes that would make him not qualified for a severance package.
Correctomundo, Many Arrows, about the fine print. One of the things I think is bad in the management agreement is that it authorizes Riverfront LLC to hire personnel to run the deck and obligates the city to pay Riverfront LLC for their salaries and benefits. But it places no limitations on Riverfront LLC about the details. There are no limits on the number of people they hire nor limits on the salaries! It is a complete blank check.
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BTW, nice suit.
Where is the outrage with this debacle? Why can't those in charge of this "oversight" just admit they didn't do their due diligence on this project and move on? There is probably nothing illegal about what has taken place but it is the conduct of the six white commissioners, the administrator, and now the mayor after the debacle that makes us nervous and suspicious. The commissioners are part-timers and it is very easy for details to get by them but now that you know this debacle has taken place why treat the four black commissioners like they are demons for asking questions and failing the taxpayers of Augusta by not being responsible stewards. It’s called admit and move on not damage control.
As some may recall, I've taken up a good bit for Fred Russel when I felt like Mason and others were personally slamming him unduly as he goes about his job trying to please everyone. However, his involvement in this land deal is pretty obvious. He was amiss to have let this thing get this far.
I understand how LLC's work and are protected, but I'd still like to know how Morris Communications, owing debt holders tens of millions of dollars, is going to pay the lien or swing having the bank give up the $7 million lien they have. Won't the Morris debt holders have some say in all this? Those of us who simply pay our bills at the end of the month need to learn some of these tricks.
just pass me the popcorn. munch munch munch...
Good questions, RM. On the city's web site, it says 933 Broad paid around $2,322.77 property tax on that parcel in 2011. I could not find the assessed value on the web site, but what would you guess, MA, about $200,000? I would not think there would be a $7 million lien on that parcel.
The address of the parcel is 921 James Brown Blvd if someone wants to look at it.
Right now, they still have the property tax info on the hot dog stand parcel, and the photo on the web site shows the hot dog stand still standing. You might want to look at it for nostalgia's sake before they change the picture and show the parking deck monstrosity. The address of the hot dog stand property is 902 James Brown Blvd
We expect the city to manage crime, but they have to outsource to manage a parking deck?
Can anyone explain why we are paying for a management company at all?
If we are paying for the employees, are we getting anything out of this deal except a bill?
From the article:
Bowles said that under his motion, the city can’t enter into the agreement unless the land is transferred and the lien released.
And then:
Paul Simon, the president of 933 Broad, said he has had a letter from the bank holding the lien agreeing to release it when the deal is final since as far back as July 2010.
Sounds like a stalemate to me.
River, Morris Communications is pretty much walled off from the LLC's, as one might suspect. This deal is Billy's retirement courtesy of the taxpayers. The attempt was made to open up ALL agreements between the LLC's and the CVB to thorough operational audits, to spell out exactly what "costs" are, and to provide for open records requests so that the watchdogs can see. They wanted none of that and rammed this corrupt deal through. Shame on every one of the 6 who voted for this travesty.
Don't worry, madgerman. Jim Plunkett said that the lawyers are there to take care of little hurdles like that.
Okay, Insider. You wondered why the city needed to hire a company to manage the city's parking deck. Well, the short answer is that they are all into outsourcing these days. But the more complete answer is that the very reason for the parking deck is to serve Marriott Hotel guests. The owners of the hotel do not trust the city to manage their deck. The owners of the hotel want to hire people to keep the deck clean and tidy, and to present the proper image when collecting the money.
Lori Davis and Al Gray should be commended for their citizens activism on the behalf of all taxpayers. Scott Hudson reported yesterday that this deal would go through but that Joe Jackson was calling for everything to be looked at in an audit and expressed how Lockett would not like to see the Laney Walker/Bethlehem development to be included in his decry to audit the dealings. Wonder what he (Jackson) or Scott Hudson meant by this little tidbit? It was even suggested that findings on these transactions could bring jail time for some people...I say let's get it started! I'd be willing to chip in to help pay for the audit! Let's go ahead and expose all the corruption! Citizens united and thank you Lori and Al for your time and talents!
LL, outsourcing management of the James Brown Arena makes sense because that requires a specialization.
But a parking deck?
Pop a credit card reader in there and hand a man a garbage pail. Bam. Instant management.
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