Petitions Submitted; PR Battle Begins - O'Grady Swings and Misses

The group leading the effort in opposing a taxpayer-funded baseball stadium in Wilmington, led by co-organizers Josh Fulton and Ben McCoy, turned in around 4,000 completed petition signatures to the City Clerk on Thursday, marking the end of a long process of gathering support against the effort to secure tax dollars for a stadium led by Mandalay,  the Atlanta Braves, and the Flywheel/Trask (FT) conglomerate.

Within hours, the effort to discredit and skew the facts about the petition effort began, led by Wilmington City Councilman Kevin O'Grady.

Click here to watch O'Grady's comments

O' Grady's comments were a tacit declaration of war on Wilmington citizens, who are clearly against the idea of handing over their tax dollars to private enterprise to build a baseball stadium. 8 out of 10 citizens approached with the petition enthusiastically signed it, and wanted their voice to be heard on the issue. Many just believed that they should have a say in the matter, and that it should go to a voter referendum, instead of city council shoving it down their throats.

But that's not how Councilman Kevin O'Grady sees it. If he decides he wants to spend tens of millions of tax dollars on a bad project, then how dare any citizen speak up and say otherwise.

O'Grady also tells us that those in favor of the petition are forcing the city to spend money to verify it. County Board of Elections estimates that the entire process would cost no more than $50K, including an election. This is far less than $60-$80 million for a stadium, and is unfortunately the only way to stop it, since those elected on council are not representing the will of the people. City Council has had ample opportunity to assure the public a voice in this matter, and to put the issue to a public vote. They have chosen not to however, because they do not agree with the sentiments of the public, and want to have their way, rather than those they are elected to represent. Any costs associated could have been easily avoided by a city willing to serve the public - as they are chartered to do.

There is also a fear campaign being waged. O'Grady and Mayor Saffo are out there telling the public that the language of the petition affects much more than just the proposed stadium. They have said that if this petition passes, that funding will have to be cut from Legion Stadium, since it is a stadium for the "purposes of professional sports and other events", which is the language from the petition ordinance.

There are several problems with this however.

Besides the fact that it was never the intention of the petition to target anything other than the construction of a new stadium with tax dollars; and the fact that the city chose to ignore multiple attempts to work amicably together on drafting language mutually agreeable, several technical and legal issues still stand in the way of the idea that Legion would have to be defunded.

ISSUE #1: According to city documents, the city is under contractual obligation through an interlocal agreement with New Hanover County to fund the operations and debt cost of Legion Stadium. The petition ordinance says nothing about breaching any existing contracts or interlocal agreements - in fact, doing such would probably be a violation of the law.

Interlocal Agreement: Click Here

ISSUE #2: The City of Wilmington is obligated to pay debt on Legion Stadium. City documents reveal that the city still has several years of debt to pay along with the county on the stadium. It would be impossible for an ordinance of any kind - petition-generated or not - to nullify that debt obligation. This debt is held by the banks, who have every legal ground to hold the city financially responsible for that existing debt. Furthermore, the city has a fiduciary duty to pay its agreed debts.

If cities could simply nullify debt obligations through ordinances, then there would be debt-free cities all over the US! Simply put, the city is on the hook for the money it borrowed and agreed to pay back for Legion Stadium. Cancelling this debt through an ordinance would be impossible.

Legion Debt Agreement: Click Here

ISSUE #3: One prime consideration, that has played a vital role in many court case verdicts, and even interpretation of the Constitution and the Bill of Rights, is the idea of the spirit vs. the letter of the law. There is no doubt that the spirit of the law in this regard is to target a yet to be built, minor league baseball stadium for private enterprise with tax dollars. This would invariably be considered should the law ever be interpreted by a judge.

Again, it is imperative to state that although concerns about the impact this ordinance would have to functions such as Legion Stadium have been overblown and completely misrepresented, it is important to consider the facts as they are surrounding the issue and the reality of the fact that ordinances cannot nullify prior fiduciary obligations. It is believed however, that these views expressed by certain members of the City Council are not true concerns, but cheap scare tactics employed out of the desperation they feel to rule unhindered; the entitlement they ascribe themselves; and the will to spend tax dollars frivolously without incurring any resistance from the public.

Encouraging, and Discouraging Numbers on Unemployment

The good news is that unemployment in New Hanover County is down .9% over the last year.

The bad news is that unemployment in Wilmington is about 1.5% higher than in the unincorporated area and beach towns combined.

How is this possible?  Let's take a look.

Unemployment in Wimington is 9.2%; and 8.5% in the county as a whole.

The Wilmington population is about 106k; the population for the county is 203k, meaning that Wilmington is 52% of the total population of the county.

So, let's get out our thinking hats to figure out how much higher unemployment is in Wilmington than in the unincorporated area and beach towns.

The equation would be:  .52 (Wilmington pop. as % of NHC) * 9.2 (Wilmington unemployment rate) + .48 (nonWilmington population as % of NHC) * x (unknown unemployment rate in nonWilmington NHC area) = 8.5 (total county unemployment)

Solving for x gives us about 7.7%, meaning that the unemployment rate inside NHC but outside Wilmington is a full 1.5% lower than inside the city of Wilmington.

WHAT THE HELL IS GOING ON INSIDE WILMINGTON TO RAISE THE UNEMPLOYMENT RATE SO MUCH!!!????

Oh, wait a second.  I know.

"Private" Stadium Plan Completely Hoses Taxpayers

Haven't signed the petition against tax dollars being used for the stadium? Need to turn in your petitions? Click here: http://Stadium.WilmingtonRants.com

As is typical with large, high profile public projects, last night's presentation to the Wilmington City Council clearly demonstrated that the highest priority concerning the baseball stadium project is exactly how many palms get greased in the process.

The presentation, which was conducted by the ever-growing development team under the watchful eye of local land developer Raiford Trask III, was entitled, "Private Development Proposal Overview", giving the impression that perhaps a truly privately-funded stadium is within reach. However, nothing could be further from the truth.

One of the key players involved with Trask is Clay Boardman of Augusta, GA, who owns Flywheel, LLC. The "private" stadium investment team was referred to in the presentation as "Flywheel/Trask" or "FT". The Greater Wilmington Business Journal (GWBJ) recently wrote a piece on Clay Boardman, in which they said this:

An Augusta, Ga. native of dapper style, Boardman, 53, announced his firm — Flywheel Projects — would finance and construct the stadium at its own risk to bring an Atlanta Braves franchise to the Port City. http://wilmingtonbiz.com/industry_news_details.php?id=3603

Leading up to last night's presentation, one may have had the impression that Boardman was planning on financing the stadium completely on his own, without the use of tax dollars, which is what over 80% of Wilmingtonians said was the only way they would support a stadium. However, Tuesday night's presentation not only revealed the use of tax dollars in the project, but a strong reliance on the public's money for the project.

GWBJ went on to quote Boardman who said:

“I want to be transparent about all this,” Boardman said of current stadium negotiations. “I want to do the right thing because we’re spending money on this and so are the taxpayers . . . there will be no deal done if the taxpayer gets screwed, because I’m not going to be a part of it.” http://wilmingtonbiz.com/industry_news_details.php?id=3603 

Boardman gave an interesting personal story at the council meeting, where he talked about how his hometown of Augusta was trying to do basically the same deal as far as obtain a minor league baseball stadium. Boardman stated that he did not support the project there, and said it wasn't a good deal. However, a few hours up the road, in a town where he has no tax burden, and a tasty piece of the action; we're told a stadium is somehow perfect for us.

Proposal Details Revealed

The devil was definitely in the details of the Flywheel/Trask presentation, and answered the specific questions about exactly how much "investment" taxpayers would be in for.

The most fascinating element of the presentation was the fact that a private group of investors are clearly running the show, and dictating to the city exactly how much money is required from we the taxpayer. FT's presentation contained a graphic which identified the funding model of the stadium, which conveniently has FT sandwiched in the middle between the city and the stadium, getting a piece of the action both ways. Mandalay and the Braves pay a very nominal lease payment not to the city, but to FT; FT pays sales and use taxes to the city; the city turns around and makes all of its large payments not to Mandalay or to a bank, but to Trask and Co.; and in turn, FT makes the payment to the bank, after "administrative" costs are accounted for of course.

The basic premise was this:

According to FT, the proposed cost of just the construction of the stadium is between $32 and $38 million, and does not include the cost of land, remediation, etc. FT will have a total investment of only $10.5 million, payable over 30 years in $350,000 installments. The city will pick up every dime of the rest, including land and interest. Taxpayers could end up with a burden of around $50 million or more over the 30 year period. 

This is the much anticipated and wonderful "private" funding mechanism that we have heard is coming after the much-ballyhooed announcement and press conference held at the Wilmington Chamber headquarters last month, that revealed a "private" investment team.

As far as economic impact, FT and Co. state that as a result of all of this, 139 permanent jobs will be created, at an average pay of less than $28,000/yr. FT referred to these jobs in the presentation as "high paying".

The much-anticipated details of the "private" funding plan have been unveiled, and leave much to be desired, as well as leave the taxpayer on the hook for as much as 85%+ the total 30 year cost of the entire project. The private investment part has their bases covered, situating themselves in a position to recoup their investment from both directions. 

Now is the time to solidify our opposition more than ever against this ridiculous waste of taxpayer dollars and the public trust in general. The Wilmington City Council has shown itself a willing party in being manhandled, ordered around, and dictated to by Mandalay and Trask; from the choosing of a sports analysis firm, to exactly how much money they will bilk future generations of taxpayers out of. 

One thing is crystal clear about the proposal at hand: Flywheel/Trask and Co. are going to get paid; and taxpayers are going to be on the hook for decades to come.

How Do Film "Incentives" Affect NC?

An interesting article about whether or not NC's film incentives actually work. American Spectator:

The state offers one of the nation’s most enticing tax-incentive programs to production companies. Last year, Tar Heel taxpayers forked over $5,071,322 in tax credits to Journey 2: The Mysterious Island. In its three-season run, the HBO series Eastbound and Down has siphoned $3,740,884 from North Carolina. The CW Network’s One Tree Hill has drained a whopping $27 million from the state’s coffers over the last five years.

Even Vince McMahon’s World Wrestling Entertainment body-slammed the state for $135,401. That was its reward for shooting Raw and Smackdown at arenas in Charlotte and Raleigh in 2010.

WWE? WTF?

Hollywood welfare, like actual welfare, overflows with abuse. Last month, a Massachusetts court found filmmaker Daniel Adams guilty of defrauding the Bay State out of more than $4 million in tax credits by inflating his costs on The Lightkeepers and The Golden Boys. The offenses included a claim by Adams that he had paid Richard Dreyfuss six times his actual salary of $400,000. If you haven’t seen, let alone heard of, The Golden Boys or The Lightkeepers, you’re not alone. They appear to have been made as much for tax subsidies as for box-office receipts.

“In fiscal year 2010, the forty-three states that offer film subsidies spent $1.5 billion of your tax dollars subsidizing film and TV production,” Jason Mattera writes in Hollywood Hypocrites. “Let’s put that in real terms. Hollywood’s 2009 welfare payments would have been enough to pay the salaries of 23,500 middle school teachers, 26,600 firefighters, and 22,800 police patrol officers.”

How Do Regulations Affect Wilmington?

A few months ago or so, the Wilmington City Council hired a consultant, yet again. This time it was to tell them how to improve the "development process", meaning they paid someone $23k to tell them just how much the planning and zoning department is a tyrannical bureaucracy.

Of course, it would have benefited members of City Council to actually look into this themselves, but instead someone looked into it for them, and now we have this report.

What does it say? 

Recommendation #1: Hire a new person. Not fire anyone. Not give deadlines where if no action is taken on something it's automatically approved. Hire a new person.

They say this is necessary to essentially "change the culture" within the department.

The department already has a head. Should this kind of responsibility not go to the department head?

Additionally, from what I've heard, the city planning and code enforcement staff are real ballbusters, especially downtown.  Of course, the people who create this kind of atmosphere are never addressed.  The "solution" is to simply add another layer of bureaucracy that could be just as hostile as what's already there.

What about how quickly the city approves projects?

"There is certainly an issue with timeliness and timeliness is a two way street," Michelle Ferguson, associate of The Novak Consulting Group, said during a presentation of the findings to council at an agenda briefing Monday. Some of the lag has to do with insufficient submittal of site plans, the study found. 

Mayor Bill Saffo said several projects are taking six to eight months to get through the review process.

Ahhh, you have to love the understatement of Bill Saffo, especially when it benefits him.  Does it really take just six to eight months?

Let's take a look at part of an article that describes how long it took for The View to get approval downtown. For those of you who don't know, The View would have been where we now have our "wall of keys", the city's most appalling eyesore.

A lot has changed since 2006 when architects started drawing plans for The View. Terry Espy, managing partner and project developer, said it took three years to get the needed permits. The land, which has all the needed permits and has been released for construction from the city, now sits vacant as the economic tornado hit that project too.

Three years, folks. That's a lot more than six months, which is still too much. With some projects, like the Gateway project, they simply stifle it for years until the developers go bankrupt.

Additionally, what Saffo is saying is that he knows about this but he's doing nothing.  He's presenting himself as if he's helpless, when in reality he could actually be the most important figure in city government (no offense, Sterling.)

Finally, at the end of the story, we get actual figures about how terrible our city is in terms of facilitating development:

In the study, which included a survey of more than 57 stakeholders, 67 percent of those in the community who responded said the process doesn't result in higher quality development, 62 percent say it doesn't compare favorably with other communities and 85 percent said the current regulations hinder development.

Upset you don't have a job? Your kid or your friend doesn't have a job? Upset you don't have a nice place to shop or relax?  Talk to the Wilmington planning and development department.

Of course, don't talk to the Wilmington City Council, because we all know it's not them who's actually in charge of the city government.

Government Lobbying Government?

Yes, folks, that is the next great "economic development" idea out of our brilliant Mayor Bill Saffo.

In other news to come out of the agenda brief, Wilmington Mayor Bill Saffo said he'd like council to consider hiring a lobbyist for both Raleigh and Washington, D.C. Saffo says the need has increased in recent years.

Yes, folks, government lobbying government. Does merely reading it not make you feel disgusting? What ever happened to lean, efficient government? Now it's pigs feeding at the troph. Never forget that all federal and state dollars still come ultimately from the taxpayers.

But what's the truly amazing thing about this?

Wilmington already has a lobbyist. It is Ms. Lawless Bean, whose real first name apparently is Mary. I don't know why she goes by "Lawless." Maybe because she's employed by the Wilmington government.

I've also heard that we're the only city of our size to have a lobbyist up in Raleigh. And now Bill Saffo wants to send another one to D.C.? You've got to be kidding.

$1.1M for Recycling Bins That Tell on You?

Were you aware that Wilmington authorized $1.1M for new recycling bins? If you're a close reader of the local news, chances are you were.

Were you aware that these recycling bins will be outfitted with rfid chips? Chances are you weren't. Only the StarNews mentioned it and they mentioned it very briefly.

However, it's true and clearly stated in the supplemental documents for the last City Council meeting:

Each of the roll-out carts will have a Radio Frequency Identification (RFID) chip which will allow us to collect and maintain data regarding the carts’ use, location, and to target outreach efforts in specific sections of the City.

Additionally, City dump trucks are going to be outfitted with readers for these rfid chips. The cost will be about $81k.

What are these going to be used for? Well, if you're familiar with the City of Wilmington you're aware that the answer is probably: "no good".

Let's take a look at how they've been used in other places.

Cleveland Plain Dealer:

It would be a stretch to say that Big Brother will hang out in Clevelanders' trash cans, but the city plans to sort through curbside trash to make sure residents are recycling -- and fine them $100 if they don't. The move is part of a high-tech collection system the city will roll out next year with new trash and recycling carts embedded with radio frequency identification chips and bar codes.

The chips will allow city workers to monitor how often residents roll carts to the curb for collection. If a chip show a recyclable cart hasn't been brought to the curb in weeks, a trash supervisor will sort through the trash for recyclables.

Trash carts containing more than 10 percent recyclable material could lead to a $100 fine, according to Waste Collection Commissioner Ronnie Owens. Recyclables include glass, metal cans, plastic bottles, paper and cardboard.

Another:

[S]ome cities are using RFID tags to penalize those who don’t recycle. Earlier this summer, Laurel, Md. began using RFID bins to enforce $25-100 fines for houses not using their bins. All bins are linked to an address, and the city requires recycling participation.

It's my guess that this is exactly the kind of thing that Wilmington has in mind.

Is this a good idea? Is recycling even "environmental friendly"? Of course not. Take a closer look at the facts:

"Recycling may be the most wasteful activity in modern America." (Originally NY Times)





It's another scam. And it's going to wind up costing you more and more.