Pueblog USa
Wednesday, January 30, 2008
I’m SOOOO Confused!
Is it too much to ask that it make sense?
An article in the Pueblo Chieftain today says that a developer is going to get a tax break for remodeling some apartments.
The Pueblo City Council and County Board of Commissioners both approved a measure this week that will give a private developer a break on property taxes in exchange for remodeling the Bethlehem Square apartments.
On Monday, council approved an agreement with Lucky Star LLLP that allows the company to make payments to the city and county in lieu of property taxes.
How, exactly, are “payments” different from property tax payments?
Councilwoman Vera Ortegon voted against the agreement after expressing concerns that cutting a private property a break on future property taxes establishes a bad precedent.
No kidding! Of course, the way things work in Pueblo, it probably already is a precedent, and no one’s told Mrs. Ortegon.
Ortegon noted that the company will probably pay considerably less taxes than what would normally be levied once the 130 HUD-subsidized, Hyde Park apartments are remodeled.
The city and county will both be paid $9,859 annually.
Ortegon asked how much the city and county would be losing in property taxes, but Housing Director Ada Clark said those estimates aren’t available.
Well, why aren’t they available? How long could it take to work them up? How much is being paid in property taxes now?
Clark also said the only reason the city and county were considering the agreement was because Lucky Star was working with the Pueblo Housing Authority and refurbishing one of the city’s oldest affordable housing projects.
Okay, I’m confused. If this is privately owned, why is the Housing Authority involved?
The city approved a $250,000 federal loan for the project last month. Clark said the tax break was necessary under federal guidelines to ensure that there was enough cash flow to repay the loan.
I’m still confused. If Lucky Star owns the apartments, why did the City need to approve a loan? And where does the Federal Government get off telling a local government that it needs to give a tax break to a private party to repay a federal loan?
And why wasn’t Council told that it would need to grant a tax break before it voted on the loan? Or was it told?
BTW, a quick check on the Colorado Secretary of State’s web site shows that Lucky Star is probably owned by folks in Maine and that they’ve been operating in Colorado for not quite a year. These folks already got what is probably a below-market-rate loan from the federal government and now they’re getting a tax break from local government, with the feds holding a gun to our heads.
I’ll agree that Pueblo needs inexpensive housing, but it seems like we’re giving up an awful lot to get it. The renters may not be paying the cost, but the taxpayers of Pueblo certainly are.
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