Entries Tagged 'Development' ↓

City of Sioux Falls puts out video bragging about spending tax dollars on private development

You would think normal public officials would be putting out videos about road improvements and cleaning up neighborhoods, nope, they like to brag about TIFs and giving tax rebates to wealthy developers to build parking ramps and condos.

Sioux Falls City Councilor Curt Soehl plays an interesting game tonight

At the council meeting tonight, Soehl recused himself on Item #45, which is a rezone of an historic building in Pettigrew Heights to be converted into a coffee shop. I’m am not sure why he recused himself because he never told the council and the public, but my guess is he may be investing in the project but I do not know for sure. Let’s just say he has a conflict and admitted to it, whatever it is.

After coming back he co-sponsored item #53, a resolution to pull $120K from streets to re-establish the core facade program. He claims he has NO idea who would want to use it but has heard several people are interested.

So imagine my surprise when the main developer of Item #45 was interested in applying for the program after his rezone was approved.

Coincidence? I think not.

So how is it that Soehl walked out on the coffee shop project because of an assumed conflict, then turns around and sponsors a program that MAY benefit the project he has a conflict with?

Hey Curt, we can connect the dots . . . unfortunately you cannot. This will be brought up time and time again when your re-election campaign heats up.

UPDATE: Apparently the Developer of the Coffee Shop is Curt’s re-election campaign treasurer

Sioux Falls CountCilor Jensen continues to push useless trickle-down policies when it comes to housing

You know what they say, even if you know your are wrong, never admit it, just dig in deeper. During the latest episode of Inside Town Hall in which Councilor Brekke tells us to eat more vegetables and drive electric cars, Jensen continues to push the narrative that if we just give contractors and developers even more tax breaks we will get more housing (he supports legislative proposals that would create entire neighborhood TIFs, instead of individual homeowners and a rebate of excise taxes to contractors). While at the same time promoting (low-wage) workers to live someplace else. When it comes to affordable and accessible housing, it starts at the bottom, not at the top. But not in Sioux Falls, hand all the TIFilicious goodies to the ones at the top hoping they will throw us some crumbs while spray painting the poorer neighborhoods sidewalks.

And why would we NOT think Alex’s plan wouldn’t work? He works at the number #1 bank in the Nation, and he had no problem advertising the place while appearing on a tax payer funded program. Actually surprised me because every time he sits on the dais at Carnegie he has no problem flaunting his SF City Council logo wear puffy vest we all paid for (even though I suggested they just all get magnetic badges instead). It must have been at the cleaners when he recorded this show so he had to wear his primary employer’s vest instead.

Billion dollar permit record in Sioux Falls happened by pouring gasoline on a fire and massive property tax increases

As I have been saying for years, we are breaking these records by ignoring affordable housing, handing out millions in tax rebates and TIFs and including publicly funded projects while raising property taxes a record amount.

If you read the article you see that two large chunks of permitting were projects that received millions in TIF money and another large chunk was public projects like the water treatment plant and the public safety center.

I have often argued that permits should be separated into PUBLIC PROJECTS and COMMERCIAL PROJECTS.

Private Commercial projects build economic growth, but when they are propped up by massive tax rebates it’s just putting gasoline on the fire. As for Public Projects, those are funded by the taxpayers as investments in infrastructure and should NOT be considered towards the permitting financials as part of economic growth. Sure, we have to build these facilities because of growth, but it also means our taxes are going up to do so while handing out tax breaks to the very developers fueling the uncontrollable growth. It is counter productive and simply growth for growth sakes instead measured, calculated slower growth.

I would love to see the city stop giving TIFs for Korean owned egg roll factories and parking ramps and start applying them to neighborhoods. Or better yet abolish TIFs all together and simply invest tax dollars in neighborhoods by encouraging the construction of more affordable housing through other tax incentives. Instead recently the city code enforcers bombarded neighborhoods in the central district with pink spray paint and violation notices for city owned sidewalks. What a great way to prop up our central neighborhoods by fining citizens to fix city owned property (more on this story in the near future).

Recently CountCilor Alex ‘Expert Economist’ Jensen suggested on CityLink that the way to solve our workforce and housing issues is by inviting people to work in Sioux Falls but to live in towns around us like Tea, Hartford, Dell Rapids, etc. Yeah, that’s an awesome way to build a solid tax base 🙁 and this guy works at a bank!

I would also like to see separating commercial and public permits. They don’t represent the same thing and shouldn’t be held up together. It’s like saying you are the championship BBQ’r in your own backyard and buying yourself a trophy. The city saying they broke records by including infrastructure projects they approved and we are paying for through higher taxes is putting the thumb on the scale.

Don’t get me wrong, economic development is good, but let’s be honest about the numbers and where the money is coming from (mostly taxpayers) and let’s start investing in neighborhoods, local businesses and people – then you will see true economic development we can be proud of because you can’t live in a parking ramp, police firing range or an egg roll.

More Backroom Shady deals from the TenHaken Administration and the spineless Sioux Falls City Council

While the city councilors did a lot of whining last night, all 8 of them voted for this deal;

The Sioux Falls City Council voted to discontinue parking at a downtown surface lot, as well as declare it surplus property — the first steps in a plan that could add a four-story building and 150 apartments to downtown Sioux Falls.


The pair of 8-0 votes were taken in relation to a 0.5 acre surface parking lot at 400 S. 1st Ave., one of two lots that have been up for sale since September 2020.


The project is not final, with Powers noting the resolutions passed by the council would enable the city to enter into negotiations on the sale of the lot, which was appraised last year at $502,000.


In an informational meeting earlier this year, Soehl had said he didn’t believe the lot could legally be declared surplus, and called the system of informing the council about submitted proposals “inadequate.”


Basically, as I predicted on Sunday (item #47), a backroom deal was concocted with the developer, which seems to be an odd coincidence considering Mayor TenHaken’s Chief of Shaft, Erica Beck, was a former executive with the company and the developer has continued to receive tax incentives, TIFs, land discounts and other goodies from this administration and council.


Just look at the appraisal price. It is laughable considering that an unblighted lot, on prime downtown property with plenty of access to sewer, water, gas and electrical would only be worth $500K. That lot should go for at least 4 times that amount. I would be curious who appraised this lot and how many appraisals were done? Good luck with that request.


While the City Council wrings their hands about how this deal is being done, they voted for it and refuse to remedy the issue. Oh that’s right, because most of their butts are owned by the banksters, bondsters and developers in town, and they know it. This also should NOT have been voted on as a resolution as ‘surplus’ after a deal was already done with a developer without a proper RFP process. The lot should have been voted on as surplus before ANY developer put in a bid. A little game of the cart before the horse. There should have also been a recommendation to only allow workforce housing be sold at the location. Instead, it appears these will be higher rents. The inept council has had ZERO control of this process from the beginning, but golly gee they sure let the city staff have it by voting 8-0 to approve 🙁


The WAR on transparency and open government continues and the rubberstamp council just plays along while ‘pretending’ they are concerned.

UPDATE: The RR Redevelopment Area just might fill up after all

UPDATE: My suspicions were correct. I guess the city has already denied a purchase agreement with this guy, and he was trying another approach by going through the media. The rumor was it was denied because the developer doesn’t roll with the developer welfare queens the city normally gives these projects to. I wondered why this wasn’t in SF Bizzo. This from the city;

Yesterday you received a packet from Thomas Development with their proposal for the railyard sites south of 8th Street (Parcels D & E), which is highly irregular as the process does not ask them to send their proposal to everyone and most developers would not want their plans made public.  Unbeknown to us they also sent a press release to the Argus Leader, https://www.argusleader.com/story/news/2021/09/28/sioux-falls-developer-proposes-more-than-200-affordable-apartments-housing-downtown/5906625001/  which is totally outside the normal process we would expect. 

As I have mentioned in different meetings with each of you, we have two other parties who are planning to make an offer on this site as well.  Under our negotiated sale process they have been notified and we expect to see their proposals toward the end of October.  Just wanted to let you know that the process undertaken by Thomas Development was a total surprise to everyone and does not indicate that we are doing anything other than receiving their proposal at this time.

Thank you and please let me know if you have any questions.

Jeff Eckhoff Director, Planning and Development Services

The 8th & Railroad building is to the Right of the Development

While this isn’t ‘affordable housing’ it does fit into the ‘workforce housing’ category;

If approved, the proposal calls for 54 studio apartments, 104 one-bedroom apartments and 58 two-bedroom apartments, with rents ranging from $795 to $1,005.

I couldn’t find out too much background information on the developer, Tom Andrews, but he has done housing developments like this all over the country. We will see what kind of tax incentives he looks for, either in discretionary, TIFs or a discount on the land like the development across the street got. If he asks for none of these things, I will personally thank him to his face for embracing the free market. But I’m not holding my breath.

Mayor TenHaken needs to stop mansplaining and take action in public view

It’s rare that I give Mayor Poops props, but he made some interesting comments about density and our core (FF 12:00). The only problem is that he has had more then 3 years to do something with the help of the do-nothing council. He mentions that we need to do a better job of building density in our core. DING! DING! DING! This wasn’t the first Mayor to try to mansplain this issue. Mayor Munson actually took a stab at it when he created the Pettigrew Heights neighborhood and started the rebuilding of Downtown. The problem was when Bucktooth & Bowlcut took the baton he just focused on the immediate Downtown. Fast forward to Paul and the story behind the scenes is that he has been talking to core property owners around the downtown area, the problem, as rumor would have it is that Paul wants to try to strong arm these owners into selling property to the city so he can bulldoze it and turn it around to his rich developer friends. This is what happens when you have a COS that used to be a developer executive. Most of those owners have told them they will redevelop on their own without the help of the city.

The bigger issue with this is that the public, the city council and these owners all need to come to the table and put together a strategy, and the process needs to be very open and transparent. Right now those meetings, like the MED MJ ordinance discussions are happening behind closed doors, and as I understand it are failing miserably.

I’m not sure what it will take to get this mayor to understand open government, he just doesn’t, and neither does the council or the city attorney’s office.

The only way we will will ever succeed with this core redevelopment is if we open the books, unfortunately I don’t think that will ever happen with the current administration.

Sioux Falls Rubberstamp City Council passes $25 Million Dollar Corporate Welfare TIF Tax Rebate to wealthy developer with ZERO discussion

While the almost 5 hour meeting last night had many fireworks from the Med MJ ordinance discussion (this was only 1st Reading) towards the beginning of the meeting they approved TIF #25 with almost zero discussion (they moved it up so the VIP wealthy developer getting a handout wouldn’t have to sit thru all the people’s REAL business).

Besides the same lame brain presentation from the Planning Director about the TIF itself only one speaker emerged to defend the TIF, and it wasn’t the developer. In fact the developer has said NOTHING about the TIF except when he made a presentation to the council at an informational meeting. His daughter did say a handful of words when the Planning Commission approved the TIF, but the developer himself has said NOTHING at the 2 readings of this ordinance. Not even a please and thank you for getting this handout that the rest of SF property tax payers will have to make up for. Of course, why should he? All of those negotiations were done in secret over the past several years, this is also why you didn’t hear a peep from the councilors either, just a gigantic sound of 7 whaps on the dais with a rubber stamp. (Marshall Selberg was absent)

Wouldn’t it be great if getting food stamps was that easy?

So who was the only defender last night? Joe Batcheller, Director of Downtown Sioux Falls. While Joe and I are on good terms, even if I disagree with him about bringing snakes to outdoor events (he thinks it is fine) ðŸ˜Š we also disagree on TIFs. As a trained urban planner, Joe adamantly thinks they are good thing. He also even makes the tired old argument I hear councilors make ‘TIFs may not work well in other communities, but golly gee they work great here’. The problem with the argument is that we have NO economic or financial evidence of that, NO studies have been done on TIFs in SF or SD that shows an actual benefit to the public.

Which brings us to another point Joe made. He said this TIF was justified because we are getting a Return on Investment (ROI). I’m not sure a parking ramp (this is what most of the TIF will be spent on) that can only be used by the public on nights and weekends is much of an ROI when you consider that the Bunker Ramp is mostly empty at night and barely filled during the day, we will have another parking ramp sitting at the Sioux Steel Project and my long term argument is parking ramps really probably won’t be needed in the next decade. The irony of it all is that by the time this TIF runs out in approximately 20 years, it will probably NOT be a parking ramp.

The King of Sioux Falls TIFs himself (Stormland TV Screenshot)

Joe also made the argument that TIFs are not ‘Handouts’. I’m not sure what else you would call them. TIFs are essentially a tax rebate you get to use on your private property. The developer builds a parking ramp that they will be using during the day, and likely charge for access and they get that ramp paid for by getting a rebate on the $25 million dollar taxes they are supposed to be paying to the county, the school district and the city while raising taxes on the rest of us due to the total valuation of the project. It would be like you personally getting a $500 dollar property tax rebate to fix your front door. While that benefits YOUR property, it has very little benefit to the tax payers who have to pay their full tax bill, while also supplementing your rebate. Sure they throw us a few crumbs saying the TIF will also build roads (to their private project, to their benefit) and we get to use the parking for the Levitt (even though I have yet to see a parking issue at the concerts even when the lawn is packed) the true beneficiary of this REBATE is the developer and his investors, this is why it truly is a HANDOUT.

The most egregious part about the almost $200 million dollars in TIFs the city council has gleefully handed out this year is that this could ALL be done with private investment. The money is there. It has been proven by the past decade of record breaking building permits that have been issued to contractors in this city who have asked for ZERO tax breaks. Besides the public building permits, I think most of the private permits issued by the planning department are 100% privately funded. It would be a great presentation and study done by our Planning Department, but of course that would shoot holes in the whole NEEDING TIFs to succeed in Sioux Falls. Believe it or not, I think that is fantastic that private business, can invest privately while providing good jobs without a government HANDOUT.

Which brings us to Joe’s last point, that was so ridiculous when he said it, I laughed for about 5 minutes. Joe said it was important to remember that Cherapa II’s developer was taking on 100% of the risk for this approximately $350 million dollar project.

Really Joe?!!!  He should be commended for that after getting this handout from the city?

Isn’t that how the Free Market system is supposed to work? Oh never mind, in Sioux Falls it’s called Developer Socialism. You give us massive tax breaks and we will make sure we spend it on us and never present data that shows otherwise.

And lastly, Jeff, a Thank You would have been nice.

Are Sioux Falls Developers angling to push residents out of the zoning process?

The Argus did a story about how homeowners are not real keen on having apartments built next to them out in the burbs;

“This sentiment that apartment owners and apartment dwellers are scumbags has got to stop in this community,” said Councilor Christine Erickson. “It’s just not what it is.”

I guess it depends on the location and the condition of the apartment. There is also a difference between $1,100 dollar a month apartments and HUD subsidized housing. I agree with Erickson, apartment dwellers who pay their own rent are NOT scumbags, and this city should do everything in their power to encourage more apartment dwellings for working folks.

The problem here is NOT the homeowners complaining, the problem is the location of the apartments. The large developers want to make a quick buck, so they prefer to build next to homes in a cornfield instead of in the core of the city where we should be building up density. This is what happens when you allow a hospital to bulldoze an entire core neighborhood instead fixing up these core neighborhoods. I know, I sound like a broken record.

As for the neighbors complaining, some of their statements are pretty ignorant. I lived in 7 different apartments in Sioux Falls before I bought my home, there was nothing wrong with it, and there is nothing wrong with me living by apartments now in my home. The bigger issue with these ignorant (and sometimes racist) complaints is that it is helping the developers that are pushing to skip several steps in the zoning process;

There’s always been hesitation from neighbors when they hear an apartment could be going up nearby, said Jill Madsen, vice-chair of the South Dakota Multi-housing Association.

But once all the meetings and votes are done, the construction is completed and the tenants have moved in, she said, “most people don’t even … there aren’t any issues going forward.”

There has been a rumor going around that this organization along with developers are pushing to change city ordinances and state law so that developers no longer have to ask for permission from the neighbors and can just go directly to the planning office to rezone the property and get building permits. No notification and no neighborhood meetings. This of course goes against how things have always been done, but it also lacks transparency. The proponents of this supposed change will of course use all the dreadful comments from homeowners to plead their case for less transparency and essentially ruin the process for the rest of us.

I have felt the planning department has wanted to sidestep the commission and council on a whole host of things. Just look at TIFs, they used to be for only blight and affordable housing until the state legislature changed the law to pretty much make them for anything, and since then they have been handing them out like candy in Sioux Falls, raising the taxes on the rest of us while getting NO economic benefit from the projects. If we allow the state legislature to make these new guidelines you will see apartments go up on every street corner and rent go through the roof;

With a housing market that’s often pricing out even those lucky enough to actually find a home for sale and multiple companies touting the thousands of jobs they hope to bring to Sioux Falls in just the next five years, city staff say qualms about multi-family housing simply don’t mesh with the reality of what the city of nearly 200,000 people needs.

The city administration is getting nervous because they have enticed all these employers with ridiculous tax breaks and now they have no workers and no place for them to live, so they will try any desperate attempt to get up apartments as fast as possible. I have also felt that homebuilders and realtors have artificially inflated home prices, which is going on across the country. The value of my home went up around 37% in ONE YEAR!

I can almost guarantee the Amazon parking lot will be one big campground when it opens.

Slow, measured growth is way better than the fire sale we have been having. Growth for growth sakes never turns out well, and we are in for quite a ride over the next few years.

Fargo, ND developer still invests in project after City denies TIF

So you mean some cities still believe in the FREE Market and private investment;

Earlier this year, the Fargo City Commission declined Hyde’s request for $5 million in tax increment financing for site development for the project but he says he was able to negotiate both a lower price for the property and the bid for site work and was able to get the model to still work.

Pretty crazy how the developer could figure out a way to invest in the property even after the TIF was denied. Even this story from September 2020 shows how Amazon turned down incentives in Fargo;

Amazon has reportedly not asked for any local tax breaks.

While Amazon technically didn’t get direct TIFs or tax breaks from the City of Sioux Falls either, the park they are at has gotten millions in infrastructure upgrades from taxpayers and will continue to benefit from the $94 million dollar TIF recently given to the park. I have argued for a long time that the developers in this community have plenty of private investment without needing TIFs. But when you turn on the candy trough, they all come to feed. If I were the mayor or a city councilor I would have ended TIFs a long time ago in this city, the welfare program for the super rich.