Entries Tagged 'Development' ↓

Expensive home sales as ‘News’ shows the enormous gap between the wealthy and working poor in Sioux Falls

Over the past couple of years we have seen this rise of expensive home sales as somehow being ‘news’. We get to see these enormous castles on various news websites as somehow being a testament to the booming economy of community. All it says to me is that our industrial complex hospital systems are paying their doctors too much.

What’s sad is that week after week as we have to endure the sales of the week (which always exceed $500K and sometimes teether on the million dollar mark) while most working class folks in Sioux Falls are struggling to pay a mortgage (if they are so lucky) or even pay rent and feed their families. Don’t be fooled by the poorly decorated rich peeps homes that are selling like hot cakes, Sioux Falls has an enormous housing crunch right now that has nothing to do Dr. Ding Dong’s Lake Estate.

Let’s admit it, unless you qualify for some charitable or federal program (because you suddenly have 6 kids jammed into a 1 bedroom apartment because you don’t know how to use a condom) most working poor people are left behind. And even if you can manage to keep your willy wrapped and work three jobs, it is virtually impossible to build a new home in Sioux Falls for under $200K.

And rents, they are astronomical because we have allowed the apartment developer market to regulate itself with little interference from local or even state government (besides handing out TIFs like candy).

The carrot dangling by some of the news organizations is ridiculous. The constant ‘look what you could have if you just worked harder’ (or had a medical or law degree) isn’t reality. Reality would be for these same ‘news’ organizations to push for more pay equality, living wages and ending wage collusion between our top employers in town, then we can move onto affordable housing.

Let’s start talking about the real housing issues in Sioux Falls instead of Dr. Ding Dong’s indoor pool vaulted ceiling irish pub hot tub gourmet kitchen and heated floor garage.

Stehly sets up meeting with developers and business owners to discuss diaganol parking

Theresa told me,

“Taking time to listen and hear all sides is an important part of the role of City council. I will summarize the items that were negotiated on Tuesday Night.”

Was the Downtown Parking Ramp just a ‘SHAM’ from the beginning?

I never did have a good feeling about the project and told several city councilors that the hotel will never be completed, then I hear this;

“The NMTC is a highly competitive economic development program, which incents private investments in the poorest rural and urban communities in America,” Rapoza said in a statement. “To receive NMTC allocation from the Department of Treasury and participate in the program, community development organizations demonstrate a record of financing dynamic projects that improve services such as health care, or create jobs and opportunity in communities where capital is difficult to obtain from conventional lenders.”

Low paying hospitality jobs is hardly a good reason to give such a project tax incentives. This deal was doomed from the beginning and any city official/employee who supported this, worked on this or voted for this should be ashamed and should resign.

UPDATE: Is a local developer remodeling downtown apartment building without permits?

UPDATE: I guess a building permit mysteriously got posted yesterday late. Not sure if it was laying in a contractor’s tool box up until this point or what. Funny how these things work.

I’m still getting more details, but I found out last night that this historic building downtown had tenants complaining because of the mess, they also noticed NO permits for demolition and remodeling. The City’s Building Services department may also be investigating.

The worst part about it is this developer has a track record of this kind of funny business. Some people never learn.

It will be interesting to hear what is really going on.

Is someone waiting in the wings to scoop up the parking ramp project?

Yeah, I know, Mr. Conspiracy theory here, and who can we believe? But this is an interesting change of events;

The group said it had proposed changes to the project to the city, but then it stopped receiving any notices or responses from the city, which the developer also alleges canceled meetings before alerting it that it was terminating the deal, which would have co-mingled public and private money to see two hotels, restaurants and retail space built around a parking garage at 110 S. Mall Avenue.

So the city council now is on ‘silent mode’. The city refused to negotiate the deal and late last night, TJ TypeOver sends out a press release saying they are looking for someone to complete the project.

When the performance bond payment didn’t come in, do you think the city got a little nervous and did some ‘shopping around’?

It will be interesting to see how fast another developer swoops in, and who it is. Information lockdown usually means things are going on in the backroom. At this point I can’t even speculate who would want to take it over, but we have our guesses 🙂 Heck, I wouldn’t even be surprised if one of healthcare monsters builds a hospital on top of the parking ramp.

It will be fun to watch as the administration and the rubber stampers talk about how they ‘saved’ the doomed project while the rest of us roll our eyes.

UPDATE-NEW VID: Sioux Falls Housing Summit

UPDATE: Downtown Parking Ramp a bad deal. Yah think?!

We have all heard the story tonight, and Detroit Lewis saw this coming. I predicted early on “There will never be a hotel built at that site.” Trust me, I hate being the ‘I told you so’ guy, but this was obvious from the beginning. I will leave you with my public scolding tonight at the city council meeting.

UPDATE: The city just sent this out;

CLARIFICATION: The City of Sioux Falls has not ruled out private development at this site in the future. At this time, we are focused on the completion of the parking ramp portion of the project.

Today, the City of Sioux Falls provided the Village River Group (VRG) with a notice of termination of their development agreement and ground lease for the Village on the River project.

On December 29, 2017, the City entered into a development agreement for construction of a mixed-use development including a public parking ramp and private hotel with leasable retail space.

The City has invested significant time and resources working with VRG in furtherance of performance of the development agreement.

On April 1, 2019, the City notified VRG that it was in default on the Village on the River project. In accordance with the development agreement, VRG had 30 calendar days to cure multiple defaults. VRG has failed to cure these defaults within the development agreement’s cure period or at any time thereafter.

The project can and will proceed as a stand-alone parking ramp which will alleviate parking challenges within downtown Sioux Falls.

Consistent with protecting taxpayer interests, the City has reserved any and all of its legal remedies available to it under the terms of the development agreement.

In other news, at the Informational meeting, councilor Brekke read her letter to the editor that Cory Myers, News Director of the Argus Leader refused to publish;

May 6, 2019

Letter to the Editor

From: City Councilmember Janet Brekke

I am writing in response to the recent letter to the Editor by Former Councilmember Rex Rolfing and the May 5th Argus Leader Editorial. In my opinion both articles missed the point.

In today’s environment of good versus evil, winners versus losers, or us versus them, frameworks it is plain to see that the Sioux Falls City Council is suffering from the same ultra-polarization that is immobilizing our Federal Government.

The problem that arose with the City Council’s hiring of an Internal Audit Manager has very little to do with the candidate that was ultimately selected. Ultimately the failed discussions and subsequent actions are symptoms of a larger problem.  The larger problem is the City Council’s inability to discuss any divisive problem in a deliberative open minded manner.

Since I joined the City Council last year I have tried to promote and adhere to good government procedures and practice: Decorum, Ethics, Roberts Rules of Order, Open Meetings and Open Records laws. So why does process matter? I believe good process matters because solving complex problems calls for creativity and collaboration, in ways that us versus them, winners versus losers, and good versus evil, do not. In a political context the idea that the good need to simply destroy the evil as we were taught in the movies of our childhood simply does not apply. Affixing blame and demonizing individual councilmembers is counterproductive.

We all have a role to play in our dysfunction. Ron Brownstien, CNN Sr. Political Analyst spoke at the National League of Cities about Congressional polarization on the health care issue. He said both sides claimed they could not talk about the issue because they were too far apart.   Brownstein’s suggestion, “Being far apart on an issue is not a reason to refuse to discuss an issue. Rather being far apart on an issue is the very reason you begin discussions.”  The City Council needs to engage in a deliberative process where we interact and listen to each other. I believe each of us has a valuable perspective to bring to the discussion. We need to work on our ability to collaborate and compromise. If we cannot take the time and effort to work to achieve consensus on hiring an Internal Audit Manager how can we expect to solve the complex problems facing the City. This us versus them mentality serves no one well, least of all the residents of Sioux Falls.

What amazes me is that our soul daily in town had to come after the only councilor (besides Starr) to oppose the parking ramp. The chickens are coming home to roost.

UPDATE: I told you so! Downtown Sioux Falls Parking Ramp mixed use – BAD IDEA!

UPDATE: So now everyone is back peddling like crazy. Village on the River went over to the ‘Safe Room’ to tell their side of the story to a content marketing website. I’m actually surprised they didn’t take out some google ads. But even if the deal is to be saved, it’s NOT going to turn out well for the taxpayers;

“Adjustments to the design and size of the hotel/retail structure have been analyzed by the project team to ensure that it is the best possible project,” Village River Group said in a statement.

“Once approved by the city, the group will finalize the design details and related construction, architecture and bond requirements and move forward with construction.”

Here lies the problem, the design was ALREADY approved, heck, the most important part, the parking structure and it’s foundation is near completion. Shouldn’t these design changes have taken place before ground was even broken? It would be like building a one-story house and telling your builder after he finishes the roof that you want a second floor. But besides over building the foundation (which taxpayers put in around $6 million for) they want an even bigger incentive;

Village River Group has looked at multiple funding options to offset its private investment, it said. That included use of city tax increment financing and new market tax credits, but those incentives “did not materialize,” it said.

So now that is the fault of the city and taxpayers who upheld their part of the deal?

The project is planned to be funded privately, and “the city has offered the project BID tax rebate incentives and a real estate tax reduction incentive,” Village River Group said.

How is this any different then a TIF? It isn’t, it’s just packaged differently. More HUGE tax breaks and developer welfare for a project that now is smaller? You have got to be F’ing kidding me!

According to its development agreement with the city, a second development fee payment and performance bond are due to the city when phase one of the private improvements begin, the developers said.

Which was pretty much ‘yesterday’ in lack of a better term. The developer broke a promise with the taxpayers of Sioux Falls and it is time to shut down the building site and find a NEW partner and sue the pants of the one that screwed us over.

Here is a link to several blog posts about this topic; LINK.

From the beginning, the warning signs were there;

Bad location

Not enough spaces

Expensive spaces (to offset foundation costs)

Using 2nd Penny as collateral

Investing with a developer (still) being investigated by the Feds for the Copper Lounge collapse

And now we have a whole new set of problems;

However, the city says a start-date for construction on the private portion of the project hasn’t been determined. That’s because the city has yet to receive proof of a performance bond and a $350,000 fee spelled out in the development agreement.

City officials repeatedly did not answer whether the developers are in default of their contract on the project.

I find it ironic, that a former city councilor who supported this project would be chastising councilor Stehly for being negative when she was virtually a one-person army fighting this project. The height of negativity would be supporting this ignoramus project.

On top of all this, it seems the city council will be appropriating another $50K in legal fees for the project Tuesday night in the contract approvals.

I often talk about ‘common sense’ government. Nothing about this project made any sense, and at the end of the day the citizens may be holding the bag. I think any current city councilor that voted for this project should resign in shame. It’s one thing to make a bad decision (like voting against a movie theater beer license or approving ax throwing in bars) but this decision by a majority of councilors and BOTH mayors to move forward is beyond a ‘bad decision’ – it’s gross negligence and they should be removed from office.



Sioux Falls Ethics Board Chair warns Councilor Neitzert about his FB joke

Tonight the city council was invited to a presentation and an after party for the Sioux Steel project. I know for sure that 3 city councilors did not attend the after party (you can guess who they are). Stehly asked an advisory opinion last week about accepting drinks and ‘HEAVY’ apps from the developer. The ethics commission couldn’t rule on the opinion because Stehly didn’t present evidence of the possible TIF request. Chairman Greg LaFollette was absent from the meeting, but in the past he has frowned on this kind of gift giving. Neitzert decided to make a joke about it earlier today and LaFollette warned him that it probably isn’t such a good idea. It will be interesting to see how many of the other 5 attended and chowed down on their ‘Heavy’ Tifilicious Snacks. Awaiting photos.

In other ‘Neitzert’ news, I guess he requested that all of the councilors sign a document of confidence in the new Internal Auditor that he would frame and present to Mrs. Nelson. He pretty much admitted that the document wasn’t an ‘official’ but would help in mending bridges. That bridge could have been solid if they would have hired someone with no conflicts.

Oh, and still no word if Shana will be replaced in the finance department . . .

This place would have made a great apartment complex for nuns

A few weeks ago when Avera came to the city council for permission to bulldoze a block of affordable housing to build a retirement apartment for nuns, I thought to myself ‘Why doesn’t Avera just rehab the house across the street for apartments?” Remember when Avera said the house was in to bad of shape to rehab?

I walked by today to see that was NOT the case. It seems a private builder is working on the house to convert it into a 4 or 5 plex (by looking at the electrical box). A parking lot has also been already poured.

Wouldn’t this have made a great place for retired nuns volunteering their time at the Hospital?