[Vision2020] Alturas Phase II

[bill london]

The message below was written by Duncan Palmatier, a Moscow Urban 
Renewal Agency commissioner, about the plan to use tax money to expand 
Alturas Technology Park.
BL

Law Office of Duncan Palmatier wrote:

> Dear Moscow City Council:
>
> I am concerned about the haste to move forward with Alturas Phase II. 
> After three years as a URA commissioner, during which time there was 
> very little activity, there is suddenly a rush to fund Phase II and 
> start construction this coming summer. I have the feeling that "Hoover 
> time" has come to Moscow.
>
> City Supervisor Gary Riedner is pushing for a fast start to Alturas 
> Phase II. A short notice URA meeting is scheduled for this coming 
> Friday, March 12, at 7:00 am, to vote on URA funding of the project. I 
> probably cannot attend, but the meeting will proceed anyway. As far as 
> I can tell, I am the only commissioner to voice reservations about the 
> project. As I understand it, URA money will be used for infrastructure 
> (streets, lighting, and the like). The proposal is to have the URA 
> fund the full amount of the work. This contradicts Gary Riedner's 
> recommendation of two years ago that the URA should only pay for a 
> portion of a project, such as 10%, and let private developers pay the 
> rest. Hodge & Associates has estimated the cost of the project at 
> approximately $275,000. This is less than Phase I, I assume because 
> Phase II involves less land and fewer parcels. By funding Phase II, 
> "tax increment financing" means that a portion of tax revenues from 
> the Alturas area will continue to pay off bonds rather than go into 
> the general city tax revenues. If Phase II is not developed with URA 
> bonds, Phase I will be paid off within a few years and these taxes 
> will go to the city. The benefit of funding Phase II is that, if the 
> project is a success, then new taxes generated by employees of high 
> tech business, through income and sales and property taxes, will bring 
> in more revenue than if the project were not undertaken. I do not know 
> whether anyone has done a study to see if this was true with Phase I 
> or any other similar URA project in Idaho.
>
> At the last URA meeting, the URA was asked to fund preliminary 
> engineering work by Hodge & Associates. Gary Riedner estimated the 
> cost would be less than $3,000.00. There was no suggestion the work 
> would be put up for bid. I suggested a cap of $3,000.00, but the other 
> Commissioners felt this was inappropriate, and one Commissioner argued 
> that all available URA cash ($8,000.00) should be made available for 
> the work. I voted against the appropriation. In light of the UI's 
> Boise project, which allowed unlimited bills for preliminary work that 
> turned out to wildly extravagant, I felt some URA control was advisable.
>
> I questioned why Alturas Phase II could not be privately developed; to 
> wean private enterprise of government assistance by pushing it out of 
> the nest and seeing if it can fly.
>
> Gary Riedner argued that Phase II will not happen without government 
> assistance. Apparently, the cost of private commercial development in 
> Moscow is too high.
>
> LEDC Director Barbara Richardson Crouch spoke for the project on the 
> theory that, if the URA does not develop Phase II in accordance with 
> the RTO restrictions of Phase I (high tech businesses only), private 
> development will develop it in the more lucrative, but undesirable, 
> mini-mart fashion. It was argued that such a development would lower 
> property values at the existing Alturas.
>
> Everyone seems very optimistic about the project and convinced it will 
> be a great success. Of course, everyone felt that way about Phase I, 
> too, before it flopped and the bonds had to be refinanced. We were 
> told that letters of intent had been signed by prospective tenants. My 
> inquires revealed that there are no signed letters of intent; rather, 
> a number of prospective tenants have expressed interest. This was, as 
> I recall, the same situation before Phase I was started. It was noted 
> that Schweitzer Engineering has started taking over more property at 
> the Port of Whitman development in Pullman, and that, as a 
> consequence, there are several tenants who must relocate and are 
> willing or want to move to Moscow. Some of these companies have 
> expressed interest in Alturas Phase II. However, at this time, no 
> company has signed on to build on a lot in Phase II.
>
> Other than standard notices, no effort has been made to publicize the 
> URA involvement in Phase II.
>
> I am concerned that this project is proceeding with too much haste and 
> not enough solid support from prospective tenants or the public.
>
> Faithfully
>
> Duncan Palmatier
> Tel: (208) 892-2962
> Fax: (208) 892-3853
> Email: dpalm@dpalmlaw.com
>
> .
>