The City of Manhattan has been stuck with nearly a million dollars in lost special assessment revenues after two large developments were abated, including Four Winds and Lee Mill Village. Commissioners met Tuesday to discuss solutions for mitigating the City’s risk when issuing bonds for benefit districts going forward.
“It is roughly a million dollars that was abated,” said Commissioner, Wynn Butler, “If the City hadn’t bid on the properties and taken them over, it could be worse.”
Less than 2% of the $70 million in specials certified over the last 10-years have been abated, however Butler said the issue is more significant than the numbers suggest.
“It’s only like a little over one percent should we just not worry about it entirely. Well, a lot of the folks out there think that we should worry about it, because they don’t like their mill levy,” Butler said, “and the mill levy rate went up five over the past three years…now this contributed some to it.”
One solution the Commission discussed was requiring developers to pay 30-35 percent of the special assessment cost up-front, a policy Rich Seidler with Commercial Real Estate Services said would force the “little guy,” and the people they employ, out of business.
“I also believe it’ll encourage out of town developers who don’t have the good of the community at heart, to come here with their checkbooks open, build projects using out-of-town laborers, engineers and architects,” Seidler said, “That’s a cost to our economy and our locals that has to be taken into account also.”
The Commission also discussed the possibility of charging developers a 1-2 percent fee, which would serve as an insurance policy should an abatement occur in the future.
Mayor, Usha Reddi stressed, however that Tuesday’s meeting was simply a discussion, and that the City would keep the community in the loop moving forward.
“The foundation for the developers and the City working together has been there for decades, and we certainly don’t want to mess that up as we still have more to grow.”
