Archive for April, 2015

Memphis Urban Development In Action

Tuesday, April 28th, 2015

April 28, 2015

Memphis Urban Development In Action

Memphis Bass Pro is set to open tomorrow and I for one hope that it is successful and pays off the millions that the City of Memphis has put into it. But I would like to point out a past example of big government and their programs for downtown. Take a look at the Peabody Place Project.

Peabody Place was a 300,000-square-foot shopping and entertainment mall intended to aid Downtown’s revival. The mall opened with a Muvico cinema complex, retail and restaurants in June 2001 but started to empty as the recession deepened in 2008. When the theater closed in July 2008, the Belzes announced plans to renovate part of the mall into a suites hotel, but lack of financing kept the project from going forward. Now look at the funding sources and amounts that financed the original project. UDAG, CDBG, Section 108 and City CIP to the tune of $41.8 million. What are UDAG, CDBG, Section108 and City CIP?

UDAG (Urban Development Action Grant)

The Secretary is authorized to make urban development action grants to cities and urban counties which are experiencing severe economic distress to help stimulate economic development activity needed to aid in economic recovery.

CDBG (Community Development Block Grants)

The Community Development Block Grant (CDBG) program was enacted in 1974 by president Gerald Ford through the Housing and Community Development Act of 1974 and took effect in January 1975. It had the goal of extinguishing poverty and urban blight.

Section 108

Section 108 is a loan guarantee program administered by the Department of Housing and Urban Development (HUD), which, since 1978, has committed more than $6 billion to almost 1,500 capital projects aimed at ameliorating housing conditions and creating economic opportunities, particularly for the benefit of low- and moderate-income persons.

City CIP (City of Memphis Capital Improvement Program)

This is City of Memphis capital money.

Now I ask the question, does any of this investment of our federal tax money or our City of Memphis tax money fit these definitions or objectives?

Then more recently there was this information in a Commercial Appeal article from 2014. The Belz family plans to refinance Peabody Place in a move that Downtown officials say is unrelated to talk of converting the vacant complex into a convention-related facility.

The Center City Revenue Finance Corp. on Tuesday approved a refinancing request from Hotel Peabody L.P., the Belz unit that owns The Peabody hotel and adjoining retail and entertainment site.

Refinancing required the board’s approval as a condition of a 25-year property tax abatement that was granted to the project in 1997.

This and other projects and questionable financing and use of federal tax money need a public discussion and open record information on how this money is to be repaid and who benefits.

 

Happy Tax Day!!!

Thursday, April 16th, 2015

April 16, 2015

Happy Tax Day!!!

Yesterday was April 15th and your taxes hopefully were paid or your check was in the mail. Most working people and retirees are tax payers and pay more in taxes than they receive in government benefits.

One huge item most of us do not understand is nonprofits. One definition of non profits is “A business entity that is granted tax-exempt status by the Internal Revenue Service. Donations to a nonprofit organization are often tax deductible to the individuals and businesses making the contributions.” Donations to non profits also come from Federal, State and local governments from taxpayer funds.

Information about nonprofits is available from Guidestar. Guidestar is a 501(c)(3) public charity that collects, organizes, and presents the information you want in an easy-to-understand format while remaining neutral. Guidestar provides nonprofit information to a broad audience at no cost to the users.

Why Should You Care about Nonprofit Information?

Because the nonprofit sector is incredibly powerful. According to the Center for Civil Society Studies at Johns Hopkins University, more than 70 million people work and volunteer in the nonprofit sector. Nonprofit employees make up the third-largest workforce among U.S. industries, behind only retail and manufacturing, and nonprofits create total revenue of more than 1.9 trillion annually, exceeding the total GDP of Canada, Australia, Russia, or India

Locally, according to Guidestar, we have 3705 non profit organizations just in the City of Memphis. I am in the process of trying to gather information of Memphis nonprofits. It is not easy. I have attached a spreadsheet on just 413 local nonprofits and I am up to $3.5 billion dollars of income. At the top of the list are well known and respected medical organizations like St. Jude and Baptist Hospital and charitable organizations like Autozone.

But then you get organizations like Global Ministries Foundation and take a look at their Form 990. You probably read the recent CA article about Global and the Rev Richard Hamlet who is paid a salary $485,000. Read the article and make your own decision as to the benefits of such a nonprofit. I am reaching out to the public to send me information on local non profits, where their money comes from, where their money goes and the cost of administration. Many people have called for better coordination of local non profits so that those that work on housing for the homeless (for example) could work together and reduce the cost of administration and get more of the money to those in need. The real question about any non profit is this. What is the percentage of benefits out versus money in? Hopefully the cost does not get above 15% with the benefits at 85%. Is that reasonable?

Subsidized Housing, MHA, HCD, HUD, HEHF, Say What?

Tuesday, April 14th, 2015

April 14, 2015

Subsidized Housing, MHA, HCD, HUD, HEHF, Say What?

Recently I attended a MHA board meeting and at the end of the session I asked the board in the future to post all recent financial statements. Until recently they had not posted 2013 and 2014 statements. I also asked that in the future that they post the board agenda and all supporting documents at least two days in advance of the monthly board meetings. We will see in the future whether they do this.

They did in fact post the financial statements for 2013 and 2014 so that now we have posted 2009 through 2014 posted online.

At this point I do not pretend to understand this organization which is headed by Robert Lipscomb as well as the City of Memphis department of Housing and Community Development which is also headed by the same Robert Lipscomb. Then you add in HUD (Housing and Urban Development), HEHF (Health, Education and Housing Facilities Board) and then all the non profits like Global Ministries Foundation which was recently written about in the Commercial Appeal and you have a real witches brew brought on by big government spending in an attempt to solve social problems and garner votes. The real question is what is the most efficient way to help those truly in need? Is big government the answer or should rent money be given to those truly in need and let them make their own housing decisions? What do you think?

In order to get a better understanding of the financial structure and purpose of the MHA and HCD a friend asked for a meeting with MHA accounting (Ms. Vickie Aldridge) and here is the answer he got.

“I am not available to meet however if you submit your questions in writing, I will respond at my earliest convenience.” My friend will no doubt respond but here are my thoughts on these posted financial statements.”

I have attached one page out of each of the last six financial reports (2009 thru 2014). These pages list the notes, loans and mortgages receivable for various local housing projects. If you read on through the following pages of the reports you will see the following statement for each of the projects.

No payments were received on this note during 2014, 2013, 2012, 2011, 2010 and 2009.

My request to the MHA would be that I want to see these financial documents on the loans and mortgages to understand the terms and conditions and who is benefiting from these finances. You will note that the long term notes receivable has gone from $92 million in 2009 to $155 million in 2014. The public should be made aware of these finances, the cost to the taxpayers and the benefits to the tenants of this housing.