BURNING QUESTIONS: Assistant City Manager resigns, explaining Councilman Blair’s math

Welcome to Loveland Ohio and beyond’s Burning Questions!

See you, Tom. Thanks for the memories.

Loveland Assistant City Manager Tom Smith has resigned, according to City Manager David Kennedy. Maybe his severance package is the secret subject of an executive session during Tuesday’s City Council meeting? Either way, good luck, Tom. Sorry you were told you could not talk to the media. Hope your next boss trusts your judgment more. No word on where he’s headed next.

$2 million “savings” is half the story – not a canard

Mr. “Not My 20,” Councilman Kent Blair – given this moniker when during a recent Council meeting discussion about whether the city should buy more parking meters or use an app-based pay-to-park solution, said he and older folks like him preferred the old-fashioned coin-accepting parking meters. When it was pointed out the physical machines would cost the city about $20,000 he quipped, “Not my 20.” So, there’s that.

After Blair’s remark, sources say Mayor “Queen” Kathy Bailey was displeased with her subordinate and apparently squished him (verbally, mind you) like a bug just moments later (in private, in violation of Ohio’s Open Meetings law, of course).

Well, at a different recent Council meeting, Kent Blair had another one of his rather frequent rants. This time it was about tax increment financing and clearing up the “canard,” as he called it, around the nearly 11-acre Christman Farm property, now known as “Chimney Ridge,” and now may be better known as “site of Homerama 2022” this August. Sometimes these Blair rants go to weird places, so buckle up.

Blair insists the “canard” is the city’s selling the property for $300,000 to developers was not a good deal – even though the city paid $800,000 for the property in March 2007. It included the farmhouse – which the city has since sold – that the Christmans were allowed to occupy rent-free for a year after the sale.

So, all told, with fees, the city financed $900,000 back in 2008 to buy it. For years, city officials insisted, especially former Mayor Rob Weisgerber who left Council in December after nearly 30 years, it would become a city park – the first one in Loveland’s Warren County portion. Well, that seems a little disingenuous, at best.

The property was appraised for around $710,000 in 2017. In 2021, when the deal was finalized, it would have reasonably been worth even more considering Loveland’s (and the nation’s) red-hot real estate market.

Why did Blair think it was a good deal? Well, Blair says the city will get, “I dunno…$2 million back” in fees.

Where did he get that $2 million figure? It’s not exactly clear and the best answer might be “…paid over 14 years.”

So, here’s what we do know: There is a TIF, or tax increment finance district, created to…not sure actually what. The city never lifted a finger toward building a park there since Council passed the TIF ordinance in May 2008. Parks and empty government-owned land are notorious for not generating a penny in tax dollars. So, instead, the city has been paying roughly $50,000 annually in debt service from its general fund to cover the debt on the property.

So why the TIF district in the first place if it wasn’t going to generate revenue at all, ever? Good question. Was the plan all along to sell it to a developer? Possibly. But why sell it at a deep discount in a hot real estate market now? The only good answer to this burning question seems like a hand-out to a developer building $700,000 and up mansions. Welfare. And Kent Blair calls that a good deal for Loveland taxpayers.

So, will the city “get the money back?” Sort of. In a TIF, state law allows a city like Loveland to stop the taxes being paid on the land. Now new taxpayers still have to pay the equal amount – it just all goes to the city instead, called a “payment in lieu of taxes,” or “PILOT.” State law says an ordinance creating a TIF must designate where the money generated can be spent. In Loveland’s 2008 legislation creating the TIF, it pretty much stipulates funds can be used for just about anything the city wants – except maybe ski lift tickets at Perfect North Slopes (instead use COVID funds; more on that another time). Right now the TIF is set to stop generating funds for the city on December 31, 2038 – in nearly 17 years.

Meanwhile, money meant for Warren County and, in this case, the Little Miami Local School District gets redirected to the city. Schools districts often work out deals with cities to at least get some of that money paid to them. That’s the case with Little Miami, though, it was unclear how much it will get. Warren County is expected to get some money paid to it as well, but that amount is also unclear.

County maps show approximately 22 home plots at Chimney Ridge. Based on other similar current property tax rates for homes in Loveland, it is estimated the city will collect an average $8,000 per year per home built at Chimney Ridge – but even that is a guess.

If that number is accurate – and it’s likely close – the city won’t even break even on the project, with the giveaway to the developer, for 3.5 years. If that’s the case, and the homes generate $8,000 per year when the TIF ends in 2038 the city will have collected around $2.4 million. So, that might be Blair’s $2 million figure, paid in full in 17 years. The city’s budget each year is about $5 million in unrestricted funds. Any money is nice, but that seems like a drop in the bucket.

And keep in mind: In all likelihood, the school district will collect less tax revenue, but any children who live at the new development still get to attend the schools. And Warren County – with services like roads, jails, sheriff’s deputies, the Board of Elections, etc. – will get less, too, which means other taxpayers will pick up the slack.

And don’t get too excited about the big tax dollars going to the city just yet. It appears no homes have been sold yet and sources say one deal fell through recently. Why? Well, apparently traffic along Route 48 – which Council has all but ignored – and the high-tension power lines through the former farmland sunk the deal.

So, yes, Mr. Blair, the city will eventually start having increased tax dollars each year. But who picks up the tab for other school and county services? Well, everyone else. Did we have to incentivize a developer to build on highly-coveted land? Seems like that wasn’t a great deal for taxpayers during a real estate boom.

Compiled by Joe Wessels

Burning Questions is a periodic attempt to raise questions few, if any, in or around Loveland are asking or possibly willing to ask. If you have a question you’d like answered but are afraid of the repercussions, shoot us an email at [email protected] or call/text us at (513) 899-6397. We’ll handle it and you can read your answer here. Safely.