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Its seems that these projects require aot of funding from the State/Fed and the city. The mayor is pledging funding we do not have, alot of it too. Now since when was the $35,000,000 bond issue for the Connell Building project. That was voted on for the parking garages. Nice the mayor slips up and now we are paying not for just the garage for the project but $35,000,000 of the entire project, nice. I have said from the beginning that these projects require too much funding for them to be done privately but I guess if your a contributor or supporter of the mayor its ok for him and his council three to spend and spend our tax dollars on private development that really only benefits the developers in the long run. This will end up like the ice box deal, they still owe the city over $600,000 and we have not seen any of it and the mayor won't go after it? Why not? This admin is going to absolutely bankrupt the city, I just cannot understand how some of you can follow a man with blind faith when he is costing you so much of your money over the projects that will not benefit you if they are not right now. Either you do care about the $300,000,000 in debt and the absolute obserd spending that is going on right now because you are A. Benefiting right now in some sort of a way and you don't want the gravy to pull out of the station yet, or B. You refuse to the research and just beleive what you are being told is right and good for the city when in reality with abit of a open mind you will see that we have nothing to show for in the last 6 years that is worth the $35,000,000 price tag that these years have cost us!
EMPTY PROMISES?
BY STACY BROWN
STAFF WRITER
08/12/2007
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In July 2003, developer Jerry Joyce announced plans to build a $26 million development in downtown Scranton called St. Peter’s Square.
The plans called for construction of a five-story development over two city blocks, consisting of a mix of 100 high-end condominiums and assorted shops.
In July 2003, developer Jerry Joyce announced plans to build a $26 million development in downtown Scranton called St. Peter’s Square.
The plans called for construction of a five-story development over two city blocks, consisting of a mix of 100 high-end condominiums and assorted shops. Construction would begin within months and take 12 to 18 months to complete, Mr. Joyce said. Once done, it would change forever a highly visible portion of Central City.
Four years later, little appears to be happening with the project except for a new price tag. It is now estimated to cost about $50 million. Some of the site has been cleared. Two restaurants have been opened. But the biggest part of the project — the construction of the condos and shops — appears to be at a standstill.
It’s not the only downtown project languishing on the drawing boards. Others include:
¦ Jefferson Pointe. Only months after his St. Peter’s Square announcement, Mr. Joyce announced plans to build a $9 million, 70,000-square-foot mixed-use development at Jefferson and Lackawanna avenues, a major entrance to the city. Mr. Joyce said he would break ground in a matter of months with construction taking place the following November. To date, there has been no work done on the site.
¦ Renovation of the 500 block of Lackawanna Avenue. In October 2004, the Scranton Redevelopment Authority approved a $250,000 grant for a $20 million project to be developed by local businessman Donald J. Rinaldi. Plans called for construction of a new building, restoration of building facades, creation of a public park and converting the block into restaurants, boutiques, loft apartments and offices. Gov. Ed Rendell presented a $9 million state grant. The project was scheduled to be completed in late 2005 or early 2006. To date, there are no visible signs of progress.
¦ The Connell Building. In October 2004, the SRA agreed to help Connell Building owner John Wolfington acquire tax-incremental financing from the city, county and school district to refurbish the building. The $17.2 million project, which also received a $5 million state grant, called for developing 80 apartments, creating office and retail space on the first and second floors, and developing underground parking for residents. Under the TIF program, Mr. Wolfington was to use the property tax increase expected from renovation of the building to pay for debt service toward a $2.7 million construction loan. The abatement, estimated at about $314,000 annually, would continue for 20 years. To date, work has not started on the building.
In all, nearly $100 million worth of Central City development, factoring in the new estimates on the cost of St. Peter’s Square, remains in the planning stages and some are beginning to doubt whether the projects are going to happen at all. The more cynical among them go as far as to suggest the projects may be little more than empty promises.
“They’ve said they would do this and they would do that, but nothing has happened,” said attorney Boyd Hughes, former counsel for the SRA.
Mr. Hughes now represents the owners of Buona Pizza, 504 Lackawanna Avenue, whose property is due to be taken by eminent domain to make way for the Lackawanna Avenue project. “Do I believe the city will get something done?” he asked in reference to all four Central City projects. “No.”
“We are working on all of these projects and they will soon come to fruition,” Mayor Chris Doherty said, insisting that officials continue to work behind the scenes to iron out details of the projects and movement on some should be visible very soon. “I wouldn’t be quick to call any of them empty promises.”
Community activist and former city planner Wayne Evans also counseled patience.
“All four of the projects, St. Peter’s Square, Jefferson Pointe, 500 Lackawanna Avenue and the Connell Building, are wonderful projects on paper,” he said.
As city planner, Mr. Evans pushed for loft apartments and other housing to spur development downtown.
“I think all of the developers are committed to the properties and, while it’s typically a slow and complicated process, once done, these projects are going to change the landscape of Scranton for a generation,” he said. “I haven’t given up on any of the projects.”
Large projects take time, and every tick of the clock translates to an uptick in costs, Mr. Joyce said.
“When you talk about these big and important projects, they are going to take a while,” he said. “One of the problems we’ve had with St. Peter’s Square is cost.”
Construction, development and materials are as costly in Scranton as they are in places like New York City and Philadelphia, Mr. Joyce said.
“However, we can’t charge people the same rent or mortgage someone would pay in New York or Philadelphia, and that’s one problem,” he said.
While the land purchase for St. Peter’s has not been completed, a major obstacle for the project has been design, which has changed several times over the past year, Mr. Joyce said. The developer considered replacing proposed apartments with brownstones that would line Linden Street and part of Wyoming Avenue. However, those plans recently shifted back to apartments, but problems remain.
“We asked potential tenants and apartment owners what they would like and everyone wants large apartments, which cost more,” Mr. Joyce said. “You get into the overall cost, $50 million, and you start to realize that you are going to have to sell these units for upwards of $500,000, but you can’t do that in Scranton.”
Although the city pledged $3.6 million to assist the St. Peter’s Square development, Mr. Joyce has been unsuccessful in securing state and federal money to help the project. Ideally, he would like government funds to cover half the cost.
Mr. Joyce said a New York firm he would not identify is still negotiating a long-term lease for Jefferson Pointe. If the firm and Mr. Joyce can agree on the terms of the lease, the project could move forward, he said.
The track record of the developers involved vary. While Mr. Rinaldi has not been involved in any other major development projects, Mr. Wolfington and Mr. Joyce have enjoyed some measure of success. Although he had little success in a plan to convert the Northrop Grumman/Corning facility in Benton Township into a financial services park, Mr. Wolfington’s company has completed 13 projects to date in Pennsylvania and New Jersey.
For Mr. Joyce, his admitted shining moment came about two years ago when he completed the Lofts at the Mill apartments, where he converted the old 100,000-square-foot James Avenue silk mill into 67 upscale loft apartments. Since its development in 2005, the lofts have been at or near capacity and even members of the Scranton/Wilkes-Barre Yankees have called the place home.
Despite the lagging projects, state and city officials say Scranton’s economic development is among the best in the commonwealth and others back up the mayor’s contention that there is progress being made behind the scenes.
“A consultant has just been appointed to the 500 Lackawanna Avenue project and, as far as we know, there has been movement there,” said Kevin Ortiz, a spokesman for the state Department of Community and Economic Development.
Some property owners in the 500 block of Lackawanna Avenue are frustrated, not only with the apparent lack of progress, but with the inaccessibility of Mr. Rinaldi, who failed to respond to repeated inquiries from The Times-Tribune. Messages left for Mr. Wolfington also were not returned.
“Mr. Rinaldi has told us not to talk to the media about this,” said Dr. Peter Cupple, who owns the building at 514 Lackawanna Avenue. “I signed a contract to be a part of the project last week and I’m going along with it. It’s going to get done, but you have to ask Mr. Rinaldi for details.”
Other property owners in the block, like Giovanni Piccolino, owner of Buono Pizza, and Tom Moran, owner of Coney Island Texas Lunch, have complained about Mr. Rinaldi’s lack of communication.
“The Rinaldi project has continued to go nowhere, and I don’t believe it ever will,” Mr. Piccolino said. “Nothing at all has been done, we don’t hear from the city, and we don’t hear from Mr. Rinaldi because they don’t know what they are doing.”
“We have no answers,” Mr. Moran said.
Sara Hailstone, the city’s Office of Economic and Community Development director, insists there is movement on the project. In fact, she said, the public can expect a “major” announcement on the 500 Lackawanna Avenue project in about two weeks.
“There are plenty of things that are done, but you wouldn’t know it by looking at the block,” Ms. Hailstone said. “We’re doing a lot of coordination with PennDOT, utilities and other factions.”
The city and developer have been poring over architectural exhibits, discussing and preparing construction agreements and securing insurance and other preconstruction agreements, Ms. Hailstone said.
“These things take a lot of time,” she said.
Work on the site has to be done in conjunction with guidelines provided by the Pennsylvania Historical & Museum Commission to ensure preservation of its historic district designation.
The first phase of the project should begin this month, with sidewalk replacement and other work scheduled, Mr. Doherty said. The mayor also disagreed with the notion that the Connell Building and St. Peter’s Square projects have stalled.
“Everything is in order with St. Peter’s Square,” he said. “We are going to be issuing the final permits for demolition in the fall, so the land will be cleared for development. As far as the Connell Building, that should get under way soon now that City Council has passed legislation approving a ($35 million) bond for the project.
“Empty promises?” he said. “No way. No one has matched my record on economic development. No other mayor has done what I’ve done. There have been 12 new restaurants in the downtown in the past year, and we continue to build. [color="Red"]Great jobs for our residents Mr. Mayor...[/COLOR
“The mayors who came in from around the state last month (at the Pennsylvania League of Cities and Municipalities Conference) all praised us for our economic development. We are at the forefront in the state on economic development. You can’t criticize me on economic development and there are no empty promises.” Nope just empty pockets
Contact the writer: sbrown@timesshamrock.com
Dan, I posted the same article on a different post. What a mayor we have. That's what he considers economic development. Trendy restaurants that don't stay open long because the city can't support them. These aren't jobs that people can work at and make real money. We need industry here with wage sustaining jobs.
Here is some minutes from the July 19th council meeting when they voted in the SPA $35,000,000 bond issue. Clearly the mayor is using public funds for the Connell Building and he is using it thru the parking authority which I stated last week in the Gatelli borrowing thread.
RE: MEETING OF 19 JUL 07
5B - READING BY TITLE FILE OF COUNCIL NO. 104, 2007 - AN ORDINANCE ($35,000,000 parking/SPA ordinance):
MR. COURTRIGHT:Questions for Mr. Wintermantle...and from the people that came in there. And I know some of you were in the back room. But I think that some of the things I asked and that other people asked was that are the parking garages able to --- are they generating enough revenue to pay for all of their bills, and he said they were.
Asked if the new facilities that they were going to acquire -- and if they had any people that were already interested in the spaces, and most of the spaces were all taken.
Asked about the Medallion Garage, and he said it was paying for itself. There was only 1 retail space, I believe he said, wasn't rented out yet, and they'e hopeful that somebody else...
Asked about what the interest was on it, and we're gonna go for a lower interest rate, from a variable rate to a fixed. I know Mr. Sbaraglia, Ms. Shumaker asked some questions; and I just think that, when we have legislation like this in the future, that maybe if they come in beforehand -- and I said this last week -- that it would be a good idea to help move things along a little quicker. But I just wanted to share that with you. Thank you.
MRS. GATELLI:
Anyone else On the Question?
MRS. EVANS:
Yes. To add to what Mr. Courtright has...yes, Mr. Wintermantle indicates that the Parking Authority is in the black, currently. But if you take a look at the audit -- the Independent Audit of City Council for the Year 2005, but it's classified as the 2006 Audit, they carry a long-term debt of $31,805,159 without -- just setting aside --this $35,000,000 project.
In addition, in their current fiscal year 2007, they owe $1,173,528 in principal and interest on Bond Series from previous years. That does not take into account all of the monthly expenses of the Parking Authority that would include salaries, and health benefits, and materials, and supplies, etc., too numerous to mention.
As of today's meeting, I had not received the most current monthly financial reports of the Scranton Parking Authority, so I had to base my questions and concerns during today's caucus on the financial statements of January and February 2007. And, according to those figures, the Parking Authority -- the garages -- would have been in the red; and that they were not earning enough income in order to pay all monthly expenses and the current bond issues. However, Mr. Wintermantle responded that the Medallion Garage recently opened, I believe, in November 2006; and, since it has now been up and running for a period of 8 months, they are anticipating much greater revenue. But that is an if. There are many if's in this situation.
I also learned that a company who had been very interested in the purchase of the Electric City Garage will not be doing so because this particular bond issue would be unsuccessful without the Parking Authority retaining ownership of all of its garages in order to remain financially viable. So that, the bottom line here, if you were to attempt to sell any of the garages, the Scranton Parking Authority would find itself in difficult financial straits.
I do believe that the Oppenheim Garage is in need of repair -- it's a very old garage. However, when questioned about the possibility of renovation rather than demolition and new construction, that had never been discussed. Yet, Mayor Doherty in 2004 stated that when he was -- or when the Scranton Parking Authority was taking on a new series of bonds in January of 2004 -- $1.5MM worth of that money was going to be set aside for renovation to the Oppenheim Garage. Unfortunately, that didn't occur because the $1.5MM was needed for the additional costs of the Medallion Garage, which is a beautiful, beautiful garage. But if renovation was discussed in 2004, why has renovation not even reached a stage or a discussion of consideration in 2007?
I don't believe that the Parking Authority can so easily assume $35MM worth of additional debt, on top of the $32MM they currently possess. And, as I said, I do believe the garage has to be addressed, but I would think that, perhaps, Sanofi Pasteur, who would like to take quite a number of those spaces, might entertain taking ownership of that garage, and making the renovations, or constructing the new garage at their own cost and then receiving, you know, payments for that from the tenants of that garage.
In other words, we're building something here for the employees of Sanofi and the tenants of the Connell Building. And far fewer of the spaces are designated for those who work in the City of Scranton and those who shop or do business in the City of Scranton.
Now, we can set that aside. The fact remains that this is a tremendous amount of money, and you -- ultimately -- are responsible for those payments IF EVER -- it hasn't occurred, to date, but IF EVER the Parking Authority were unable to make those payments. And I just don't believe that's a financial burden that the citizens of the city can assume at this point in time. Yes, there should be a garage, but I think these multi-million-dollar companies who would like to utilize it are the ones, perhaps, who should be looking at turning that garage around.
MRS. GATELLI:
Anyone else?
I posted this two days before the article hit. This was posted on 8/10/07. It has been right in front of your faces but yet no one sees what is going on until its too late, well here ya go. The money was and is supposed to be for a garage but since the mayor has stacked the SPA with cronies he will get his $35,000,000 to give to the Connell building project instead of the garage. I wonder how much he owes the developers and owners from the last election?
8/10/07
He doesn't really need to borrow he has stacked the parking authority with his cronies and they just got $35,000,000. He is going to use it to build at least two more garages in the downtown for who I could even begin to guess because parking really is not a issue in Scranton at all. He will build two and the contracts will go to Scratelli and Highland Assoc will get the design contracts thus fulfilling his favors from those companies and probably repaying their contributions. He has squirreled money and people away in different depts this year so that he will still be able to get to the money thru them. Thus he does not have borrow because he already took the money and placed where he needs it. See he is getting ready to run for a third term and he can not win if he borrows more but if he doesn't then he might have a chance, but for those of us that have watched the money goto to the SSA and SPA along with the former Treasurer and several other key people its clear what he is doing.... He has already set up his cash for the next year thru the authorities. He also gave the SSA their charter which means that they do not have to answer to the city hence when they give the money to him we(the city) cannot stop them. Very slick moves on the mayors part and not to mention our old friend Judy has played into it the entire time, she does not need to do this exploring of ways its right infront of her. He created the dept of Public Safety to give a job to Ray Hayes and Mark Seitzinger plus their two secretaries, if Judy wants to save on the cash then eliminate this dept that we survived without just fine for many years. Its just funny how Judy is going to try to and come out as the president of council who helped the mayor not borrow right before he is getting ready for a third term run, what a joke and its as transparent as they come. If you did not pay attention to where the money has been stashed thru out the authorities then it would seem all is well but its not. The SSA is going to raise our rates thru the ceiling and the city will not be able to stop it because Judy and Doherty 3 have placed them on their own without having to answer to us on their spending. This is just a tactic to pull the wool over the sheeps eyes in the city. Not to mention that they did not bother to bring up the long term Doherty debt of $300,000,000, they only mention the principal debt which is lower due to the fact that did not and would never take into account the interest among other things....Nice try Judy but you still are feeding this corrupt admin money jusy doing under the radar and using the authorities to hide it, great job ...........
MRS. EVANS: Yes, there should be a garage, but I think these multi-million-dollar companies who would like to utilize it are the ones, perhaps, who should be looking at turning that garage around.
Actually Sanofi Pasteur is a part of Sanofi Aventis, the 3rd largest drug company in the world, which is a multi-billion dollar company. I would think $35 million is a drop in the bucket to a company like that, but of course like most, if not all of corporate america, they would be more than happy to take any handout they could get. They actually threatened to build a new plant elsewhere, if the State didn't spend, I think like 10 to 30 million on a sewer line extension project for their new $200 million vaccine plant they just opened in Swiftwater.
I'm curious how you came to acquire the meeting minutes from 7/19, when minutes are posted only up to 6/28? This is a simple question. Please spare us the rhetoric and keep your answer simple as well.
They are transcribed every meeting some go up on DD and some can be had by requesting them from the individual that does the transcribing. I do not know the person but a pm request usually gets you the minutes you need. They are accurate to the word and some people do not like to wait till the important minutes are up well after the damage has been done. They have been available for a while usually before the next meeting. See they drag out putting them up on the Scranton.gov site so quick because they know that people will use their words against them. Like now.
Here is the reading by title from the agenda in regards to the $35,000,000 for the SPA.
For consideration by the Committee on Finance - For adoption - File of Council No. 104, 2007 - declaring (1) the acquisition of parking facilities by the Parking Authority of the City of Scranton, Pennsylvania, and the associated refunding of the Redevelopment Authority of the City of Scranton guaranteed variable rate demand lease revenue bonds, Series of 2004, issued to finance such parking facilities, (2) the acquisition, construction and equipping of new parking facilities of the Parking Authority of the City of Scranton, Pennsylvania, (3) the renovaton of existing parking facilities owned by the Parking Authority of the City of Scranton, Pennsylvania, and located in the City of Scranton and operated by the City pursuant to an operating agreement; and (4) the financing of necessary reserves, capitalized interest and costs of issuance of the hereinafter mentioned 2007 bonds, to be a project of the City for which lease rental debt is to be incurred; determining to incur lease rental debt in the maximum amount of $35,000,000 in respect of the project, such debt to be evidenced by bonds to be issued by the Authority and secured by rentals payable to the Authority by the city under a lease (including a fifth supplemental lease) of the parking facilities, and by a covenant of guaranty of the City contained in said fifth supplemental lease; stating the estimated realistic useful lives of the parking facilities; authorizing certain City officers to prepare, certify and file with the Department of Community and Economic Development the debt statement required by Section 8110 of the Local Government Unit Debt Act and any statements required by Section 8026 of such Debt Act to qualify the debt incurred as self-liquidating debt; authorizing the preparation of a debt statement and borrowing base certificate; specifically approving amounts of fixed rent and other payments (including the guaranty of debt service on said bonds) to be made by the City under such lease; approving and acknowledging notice of the Authoritiy's assignment of such rentals to trustee in respect of the Authority's bonds; authorizing incidental action; repealing inconsistent prior ordinances; and approving the form of, and authorizing, subject to receipt of necessary state approvals, executing and delivery of the fifth supplemental lease and the third operating agreement.
Here are the minutes on the fianl vote on 7/26 when Bob Bolus tried to stop it under the sunshine act.
6B. FILE OF COUNCIL NO. 104, 2007
(SCRANTON PARKING AUTHORITY - $35,000,000 BONDS) MRS. GATELLI:
What is the recommendation of the chair on finance?
MRS. EVANS:
As chair for the Committee on Finance, I recommend Final Passage of Item 6B.
MR. COURTRIGHT:
Second.
MRS. GATELLI:
On the Question?
MRS. EVANS:
Yes. I believe I made my stand on this particular piece of legislation very clear last week, and that is enough said.
MRS. GATELLI:
Anyone else?
MR. BOLUS (from the audience):
Mrs. Gatelli, under the Sunshine Act, do we get to speak on this?
MRS. GATELLI:
Attorney Minora, could you rule on this, please?
ATTY MINORA:
I did last week.
MRS. GATELLI:
You are not allowed to speak.
MR. BOLUS:
I think we have the opportunity to speak before a final vote is taken. I would like to say it is a violation of the Sunshine Act.
ATTY MINORA:
It's been on the agenda for the last 3 weeks, it's been there twice. There have been 2 opportunities for public comment; and, basically, Mrs. Evans has waived another opportunity because she has already stated her position very clearly; and that's the point. That there's an opportunity to be heard, the opportunity has been presented.
MR. BOLUS:
I believe our opportunity...
MRS. GATELLI:
Thank you.
MR. BOLUS:
...has been violated.
MRS. GATELLI:
Mr. Coolican.
MR. COOLICAN:
Mrs. Evans?
MRS. EVANS:
No.
MR. COOLICAN:
Ms. Fanucci?
MS. FANUCCI:
Yes.
MR. COOLICAN:
Mr. McGoff?
MR. McGOFF:
Yes.
MR. COOLICAN:
Mr. Courtright?
MR. COURTRIGHT:
Yes.
MR. COOLICAN:
Mrs. Gatelli?
MRS. GATELLI:
Yes. I hereby declare 6B legally and lawfully adopted. (4-1)
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