Some Good Will Come of This
This writer, Enfield Councilperson Robert Lynch, (speaking as a member of the public) addressing the Tompkins County Legislature:
January 18, 2022
Six days ago, I attended, via YouTube, a meeting of a Tompkins County administrative agency, a Board on which two of our County Legislators attended as members. As at least one of them knows, I harbor strong disagreement with how it conducted its business that day. Unilaterally, and without notice, an agenda item was expanded to include a much more controversial decision. A multi-Million Dollar PILOT abatement for a financially-fragile, long-delayed downtown apartment project was extended. I would like to have addressed the matter. Maybe others would have, too. Yet we found no opportunity to do so. The agency blindsided us.
I’d like to believe that day’s wandering away from customary procedure was neither deliberate nor sinister, but rather systemic. Those in charge just never thought about us, the taxpaying, skeptical public. But as we’ve learned in other contexts, systemic ills, no matter how inadvertent, demand correction. No, the law did not require a Public Hearing. But democratic due process did dictate the agency provide the public an opportunity to speak.
Your Lansing legislator, Mike Sigler put it best: “Listen, the residents are mad,” Sigler relaying neighborhood frustration concerning the project’s “unkempt” appearance and the developer’s protracted foot-dragging. Thanks, Mike, for standing up for us. I wish all Board members and staff had done so. But instead, at least one member sought to excuse the developer despite his broken promises. Yes, this agency has a problem.
Others, too, remain angry. Like me and my colleagues on the Enfield Town Board, who last year found little support when we sought from the agency greater compensation for a new solar farm in Enfield. The City of Ithaca has secured a seat on the Tompkins County Industrial Development Agency. Why can’t we, the rural towns?
There’s little I can do tonight to affect that now-extended Library Place PILOT. But I can do this. Tonight I propose your Legislature revisit Resolution 9855 of February 2021—withdrawn in committee a year ago— and request New York State expand the Tompkins County Industrial Development Agency Board from seven members to nine; with the understanding that this Legislature will appoint a representative from the outlying municipalities, the rural towns and villages, to fill one of the new positions; with the second seat reserved for school district representation, with all districts—city and central schools— eligible to nominate, collectively, that member.
We need a voice. I need a voice. Most importantly, TCIDA must learn it serves every one of us, not just the biggest in rental realty. Please don’t ignore our voices any longer, like some did last week.
Later, under his own Privilege of the Floor, County legislator Rich John addressed my comments, stating in part:
“I am the Chair of the Industrial Development Agency. And a speaker questioned a decision we made at our last meeting regarding the Library Place project. A request came to the IDA, and my recollection—I don’t have the agenda in front of me—but that it was on our regular order of business. So it was on the agenda. It was publicly stated that, you know, in advance of the meeting that we would be talking about that. So I’m not entirely clear what the concern is that we did something inappropriate.
“The request was for an extension of the timetable for application of the tax abatement. And what a developer typically asks for is that the abatement apply as soon as the construction is finished and the full value of the project is realized. When a project is delayed, you can run into a situation where the first year or so of the abatement, there’s no improvement completed, and the Assessment Department has not assigned it any new value to the property. So effectively you dramatically change the nature of the incentive that was applied. What we typically do is we amend the timetable for application of the abatement basically to correspond to the deal we agreed to make at the beginning of the project….
“You know, this has been an imposition on the neighbors, and certainly for everybody who has to drive by and see a half-completed project. But it does look like it’s going forward. And what the IDA did was extend the benefit that had been agreed upon originally. We didn’t really do anything else. We’ve done this on many occasions before. So I don’t see this as a particularly controversial step. But perhaps I’m missing something.”
The next day, in a private email to County Legislators Rich John and Mike Sigler, both members of the TCIDA, I explained the facts; specifically that the Library Place PILOT extension was not on the agency’s agenda that day. But my message added the following with reference to my comments the night before:
“I sought to be as constructive as I could. I sought to build something positive out of a situation that provoked my anger greatly when it occurred. Rather than vent about a procedural slight to open democracy, I reflected during the past week on both the January 12th incident and earlier events and advanced last night an initiative that I believe would benefit outlying municipalities, their governing Boards, and Tompkins County’s component school districts. Municipalities and school districts both stand as intended beneficiaries of TCIDA PILOT abatements, but their governing boards currently may exercise little, if any, voice in the IDA’s decision-making process. I fear that my good idea of the evening got lost in the fog of subsequent discussion.
“As I made clear in my prepared remarks concerning January 12th, “I’d like to believe that day’s wandering away from customary procedure was neither deliberate nor sinister, but rather systemic.” Your own words later during last night’s meeting confirmed my assessment.”
Legislator John, in his reply, later acknowledged that I was correct and he mistaken. The Library Place PILOT extension had not been on that day’s TCIDA agenda. The legislator also invited me to advance my idea of expanding the TCIDA’s membership, if I so choose.
Now, the meeting that prompted my comments:
Doing Business the “IDA Way”
Surprise! Industrial Development Agency tosses troubled Library Place a strings-attached lifeline
by Robert Lynch, January 16, 2022
“Nobody wants to see this project completed more than I do.”
Library Place developer Frost Travis, addressing the TCIDA, January 12th
“Everybody else is building, and I’m not the only one noticing that.”
Legislator Mike Sigler; same meeting, asking why Library Place still lies idle.
It had a bury-it-as-best-you-can stench to it. The posted agenda never listed it. COVID-cautious orders locked out the public so they couldn’t protest. All that they—and yes, I—could do was shout at their computers. But the Tompkins County Industrial Development Agency (TCIDA) Wednesday (Jan. 12th), after endorsing a perfunctory extension of a sales tax waiver for Frost Travis’ long-stalled and financially-fragile Library Place housing project, suddenly expanded its largesse, granting the Ithaca developer a two-year extension on the project’s Payment in lieu of Tax (PILOT) abatement, a much-bigger benefit, and an extension for which Travis pays no price for having dragged his feet.
The TCIDA Board Wednesday saw no reason to explain or justify its impromptu, unannounced action, other than to say that Travis wanted the extension and wanted it now; well before a March first tax deadline. Yet it could have waited. The agency’s Board meets again in February.
“Listen, the residents are mad,” said County Legislator and TCIDA Board member Mike Sigler as the extension Resolution hit the floor. “I’m not saying I’d never vote for this. But I’m not inclined really to give away our leverage either on this project.”
In the end, Sigler did not fight the extended abatement. But neither did he forfeit his perceived leverage. In a move welcomed by the Lansing Republican, the agency tacked on a requirement that Library Place must become more than just its perennial weed patch come six months from now. Structural steel must actually rise above it.
“I think that sounds reasonable,” developer Travis reacted to the tethered string the Board attached. “I don’t mind the condition. I believe, ultimately, our interests are aligned. I have a huge amount of capital tied up in this, and the sooner I get the project done, the sooner I get a return for myself; for my investors. Nobody wants to see this project completed more than I do.”
In May 2019, the TCIDA granted Ex Libris, LLC, the developer’s official name, a 10-year, sliding-scale PILOT abatement. The agreement waived an estimated $3.9 Million in County, City, and School District property taxes over a decade to get the project rolling. The abatements were to kick in this year, when the project was supposed to be finished. But even though the project’s completion has lagged, the PILOT would have run as scheduled, meaning that instead of receiving some $400,000 in tax savings each of this year and next, Travis might have earned nothing. Wednesday’s action pushed both the start-and stop-dates two years forward, meaning Ex Libris will reap all the same benefits as before, just later, beginning when the apartments may finally be built, the rents start rolling in, and the abatements hold bankable value.
“We supported this one a long time ago,” retired County Legislator Martha Robertson said of Library Place, during what was her final meeting holding a seat on the agency’s Board. “It’s one of those on the bubble, and I think pulling back this support [could mean that] the whole thing could end up being a big waste, actually fail, and end up being a hole in the ground for many more years to come.”
In a year when Ithaca has beaten back the pandemic to become construction-crane city, a boom town with high-rise housing and offices going up on almost every block, Library Place, Frost Travis’ upscale senior citizen apartment house downtown at Court and Cayuga—originally-projected to cost $31.7 Million—has lain idle as a glaring exception to local prosperity’s rule. Its construction commenced in December 2018 with demolition of the Old Tompkins County Library. But after some foundations were laid, and those always-ugly concrete block elevator shafts erected, the project hit semi-permanent pause.
First, the developer blamed COVID-related work stoppages. Then it claimed it had forfeited its place in the construction queue. Last summer, officials finally admitted Library Place had lost its financing, yet had purportedly found a fresh lender. “They have re-bid the project. It is getting ready to tee-up for construction,” TCIDA Administrator Heather McDaniel optimistically forecast in mid-July. (See story, posted here July 15th and archived.) Back then, McDaniel predicted an August restart. It didn’t happen. Library Place has continued to lie as though abandoned.
The risk of prolonged—and continued—procrastination worried Sigler more than it did anyone else on the Board Wednesday. Sigler’s former legislative colleague, Martha Robertson, conspicuously carried Frost Travis’ water during most of the discussion. Lost on no one was that Travis and his company had donated more than $20,000 to the Dryden Democrat in her failed bid for Congress in 2014. See: https://www.ithacajournal.com/story/news/local/2015/07/09/martha-robertson-campaign-donations/29938055/
“Nobody knows about the community’s disappointment and frustration in the progress of this project better than Frost,” Robertson said with patronizing praise. “I don’t think we have to beat him up here,” a mild slight to Sigler. “Look, what’s the alternative, guys? Let’s get this done as fast as possible.”
“This is what we’ve done over and over again,” Robertson insisted. “Extend the beginning of an abatement until the project is actually starting to see some income.” She called it a “threshold moment” for Library Place.
But what those like Sigler sought most that day were not more idle promises, but demonstrable action.
“I obviously like this project. I voted for this project,” said Sigler. “I’m just—I’m looking at other projects and going, everybody else is building, and I’m not the only one noticing that.”
Both Travis and his construction manager, Jim Brown, who joined his boss in zooming Wednesday’s agency meeting, handed up their firmest timetable yet for Library Place since COVID-19 idled the worksite nearly two years ago. Brown apologized for delays encountered to date.
“We had a struggle with the market and the manpower,” Brown explained to the Board. The project lost one site contractor. It then found another. “We plan on mobilizing in the first week of February,” the manager predicted. After “3-4 weeks” of work by masons, steel could start going up, perhaps by the middle or end of March, he forecast.
Frost Travis told the IDA he plans to finish Library Place by the spring of 2023. (The 2019 abatement paperwork had envisioned completion by August 2020.)
Board member John Guttridge floated an idea: Why not delay action for now, and just tack on an eleventh year to the abatement later, awarded only after the developer demonstrates his sincerity. But TCIDA Chair, County Legislator Rich John, shot down that idea, acknowledging financial fact.
“The problem as I see it,” said legislator John, “is what’s happening between Frost and his bankers.”
Are we just imagining that might be an issue? Guttridge questioned.
No, sorry John, that really is an issue.
“It does change the underwriting,” Travis cautioned the Board, the developer discouraging any departure from a straightforward two-year, front-to-back extension. “Definitely it could impact the overall loan amount. I’ve already had to put in substantially more equity than I intended. My returns are not what I had anticipated. That has to do with the COVID-related and supply-chain costs.”
“I would think it’s fair to say it would be a body blow to have the abatement shortened by two years,” Travis admitted, “because it wouldn’t give me time to grow the top-line revenue while the expenses increased due to the reduction in the tax abatement.”
It was actually an administrative oversight that brought Library Place to the TCIDA’s Wednesday agenda in the first place. Ex Libris’ waiver from paying sales tax on its construction supplies expired in late-2020, and nobody caught it. TCIDA staff could have extended the waiver administratively had they done so in time, but not after-the-fact. The sales tax abatement, originally pegged at $1.3 Million, could rise as construction costs climb. Travis said he’d have a firmer bead on inflation’s hit later this spring.
“We’re half way across the creek. We’ve got to get to the other side,” Rich John said, seeking to put Library Place’s plight in proper perspective, though some—like me—might reason we should never have attempted to ford Frost Travis’ stream in the first place.
With Wednesday’s 30-minute TCIDA discussion finished, any reasoned observer could draw the following conclusions: Completion of Library Place remains long overdue. Its tax abatement proves critical. Its financing perches “on the bubble,” as Robertson put it. And a construction restart now appears solid enough for neighbors to look out their windows and see if deadlines actually get met.
One more thing stands evident: The Tompkins County Industrial Development Agency answers first to well-heeled developers, and to inquisitive—if not incensed—peons from the public only when it chooses to.
“This was not administrative due process,” this writer emailed legislator Sigler after Wednesday’s discussion had ended. “I will express my displeasure to the TCIDA.”
I will. It beats yelling at my computer.