KEVIN LEININGER: Coming ‘Electric Works’ analysis should guide Fort Wayne’s future ‘public-private’ deals, too
“This is a freight train running down the track, and nobody wants to get in the way. If the project is as strong as the developers say it is, it will be OK,” Don Steininger told his fellow Capital Improvement Board members last week when he suggested they fund an independent analysis of the Electric Works project, the first phase of which anticipates $65 million in local funding.
Friday the board is expected to hire a three-member team of local and national experts to do just that, and with City Council on Tuesday signaling its willingness to inject millions of dollars into the $213 million project, the decision would come just in time to allow council members and other local officials to base their funding decisions on information that is as accurate and objective as possible. Conducting such a review in advance of such a massive “public-private partnership” represents the best idea I’ve heard in a long time, and should provide the blueprint for assessing taxpayer involvement in similar future projects. As CIB member Ben Eisbart said last week, “We need to learn from the (downtown) arena. We spent $500,000 on (plans and other expenses) then did a feasibility study” that persuaded Mayor Tom Henry to scrap the $100 million project, at least for now.
The CIB has already approved a possibly forgivable $2 million for environmental cleanup of the former General Electric campus, along with a similar $1 million loan from the Allen County Commissioners. But Steininger expects the CIB’s study to be ready by April 15, which would allow the CIB, City Council and other potential backers to review and act on its conclusions in plenty of time to keep the project on schedule. Developers say they need to break ground by July 1 to avoid losing tax credits.
The CIB’s “due diligence” effort will not produce an appraisal, feasibility study or market analysis,” said Steininger, a longtime and respected developer who attended his first CIB meeting last week after being appointed by the County Commissioners. Instead, he said, it will analyze “the overall reasonableness of the assumptions in the proposal, how realistic they are. We need to be educated about the guts and nuances of the deal and the risk involved.”
The project’s developer, RTM Ventures, has produced a document outlining proposed funding sources (council Tuesday said it is willing to consider $13.6 million in loans and grants from the Legacy fund, among other things) and projecting the project’s economic impact, which includes recouping that $65 million in 13 years through taxes on the project. And, just prior to Tuesday’s council meeting, RTM issued a news release stating interest among potential tenants is increasing and that interest an letters of intent have been received for more than 114,000 square feet. Steininger does not question the developers’ integrity, but correctly points out the need for independent analysis before committing millions of taxpayer dollars that, if the project did not succeed, might never be recovered.
Even if a banker wouldn’t make the deal government is being asked to consider, Steininger said funding could still be appropriate if the study indicates the project would be in the overall public good. Cost of the study is expected to be less than $30,000, he said — a bargain if it ensures millions of public dollars are spent well if they are spent at all. Steininger hopes the study reaffirms the developers’ optimism. “I don’t want it to come back and say this is the dumbest idea ever,” he said. “We should have done this with The Landing.”
Most recent public-private deals seem to have justified the risk, starting with the at-the-time controversial Parkview Field that spawned several other downtown improvements — including the Electric Works project. The $32 million redevelopment of the Columbia Street Landing, which has had its share of delays and setbacks, is now underway. But past achievement does not guarantee future success, especially when the project is as massive, expensive and unique as Electric Works.
Nobody should want to stop this train arbitrarily, but with $65 million at stake neither should it be allowed to careen down the track unchecked. As Steininger said, if Electric Works is the transformational project its backers and supporters insist it is, impartial scrutiny should be not only sustainable, but welcome.
This column is the commentary of the writer and does not necessarily reflect the views or opinions of The News-Sentinel. Email Kevin Leininger at firstname.lastname@example.org or call him at 461-8355.