Smelling blood after a judge struck down a deal that would have allowed more than
Developers, for their part, contended that the board should fight to reaffirm the two-year-old decision to allow taxpayer financing when it meets Friday at
"This will become an economic anchor," Mallen said.
But that opinion was in the minority at a bruising meeting that saw the city council chambers filled nearly to capacity with vocal opponents of the project.
Quoting from Miller & Martin's own website, Scott heaped scorn on the developer's attorneys for its "outside the box thinking, which is critical when a project fails to meet the criteria of statutory incentives or when a company's first proposal fails to close the gap on financing."
"The developer's investors want you to think outside of the box," Scott told the
Under tax increment financing, developers spend the money for a project up front, then are paid back with interest over a 20-year period out of additional tax revenues generated by the development. Developers have argued that the road serves a public purpose, since it would could potentially lead to
In a rare behind-the-scenes look at how deals to finance private projects with taxpayer money are forged, attorneys revealed that McMahan acted alone to approve
It was that type of secrecy surrounding the project that prodded retired city planner
McMahan acted without the approval of the board itself, alleged former chairman of the IDB,
"I understand why the judge is confused, I'm confused. I don't know how [the deal] closed," Ebersole said. "If any of you were involved in any way, correct my misunderstanding, but I don't believe any of you had any communication with anyone else on the board about the closing of this transaction until you read about it in the paper. If I'm wrong, speak up."
No one did, including McMahan, who did not respond publicly to the allegations and could not be reached for comment after the hearing. McMahan previously said the board was meeting in executive session under the cover of attorney-client privilege.
Despite the fact that apparent violations of
Developers claim that proposed commercial development as well as a sewer pipe that will serve the top of the mountain are what qualify the project for public money. But
The proposed convention center would compete with the already debt-ridden Chattanoogan hotel, which is owned by the city, and the proposed sewer line would bring more sewage into a city that is already under a federal consent decree for dumping excess waste in the
But objections to the project on public policy grounds had no place in the IDB debate, said
"They make some very good public policy points. However, there are only two bodies that make the decision on this, that's the
And unlike cities such as
"I don't think that I ever, on any issue, either before the city and county bond board have seen as much misunderstanding and misrepresentations of what the law and the fact are as on this project," Smith said. "I suppose the closest thing was when the Aquarium was being planned. It was stated that the Aquarium was really just a scheme to benefit private citizens, and that the investment by the city and county governments in the plaza around the aquarium was a boondoggle, wasted public money."
But developers could have a hard time convincing ever-more-skeptical public servants of the wisdom of funding the road up
In fact, "the council that approved this TIF is no longer in existence," said Grohn.
"Every incumbent that had a contested race that sat on the council who approved this TIF was thrown out of office," Grohn said. "It is a telling, telling point, that immediately after approving this TIF, that council placed a moratorium that still exists today on all TIFs, because they felt they did not have enough information to properly make a decision. That point alone should encourage you to follow some of the advice you've received today."
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