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 V.17 No.18 | May 1 - 7, 2008 

Council Watch

Come and Get It! Free Money!

No, not you, silly. Not unless you’re a large multi-state developer or a defense contractor.

Discussion at the April 21 Council meeting swirled around who would get the biggest cut of tax money in the form of TIDDs (Tax Increment Development Districts). Public comment included nine speakers that asked the Council to oppose sentiments expressed by a Kirtland Air Force Base speaker, who seemed to prioritize money for more weapons systems above funding Social Security and Medicare.

In other actions, councilors directed Mayor Martin Chavez to study a proposed rate hike by the Public Service Company of New Mexico. Councilor Rey Garduño’s bill supporting the Mining Reclamation Act of 2007 passed. The new mining act would update the 1872 act that allows toxic contamination of water and destruction of public land while paying no royalties.

Send your comments about the City Council to laura@alibi.com.

Issue Council's Take Reporter's Take
The Elephant in the Living Room

Last year the mayor vetoed a bill limiting TIDDs. The districts divert a percentage of gross receipts and property taxes generated in an area to developers to help pay for the area’s infrastructure. A recent state law, along with city and county laws, expands TIDDs to fringe areas.

Councilors Garduño, Michael Cadigan and Isaac Benton sponsored another bill to limit the districts. The bill would not affect TIDDs for areas within the 1979 city limits, designated as Metropolitan Redevelopment Areas, or where TIDDs are already in force. In outlying areas, TIDDS would be allowed only for nonresidential development and only if the deal caused the city no net expense. No gross receipts tax and only one third of property tax could be turned over to a developer.

Speakers from the Chamber of Commerce, SunCal, the National Association of Industrial and Office Properties, and the Home Builders of Central New Mexico opposed limiting TIDDs. They said the current system would stimulate economic growth and that councilors should decide each TIDD application on a case-by-case basis.

Supporters said unlimited TIDDs violated the Planned Growth Strategy and would use up water needed for infill development and local agriculture. Representatives from Environment New Mexico and Conservation Voters of New Mexico said sprawl resulting from unlimited TIDDs would worsen city vehicle emissions. (Albuquerque, with an average of 18,000 miles per year per driver, is already the sixth-worst city in the nation for emissions, according to a
Journal column by Benton, Cadigan and Garduño.)
Evoking the railroad companies’ 19th century practice of promising the moon to little towns that gave land to the railroad, Cadigan said fringe-development TIDDs violated the anti-donation clause, which prohibits municipalities from ”giving private industry stuff for free.” Garduño said the new bill allowed economic development. Benton said he didn’t think unlimited TIDDs would remedy “piecemeal development.” He predicted unlimited TIDDs would cut out smaller, local homebuilders.

Councilor Sally Mayer said she thought the Council should decide TIDD applications case-by-case. Councilor Ken Sanchez said limiting TIDDs “slammed the door shut on companies that want to come to Albuquerque.” Sanchez said the city should hire a full-time employee to study TIDDs. Councilor Trudy Jones said the bill offended her because councilors have the intelligence to decide TIDDs case by case.

Councilor Debbie O’Malley said TIDDs were originally created for areas otherwise too difficult to develop, but they now were used for land that would be developed no matter what. O’Malley said specific standards for TIDDs saved time for interested developers.

Cadigan said, “We wouldn’t start a baseball game without setting ground rules.” He said the Council could change the ordinance if needed, but having overall standards for TIDDs helped the city “drive a hard bargain.” The bill limiting TIDDs failed 5-4, Councilors Don Harris, Brad Winter, Jones, Sanchez and Mayer opposed.
Homebuilding has been a major economic engine in Albuquerque, staying healthy for longer here than in most places. Housing permits are down 40 percent from last year, part of a nationwide slump triggered by careless subprime mortgage lending, but no one mentioned that elephant in the living room.

Several years ago, District 1 Councilor Miguel Gomez sponsored a bill cleaning up predatory lending. A series of real estate professionals claimed any attempt to regulate mortgage lending destroyed the American Dream for first-time homebuyers. The bill failed. And here we are, the mortgage industry in worse shape than the most lurid predictions by supporters of NINJA loans (to applicants with No Income, No Job, No Assets).

In the March
Atlantic Monthly, Chris Leinberger, of the Brookings Institute and former Albuquerque Downtown developer, examines the rising foreclosure rates in communities with longer commutes. Limiting TIDDs might be the best weapon against a similar pattern here fueled by more square miles of housing with no nearby jobs, public transportation, retail or services. Talk about deciding TIDDs case-by-case seems largely irrelevant. Judging by past performance, it seems unlikely that any councilor opposing general TIDD standards would vote down any individual application.

It’s the development industry’s job to obtain as much in tax subsidies and block as much regulation as possible. It’s the job of the Council to see that tax money is allocated in a fair and just manner. It’s also the Council’s job to balance individual well-being and corporate advantages, so that citizens aren’t like 3-year-olds trying to seesaw with a sumo wrestler. On the eve of Earth Day, several councilors didn’t do their jobs.
 

Today's Events

Over the Edge for Special Olympics at New Mexico Bank and Trust

Join the League of Edgers and prepare to rappel 16 stories down the New Mexico Bank and Trust Building in Downtown Albuquerque.

Dance Happy Hour at Studio Sway

Monthly Craft with Jackie at West Gate Heights Library

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