What’s Become of that “TIF” Subsidy Deal for the Old Salisbury Mall

This post was submitted by one of our readers -

The last we knew, Salisbury’s former “Dream Team” City Council – under the “leadership” of Mike (“gone with the wind”) Dunn – was amending the regulations for the special subsidy (“TIF”) for the mall owner to allow Barrie Tilghman to exercise even more power without the need for Council approval of her actions. That was done by means of Resolution No. 1501 and Ordinance No. 2030, both adopted by the Council on March 26, 2007 – just prior to the election when it was still uncertain how the next Council would view the subsidy deal (and who would be elected). Unfortunately, the minutes of the meeting provide no details of the discussion; Salisbury uses the “no embarrassing record” concept.

However, documents prepared for the special subsidy deal, specifically to support the City’s TIF bonds, state that the redevelopment project is “expected to be build out in four to six years,” and a news article last summer said that construction would begin within a year (now down to 9 months). And, the walls are tumbling down as we speak.

Thus, it looks like the TIFbonds must have been issued by now. But the City has not announced that anything has happened or, if it has, who purchased the bonds.

Now, the recent news of a lawsuit against the mall owner (Salisbury Mall Associates, LLP) by the firm that had agreed with it to purchase residential lots for build-out (K. Hovnanian Homes of Maryland, LLC) makes you wonder just who did purchase the TIF bonds because that case does not bode well for a happy outcome. The developer’s “Complaint for Declaratory Relief” states that Salisbury Mall Associates, LLP “has not submitted a Final Comprehensive Development Plan to the Planning Commission, nor completed Phase I Civil/Site Construction Plans, nor recorded either a Final Subdivision Plat or a Final Development Plan.” By letter dated September 27 an attorney with the law firm “Venable, LLP” wrote to the mall owner by way of its spokesmen – the notorious MessrsNatelson and Dzaman – to state Hovnanian’s declaration that their contract “is null and void.”

It looks like that 4-6 year build-out schedule may be delayed, which could cause major difficulty in amortization (repayment) of the bond debt. The bondholders must be wondering what to do, just as we are wondering who holds the bonds. Maybe Barrie Tilghman could let us know, but don’t count on it.

Technorati Tags: Salisbury, politics, salisburypolitics, TIF, development

Planning Commission Decision Not the Problem With Hearne Development

Yesterday's decision by the Wicomico / Salisbury Planning and Zoning Commission to allow the proposed "Orchard" development move forward as student housing was neither unexpected nor wrong. The commissioners had little choice in granting the developers the go-ahead. Who then is to blame for a promised development for seniors being turned into a student apartment complex?

The blame lies squarely on the Salisbury Council members (Gary Comegys, Mike Dunn, Lynn Cathcart and Shanie Shields) who approved the annexation and rezoning of the property. When this property was annexed and re-zoned some members of the public accused the developers of planning to put student housing on this site. Councilmen Dunn and Comegys lectured those in attendance that this surely would not happen. The developers were "locals" and their reputation was "above reproach". These gentlemen could be counted on to keep their word.

Mr. Comegys told the public that the planning commission would see to it that this project was held to the plan. When it was pointed out the new zoning would allow any multi-family housing, Mr. Comegys just shook his head and responded again that these developers were men of honor. We now know differently. The developers and their attorney claimed that they would stick to their plan. Of course the real estate climate has changed since then. Never expect a developer to keep his word if the market changes.

Personally, I don't care what they build there. What does concern me is that citizens were deceived. They were deceived by Messrs. Comegys and Dunn. They were deceived by Mrs. Cathcart, who now appears to be planning a political comeback (possibly as an opponent to Councilwoman Debbie Campbell in 2009). Mrs. Shields just does what she's told, so we won't accuse her of anything.

A sadly amusing footnote to this debacle was the decision of Councilman Comegys (now a member of the planning commission) to slither out of town rather than perform his duty on the Planning Commission. Of course this was after Mr. Comegys attempted to make political hay out of his past deceit by claiming to be opposed to the new project, when he knew that there was nothing that could be done.

Mr. Comegys now claims that the council has "learned from their mistakes" and that the new annexation policy will take care of this in the future. Of course we are already seeing cracks in the facade of this supposed cure.


Technorati Tags: Salisbury, Wicomico, politics, salisburypolitics, wicomicopolitics, development

Sabbatical Over, For Now

We're still trying to fix our server problems so we'll start posting here on Blogger. We'll start with new posts after this afternoon's Salisbury Planning Commission meeting.


Technorati Tags: blogging, technical

No, We Haven't Moved Back

No, Delmarva Dealings hasn't moved back to its original site. We're just keeping the account alive in case we need it again later. You never know.