Barre mayor conflicted out of TIF talks
By David Delcore
Staff Writer | October 26,2012
BARRE — Whether it is real or perceived, Mayor Thomas Lauzon has a conflict of interest when it comes to Barre’s bid to obtain state approval for a downtown “tax increment financing” district, and if he wants to advocate for the idea going forward he’ll have to do it from the audience.
Lauzon acknowledged as much this week, citing concerns raised by members of the Vermont Economic Progress Council during their initial review of the city’s application for a state-sanctioned TIF district late last month. The proposed district includes several properties that Lauzon owns, either through corporations or personally, as well as three that are specifically referenced in the city’s TIF district plan. Those properties, according to the plan, either could not be developed or would not be developed to their fullest potential unless improvements funded by the TIF district are made.
Lauzon pointed out the potential conflict to City Council members several months ago, but at the time they were comfortable with his continuing to lead a discussion that culminated in their Aug. 27 approval of the city’s TIF plan and application to VEPC.
That’s a potential problem, according to some members of the VEPC board, a lawyer that the city subsequently consulted on the issue, and Lauzon, who this week turned the gavel over to Councilor Michael Smith when talk turned to the proposed TIF district.
“As we get further into the process, and … as the stakes get a little higher it was pointed out by some of the VEPC members during the first hearing that there could be a perceived conflict of interest,” Lauzon said.
Responding to that concern, the city consulted Montpelier lawyer Paul Giuliani, according to Mike Miller, the city’s director of planning and zoning.
Miller told councilors that Giuliani advised that while Lauzon’s disclosure and offer to recuse himself, as well as the council’s informed decision to allow him to participate in the months-long discussion of the TIF application, were all in keeping with the city’s conflict of interest policy, that was not enough.
“The procedural and substantive steps leading to the adoption (of the TIF district plan and application to VEPC), need to be free of doubt, speculation and impeachment,” Giuliani wrote, suggesting Lauzon recuse himself and the council retroactively ratify its earlier decisions in order to “dispel and obviate any doubts as to the mayor’s (Lauzon’s) participation in council action relating to the creation of the TIF district.”
Lauzon, who has been the most vocal proponent of a TIF district for Barre, urged the council to do just that. He said that while he plans to attend VEPC meetings involving Barre’s application, he will not do so in his capacity as mayor.
“I don’t want to do anything that would ever taint or jeopardize the city’s TIF application,” he said. “It’s … too important to the future of this city.”
With Lauzon seated in the audience, councilors ultimately reaffirmed their decisions after they and some members of the audience quizzed Miller and consultant Stephanie Hainley on the contents of the plan and the process going forward.
Simply stated, TIF districts are a way for communities to capture and reinvest a portion of the increased revenue generated by new development in a targeted area — the “increment” — on infrastructure improvements specifically designed to attract or enhance that development.
Barre is still several steps away from being in a position to pursue any projects, but improvements identified in its TIF plan include the redevelopment of Merchants Row and Enterprise Alley, as well as the construction of a 200-car parking structure off Keith Avenue.
The former project has been cited as necessary to accommodate Lauzon’s potential future development of the nine-acre property where the former Rouleau Granite plant now stands, as well as redevelopment plans for the Blanchard Block and City Place. The parking structure would serve several redevelopment proposals, including both phases of the Aldrich Block, which Lauzon owns, as well as City Place.
From his seat in the audience Lauzon rebutted one resident’s assertion that TIF districts somehow provided “tax breaks for developers,” while suggesting problems involving TIF districts in Burlington and Milton have been overstated. He also bristled at the observation that he has ties to three of the nine redevelopment projects identified in the city’s TIF plan — both phases of the Aldrich Block, and the Rouleau property on Metro Way.
“Who else would invest money here, and what would it say about your community if your mayor wouldn’t?” he said.
Both City Assessor Joe LeVesque and George Malek, executive vice president of the Central Vermont Chamber of Commerce, spoke in favor of the proposed TIF district that they argued would help provide a welcome jolt to a comparatively stagnant Grand List.
Lauzon kicked off the discussion by noting that the city’s $4.9 million Grand List — a figure equal to 1 percent of all the taxable property in the community — ranks last, on a per-capita basis, among the state’s 16 largest communities. That translates into the highest tax rate — $2.73 per $100 of assessed property value — among those communities, despite the fact that Barre’s spending per capita is only slightly higher than the state average.
“Our issue in terms of our tax rate isn’t that we’re spending too much money for every person that lives here,” he said. “It isn’t that you’ve got a municipal government out of control. It’s that you’ve got a Grand List value that’s abnormally low.”
According to Lauzon, the TIF district is one way to reverse that trend by spurring development and redevelopment in the city’s central business district that would generate additional revenue — some of which could be used to cover the cost of long-term debt for public infrastructure improvements without requiring property tax support — and eventually significantly reduce the city’s tax rate.
VEPC is scheduled to resume its review of Barre’s TIF application when it meets Nov. 15 and could act on it Dec. 6.
The city is planning a series of public hearings on the proposal — including one Nov. 27 — in the run-up to what officials hope will be a Town Meeting Day vote to establish a debt ceiling for the district. Additional hearings have been tentatively scheduled for Jan. 15 and Feb. 26.