TIF tiff | Arkansas Blog

Monday, December 22, 2008

TIF tiff

Posted By on Mon, Dec 22, 2008 at 2:45 PM

The word is that the NLR Council vote is wired tonight for Mayor Pat Hays' ex post facto Tax Increment Finance scheme.

He's going to redirect school tax money to a hotel parking deck. It stinks.

You'll hear lots of  development tom-tom beating tonight. 1) The hotel will create jobs. Amen and good for it. Just like the one being built wholly with private money in Little Rock. 2) It will create new sales tax revenue. Probably so. But, guess what, not a dime of that sales tax revenue will reach the North Little Rock schools. Never has. Never will. By this standard, the new sales taxes at the Maumelle Boulevard Wal-Mart justify taking some of the Wal-Mart's school property tax millage to haul that tugboat to the mayor's river fleet mooring. 3) Property in the three TIF districts that Hays is knotting together by claiming public streets as TIF real estate  WILL produce property taxes for the school. But no thanks to Mayor Hays.

Hays was instrumental in 2005 legislation that attempted to rewrite the Arkansas Constitution to allow North Little Rock and other cities to grab ALL school taxes within the boundaries of TIF projects. The Supreme Court has ruled the state's 25-mill base property tax off limits, much to the mayor's displeasure. He wanted it all. I still think there's a successful lawsuit in challenging Hays' effort to take the more than 16 mills of NLR school tax in excess of the base charge  for his parking deck. But, yes, schools will get SOME of the money to which they are lawfully entitled. Again, no thanks to the mayor. And not because of the TIF vote on the Council agenda tonight. The mayor has no valid claim on it except that he says he CAN take it.

Finally, this issue is still very simple. The Enclave apartments and Argenta Place were built solely with private money. They received no public aid. After that fact, Hays is trying to find a legal loophole to annex the new property taxes from these projects for an unrelated and non-contiguous hotel development. By any rational standard, it's wrong. If  it eventually proves to be barely legal, it shouldn't be and the legislature should consider fixing the law to prevent such excesses.

Perhaps after Hays' Council puppets OK his plan tonight, the NLR School Board will sue. If the Board or some public interested party doesn't sue successfully, the mayor will have established a template to use over and over again. He can just identify property ripe for development. He need provide no public assistance. But, when the development is completed, he can claim the increase in tax revenue for his own uses, however unconnected they might be to the new developments. Heckuva scam, Haysie.


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