All posts by C. J. Summers

I am a fourth-generation Peorian, married with three children.
City Council, City of Peoria

Firefly loan guarantee high compared to similar programs

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Firefly LogoTonight, the City Council will be discussing whether to offer a somewhat unique incentive to a local private business. Firefly Energy needs a loan, and they’ve been unable to secure it through the Small Business Administration (Caterpillar owns 35% of Firefly, hence they’re not small enough for an SBA loan) or Industrial Revenue Bonds (also ineligible).

So the plan is for National City to provide them a loan that would be secured by their equipment and a loan guarantee from the City of Peoria and Peoria County. For the City’s part, they are wanting to pledge $3.3 million in utility tax receipts.

This is organized more or less just like a Small Business Administration (SBA) loan. The SBA doesn’t directly loan money, but rather acts as guarantor, which reduces the risk for private financing companies and allow loans to be made that otherwise would not be approved. “The policy question for Council,” the council communication states, “is whether the City of Peoria should guarantee private debt to encourage economic development. Furthermore, if this approach is used what should be the guidelines for assistance? City and County staff could develop guidelines if the Council so desired.”

I expect this to be the question that gets the most discussion. This kind of incentive has apparently not been used before by the City. If the City approves using it tonight, you can bet they’ll be asked for such assistance again. What kind of precedent, if any, does this vote set? There are two parts to any precedent that may be set: (1) The use of this incentive at all, and (2) how much money they’re willing to guarantee.

It’s common for loan guarantees to be provided at the state level, but not as common for cities. My efforts at Googling such a situation at the city level only turned up one city that provides such incentives: New Brunswick, New Jersey. They’re a city of about 49,000 residents, and their program works like this:

New Brunswick provides a 50% guaranty to loans made through the program with participating banks. The guaranty permits banks to make loans they would otherwise decline. The borrower gets access to capital at reasonable rates.The Economic Development staff will also assist business owners in developing a business plan for presenting their loan ideas to bankers or hard money lenders.

Loan Term: 1-7 years
Loan Rate: Prime + 2 points. The rate is fixed at the time of closing
Loan Amounts: $25,000 – $150,000

I called the Peoria City Manager’s office and also talked to the Economic Development department, but neither of them could provide the names of other cities that provide similar programs. I didn’t talk directly to City Manager Randy Oliver, however, so it’s certainly possible he knows of other cities.

What I found interesting was the amount of the loan they guarantee in New Brunswick — the upper limit is only $150,000. According to this website, the average loan guarantee in Michigan’s Capital Access Program is $53,000. California’s Small Business Loan Guarantee Program “cover[s] up to 90% of the loan amount, with the guaranteed portion of the loan not exceeding $500,000.” Here in Peoria, we’re talking about $3.3 million — and that’s only the City’s share. The County is putting up an equal amount for a total guarantee of $6.6 million!

I’d like to see Firefly Energy stay in Peoria, and I’m not against providing them incentives, but this seems to be a rather large loan guarantee when compared to other state and local programs I could find. Considering the County won’t take up this issue until June, I would suggest the City not vote on it tonight. Discuss it, think it over, consider the ramifications, take up the staff’s offer to write up guidelines — this is too big to rush into.

Peoria County

Anyone know a cheap forensic pathologist?

Peoria County is looking for one. Jonathan Ahl is reporting on his blog that the new $300,000 Peoria County morgue was supposed to open a year ago, but has been held up by the county’s inability to find a forensic pathologist who would work for the salary the county is offering.

It’s a shame. Here they have a huge empty building that people are just dying to get into…. Sorry, I couldn’t resist….

(If you’d like to comment on this story, please go to Jonathan’s blog.)

Blogosphere, Television

Eyebrows to take Billy’s place on TV

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Since Peoria überblogger Billy Dennis won’t stoop to being interviewed by WHOI news, Laura Petelle (aka Eyebrows McGee) will be the guest blogger instead. Be sure to check out the live segment during the 5:00 news on channel 19 (channel 8 on Insight Cable). Discussions with Laura are always interesting.

Also, I’ve been rather impressed with WHOI’s news coverage lately (not just because of the Big Hollow story, either). They’ve been reporting on stories I don’t see in any other media. For example, not too long ago, they did investigative reporting on sex offenders living too close to District 150 schools, and just recently they investigated crime in Peoria’s parks.

City of Peoria, Gary Sandberg

No kid gloves for Sandberg

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Jennifer Davis reports today on Gary Sandberg’s disputes with the city over property he owns. He had to pay fines before he was sworn in as an at-large councilman or else face the possibility of being removed for being in violation of state law 65 ILCS 5/3.1‑10‑5(b). That statute states you can’t hold municipal office if you’re “in arrears in the payment of a tax or other indebtedness.” Sandberg owed a couple of fines ($110 for the city to clean up what he claims were properly-stored construction materials on his property, and $500 for not registering another property he owns as rental property; he claims it’s owner occupied) which he paid off just before being sworn in a couple weeks ago.

Having heard both sides of the story on the the city clean-up item, I feel that Gary should have paid those fines a long time ago (the incident happened in 2004). He still could have fought against any due-process violations he felt were made without withholding payment.

The housing issue is interesting, though. Sandberg claims he occupies the house at 1723 N. Bigelow at least part-time, but the city says otherwise. Because the property doesn’t have water or electric service, it was determined by the city that it is not occupied and therefore has to be registered. I think that sounds logical and reasonable. While a case could be made that you don’t have to have electricity to occupy a house, I think you definitely need to have water, if for no other reason than to flush the toilet.

But here’s the issue. I can find no definition of “occupied” or “occupancy” in the municipal code that requires electric or water service. Can anyone find it for me? And is electric and water service the only things necessary for a house to be considered “occupied”?

I ask only because 616 Phelps isn’t registered with the city. That’s the supposed city residence of Streets Department manager David Haste. That home apparently has water and electricity, but no stove. No stove means no cooking. Unlike the absence of a clear definition of “occupied,” the code is pretty clear on what constitutes a “dwelling.”

The definition of “dwelling” in Sec. 5-520 states (emphasis mine), “Dwelling shall mean any enclosed space which is wholly or partially habitable by human occupants, and is used or intended to be used for living, sleeping, cooking and eating….” So, why is it that Haste can be considered in compliance with registration requirements even though his house isn’t even a “dwelling” by definition?

My point here is not that Sandberg should get off the hook because others got off the hook. My point is that enforcement of these ordinances should be evenhanded, and they’re not. There are different rules for different people.

When Haste is found to not meet city residency requirements, it’s overlooked. But when Sandberg is found in violation of property registration requirements, he’s threatened with being unseated if he doesn’t pay.

I guess it all depends on who’s got your back.

General News

AASHTO: Freight and passenger rail “critical components” of nation’s transportation system

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The American Association of State Highway and Transportation Officials (AASHTO) recently released a report titled, “America’s Freight Challenge,” that claims freight transportation is going to grow significantly and the nation’s surface transportation system is ill-prepared to handle it. They say this increased congestion of roads, rails, and ports amounts to a tariff on trade:

This congestion increases travel times, it disrupts tightly planned supply chains, and it raises the costs of doing business with America and in America.

The effect of rising congestion is like a tax—only it escalates every year without a vote of the people. This congestion tax can be repealed only if the United States adopts a new vision and new strategy for a global, 21st Century American transportation system.

The report goes on to document the limitations of America’s highways, rail network, and water ports and especially the connections between them (intermodal transportation), show trends in the growth of freight transportation, and make recommendations to take a multi-modal approach to improving the nation’s surface transportation system.

There are many interesting points in the report, but I want to pick out those dealing with freight and passenger rail because there seems to be some anti-rail sentiment around Peoria. I don’t think this sentiment is pervasive, but you do see it occasionally, such as when the Kellar Branch debate comes up or when LaHood says we don’t need passenger rail here in Peoria.

In particular, I found these recommendations interesting (emphasis mine):

Recommendation 1. Meeting America’s surface transportation needs for the future will require a strategy which goes well beyond just “more of the same.” It will require a multi-modal approach, which preserves what has been built to date, improves system performance, and adds substantial capacity in highways, transit, freight rail, intercity passenger rail, and better connections to ports, airports, and border crossings.

Recommendation 6. Establish a National Rail Transportation Policy. Intercity passenger and freight rail are critical components of the nation’s surface transportation system. Current rail capacity is not sufficient to meet passenger or freight needs. It is imperative that a national rail policy be developed which addresses institutional roles, passenger and freight capacity, and new non-Highway Trust Fund funding and financing options.

Better intercity rail means fewer cars on the streets, and more freight rail means fewer trucks on the streets — that all adds up to cost savings on road repairs. The report states, “The expanded rail capacity analyzed by AASHTO would remove 450 million tons of freight and 15 billion truck vehicle miles. That service would save shippers $162 billion and save highway users $238 billion over 20 years and avoid $10 billion in highway repair costs.”

This is why I think rail service needs to be beefed up in this country, not remain status quo. It’s cheaper, cleaner, and more efficient than highways. We’ll always need highways, but we can significantly reduce the size requirements and maintenance costs of them by utilizing rail as much as possible.

Peoria Housing Authority, Peoria Public Schools

Expect more money to be wasted by District 150

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Clare Jellick has been doing some digging. She found out that District 150 and the Peoria Housing Authority (PHA) are represented by the same law firm (Kavanaugh, Scully, Sudow, White & Frederick) — and by lawyers whose offices are apparently right next to each other. The two bodies are negotiating a land deal so that District 150 can build a new, suburban-style grade school on the site of the existing Harrison Primary School plus land it wants to purchase from the PHA.

While the best course of action would be to retain separate counsel, the district is, of course, going to instead sign a conflict-of-interest waiver. That makes everything legal and ethical, but it doesn’t remove all risk. It appears that such conflict waivers are generally discouraged, and for good reason. According to one resource I found on the web, it may mean that the District won’t be able to get as good of a deal on the land as they could if they had separate law firms. Here’s a portion of a sample conflict-of-interest waiver (emphasis mine):

It may not be possible for a single law firm to represent both parties to the Transaction in the same aggressive manner as would two separate and independent law firms. By giving the consent requested in this letter, you are, in effect, waiving that kind of zealous representation of your individual and conflicting interests with respect to the Transaction. It is possible that each or both of you might be advised by independent counsel to demand or offer different or more favorable terms and conditions with respect to the Transaction than we can or will demand or offer.

Here’s why it makes such a big difference: According to the Journal Star, the 22-acre parcel of land the district wants to buy from PHA is appraised at $178,000. The PHA, however, is asking $800,000 for the land because they want to recoup the cost of demolishing the slums that sat there until just recently. That’s a huge difference. Remember, this is the school district that supposedly can’t afford $40,000 to keep their truancy center open or $63,000 to pay for their own marketing director (she’s paid by Caterpillar). This is also the school district that paid way over market value for eight homes on Prospect road that they can’t use, wasting $877,000 in taxpayer money.

The district doesn’t really even need this extra land (a total of 25+ acres for a K-5 school?), but if they’re going to buy it anyway, the least (and I do mean the least) they can do is try to get the best possible price for it. True to form, the school district is poised to waste more money by not getting separate representation.

City of Peoria, CityLink, Firefly Energy

My little brainstorm for the City/Firefly partnership

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Electric Bus graphicOn Tuesday night, the city is probably going to approve a loan guarantee, in partnership with Peoria County, for Firefly Energy. This will allow Firefly to establish their headquarters here in Peoria and employ 65 people locally. Assuming they’re successful, which seems pretty likely, it won’t cost the city or county a thing. In fact, the city and county will receive $480,000 of common stock.

So here’s the little brainstorm I had*, for what it’s worth: I believe Firefly should have a place to showcase their battery technology. How about if they showcase it in CityLink buses?

Imagine if CityLink buses ran on Firefly batteries. With gasoline prices skyrocketing, I’ll bet the cost savings in fuel would be enough that CityLink could afford to run the buses more frequently and increase ridership as a result. It would also get Peoria a lot of press — even nationally — especially if they weren’t typical hybrid buses but 100% battery-powered.

Maybe it’s a pipe dream, but why not at least explore the idea? I figure, as gas prices climb, there’s going to be increased demand for convenient and affordable public transportation. That’s going to require the buses to come more frequently than once every half-hour during peak times or hour during non-peak times. In order to make it economical to provide that additional service, either fares are going to have to go up or costs are going to have to be cut somehow. It seems reasonable that Firefly battery technology — especially if it were donated as a marketing strategy — could provide enough cost savings to make improved frequency possible. I’ll bet there’s even a federal grant or two out there that could help defray the costs of a feasibility study and/or implementation.

Maybe someone can run the idea past Ray LaHood. If he shoots it down, we’ll know we have a winner.

*Hat tip: Sharon Deckard, who had the idea to run a Firefly battery-powered trolley on the Kellar Branch. That was the seed for my idea to put the batteries in buses.

Crime, Peoria County, Television

Old Big Hollow Dump no more!

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Kudos to Peoria County for quickly cleaning up all the garbage on an abandoned portion of Big Hollow Road and sealing off access to it! Here are a couple of pictures showing the cleaned road and the barricades blocking access:

Road Closed to Big Hollow dump

Big Hollow Road clean

Also, kudos to HOI News for drawing attention to this situation and following up with city and county officials. This was a win for everyone. Hopefully the filthy pigs who dumped their garbage there in the first place will stay away now.

City of Peoria, Heart of Peoria Plan, HOPC

What’s the next step for the Heart of Peoria Commission?

9 Comments

Billy Dennis is reporting that the city is planning to de-commission the Heart of Peoria Commission and redistribute the members to other city commissions, most notably the Planning Commission. This has all come up relatively quickly, so I’m not going to have many comments on it until the HOPC meets (May 25) and we have a chance to discuss it. I will say a couple of things, though.

First, the part about putting Heart of Peoria Commission (HOPC) members on other commissions should be no surprise, since that was the recommendation from the city’s Committee on Commissions (item C.4.). The specific appointments to these other commissions that Billy lists on his blog are only suggested at this point, as not all commissioners have been contacted to see if they are able or willing to serve on those commissions. I have been contacted and have expressed my willingness to serve on the Planning Commission. I think dual appointments are a good idea, and infusing New Urbanism principles into these existing commissions will make them and the city stronger.

As for the HOPC being decommissioned, that’s something that needs to be discussed. I knew this idea was out there as a possibility, but I didn’t expect to see it coupled with the dual appointments as it was in the communication that Billy posted on his blog. There are a number of pros and cons to decommissioning HOPC, and I don’t know that all the ramifications have been thoroughly explored.

The idea promoted in the draft council communication would be to change HOPC from a city-appointed commission “to a private, civic commission, similar to that of Peoria City Beautiful, allowing the current and future members to meet as they wish, without Open Meeting Act regulations, to study, advocate, and take other actions as they wish related to the Heart of Peoria Plan and New Urbanism.” Another idea I’ve heard that was not listed, however, would keep the HOPC as a city commission, but have it meet more infrequently (quarterly, perhaps) to advocate for and educate on New Urbanism principles, kind of like it’s doing now.

I’m sure there will be some (ahem) spirited discussions about these ideas over the next couple of weeks. I think the dual appointments definitely need to be done because all the commissions need to have new urbanism principles represented. Whether the HOPC is decommissioned is still an open question for me. I look forward to hearing more discussion/debate on that idea.

AmerenCILCO

Electric rates not nearly high enough yet for greedy Ameren

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Ameren LogoDespite the fact that Ameren’s webpage boasts “To Our Illinois Customers: We have listened to you and are ready to provide immediate rate relief,” the Journal Star reports today that rates are going up still more during June, July, August and September:

“No one likes to pay more for any product or service, but the rising costs of electricity have made higher rates a necessity,” Stan Ogden, Ameren Illinois’ director of customer service, said in a news release. “We have been able to structure rates to minimize the impact of higher costs during the summer months.”

I guess that 76% jump in profits just wasn’t enough to sustain old Ameren over the summer months. Their costs are going up, and it’s going to eat into that $123 million profit they made during the first three months of the year. I just don’t know how they’ll manage to stay in business at that rate.

To prevent paying higher electric bills, make sure that your home does not have cracks and gaps where so the ac does not have to over work, you can use spray foam to properly insulate your home.

Fortunately, they’ve worked to “minimize the impact of higher costs.” How thoughtful. Mr. Ogden and his bosses can console themselves with that thought every time an elderly person on a fixed income dies this summer because they can’t afford to run their air conditioners.

Do the greedy monopolists at Ameren really think they’re fooling anybody? Luckily, homeowners can switch to Regional Energy for lower electricity rates Calgary.

Update: First, it has come to my attention that my understanding of the rate increase is not accurate. The way I read the newspaper article, it sounded like they were talking about an additional rate increase for the summer months on top of the increase that took effect January 1. Not true. In fact, the increase is rather in reference to how much higher the summer rates will be relative to last year.

Secondly, for the record, I just want to express that I don’t really think Ameren is trying to kill old people — that was hyperbole. I felt that was obvious, but I’ve been told that Ameren employees take comments like that personally. So, if any Ameren employees thought I was accusing them of negligent homicide, my apologies. I guess some people take my blog way more seriously than I thought. I suppose that’s a good thing. It could mean that people are reading the Chronicle and have high expectations for it. I’ll go with that explanation. 🙂