Category Archives: Peoria County

City Council, City of Peoria, Museum Block, Peoria County

County told State it already owns land for museum

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In April, Peoria County applied for a $5 million grant through the Illinois Department of Commerce and Economic Opportunity (DCEO). A copy of the grant application was acquired from the County:

DCEO Grant Survey – Peoria Riverfront Museum

The County listed itself as the “grantee” on page 2, and 203 SW Water St. (which is the City-owned Sears block) as the “project location” on page 4. Then, in answer to question 2d — “If the property is being improved, is the property owned by the grantee?” — the County checked the “Yes” box.

Question 10c asked, “If grant funds are to be utilized to make capital improvements to real property (structures/land) that your organization does not own [emphasis in original], provide a copy of the lease or other agreement (i.e., easements, rights-of-way. etc.) between your organization and the property owner that will allow your organization to continue to use the improved premises for an appropriate length of time, consistent with applicable state law and rules.” The County’s answer: “N/A.”

Question 10d asked, “Does your organization have an executed contract for the purchase/acquisition of the land/building in question?” The County’s answer: “N/A.”

Question 10g asked, “Provide the name, address, phone number and email address (if applicable) of the entity from which the land/building(s) is/are being purchased.” The County’s answer: “N/A.”

As you can see, the County consistently represented itself to the State as the owner of the land. When asked why, Peoria County Administrator Patrick Urich said:

By April when the grant survey was submitted, we had already negotiated the title transfer issue with the City of Peoria. As I said before, the redevelopment agreement has included language regarding title transfer since at least February, and by April, this issue had been to the County’s understanding, resolved. There were several other issues (paying permit fees, the commercial space approvals, the assurance that the funds would be there to build the museum, and what happens to the property if PRM no longer operates the museum) but the negotiating teams had moved on from the title issue.

That still doesn’t explain why this information wasn’t included on the grant application. The proper way to complete the application would have been to answer “No” to question 2d, and explain these negotiations in question 10d, at minimum. The questions couldn’t be any more specific; they clearly expect even anticipated ownership to be disclosed. The County misrepresented its ownership status no matter how one looks at it. No response was received from Urich to follow-up questions on this issue.

Other Questions

Urich’s answer raises another question: is it true that the title transfer issue with the City of Peoria had been resolved by April of this year? That was surprising, considering it has appeared as such a contentious issue here in August. I asked City attorney Randy Ray for some clarification. He replied:

There is no contract in place that requires the City to convey title to the Museum Site to the County.
It is true that there were negotiations, and draft agreements which contemplated such a conveyance. That was a major topic of a series of meetings with 3 or fewer council people that took place the first week of March, 2010. Obviously, those meetings did not convey the property, nor did anything else the City has done up to this point. If Council does not approve a Redevelopment Agreement, no conveyance will occur.

Ray acknowledges that negotiations did in fact take place, and we know from Urich’s statement that the County believed the issue of land conveyance was “resolved.” These negotiations were not just with City staff, mind you. There were “a series of meetings with 3 or fewer council people” at a time. Unfortunately, we’ll never know the real story because the City took great pains to completely skirt the Open Meetings Act (OMA).

The funny thing is that negotiation of the sale or lease of property can take place in closed session according to OMA, so why not just discuss it in executive session instead of these little meetings? Did they not want the negotiations on the record? (Minutes are taken during executive sessions.) Were they not giving the same information to each of the council members? Somewhere there seems to be a breakdown in communication because the City now appears reluctant to convey the land, but the County thought the issue was “resolved” way back in April.

Of course, there’s no legitimate reason not to conduct these negotiations in public, in open session. The reason property transactions are allowed to be conducted in secret is to protect taxpayers from market reaction. In this case, since the land is owned by one government body and being conveyed to another government body, there are no market forces and those concerns are moot.

During the 2005 mayoral campaign, then-candidate Ardis promised, “My leadership, a new generation of leadership, will be open, not closed; inclusive, not reserved for the select few; and bottom-up, not top-down.” Yet from the hotel deal to the museum, right up to the recent secret meeting with Ransburg — against whom Ardis ran in 2005 and, ironically, whom Ardis criticized for doing the public’s business in secret — he has not shown us this so-called “new generation of leadership.”

City of Peoria, Firefly Energy, Peoria County

Firefly update: Cost to settle bankruptcy just went up a half million dollars

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On Thursday, the Peoria County Board approved a resolution to settle a lawsuit with other creditors involved in the Firefly Energy loan default. The $500,000 settlement allows the City and County to own Firefly’s intellectual property, which they can then sell free and clear to Electrotherm Ltd. of Ahmadabad, India. After the sale of the assets, the County and City will only owe the bank $2 million, so the total cost to settle the original $6.6 million loan guarantee will be $2.5 million.

The vote to approve the resolution was 15-2, with Brad Harding and Andrew Rand voting against it for unspecified reasons.

Museum Block, Peoria County

County approves museum agreements

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A number of agreements regarding the proposed Peoria Riverfront Museum were passed by the Peoria County Board on Thursday. They passed nearly unanimously, with only board members Merle Widmer and Brad Harding voting nay.

The six agenda items pertaining to the museum included an ordinance and five resolutions:

  1. An ordinance for the issuance of $41,600,000 debt to cover construction expenses for the museum
  2. A resolutions approving the museum “facilities design concept”
  3. A resolution approving a $5,040,000 bid from Williams Brothers Construction to building the museum parking deck
  4. A resolution approving engineering agreements with PSA-Dewberry and Whitney & Associates for “construction oversight and material testing” for the project
  5. A resolution approving the museum redevelopment agreement
  6. A resolution approving a Capital Facility Development, Lease and Operating Agreement

Dave Ransburg and Ryan Beasley (the chair and vice chair of the Peoria Riverfront Museum, respectively) gave presentations on behalf of the Peoria Riverfront Museum. Ransburg stated that this will be the “greatest building built in Peoria since the Civic Center.” He also gave a brief history of how we got to this point, stressing that thousands of hours and millions of dollars have already been spent on this project.

Beasley gave a lengthy presentation, including an update on the IMAX situation. He stated that “it has always been our plan” to deliver a “giant screen” theater with a 70′ x 52′ screen capable of showing 2D and 3D digital, ultra-high definition movies. While that may well have always been their plan, they’ve told the public in no uncertain terms they would be building an IMAX theater, specifically. It’s well documented, even on their own “Build the Block” website.

Beasley went on to say that the museum is “a mission-driven organization,” and that the theater has to fit with their mission, which is “to inspire lifelong learning for ALL, connecting art, history, science and achievement through collections, exhibitions and programs.” In order to do that, the museum has three “negotiating terms”: control over programming, technology, and exclusivity. The biggest obstacle is control over programming. The museum wants to show “classic” (i.e., educational) films during the day and second-run movies on evenings and weekends. That has been IMAX’s traditional model. However, IMAX is apparently interested in seeing their theaters run more first-run movies — what they call “day and date DMR” movies — that would require multiple showings for the first two or three weeks the movie is out. “DMR” is IMAX’s proprietary large-screen film process. The museum’s concern is that agreeing to “day and date DMR” would be more profitable, but violate their mission. They’re also concerned about being required to show some films that are R-rated or otherwise not family-friendly.

The “next steps” for the museum are:

  1. To “continue preferred IMAX path” — that is, they’re going to continue negotiating with IMAX. Board member Merle Widmer asked about an e-mail one of his constituents received that indicated IMAX “does not have a client interested in opening an IMAX theatre in Peoria.” Beasley stated that was not surprising, given that IMAX received an inquiry from the general public about their “internal operations” — he would expect them to either give no answer, or to answer in the negative. He assured Widmer that he could provide proof of on-going negotiations with IMAX on IMAX letterhead. Media inquiries to IMAX by the Peoria Chronicle have gone unanswered.
  2. To “continue to evaluate alternative options,” none of which have “the brand power of IMAX,” he admitted.
  3. To “communicate progress and direction” to everyone, including the County Board and the general public.

There was another speaker (didn’t catch his name, sorry) who provided an overview of the building and grounds. There will be three “free-standing” signs (they looked like monument signs in the illustration) that would be lighted. Also, on the large blank walls of the museum, there will be humongous banners that can be used for decoration and/or to advertise the movie(s) playing at the “giant screen” theater. The only entrances are the main entrance off of Washington street and the elevator entrance from the parking garage. Thus, most of the area around the museum will be dead space (i.e., there will be no meaningful pedestrian activity outside).

County Administrator Patrick Urich explained that the cost of the project (including the parking deck) has risen from $83.4 million in April 2009, to $87.1 million in February 2010, to $92,198,731 this month. He then went on to talk about various “protections” that are built in to the agreements. For instance, there is $4.3 million in construction contingencies that will not be spent if the bids come in on budget and there are no change orders. There are also fundraising requirements built into the development and lease agreement with the museum: they have to raise $2.5 million by October 2011 and another $2.5 million by October 2012. If they don’t reach this target, then they have to reduce their capital or operating budgets “consistent with the shortfall from the goal.”

This is a marked departure from assurances the County gave to voters before the April 2009 referendum that no construction would start until the money was raised. In the July 9, 2009 Regular County Board Meeting minutes, it states explicitly, “Mr. Urich replied that currently the commitment for private funding is $8,000,000.00. If the funding is not there on the private side, the project will not go forward.” And later in the same meeting, “Mr. Urich has made it clear that ground will not be broken, even for the parking deck, until there is $8,000,000.00 in private funds to cover the gap.” Now, this has been replaced with toothless requirements that money be raised during construction.

Against all evidence to the contrary, everyone seems to be very confident in the museum’s ability to raise additional funds. When asked in a follow-up question about the stall in fundraising, Beasley said that “it’s not as simple as passing the referendum and then the money flows in,” although they did receive some additional funding (he declined to specify how much). Of course, this is exactly what the museum group assured us would happen before the referendum. Then, the only thing holding up donations was the referendum. But now people “want to see shovels in the ground” before they give more money, so we need to start building to get more funds, Beasley said. The target continues to move.

Several board members stated that the agreements weren’t “perfect,” but that they were “very good.” Several board members also stated that they had reservations and concerns about the plans, but not enough to vote against going forward. And there were a lot of self-congratulatory speeches all around as the final votes were taken.

City of Peoria, Museum Block, Peoria County

County wants to acquire museum block for a buck

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According to the recently-published Peoria Riverfront Museum redevelopment agreement, the County wants to obtain the museum site from the City for one dollar.

The site is reportedly valued at $10 million. The City acquired it after Sears moved from downtown to Northwoods Mall in 1998. At that time, the City also acquired the remaining parcels on the block, and in 2005 Caterpillar razed the land to prepare it for construction of the proposed museum and Caterpillar visitors center.

“The City’s conveyance [of the land] is in essence a $10 million contribution to the project,” explained County Administrator Patrick Urich. “In fact, the $145 million price tag figure for the entire project (Cat, PRM and parking deck) includes the City’s contribution and the $2 million Water Street upgrade.”

City representatives didn’t respond to requests for comment, except for at-large City Councilman Gary Sandberg. “Selling price toooo low. Should be $10,000,001.00 and I’ll give them the dollar,” he said via e-mail.

Urich also stated that, “Since at least February, the City has not given any of the parties any indication that they object to conveying the property to the County.” The Council has taken no public action or made any public comments regarding conveyance of the land to my knowledge.

The last museum agreement the City approved called for them to lease the land to the Peoria Riverfront Museum for $1/year for 99 years, not deed them the land permanently. “Initially there were discussions that included a ground lease,” Urich continued, “but since February (publicly at the County Board Committee of the Whole meeting) and prior to that in the negotiating sessions we have discussed the City conveying the property to the County.”

The City is facing a budget deficit of more than $10 million in 2011.

Museum Block, Peoria County

New redevelopment agreement published for museum

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Karen McDonald reports that “The first meeting of the Peoria County Riverfront Museum Committee has been scheduled for 2:30 p.m. Friday on the fourth floor of the Peoria County Courthouse.” The agenda packet was posted to the County’s website just before 2:30 Wednesday afternoon — barely meeting the deadline set by the Open Meetings Act.

That gives the public just 48 hours to review the 348-page document which includes:

  • Bid Letting for the Riverfront Museum Parking Deck
  • Engineering Agreements for Construction oversight and materials testing to construct the Riverfront Museum Parking Deck
  • Redevelopment Agreement
  • Lease Operating Agreement
  • Design Concepts

I guess museum committee members have their reading assignments for today, as do local news reporters. Of course, its adoption is a fait accompli, at least for the County. The big question now is whether the City will approve it. I’ll have more on this after I get a chance to review the documents. If you have the time and inclination to read it today (due to, say, insomnia or masochism), please leave your observations in the comments section.

City of Peoria, Museum Block, Peoria County

Museum moves forward despite dismal finances

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According to a spreadsheet document distributed at a recent Peoria County Finance/Legislative Study Committee meeting titled “Peoria Riverfront Museum Capital Budget by Project,” updated 7/28/2010, pledges to the proposed Peoria Riverfront Museum total $23,073,484. Of that, only $6,475,076 (28%) have been collected.

In addition, whereas the County has said in the past it would only be contributing $34.5 million to the museum project from the public facilities sales tax revenues, the latest spreadsheet shows a full $40 million being contributed. While that’s the lion’s share of public money, there are also significant amounts coming from other public money pots, including the Illinois capital budget, Illinois Department of Transportation, Housing and Urban Development, Department of Energy, Illinois Department of Natural Resources, Department of Commerce and Economic Opportunity, NASA, and the Peoria Civic Center Authority. Despite all of this public help, and presuming they’ll actually collect all the pledges that have been committed over their multiple years of fundraising, they’re still looking at a budget deficit of $6,448,988.

But they’re moving ahead with construction anyway. What happened to all the money that was going to come in after the sales tax referendum passed? Remember that? When questioned as to why they weren’t making their private fundraising goals before the referendum, their response was a very confident assertion that people were waiting in line to give money, but wanted to make sure the public would support the tax referendum first. Once the referendum passed, the funds would come rolling in, we were told then.

Perhaps the most shocking thing on this spreadsheet is the total amount that has already been spent. Are you sitting down? It comes to $13,471,440. $4.5 million has been spent on architectural and engineering fees for the museum building — another $1.8+ million in fees for the parking garage. $2 million has been spent on something called “pre-opening operating support.” Almost $1 million was spent on “public awareness” — which was their campaign to make sure the $40 million tax referendum passed, so I guess that was money well spent from their perspective.

There are two line items for endowments on the spreadsheet. One shows $2.3 million “committed” but not “received” from Lakeview as a funding source. Another line item shows a $5,248,000 “endowment enhancement” which has been neither committed nor received. The endowment is important because the museum needs the interest from the endowment to cover its ongoing operating expenses. If there’s no endowment, the museum will have no cushion when facing an operating deficit — and let’s not kid ourselves, there are going to be operating deficits.

But they’re moving ahead with construction anyway, undeterred.

Oh, and they’re still counting on the City just giving them the Sears block for nothing. That land is worth $10 million according to the Build the Block website. What is the City’s budget deficit for 2011? Hmmm…. $10 million, I do believe. Wouldn’t it make sense to sell the land to the museum/county and use those funds to plug our deficit so we don’t have to lay off any more police officers? Nah, the museum is more important than public safety, right?

The conventional wisdom now is that the money fairies will sprinkle the museum with cash once it’s built. You know, once people really see the thing being built, then they’ll start contributing! They’re just skeptical that we’re not really going to build it. If we show them we really mean business, then there will be a race to see who can give the most money fast enough.

Second verse, same as the first.

City of Peoria, Peoria County

County is better run than City? Not anymore.

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In Karen McDonald’s Sunday Journal Star article about the status of “uni-gov” negotiations between the City and County, she had a lengthy quote from Peoria County Treasurer Tripp O’Connor:

“We live within our means. The (city) lives how they want to live. We’ve done everything right,” O’Connor said.

He called the uni-gov concept a “bailout to save one government” that lacks a solid financial structure.

O’Connor said he’s only in favor if both city and county governments “start from scratch and design and build a government that can operate effectively in modern times.”

“I am not in favor of combining a well run organization with a poorly run organization. I am in favor of having a single cost-effective government structure that could operate financially responsibly and serve the citizens of Peoria County.”

I used to feel this way about Peoria County, but not anymore. Not since they made the same mistake as the City in backing a $6.6 million loan for Firefly, for which they’re now liable. Not since they decided to pursue non-core services like museums to the tune of $40 million. Not since they decided to break their word to the taxpayers and agree to build the proposed Peoria Riverfront Museum before all the money had been raised and collected, putting taxpayers at increased risk. Not since they decided to rebuild Belwood Nursing Home at a time when tax revenue is declining.

No, Peoria County is embarking on the same path that the City of Peoria has been on for a long time. They’ve decided they’re going to “live how they want to live,” to use O’Connor’s words. The days of fiscal conservatism at the County are over.

Museum Block, Peoria County

County wants more control over museum construction

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An interesting item is on the agenda for the Peoria County Board Rules Committee this coming Thursday evening:

ISSUE:
Establishment of Museum Standing Committee of the County Board and temporary Museum Building Committee

BACKGROUND/DISCUSSION:
In the initial Capital Lease and Operating Agreement (posted on the County website in February 2010) between the County and the Peoria Riverfront Museum (PRM), it was determined that the County would construct the parking deck and the PRM Board would construct the museum and the perimeter improvements. The following changes to the County Board Rules of Order would establish a standing committee of the County Board to oversee construction of the PRM and leasing of the PRM site and create a temporary Museum Construction Committee to oversee construction of the PRM building.

The Museum Standing Committee would be comprised of County Board Members. The general duties of the Museum Standing Committee would be to: a) make recommendations to the County Board for awarding contracts for the construction of the PRM; b) approve all change orders for the construction of the PRM of less than $250,000 additional cost; c) exercise general oversight of the PRM building and grounds; d) review and comment upon those items provided in the Lease and Operating Agreement with PRM; e) initiate all actions of the County exercising powers under the Lease and Operating Agreement; and f) review all actions of the Museum Construction Committee.

The Museum Construction Committee would be comprised of individuals selected by the Peoria County Board Chairman from the County Board, the PRM Board of Directors, county staff, and/or other citizens with building and construction experience. The Museum Construction Committee is a temporary committee that shall automatically dissolve upon the opening day of the Peoria Riverfront Museum. The general duties of the temporary Museum Construction Committee include: a) approve all change orders for the construction of the Peoria Riverfront Museum of less than $100,000 additional cost; b) Exercise general oversight of the construction of the Peoria Riverfront Museum Project; and c) report regularly to the Museum Committee regarding the progress of construction.

The advantages of the County managing the construction are numerous: a) for transparency purposes, having the construction of a public building on public property performed by a public body assures that the discussions will be open to the public; b) the PRM Board of Directors can spend more time focusing on operations, exhibit planning, and fundraising; and c) the County can be assured contractually that our capital contribution is a set dollar amount. In addition to memorializing this change in the County Board Rules, the Capital Lease Operating Agreement will have to be modified. The PRM Board of Directors is scheduled to have their organizational meeting on June 8, 2010. Once organized, the PRM Board can take up the Capital Lease and Operating Agreement and Redevelopment Agreement for either a late June or early July approval by the County Board.

At first blush, it looks like a reasonable action given the benefits listed. But look closer. This establishes a new standing committee, and the County Board Chairman is responsible for making appointments to all standing committees. Only those appointed to the Museum Standing Committee could “initiate all actions of the County exercising powers under the Lease and Operating Agreement.” That stipulation effectively freezes out board members who are opposed to the museum. Board members who believe the museum group is not fulfilling the terms of the agreement will have no way of holding them accountable because they can’t initiate any action on it. How is that in the public’s interest?

Furthermore, the County Board Chairman is free to appoint only those who agree with him, and remove anyone who crosses him. Just recently the Chairman removed board member Brian Elsasser from the Tri-County Regional Planning Commission because he (the Chairman) “owed a political favor to a friend.” Just imagine what political favors might be called in for the museum project, especially since this committee will also “make recommendations to the County Board for awarding contracts for the construction of the PRM,” and the County Board promised to have local contractors build the project.

This is a recipe for political corruption.

City of Peoria, Kellar Branch, Museum Block, Peoria County, Peoria Mayor, Peoria Park District, Taxes

PJS Editorial pretends City asset giveaways have nothing to do with budget crisis

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A couple of responses to today’s Journal Star editorial. First, there’s this:

Even Mayor Jim Ardis, who never saw a tax increase he didn’t greet with contempt, seems to have come to the realization that City Hall probably can’t cut its way out of this.

That’s not exactly accurate. Mayor Ardis happily voted to increase sales taxes by 1% within the Hospitality Improvement Zone downtown.

And then, there’s this:

As a result [of the need to make more cuts to city services or raise taxes to balance the budget], a fair number of locals are venting, understandably, though some of them paint either-or scenarios that do not exist. Indeed, the choice is not a recreational trail vs. police officers, or a museum vs. firefighters. The vast majority of the funding for those quality-of-life projects comes out of dedicated revenue streams controlled by other local governments – the park district and county, respectively, with the help of grants. Those dollars couldn’t be used to put more badges on the streets even if the council wanted to. Like them or hate them, those projects — one of them initiated by a successful citizen referendum — are not what created this operating deficit.

First of all, this framing of the argument is obviously a “straw man.” I know of no “locals” who have made the assertions they are countering. Clearly “either-or scenarios” as painted here do not exist. But to imply that these projects have absolutely no relation to the City’s fiscal crisis is also false.

Yes, construction of the rail-to-trail project is funded by the Park District, but it’s only made possible by the City of Peoria giving away a $3 million asset to the Park District for one dollar. The City just threw away $3 million (or at least $750,000, the last bona fide offer to purchase the rail line) while at the same time they need to cut $800,000 from this year’s budget. Why didn’t they put the land up for sale to the highest bidder? Putting this land into the hands of a rail carrier and working with them to woo new manufacturing business to Pioneer Industrial Park would have resulted in raising the tax base in Peoria through new business and new jobs.

Then there’s the Sears block, which has lain dormant for over a decade now because the City won’t enforce deadlines on redevelopment agreements. This is prime real estate that could be parceled off and sold, which would provide a couple of things: income from the initial sale, and on-going revenue from sales and property taxes by the businesses who locate there. Instead, the City is sitting on the land indefinitely, until they can finally give it away for nothing to be used by a non-profit organization that will be a perpetual drain on the county taxpayers.

In addition to the lost opportunity to generate revenue with these assets, taxpayers now have to pay for their development and maintenance in perpetuity. That means we have to pay higher taxes to support these drains on the economy. And that exacerbates the City’s budget woes. Since taxes are high because of increases by other local governments (to which the City directly contributed, as shown above), it puts pressure on the City not to add to the tax burden. And that means the City continues to try to balance its budget by cutting — police, fire, public works, etc.

The Journal Star is simply trying to rationalize its support for non-essential pet projects by using straw-man arguments to dismiss valid criticism.

See also Billy Dennis’s post in response to today’s PJS editorial.

Peoria County, Regional Office of Education

Some employees get the shaft from County Board

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The Journal Star is reporting that some County employees are getting no raises next year, even as union workers get “substantial [pay] increases” and there seems to be plenty of money for non-essential projects and travel. To make matters worse, there’s this:

…while some elected officials won’t get a raise next year, it’s a net loss because the state of Illinois isn’t providing the full $6,500 annual stipend for most elected officials. County officials say that’s not their burden to bear.

“The stipend was never from the county; it’s not part of the county, it’s a state issue,” said committee member Steve Morris. “The county shouldn’t start stepping into the shoes of the state for payment for what the state has created.”

Really? The county shouldn’t step into the shoes of the state for payment for what the state has created? Didn’t the county just give a the Peoria Regional Office of Education a $1 million line of credit to meet payroll? I guess the ROE’s employees are more important than the county’s own employees.