Uncle Zuma Dogg Tries to Breakdown The CRA/Affordable Housing "Catfight": It's a Shady Tale
I'M TRYING TO EXPLAIN MORE ABOUT THE CRA "CATFIGHT" OVER AFFORDABLE HOUSING AND COMMUNITY BENEFITS PACKAGES AND THE WHOLE BIG CONFLICT (AS IN CONFLICT OF INTEREST).
When community groups (like LAANE and others) ask for community benefits from the developer for a new project, most "honest", medium or small developers who are not in the knows would do the calculations, find out that their projects won't work anymore, and give up. And when there is no project, there is no community benefit. (And less economic activity too)
Some developers would go back to CRA and aks for money to cover the community benefits. But only the smarter ones could get it (but it could be like a long process). Again, even the "honest", medium or small developers who don't have enough connections or who don't have the right consultants/lawyers, know enough to ask for the money, they usually won't have the patience, won't get the money and will still have to give up the project.
So it ends up that most of the time if the project still goes forward, CRA (or the tax payers) are actually paying for the community benefits asked for by some community group that ordinary tax payers know nothing about.
The developers won't be paying for the community benefits! (LOL!)
CLICK "READ MORE" TO READ MORE
The 8/16 CRA Agenda demonstrates a loan increase of a (somewhat) smarter developer:
$4 million loan (regular meeting) to an $8 million loan (special meeting).
But as you can see, this smarter developer wasn’t smart enough. That is why there were still problems during the 8/16 meeting.
The smartest developers (the few big developers in the know) would go to the powerful community groups (such as LAANE and others); become friendly; and negotiate a community benefit package (usually involving some affordable housing) beforehand and get CRA to pay for it, as well!
(Huh...huh...huh...how can I get a deal like that?)
They work it out so that the community benefit package becomes an additional and very profitable City contract given to them for free without any competitive bidding, attached to their original project being approved! (Someone must have watched that “Multiple Revenue Streams” infomercial.) It’s like a big, gigantic cherry ontop of the whip cream and sprinkles you already got. (Plus the ice cream for free, too!)
The project will become bigger, but the enlarged portion (extra cherry on top contract/the community benefits) will mostly likely then HAVE to be paid for by the public with CRA's help, and with "reasonable" profits to the developer too.
But remember, developers are entitled to profits as a % of the total cost, particularly when the project involves something for the public? And the total cost goes up because of the benefits). The profit margin may even be higher because the developer will get the zoning changes or other city concessions (tax breaks) while doing some profitable non-profit or for-profit stuff asked for by the community group. The developer may also get more loans with low interest rates or grants for the whole project too.
Truly turning a big problem for the small or medium developers into huge money making opportunities for the very few big developers in the knows.
zumadogg@gmail.com
zumatimes.com
When community groups (like LAANE and others) ask for community benefits from the developer for a new project, most "honest", medium or small developers who are not in the knows would do the calculations, find out that their projects won't work anymore, and give up. And when there is no project, there is no community benefit. (And less economic activity too)
Some developers would go back to CRA and aks for money to cover the community benefits. But only the smarter ones could get it (but it could be like a long process). Again, even the "honest", medium or small developers who don't have enough connections or who don't have the right consultants/lawyers, know enough to ask for the money, they usually won't have the patience, won't get the money and will still have to give up the project.
So it ends up that most of the time if the project still goes forward, CRA (or the tax payers) are actually paying for the community benefits asked for by some community group that ordinary tax payers know nothing about.
The developers won't be paying for the community benefits! (LOL!)
CLICK "READ MORE" TO READ MORE
The 8/16 CRA Agenda demonstrates a loan increase of a (somewhat) smarter developer:
$4 million loan (regular meeting) to an $8 million loan (special meeting).
But as you can see, this smarter developer wasn’t smart enough. That is why there were still problems during the 8/16 meeting.
The smartest developers (the few big developers in the know) would go to the powerful community groups (such as LAANE and others); become friendly; and negotiate a community benefit package (usually involving some affordable housing) beforehand and get CRA to pay for it, as well!
(Huh...huh...huh...how can I get a deal like that?)
They work it out so that the community benefit package becomes an additional and very profitable City contract given to them for free without any competitive bidding, attached to their original project being approved! (Someone must have watched that “Multiple Revenue Streams” infomercial.) It’s like a big, gigantic cherry ontop of the whip cream and sprinkles you already got. (Plus the ice cream for free, too!)
The project will become bigger, but the enlarged portion (extra cherry on top contract/the community benefits) will mostly likely then HAVE to be paid for by the public with CRA's help, and with "reasonable" profits to the developer too.
But remember, developers are entitled to profits as a % of the total cost, particularly when the project involves something for the public? And the total cost goes up because of the benefits). The profit margin may even be higher because the developer will get the zoning changes or other city concessions (tax breaks) while doing some profitable non-profit or for-profit stuff asked for by the community group. The developer may also get more loans with low interest rates or grants for the whole project too.
Truly turning a big problem for the small or medium developers into huge money making opportunities for the very few big developers in the knows.
zumadogg@gmail.com
zumatimes.com
Posted by Zuma Dogg @ 9/09/2007 12:27:00 AM
2 Comments:
Pitiful.
You mean that the community benefits including affordable housing don’t come from the “obscene” profits of the developers, but they may come from tax payers, and that they may even help make more money for the few big developers?
Someone please tell me it is not true.
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