[Update at 1538 on 18 June: Sam Allard, writing in Cuyahoga County Will Pay More for Downtown Hilton Bailout than Covid-19 Rental Assistance, also weighs in on the story.]
It’s going to be a very tough year.
Cleveland and Cuyahoga County for the past several decades have played fast and loose with finances to reward the rich. And it charge to especially the low income. They used sharply regressive taxation. Pretty disgusting.
Now, the devastating pandemic and its partner—a depressed economy—are making those decisions even more onerous. You can’t always predict the future.
It stresses the budgets of the city and county.
The elite have demanded certain projects. No matter the cost. The politicians have responded.
We are their piggy bank. A costly burden. They get their way.
Click on the image below to download the entire issue of Point Of Viəw.
Click on the image above to download the entire issue of Point Of Viəw.
The costly public list of projects:
—Rock ‘N’ Roll Hall of Fame.
—Progressive Field.
—Browns Stadium
—Rocket Mortgage Fieldhouse (arena).
—New Convention Center.
—A 600-room hotel.
—A so-called Medical Mart.
—Two Gateway Parking Garages.
ALL WITH PUBLIC FUNDING. All property tax FREE.
These public projects were accompanied by major downtown building spree, financed by tax abatement and other forms of public loans.
And all siphoning taxes from Cleveland schools. Who wants to support the Cleveland schools anyway? Not the people who run things. Their children don’t go to city schools. Why would they?
These forces created the debt cesspool. Now let’s see who pays for it.
The pandemic’s economic-crush has damaged some of the cash flow used to financing these private interests. Other avenues are blocked.
And now, the bills have to be paid.
The method of payment rests on taxes that now suffer from the lack of commerce: sales tax, parking tax, hotel tax, admission tax, car rental tax, cigarette, beer, liquor taxes. Other tax avenues also suffer.
The kind of crisis the greedy don’t plan for.
ALL SUFFERING BADLY FROM THE ECONOMIC SLAMMING OF THE CORONAVIRUS.
Mayor Frank Jackson, a man of the People according to legend, has put his stamp of approval on all these financial gimmicks. Further, Jackson, man of the People, raised the city’s payroll tax, a sharply regressive income-type tax by 25 percent. It rules off any attempt to use that avenue of escape now. The payroll tax takes from the first dollar one earns with no deductions of any kind, making it highly regressive unlike the federal income tax. Another unfair tax.
Cuyahoga County depends heavily upon the sales tax. It provides more than 50 percent of its general fund. It was raised a quarter percent, a good-bye gift of Hagan. Of course, the deep decline in spending has cut into this source.
While this decline continues, the Cleveland news media mostly concentrates news about opening restaurants. It’s so easy to report.
County residents (and city) pay each Jan. 15 for bonds that raised funds for the basketball arena. The debt goes back the 1990s. It drains some $6 to $9 million in public funds annually. In one recent year, $6.3 million came from city admission taxes. Thus those city funds couldn’t go for police, fire, EMS and other uses. Bed tax revenue was also used to pay off the bonds.
It’s hard to make people believe their government is so corrupt. But it is true. The bonds mentioned above were advised as proper by Squire, Sanders & Dempsey (Now Squires Patton & Boggs). It didn’t matter that the Cleveland law firm had already been paid $1 million in legal fees by Gateway Economic Development Corp., the beneficiary of the bonds. Commissioners hired them for more “advice.” Wouldn’t they be biased toward Gateway? Yes, definitely so.
Of course, the law firm gave its blessing. Good to go.
It hardly seems possible. But the County Commissioners, always ready to oblige corporate leadership, held the public meeting to decide on these bonds on CHRISTMAS EVE morning, 1991. Liberal Democrats Tim Hagan, as willingly pliable as silly putty for elites, and Mary Boyle, who won her seat by ravaging Republican Commissioner Vince Campanella for proposing a stadium deal, paved the way for tens of millions of dollars into the pockets of our three sports owners.
Click on the image below to download the entire issue of Point Of Viəw.
Click on the image above to download the entire issue of Point Of Viəw.
Public expression? No thanks.
It’s Cleveland tradition to shit on public opinion. Ask the Greater Cleveland Congregations and others who worked diligently to get some 20,000 signatures to put the second bond deal to the voters. Council President Kevin Kelley in true spirit told them, “Fuck you people.” Now, Kelley wants to be your mayor. He’s paid his dues to the manipulators.
Why bother. The towns tied up.
But now the public officials are tied up. By a pandemic. But they won’t lose their toys.
I’m sure you may remember that the city and county recently arranged for the other set of bonds to be let for the arena – $35-million, $35-million and $70 million. But since bonds from 1990 are still being paid these new bonds won’t become payable until 2024 The original arena bonds will be paid the previous year. How convenient.
It’s money galore in Dan Gilbert’s pocket.
It’s a lovely game brought to you by obedient office-holders, their bosses in the private sector and with the propaganda dishing of the Plain Dealer.
The $92-million Rock and Roll Hall of Fame is also on the dole. I wrote in 1999:
“The county and city bed taxes on hotels since 1993 have diverted taxes to the funding of the Rock and Roll Hall of Fame: !993 – $1.95 million; 1994 – $2.48 million; 1995 – $2.84 million; 1996 – $3.06 million; 1997 – $3.45 million; 1998 – $3.72 million. The pay off bonds issued by the Port Authority.
Click on the image below to download the entire issue of Point Of Viəw.
Click on the image above to download the entire issue of Point Of Viəw.
It’s so easy for these private interests. Led by the Greater Cleveland Partnership, a business/foundation bloc, it arranges for public payments. For private deals. Why do we allow it? It just goes on and on.
The financing of the Rock Hall was one of the most disgusting examples of elites demanding and getting public funds for their desires. In addition, the elites, led by Dick Pogue of Jones Day, demanded and got RTA to build the money-losing Waterfront line at its cost. RTA had to avoid federal funding to get it done. QUICKLY. The fed contribution, which would have paid most of the cost, depended on environmental study. Too long for Dick. Cost: $69 million, not county any interest. And it works at a loss. If it works. Jones Day picked up $375,838 in fees. Icing on the cake.
In addition to the costly Rock Hall (other financing comes via property tax diversion from Tower City) the city, urged on by elites, wanted UDAG money from the feds. The feds refused. A first. The rejection noted: ”Couldn’t they just do a live-aid concert?”
They just don’t understand Cleveland in D. C. How can anyone?