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Show Marsac renovation should have gone on the ballot, council candidate says by Christopher Smart In a surprise action at the Sept. 22 City Council meeting, meet-ing, City Council candidate Al Horrigan charged the group with avoiding the bonding process by borrowing borrow-ing $1.5 million for the restoration of the Marsac Municipal Building, rather than taking the project to the voters in a bo i election. Address:. the council in the "public input" section of the Thursday meeting, Horrigan Hor-rigan said the City Council should "consider trusting the citizens through a bond election (for the restoration i of the Marsac Building) because you (the council) have indebted the citizens of this community to paying $238,000 a year for the next 10 years." Additionally, Horrigan charged that the City Council Coun-cil does not have the legal authority to incur long-term indebtedness without calling for a bond election. Horrigan is running for City Council against incumbents incum-bents Helen Alvarez, Tina Lewis and Tom Shellenber-ger. Shellenber-ger. Other challengers in the race are Jim Doilney and Arnie Van Classen. Councilwoman Alvarez answered Horrigan's charges by saying that the municipality does indeed have the legal authority to incur long-term indebtedness indebted-ness through the vehicle known as the Municipal Building Authority. Although the Utah State Constitution holds that municipalities cannot incur debt outside current fiscal budgets, the state Legislature, Legisla-ture, through the building . authority act, made it possible pos-sible for incorporated cities to create "building authorities" authori-ties" for such indebtedness. In Park City, the members of the Municipal Building Authority are also members of the City Council. The council members also make up the Park City Redevelopment Redevelop-ment Agency. Alvarez said that the loan from Valley Bank in the sum of $1.5 million was part of an ongoing project which would ultimately restore both City Hall on Main Street and the Marsac Building. The Marsac Building is "significant historically" his-torically" and occupies a "significant place in the community," Alvarez said. In a complex transaction, the Park City Redevelopment Redevelop-ment Agency (RDA) purchased pur-chased the Marsac Building from the Park City School District in 1982 for $1.32 million. The RDA had planned to sell the building to Trans Pac Oil Company for $1 million on the condition condi-tion that Trans Pac would renovate the building at an estimated cost of $500,000. Trans Pac would lease the building to the municipality at $216,000 a year on a 20-year lease with an option to buy after five years, according to the terms of the agreement. The RDA then planned to use the $1 million from the sale for Swede Alley improvements. The icing on the cake was that the Marsac Building would be on the tax roles since Trans Pac is a private firm. The advantage to Trans Pac would have been substantial tax credits on the investment since Marsac was considered an historic building. However, Trans Pac backed out of the deal in August of this year, when a piece of legislation, known as the Dole-Pickle bill, was introduced in the U.S. Congress. Con-gress. The bill on the block in Washington, D.C. would do away with investment tax credits on historic buildings if the "ultimate user" is a tax-exempt entity. The municipality is such an entity. When the Trans Pac agreement fell apart, the City Council took the alternative al-ternative course of borrowing borrow-ing the money through the Building Authority. In the Aug. 26 City Council meeting, the council, acting as the RDA, sold the Marsac Building to the Building Authority for $1.5 million. The Building Authority borrowed bor-rowed the $1.5 million from Valley Bank. The RDA will use those funds for the remodeling of the building and the improvements on Swede Alley. The Building Authority will lease the building back to the Municipal Munici-pal Corporation at a rate that will retire the 10.5 percent Valley Bank loan in 10 years. Horrigan maintains that when the Trans Pac deal fell through, the council should have gone to a bond election. "Should we renovate the Marsac building to the tune of $1.5 million? Should the RDA continue to hold property pro-perty rather than getting them back on the tax roles? And do you make that decision without asking the citizens if we can afford to do it?" Horrigan asked. The first goal of the City Council was to get the Marsac Building back on the tax roles, Alvarez said. Before the Dole-Pickle bill was introduced, the federal legislation that would allow Trans Pac to buy and renovate the building for tax credits seemed to offer that. It was part of a coordinated plan to consolidate the city offices and functions while saving both the old City Hall and Marsac in the process, she said. When the Trans Pac deal fell through "We were left in a building that the RDA owned," Alvarez said. "There was no time at that juncture to hold a bond election." Alvarez added that the current plan to borrow the funds from Valley Bank works out better for the citizens because be-cause the interest rate is better. Alvarez said that bonding is another way to borrow money. But redevelopment is an ongoing program which has given the public many opportunities for input. Horrigan Hor-rigan could have come forward earlier, she said. |