Sep 7, 2014
10 Reasons to Vote NO on Bond Rededication
1. City of Conway cannot (will not?) pay its obligations now. It defies logic to add $21M (plus interest) more debt to the debt the City cannot pay currently, with the “hope” that more retail will pump huge dollars into the city coffers. 2. A 40-year payoff guarantees that any other spending emergencies in Conway...
1. City of Conway cannot (will not?) pay its obligations now. It defies logic to add $21M (plus interest) more debt to the debt the City cannot pay currently, with the “hope” that more retail will pump huge dollars into the city coffers.
2. A 40-year payoff guarantees that any other spending emergencies in Conway will automatically result in higher taxes. How else would the city generate even more revenue in case of a real need?
3. Consumer spending drives the economy and the Fed Reserve’s Beige Report on our 8-state area of the U.S. shows Arkansas’s economy still flat after the 2008 recession. This is the third Beige Report in a row showing the same result, and Arkansas currently is the only state in that 8-state area to *not* have a growing economy.
4. What happened to the great future Conway envisioned from sales tax revenue when Conway Commons was built? Here it is just a few years later and that sales tax revenue boost has flattened. Why does Conway think a new shopping center will perform any differently in today’s continuing flat economy?
5. The CIty is misleading you when it talks about road improvements. Sure, one of their proposed roads goes east-west across I-40, straight into the new shopping center they want to build.
Do they really intend rush-hour cross-town traffic to dump right into that shopping center? All the road improvements included the project are to service the new shopping areas at the old airport property and the Dave Ward/I-40 intersection and will primarily serve the shopping areas, while the streets citizens travel on daily continue to deteriorate across town.
6. The area around the old airport property has many Very Low Income (VLI) households. Of concern is where these households will relocate once the shopping center “improvements” raise surrounding property values and these families get squeezed out; adding to the area’s homeless population is a very real possibility. Even though the City of Conway was asked about the displacement of these individuals, it choses not to address the issue except to acknowledge it may exist.
7. Putting Conway’s future in the hands of ever-increasing sales taxes is irresponsible in today’s economic climate. As others have said we’ve already saturated the retail market to the point where new shops won’t generate much more new sales tax revenue. There’s only so many toothbrushes and cars a person buys in a year. After an initial “it’s new” bump, a new shopping center will likely draw its customers from other retail in Conway.
8. The City made its deal with the center developers so that Conway is responsible for infrastructure, unlike most other projects developers have done in the past. If we cannot afford to maintain the streets across town now, how can we afford to add even more streets to the city’s ongoing maintenance budget?
9. Let’s talk numbers. Here’s a different perspective on Conway’s overly optimistic projection of project costs. Take a look at Conway’s return-on-investment for 75 years, assuming:
• 2% Inflation.
• 4.25% yield on 25 year bonds. (Maybe it’s a 40 year bond? But the yield would be higher.)
• The infrastructure has a typical 25 year civic life-cycle.
• The sales tax revenue is from new sales, not sales that are stolen from another store (which is more likely.)
• We start collecting this sales tax revenue in year 1 (unlikely as it will take a few years for the shops to open.)
• All revenue raised from this project is actually set aside to pay for its future obligations, and not for other city projects (also unlikely.)
If all the above is true, here’s what a 75 year projection looks like:
We issue the bonds in year 0.
All shops are built by year 1 and we start collecting sales tax.
Year 25 when both the bond ($25,052,500) and infrastructure matures ($33,777,182.24 at 2% inflation), we have a $57,427,026 expense and total ROI (return on investment) falls to -$33,294,233. Takes 13 years to recover. Oh yes, that would be YEAR 38… or 2052. Or, think of it like this — your child born this year would be almost 40 by then!
10. None of the above takes into account the method Conway has used, once again, to push what it wants past the wishes of average citizens. Special elections serve one purpose — they allow Conway to put important issues up for a vote using oddly timed, rather quiet elections that leave many citizens unaware. Of course, the backers/supporters of special election issues are highly tuned to the special election so turning out enough votes to get the issues passed becomes much easier.
Even the so-called public input sessions are gamed. Check out the Delphi technique, used to get craft certain results from public input by limiting both the specific questions asked and the allowed choices for answers.
The public dog-and-pony show at Centennial didn’t even include a question-and-answer session and the local newspaper certainly hasn’t reported any negative facts about the project, choosing to leave that kind of discussion to the readers who frequent the online forums.
It’s illogical to approve a 40-year tax to build another shopping center and roads for those developers to get more sales tax revenue to pay bills that Conway cannot afford to pay today. Vote NO.