When it serves as the sleight of hand for many bad decisions. Wishing the developer would work out advantageous deals with the property owners is just the tip of the iceberg. Perhaps Wolstein never had this in mind.
from Cleveland Scene April 11, 2007 The Wolstein Plot  
“The battle for the East Bank of the Flats has entered its seventh month in court, with no end in sight.

Developer Scott Wolstein wants more land for his $230 million housing and retail project, and accuses neighboring landowners of being greedy and standing in the way of progress.

His neighbors, however, accuse Wolstein of lowballing his offers, knowing all along that he could use the city and the Port Authority to steal their land by eminent domain.

Judge John Corrigan desperately wants the parties to settle, but he'll likely be forced to decide the eminent domain issue. At the heart of the matter is whether Wolstein negotiated in good faith.

Unfortunately for him, there's evidence he was plotting to take the land all along. It comes from Crossing the Road to Entrepreneurship, a book published by his late father Bert three years ago. The elder Wolstein writes that the Flats need a single owner if they're to be revitalized, and confesses that the "city will have to use eminent domain to purchase the land Scott and I don't already control."

Neighbors still hope to negotiate, but as shoplifters and developers have known all along, stealing is always the easier route."

And now this research on the plan is uncovered by our faithful watchdog, Roldo. Here's a quote to whet your appetite: (click above to read the whole treatise)

"Following is loot given to Wolstein Flats project in addition to tax abatement for housing portion. The Pee Dee totally ignores this disgusting form of bribery:

- BDOHS (port authority) will provide $11-million in loans.

- City of Cleveland will provide $6-million in Core City loans.

- Cleveland Public Power will provide $3.4 million in services.

- Cleveland Water Division will provide $740,000 in infrastructure costs.

- Cleveland will provide another $1-million from its general obligation bonds.

- The County, City and Cleveland schools will forgo $11,140,000 in property taxes under a TIF (tax abatement) program to help the project.

- Cuyahoga County will provide $1-million in subsidies.

- The State of Ohio will provide a grant of $3-million for “environmental remediation,” matched by a loan from Cuyahoga County of $1-million, both committed from the 2005 Clean Ohio program.

- Tax exempt Parking Revenue Bonds estimated at $8,540,000 will be repaid from Public parking facility revenues.

- Tax-exempt infrastructure bonds estimated to be $9 million are secured by annual payments by the Northeast Ohio Regional Sewer District.

- The sum of approximately $4,550,000 will be made available through the Federal Highway Administration.

- The federal government has appropriated and the city shall obtain and make available when required for eligible project costs a grant of $1,464,735 from the U. S. Department of Commerce National Oceanic Atmosphere Administration (NOAA grant).

- All rental and condominium units (some 300 units) will be tax abated at 100 percent for 15 years. No cost estimate given by the city, port authority or county.

- The city agrees to enact legislation as necessary to amend and extend the CRA residential tax abatement program to assure that all residential improvements are eligible for the full 15-year, 100 percent abatement of real estate taxes. No cost given.

- The Regional Transit Authority (RTA) will construct a transit station on the RTA Waterfront Rail Line for the project “…all at no cost or expense” to the developer. No total or estimated cost mentioned.

- The city “shall take all necessary action to vacate all existing streets within the project site to the extent no longer require as public improvements for the project, and any easements which impair or adversely affect the development, construction or occupancy of the project, or which lie within the project site and are no longer required for use as public improvements for the Project.” No cost estimate given.

- The city of Cleveland “shall convey to the developer all the land owned by it (the city) within the residential site not necessary for public improvements by official quit-claim deed…” No cost estimate given.

- Under a section called “public improvements”, it states: “Public improvements necessary to support the Residential project will include but may not be limited to the following…

- Abatement, demolition and environmental remediation (including all necessary earthwork and soil clean-up) of the Project properties as they exist as of the execution date of this Agreement so as to allow for construction of the Residential Project.

- On-site paving and landscaping for all areas from the building lines of the Residential Project to the street curb as well as the public spaces of the Riverfront Park described below.

- A Riverfront Park extending from the southern boundary of the Project along the Cuyahoga River’s edge north to the Norfolk & Southern rail line with an eastern edge defined by a realigned Old River Road and a new street network described below. The Park may include but not be limited to the following elements: a riverfront boardwalk, gather places; pavilions; project signage, retail kiosks; and a marina for transient boater use. The Riverfront Park shall be planned in such a manner so as to receive the proposed extension of the Towpath Trail…

- Utility improvements, replacements and/or upgrades sufficient to provide necessary storm and sanitary sewer, water, electrical, gas and thermal heating and cooling services for the Residential Project and the permanent improvements in the public right of way (e. g. street lighting) and property (e.g. Riverfront Park fixtures and appurtenances) for ongoing and seasonal needs.

- Street improvements, realignments and additions to serve the Residential Project and its associated parking facilities, including all necessary traffic control equipment and signage…

- Bulkhead repair, replacement and improvements sufficient to maintain the long-term integrity of the eastern edge of the Project site bordered by the Cuyahoga River.

- The Public Parking Facilities and Private Parking Facilities estimated to consist of a minimum of 1,600 spaces in total and sufficient to serve the retail and residential uses of the Project by way of four structured facilities and no fewer than two surface lots, including all necessary equipment, landscaping and appurtenances.

- An allocable share of land acquisition costs associated with the square footage occupied by the Public Improvement as a percentage of the entire Project square footage (Residential Project plus Public Improvements.)

- Any and all soft costs which may be attributable to construction of the Public improvements including but not limited to architectural and engineering services, lighting, traffic and parking consultants, permits/fees, testing and inspection, temporary utilities, financing fees and costs and capitalized interest on bonds or loans." -- Roldo Bartimole

Let's revisit Norm Krumholz's equity planning ideas. The poor people in the city need some consideration. While we need to work on pulling the drowning out of the river, we also need to work on stopping those who are pushing them in. Now is the time for a green review of the Ohio Building Code. If we can't make our own green code for the region, we will need to press the state for a better code. Green building should be demanded not dangled like a carrot to cover for heinous money grabbing tactics.

This is another interesting take on the Port's Authority role in the Flats Eastbank issue from Crains Cleveland Business. http://www.crainscleveland.com/apps/pbcs.dll/article?AID=/20060501/REG/6...
I don't understand what Mr. Fishman means when he says that sole ownership by Wolstein Group is "pivotal". It sounds like "tic toc the games locked and nobody else can play". Discourteous at best. What would be the harm in letting Shaia own the parking and Carnegie Management and Development Corp. be a partner? If there is an explanation of this remark, why didn't it make it into the article? It just seems uncooperative and unfair to everyone else who has an interest in making the flats a better place (and already owns property there). It is reminiscent of kid gangs in the schoolyard where the one who has the biggest bully wins. Always wins. Now Wolstein has brought in the biggest baddest guy (the Port Authority), and he is carrying a bat -- eminent domain. It is just not gentlemanly. Don't these guys remember the rule about candy in elementary school? If you're going to have it yourself, you have to have enough to share with everyone else who would care to partake.

I agree that we (and the environment as a logical extention of we) will benefit from more people who are earning more living in the city center, but in this case, their property tax payments are years away, and way too much public money is being used to subsidize fancy living spaces for those who do not need subsidized housing. That's my opinion. I look forward to having my mind changed by someone who can explain why taxpayers should fund riverfront time shares for the well to do. 62 million in public money seems excessive.