Ohio eminent domain and Why Southtown Mall Owners should have gotten more money from Mayor Dick

Ohio does not go along with the United States Supreme Court's ruling in Kelo. Hat tip to Indianalawblog and Cincinnati.com.


Southtown mall SOUTHTOWN PROPERTIES, INC.,MEREDITH SUITES, LLC, B.V. BELK, J.R., EASTGATE MALL, LLC (as ) Successor in Interest to B.V. Belk, Jr),did not get the deal directly from Mayor Dick but from the city's crooks, and $20,660,000 received by the city.

$20,660,000 INDIANA BOND BANK Special Program Bonds, Series 2006 C
(Fort Wayne Regional Public Safety Academy Project)INDIANA BOND BANK)

The Special Program Bonds, Series 2006 C (Fort Wayne Regional Public Safety Academy Project) (the “Series 2006 C Bonds”), are
to be issued by the Indiana Bond Bank (the “Bond Bank”) pursuant to a Trust Indenture dated as of June 1, 2006, (the “Indenture”), between the
Bond Bank and U.S. Bank National Association, as trustee (the “Trustee”), will initially be dated as of the date of delivery and will bear interest
from that date at the rates per annum and mature on the dates and in the principal amounts set forth on the inside front cover. The Series 2006 C
Bonds are issuable only as fully registered bonds and, when issued, will be registered in the name of Cede & Co., as nominee for The Depository
Trust Company, New York, New York (“DTC”). Purchases of beneficial interests in the Series 2006 C Bonds will be made in book-entry-only form, in the denomination of $5,000 or any integral multiple thereof. Purchasers of beneficial interests in the Series 2006 C Bonds (the “Beneficial Owners”) will not receive physical delivery of certificates representing their interests in the Series 2006 C Bonds. Interest on the
Series 2006 C Bonds is payable on February 1 and August 1 of each year, commencing February 1, 2007. The principal of and interest on the Series 2006 C Bonds will be paid directly to DTC by the Trustee under the Indenture so long as DTC or its nominee is the registered owner of the Series 2006 C Bonds. The final disbursement of such payments to the Beneficial Owners of the Series 2006 C Bonds will be the responsibility of DTC’s Participants, all as defined and more fully described herein under the caption “THE SERIES 2006 C BONDS-Book-Entry-Only System.”

The Series 2006 C Qualified Obligations are being issued principally to provide funds to pay the costs of the acquisition, construction and equipping of a 125,000 square foot government facility in the southeastern portion of the City of Fort Wayne, Indiana (the “City”), to be used as (i) a fire, police and emergency medical training center, (ii) an academic institution for public safety degrees and training programs, and (iii) a backup emergency operations center for the City and surrounding region (collectively, the “Project”).
Rental payments for such use of the Project by the City, as lessee, pursuant to the Lease (the “Lease”) dated as of February 1, 2006, between the Fort
Wayne Municipal Building Corp., as lessor (the “Series 2006 C Qualified Entity”), and the City, as lessee, which will constitute the principal source of repayment of the Series 2006 C Qualified Obligations, will be made by the City primarily from (i) tax increment revenues pledged from the portion of the City’s Tillman Anthony Urban
Renewal Area constituting an allocation area (the “Allocation Area”) for purposes of collecting such tax increment revenues (the “TIF Revenues”);

(ii) sublease payments from Ivy Tech Community College of Indiana (“Ivy Tech”),
subject to biennial appropriation by the State General Assembly, for its use of a portion of the Project (the “Sublease Revenues”);

(iii) if necessary, a pledge of the City’s distributive share of Allen County’s Economic Development Income Tax revenues but only up to the maximum annual amount of $1,065,000 (the “Pledged CEDIT Revenues”);


and (iv) certain other miscellaneous funds pledged by the City.

Sources of Lease Rental Payments and Risks

(a) Sublease Revenues. Sublease payments from Ivy Tech will come exclusively from appropriations made by the State General Assembly. A special one-time appropriation of $1,000,000 was made by the State General Assembly to be applied to the construction of the Project. Thereafter, beginning upon the later of July 15,
2007, or substantial completion of the Project, sublease payments will be made on a semiannual basis in the amount of $500,000. The sublease expires on June 30, 2022.

(i) Non-Appropriation of Funds; Termination of Sublease; Vacation of Premises. The sublease provides that in the event the State General Assembly fails to appropriate sufficient funding, or required budget items are not approved, such that Ivy Tech cannot meet any rental obligation under the sublease, the sublease shall terminate and Ivy Tech must vacate the subleased premises prior to the date of such termination. Ivy Tech is obligated to pay rental under the sublease for any
period (i) during which the subleased premises are available for use and occupancy by Ivy Tech, and (ii) funds have been appropriated and available to Ivy Tech to pay rental under the sublease.

TIF Revenues. Tax increment consists of the tax proceeds attributable to all real property assessed value within the Allocation Area, as of the assessment date in excess of the base assessed value as defined in Indiana Code § 36-7-14-39(a). The base assessed value means the net assessed value of all the property in the Allocation Area as finally determined for the assessment date immediately preceding the effective date of a declaratory resolution pursuant to Indiana Code § 36-7-14-39 establishing the Allocation Area (“Tax Increment”). The base assessment date of the Allocation Area is March 1, 2002.

The TIF Revenues is much higher than the tax proceeds or overflow is much higher than what Southtown group was paying in 2002.

Pledged CEDIT Revenues. The Pledged CEDIT Revenues are limited to an annual maximum amount of $1,065,000. The City has previously pledged its distributive share of Allen County Economic Development Income Tax (“CEDIT”) revenues for other obligations and leases. In addition, if the City can demonstrate, either historically using the prior fiscal year’s CEDIT revenues; or prospectively using projected CEDIT revenues in the immediately succeeding fiscal year, that CEDIT revenues for such year are at least equal to one hundred thirty-five percent (135%) of all debt service and lease rental obligations, and certain other conditions are met, the City may in the future pledge such revenues for additional obligations and leases. For a more detailed explanation of the Pledged CEDIT Revenues, the City’s CEDIT revenues generally and associated risks, see “Study of County Economic Development Income Tax Revenues Available for Debt Service” included in Appendix B.

Mayor's Office press release

City Breaks Ground on Regional Public Safety Academy
Mayor Graham Richard today led a groundbreaking ceremony to mark the start of construction on the new Regional Public Safety Academy at Southtown Centre. Mayor Richard was joined by state and local elected officials, Public Safety Foundation members, education partners, and neighborhood leaders.



The 132,000 square foot, state-of-the-art facility will provide police, fire, emergency medical services, and homeland security training and education for professionals and students from northeast Indiana and across the Midwest. The academy will also play a prominent role in the newly developing mandated state fire training for the 3rd district in northeast Indiana.

Education partners include Ivy Tech, IPFW, Indiana Tech, Taylor University, the University of St. Francis, Tri-State University, and Fort Wayne Community Schools (Anthis Career Center). The educational institutions will use classroom space at the academy to teach and train students to become public safety professionals.


“This new regional asset serves as a model for public safety training and preparedness, said Mayor Richard. “We are building high trust, high performance partnerships with agencies across northeast Indiana and the Midwest region. Residents will benefit from trained professionals that will have the skills to work together in an emergency. We are a leader in providing excellent services.”

Hagerman Construction is the general contractor for the project. The total cost of the project is $27 million. The project is financed through a City Council approved $24 million bond. Additional sources include $15 million from the Indiana General Assembly through Ivy Tech. Property taxes are not being used to finance the academy. The academy is scheduled to open in November 2007.