Council delays action on Grubaugh’s TIF

At the recommendation of the city’s legal counsel, the Vandalia City Council has delayed acting on a request for Tax Increment Financing assistance for the renovation of a downtown building exterior wall.
The council was scheduled to act on a request from Dennis and Debbie Grubaugh for $70,000 in TIF funds to renovate the wall of their building at 507 W. Gallatin St., work that follows the demolition of adjacent buildings last fall.
Grubaugh, who plans to do the work himself, has estimated the total project cost at $160,000.
The request was put on the agenda for the meeting two weeks after city officials hashed out the details of the TIF agreement – including the amount of a TIF grant – with Grubaugh at length.
As Mayor Rick Gottman asked for a motion on the Grubaughs’ request, Alderman B. John Clark referenced a letter from the city’s legal counsel.
Ryan Connor of that firm – Burnside, Johnston, Connor and Jensen – said that in a letter he had prepared, Keith Jensen of the firm “recommends that no TIF agreements are signed until there is a waiver of liability, a release of further claims with regard to anything connected to the buildings that came down.
“As you are aware, the Carroll Haynes building (which houses Nedra’s Printing) is subject to the same claims. We’re in a potential liability situation with regards to that wall, and it will be up to the insurance counsel to flush that out,” he said.
Connor said that Jensen is recommending a waiver “to avoid exposing the city to any further liability for damage that could have arguably been caused by the (demolition) that puts us in the same situation that we’re in with the Haynes building.”
After hearing from Connor, none of the alderman chose to make a motion on the acceptance of the Grubaughs’ request.
During the meeting, Gottman told aldermen that he will be forming a committee that will look at the existing TIF rules and regulations and consider making changes to those.
For example, Gottman said, some municipalities allow an individual to not have more than one TIF project pending at one time.
Also, he said, referring to the discussion on the Grubaugh request during the May 2 council meeting, the committee will look at whether the city should require that a property owner have insurance on the property that he or she plans to improve.
On the insurance requirement, Clark said he believes that that should be put in place.
“That’s only protecting us,” Clark said. “Otherwise, we have no protection – that’s no good.
“You can’t go to the bank and not have any collateral,” he said.
To that, Grubaugh said, “That sounds all well and good. But, then, looking at it from the property owner’s standpoint, there are some cases where you just can’t afford the insurance.
“In the case of the (Liberty) theater, there’s no way,” he said. “The premiums are so high I’d be better off to knock the building down.
“Our goal since we started this downtown project has always been to save as many of the historic buildings and try to better the downtown as best we can,” Grubaugh said.
“But we can only do so much with what we have, and we don’t have near enough to work with,” he said.
“I understand where the city is coming from,” he said. “Quite honestly, I wish we’d never started the downtown; I wish we’d left it alone.
“But I’m in it, and there’s not much I can do about that,” Grubaugh said.
Gottman praised Grubaugh for the work he’s done downtown.
“I think you’ve done a great job,” Gottman said. “No one can say that you haven’t put 110 percent into the buildings you’ve got.”
 

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