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Topic: Outrage over city paying development costs for Smith Village
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untanglingwebs
El Supremo

When a developer is building a major project, there is an expectation the costs of the water and sewer tap in fees and infrastructure are to borne by the developer. Not in Flint.

Burton was taking out bonds to pay for the infrastructure costs for developers like Rizzo and others because they wanted development in Burton. Now at least 3, and maybe 4, subdivisions are sitting with only a few houses sold and the unsold lots are taken over by the Land Bank. The sale of the lots was expected to repay the bonds. Burton in the beginning used reserve water and sewer funds, which were to be reimbursed. BUrton, which never had a deficit, is now experiencing financial woes and layoffs as they still have to pay off the bonds.

In University Park, Flint acted as developer and, according to a former City Engineer, the infrastructure costs contributed to the first deficit. Now we have a developer, who may not be allowed by HUD because of procurement issues, who will have the water and sewer infrasture paid for by the city. This was after the City water rates were increased twice in one year. Some estimate the total increase to be about 60% in one year.




Flint using water, sewer funds for grant-funded Smith Village housing project

Published: Thursday, September 29, 2011, 1:45 PM Updated: Thursday, September 29, 2011, 3:18 PM

By Kristin Longley | Flint Journal
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View full sizeRyan Garza | The Flint JournalWorkers from S.L. Walker & Sons LLC work on clearing trees and stumps out of a lot at the corner of Williams and Root Streets in Flint in September 2011 as part of the process for starting the new Smith Village neighborhood.

FLINT, Michigan — The city of Flint is dipping into its cash-strapped water and sewer funds for the Smith Village housing development, even though about $16 million in federal stimulus grants were earmarked for the project.

The Flint City Council this week approved spending $767,000 for water main work and tap-in fees for the first wave of houses that are expected to be built before the new year.

The city using water and sewer funds because it doesn’t have enough grant funding to cover all the infrastructure work, City Administrator Gregory Eason told council members this week.

That didn’t sit well with several council members, including Councilman Scott Kincaid, who said he supports the project, but doesn’t think the city should be responsible for connecting the houses to the water and sewer system — an expense property owners usually cover.

“There should have been something in that (grant) money to compensate us,” Kincaid said. “I just want to make sure we’re using grant dollars whenever possible.”

Flint residents this month were hit with a 35 percent increase in their water and sewer rates. The rate hike was due to a number of factors, including Detroit raising its rates to the city and decreased fund balances in the water and sewer accounts .

Councilman Joshua Freeman said using the water and sewer funds is a “hard pill to swallow” for residents and said he hopes the city won’t be dipping into the funds again.

“That well’s dry,” he said. “There’s nothing there.”

Eason said that if the city hadn’t had “hundreds of thousands” of grant dollars withheld by the federal government because of past mistakes, the city would have had enough to cover the tap-in fees.

Eason didn’t specify how much of the stimulus dollars were disallowed and the Flint Journal was unable to reach him for comment Thursday.


He said if the city doesn’t finish the project, it would have to repay the $1.3 million the city spent on the project a decade ago.

“We have this opportunity now and we want to take advantage of it,” he told council members.

The council approved Diponio Contracting of Shelby Township for the infrastructure work. The company was the lowest of four bidders.

Councilman Bernard Lawler said the Smith Village project would be a great asset to the city.

Completing the development would help “right the wrongs” of the past, he said, referring to 13 years ago when the city started the project but never completed it to federal standards.

“We need some successes for this city. We need some wins for this city,” he said. “I don’t think we have a choice but to bite the bullet and move forward.”

ic23b September 29, 2011 at 3:34PM

Incredible waste of money, not just Federal money but now City money. With leadership like his there is no wonder why Flint is broke. Another slap in the face to the citizens of Flint.



darma2u September 30, 2011 at 1:25PM


Strongly agree and it looks like we need to vote out those on the council as well as the mayor. Where did all those federal funds go, we need an article showing where the federal funds that have come to Flint go. When I first read about "Smith Village housing development" in Flint all I could think was, why are we getting Federal Grant monies for new housing in Flint, when we have so many houses on the market? Now it seems, again, where has the MONIES gone? This just seems to support my thinking that somes ones pockets are line with 'gold' /Federal monies, and there was 'not' good oversight, again, on more Federal Funds. Where is the accounting for all of this money! This also comes down to very poor leadership = Mayor and city councilpeople, the BUCk stops with them, pun intended!


1baddude September 29, 2011 at 3:42PM


Get the money from the Concerned Pastor's



shirlsz September 29, 2011 at 3:46PM

Everyone in Flint should pay their water bill and deduct the increase! This mayor needs to go!

bearking55 September 29, 2011 at 4:13PM

City is full of EMPTY Houses yet we force the few taxpayers left to pay to build more houses.

and I sure feel good about having paid my own tap in fee now that I see I'm being forced to pay these rich developers tap in fees for them too!

and WHY does the City's Water Sewer fund have almost a MILLION Extra dollars to give them?????? JUSTIFY YOUR RATES NOW!


Man Up September 29, 2011 at 5:21PM


WOW what a joke of a move by Flint. This seems to be another story that highlights the misuse of funds that the city gets and spends. 16 Million $s earmarked for this project, and the city has blown it where? I agree with Mr. Kincaid, and his is 100% right that the new homeowners or the developer should pay these costs. Its a direct benefit to them; not all the rest of the city. It smells like a loser project anyway; slash money pit. I thought the size and population of Flint was contracting? Where are these new home buyers coming from in this down depressed economy? Anyone know how cheap you can buy an existing home for? Less than you can build one new! You do the math shoppers.
Oh and feel bad about the hard luck story from city administrator Eason; we would have had the money if we had not got caught making "mistakes." That is a classic quote that should live in Flint infamy.
Flint you are hostages now, as if you don't spend $767,000 now, you will be on the hook for $1.3 million misspent already in years past. Hey lets taut the fact that it has only taken 13 years to get this project done; hold your head high down there city council; bravo!! Councilman Lawler you are really on some crazy Koolaid if you think that you can attache the work "success" to this whole mess in any way.
I read this horrible article, and it even hard to get my head around the facts here. $16 millions was already spent? 1.3 million at risk from??? $767,000 now being added to what total? What and where was all the money spent? I see in the Smith Village website that the original plan was 169 homes, but as of May 2011 is slated for 83 homes. If the 16 million is infrastructure improvements only, that comes to $192,771 per house that Flint paid to sell a house there. The houses there are now advertised to be between $69,900 and $89,900 per house. Now my math skills tells meet that is a Gross profit to the builder of only $7,387,000, and that will likely make a pre-tax profit to them of $3.3million or so. Anyone gathering all these facts in their head yet? YOU taxpayer paid almost double the gross profit to the developer, so they could make a few million dollars. They take no risk and get all the profit. Now to top it all off, they want you to give them sewer and water services to all the houses to the tune of $9240 per house. I just simply took the $767,000 and divided it by 83. This all sounds so bizarre that I am not sure why there is no federal or state criminal investigations going on into this scam. Bend over Flint you're taking it again apparently.




DWCBOB September 29, 2011 at 5:53PM


Did they dump the leaves upwind of downtown to cover up the stench coming out of city hall?



4realjoe September 29, 2011 at 8:35


"There should have been something in that (grant) money to compensate us,” Kincaid said.

Hmmm... Now, maybe it's just me, but, um, if the City was given "grant money" IS THAT NOT COMPENSATION?!?!?!? I swear!!!!!!!



aleye September 30, 2011 at 10:58AM


The water bills in Flint have gotten outrageous and promise to get worse. And the money is being put into that loser of a project that has been dragged out for years upon years, due in large part of sheer incompetence. I must ask, is there anything else City Hall can come up with to force residents out of Flint? Flint does need more housing. It needs to get existing stock occupied.




Flintasite September 30, 2011 at 11:18AM

This is just another travesty placed upon taxpaying residents in Flint. Our home is worthless because of all the blight and abandoned properties, yet they're building more houses and we get to help pay for them too! What an poor attitude, "Bite the Bullet and move forward". Sorry, but the residents are out of ammo and patience.



gogroup September 30, 2011 at 12:06PM


Councilman Bernard Lawler should remember the development died 13 years ago because area residents didn't want it. It was a loser then and wasting money today to “right the wrongs” of never completing a loser project years ago is stupid. Sometimes the City should JUST SAY NO to grants.




JohnofGB September 30, 2011 at 1:12PM


Is this one of the reasons that the city "had" to raise water/sewer rates starting this month? One of the official statements said something about their "fund" being below requirements, if I remember correctly. This would seem to be one of the main reasons why Flint saw it necessary to raise rates that are twice that of other surrounding communities. What a ripoff !!!!!
Post Tue Oct 04, 2011 7:40 am 
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untanglingwebs
El Supremo

Purchasing Resolution #11000183
(An add on of course- the City would not want the residents to have an opportunity to comment on it-also no written internet record as it is not on any agenda and the city does not publish minutes any more-yet Walling says he is transparennt!)

This resolution gives Di Ponio Contracting $767,347 out of the water/sewer fund for infrastructure development in Smith Village.

Staff review for the resolution:

The City of Flint has committed $16 million dollars of Neighborhood Stabilization Fund (NSP2)2-grant dollars for for home construction in Smith Village. Smith Village is an 83 unit new home construction project lcated just north of the downtown area in Ward 5. Forty three of the units constructed will be made available for low-income families. When completed, residents of the Smith Village neighborhood can walk, bike or take a short drive to nearby community anchors such as; Hurley Medical Center, University of Michigan-Flint, Ketterring University, and County and City offices.

The City Administration has made the Smith Village project a high priority as part of Flint's 21st Century Future [note this phrase is Walling's campaign mantra]. .....

The resolution will allow the vendor to start with Phase I of said project, with the intention of presenting council with a resolution for additional funding and appropriate change order to complete the project.
-----------------------------------------------------------------------------------

Previous resolutions in July authorized the spending of water and sewer funds for improvements in Smith Village. This is only Phase I and will only include up to 30 houses. Expect more funding resolutions from the water and sewer funds.
Post Tue Oct 04, 2011 8:56 am 
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untanglingwebs
El Supremo

I would like to review the budget and pro formas submitted to HUD for this project and would like an explanation regarding the tap in fees and infrastructure. Was this planned by the administration in the beginning?

Last edited by untanglingwebs on Sat Oct 08, 2011 7:27 am; edited 1 time in total
Post Tue Oct 04, 2011 9:00 am 
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Dave Starr
F L I N T O I D

It's only taxpayers money, it's not like it's real money.

_________________
I used to care, but I take a pill for that now.

Pushing buttons sure can be fun.

When a lion wants to go somewhere, he doesn’t worry about how many hyenas are in the way.

Paddle faster, I hear banjos.
Post Tue Oct 04, 2011 9:55 am 
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untanglingwebs
El Supremo

Burton officials weighing options ahead of county auction for Mallard Ponds Condominiums

Published: Wednesday, October 05, 2011, 7:45 AM

By Roberto Acosta | Flint Journal


BURTON, Michigan — Another failed subdivision is up for grabs, but Burton officials want residents’ input before they decide whether to own it.
View full sizeAustin Anthony | Flint JournalMarcy Schmieder, 66, moves decorations from her lawn at Mallard Ponds Condominiums in Burton Monday afternoon. "We never thought it would get this far without somebody picking it up," Schieder said about the development being put up for auction.

Mallard Ponds Condominiums’ 64 empty lots off Davison Road west of Belsay Road are set to be sold at Genesee County’s no-minimum-bid auction for foreclosed properties on Oct. 28.

Burton has three options to acquire the lots, City Assessor Stacey Bassi told the city finance subcommittee last week:

• Buying them at auction for an estimated $6,400 plus current year taxes estimated to be $123,670. The city would continue to pay off the bonds it took out to finance road, water and sewers at Mallard Ponds.

• Allow the lots to go to county land bank and possibly lose 50 percent in taxes for five years if the agency sells any of the properties.

• Accept the lots back at the end of the year from the land bank and pay no delinquent taxes, but the city would have to manage and sell the properties on its own.

Burton has purchased unsold lots in the past — 70 lots in Trail Ridge for $11,925 in November 2008 and 85 lots in Burton Estates for $4,700 during a no-minimum bid auction in November 2009.

In both of those developments, Burton also continues to pay off the bonds for infrastructure improvements it took out as a means of spurring development in the city.


“To just continue piling on these properties and sweep them under the rug...I think it’s the wrong thing to do,” said committee member Danny Wells.

The City Council has set a special meeting for 6 p.m. Oct. 13 to discuss the issue.

The county foreclosed April 1 on Mallard Ponds after SMEA Investments LLC failed to pay $480,038 in delinquent taxes from 2007 to 2008 by the March 31 deadline.

Bassi said there is a total of $783,663 in delinquent taxes from 2008-2010 that has compounded on the property, as well as an estimated $123,670 in taxes for 2011.

The county offered the property for sale for $783,663 at its auction Sept. 16, but there were no takers.

View full sizeAustin Anthony | Flint JournalMallard Ponds Condominiums in Burton is on the slate for the county's no-minimum bid auction at the end of October.

Mallard Ponds was originally planned to have 300 attached and detached condos priced at $158,900 and $162,900. Twenty-two condominiums were built at the development.

Burton remains on the hook for payments on the nearly $980,000 in bonds remaining — $125,000 in principal and $34,000 in interest payments this year. That money comes from the major streets, water and sewer budgets.

Mallard Ponds resident Paul Laper said property values have decreased “significantly” and residents share the same worry over the situation.

“What our concern is (that) we’re in the dark right now,” he said. “We don’t have a lot of answers, so a lot of residents are asking what’s going to happen next. Our values have been decimated along with a lot of the residents of the city of Burton.”

He said residents in the area would like to refinance their homes, but some banks are considering the land unfinished.

“Everything’s in flux,” Laper said. “We don’t want to be a spur in the heel, but we just don’t want to get run over either.”
Post Wed Oct 05, 2011 7:22 am 
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untanglingwebs
El Supremo

Flint is betting they can spur development in Flint by developing Smith Village with the taxpayer dollars for development costs and NSP money for construction. There is little financial bump to the local economy as the modulars are being built in Indiana and only finish work will be done here.

One council member bragged that work was underway in Smith Village. But what if large sums of money must be paid back to the federal government either by Flint or the state because of federal violations?

Flint council authorizes a contract to Metro Community Housing who then puts in substantial work on the project. Metro Housing Board of Directors approves the contract.

Then the rug is pulled out as Young, former agent of Smith Village Development, now is part of a new development team, Smith Village Construction and is now the new developer. Brett Russell, brought in as partner of Smith Village Development is now part of the new development team. But when Russell pulls permits under a company that doesn't exist, the contractors doing the excavation allegedly find out the $8 million dollar bond is not in place so they can get paid from the insurance company.


Last edited by untanglingwebs on Sat Oct 08, 2011 7:29 am; edited 2 times in total
Post Wed Oct 05, 2011 7:35 am 
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DylanLuna
F L I N T O I D

HUD rescinds Flint's $1.1 million penalty for Smith Village with conditions

http://www.mlive.com/news/flint/index.ssf/2011/10/hud_rescinds_flints_11_million.html
Post Thu Oct 06, 2011 9:33 am 
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untanglingwebs
El Supremo

It appears Flint is employing the "Neighborhoods in Bloom" project presented about 3 years ago:

Since this is a $30 million dollar project that includes construction of a child care development center and a performng arts center and theatre, don't expect any federal funds to be spent else where.

HUD's conditions.

Among other items, the city must:

•Build at least 83 houses, half of them for low- and moderate-income families
Dedicate the resources necessary to complete the project, "including effective coordination among city agencies and priority for city approval processes."
•and "Give priority to the Smith Village neighborhood for the commitment of available city resources.".



The money is not rescinded unless all conditions are met.
Expect more water and sewer funds, block grant funds and street funds to be funneled here. And who will take care of the new green spaces being created?
Post Thu Oct 06, 2011 12:24 pm 
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untanglingwebs
El Supremo

When this program was presented in Flint, several neighborhoods in Richmond, VA. were developed at one time. Also, the economy was better and the stock market and jobs environment was better. What is Walling's plan to deal with the crime in this area. Every time I drive some of these streets, I see prostitution, loittering and possible drug activity. One of my friends said this is a slap in the face to the laid off fire and police.

Doesn't Walling have anyone on his staff that could have negotiated a better deal with HUD. There was a plan in place and John Carpenter was completing it and it would have eliminated the $1.1 to $1.3 million dollar HUD issue. Brown got rid of Carpenter and Rich. Walling and Eason put in 11 new staff with no experience.


Neighborhoods in Bloom
Neighborhoods in Bloom (NIB) is an innovative program that supports the restoration of Richmond's historic neighborhoods that began in Fall 1999.

The process to select the "Neighborhoods in Bloom" areas was very inclusive and deliberate. City staff developed a set of evaluation criteria to assess the conditions and potential for revitalization of each of the city's neighborhoods.

Neighborhood condition criteria included the following items.

the number of vacant properties
crime statistics
poverty levels
home ownership rates
housing quality
Revitalization potential was evaluated upon the strength of civic associations in the neighborhoods, the existence of redevelopment plans, and market trends.


City staff conducted numerous community meetings to obtain citizen input on the process and the neighborhoods they would recommend for the Neighborhoods in Bloom program. All of this information - the data, categorizations, and community perspectives - was provided to three separate groups. These were a group of civic leaders, a task force of housing providers, and city staff.

Each group independently reviewed the neighborhoods and recommended the finalists. After their independent evaluation, representatives from the three groups met to consolidate their decisions into a consensus recommendation to City Council for approval of the first "Neighborhoods in Bloom" communities.

The initial program premise was, and remains, that a concentrated investment of resources in a limited impact area can have a substantial impact for a targeted revitalization area. In Nib, the city works with nonprofit partners who

Buy vacant houses, rehabilitate them, and sell them for home ownership.
Buy vacant lots, build houses, and sell them for home ownership.
Provide homebuyer education classes and counsel potential buyers in determining affordability and purchase power.
Provide down payment assistance.
Assist owner occupants with house repairs and renovations.
In addition to removing blight and increasing home ownership in the city, the program seeks to instill private sector confidence to invest in rental and for sale. More NiB program information can be found here.

More Information
John Accordino, George Galster, and Peter Tatian (2005). "The Impacts ofTargeted Public and Nonprofit Investment on Neighborhood Development." Community Affairs Office of the Federal Reserve Bank of Richmond. Cindy Elmore and Dan Tatar (2004).
"Neighborhoods in Bloom Program Cultivates Change in Richmond," Marketwise 2004, Issue 1. The Federal Reserve Bank of Richmond and the Richmond, Virginia office of LISC. (2005).
"Neighborhoods in Bloom Program Spurs Changes in Several Areas of Richmond," The Richmond Times-Dispatch, July 17, 2005.


Last edited by untanglingwebs on Sat Oct 08, 2011 7:30 am; edited 1 time in total
Post Thu Oct 06, 2011 3:43 pm 
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untanglingwebs
El Supremo

Smith Village Redevelopment Plan! - Flint Housing CommissionPrepared for HUD- Decembr 15, 2010 ... The “new” Smith Village with its 10 individual home designs offers ... throw from downtown Flint, two blocks north of the ...http://www.flinthud.org/smith-village-combined-web.pdf - - Cached - Similar pagesSmith Village


Redevelopment Plan - Flint Housing Commission“Smith Village will produce modern, new homes built at g p ...http://www.flinthud.org/HUD%20presentation-redevelopment2.pdf - - Cached - Similar pages

The redevelopment plans include a child development center and a Center for the performing arts. They are included in the requirement by HUD for the prioritizing of our funds.
Post Thu Oct 06, 2011 7:48 pm 
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untanglingwebs
El Supremo

Kristin Longley needed to read the whole document as well as the New Smith Village development Plan presented to HUD and the community. Roads have been reconfigured which means engineering, excavation ans street building funds. Walling promised new sidewalks, trees and landscaping. The streets, water and sewer infrastructure must be done. Water and sewer tapins are being paid for by the city.

Condition #5 of the Homeownership Zone Grant Termination Certification says the City will :

Give Priority to the Smith Village Neighborhood for the commitment of available City resources until the 83 home ownership units have been occupied and the 70 to 80 exiisting homeowners have been offered low-interest home improvement loans.


The City of Flint acknowledges that failure to implement these commitments in good faith, may result in HUD's disallowance and recovery of $1,086,935 in Homeownership Zone grants funds previously expended.


There are 3 phases of construction: The water and sewer for Phase 1 :

The Diponio Contracting bid for Phase one (25 to 30 houses) was $1,068.167.56.The add on resolution for part of this bid (11000183) was for $767,347 to be paid from the sewer and water funds.
The staff review says:
The resolution will allow the vendor to start with Phase I of said project, with the intention of presenting Council with a resolution for additional funding and appropriate change order to complete the project.

HUD rescinds Flint's $1.1 million penalty for Smith Village with conditions

Published: Thursday, October 06, 2011, 9:42 AM Updated: Thursday, October 06, 2011, 9:42 AM

By Kristin Longley | Flint Journal
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FLINT, Michigan -- The city of Flint is catching a break when it comes to the long overdue Smith Village housing development.

The federal government has agreed to waive the city's $1.1 million penalty for the stalled project, giving the city some breathing room to complete the development that was started 13 years ago but stalled after just six houses were built.

"I'm proud to say that because of our (economic development) staff... we will not have to pay the $1.1 million penalty placed over our head," City Administrator Gregory Eason told the Flint City Council on Wednesday. "That was two years worth of work trying to deal with 15 years of problems."

The U.S. Department of Housing and Urban development had demanded repayment of the $1,086,935 University Park Homeownership Grant last year, saying the city failed to meet federal standards and deadlines on the Smith Village portion of the project.

Now, in a September letter to Flint Mayor Dayne Walling, the department recognized the city's attempts to complete the 83-unit housing development with $15 million in federal Neighborhood Stabilization Program grant funding.

"HUD finds that your administration's commitment to revitalize the Smith Village neighborhood using NSP-2 funds is consistent with the commitment the city originally made to HUD and the residents of Smith Village," the letter says.

The letter goes on to say the $1.1 million penalty is terminated, with five conditions.

Among other items, the city must:

•Build at least 83 houses, half of them for low- and moderate-income families
•Dedicate the resources necessary to complete the project, "including effective coordination among city agencies and priority for city approval processes."
•and "Give priority to the Smith Village neighborhood for the commitment of available city resources."


The city's progress on the project will be monitored by staff in HUD's Detroit field office to ensure this time around it's successful.

The city originally was granted $2,013,000 in 1998 for the University Park Homeownership Zone, part of a federal initiative to test the idea that cities can transform blighted areas into vibrant communities by creating neighborhoods of mixed-income single-family homes.

The city committed to building 319 units in two target areas: University Park and Smith Village. At least half of the units were required to be sold to low- and moderate-income families, and the project was supposed to be completed in 2002.

But after University Park, located on the east side of Saginaw Street, was completed, the Smith Village portion on the west side of Saginaw Street languished.

Walling's administration restarted the project with federal grant dollars in 2010, but the project still has been plagued by several issues, including a last-minute developer switch and a lawsuit pending against the city.

City Council President Jackie Poplar said she's glad the project is progressing despite opposite from some in the community who don't think Smith Village is a good idea.

"Whatever it takes to complete this project I'm all for it," she said. "I'm just excited to see our city is going to make it whether the people want it to or not.


Last edited by untanglingwebs on Sat Oct 08, 2011 7:32 am; edited 1 time in total
Post Fri Oct 07, 2011 3:58 pm 
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Dave Starr
F L I N T O I D

Hey, that's a great campaign slogan, Jackie. "Whether the people want it or not".

_________________
I used to care, but I take a pill for that now.

Pushing buttons sure can be fun.

When a lion wants to go somewhere, he doesn’t worry about how many hyenas are in the way.

Paddle faster, I hear banjos.
Post Fri Oct 07, 2011 6:26 pm 
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untanglingwebs
El Supremo

The Flint Journal Editorial Board should read the "New Smith Village Plan". The prosed budget for the $16.1 million dollar plan does not include engineering costs for reconstructing the road in some areas to create cul-de-sacs, Nor does it include water and sewer reconstruction and tap-in fees for the entire project, the sidewalks and other expenses associated with the construction.

Where are those dollars coming from?

Will Flint residents pay through their water and sewer bills the total cost of the water & sewer infrastructure and tap-in fees for all three phases. Phase One alone was bid at nearly $1.1 million.

Will CDBG funds pay for the new sidewalks? Will we use our local street funds for the newly reconfigured streets and street rebuilds. Wood Street is as rough as a country road after a bad winter and will require a complete rebuild.

And who is paying for the Child Development Center and the new Center for Performing Arts. Is that in the $16 million the plan says is being spent



From the Flint Journal editorial: HUD will forgive repayment of money given to University Park and Smith Village projects years ago if the city indeed builds all 83 homes, making the project a priority in the city “for the commitment of available city resources.”

“Available resources” in Flint is a term that may undergo metamorphosis soon as the city undergoes the second stage of state emergency financial assessment. The city is broke.




Our Voice: Don't let Smith Village resurrection become the zombie that eats Flint

Published: Sunday, October 09, 2011, 5:36 AM

By Editorial Board | The Flint Journal

Don’t let the resurrected Smith Village project turn into the zombie that eats Flint’s last city resources.

Late last month, the City Council OK’d the spending of $767,000 from Flint’s water and sewer funds to cover water main work and tap-in fees for the first batch of houses, due for completion by the end of the year.

That didn’t sit well with City Council members and it doesn’t with us.

Such a transfer from the cash-strapped utilities to a project that has $15 million in federal stimulus Neighborhood Stabilization Program funds tied to it sure smells like a cost overrun.

But when the U.S. Department of Housing and Urban Development threatens the city with a demand to repay $1.2 million unless the first 25 houses are up and ready for buyers by Jan. 1, Flint officials had little choice but to ante up for the infrastructure work and plow ahead with the project.

The choices for the city are stark: Build Smith Village as first promised 13 years ago, or repay the money Washington gave Flint for the planned development those many years ago.

A new neighborhood or a debt this broke city cannot afford is hardly a choice, of course. So, City Council swallowed hard and approved the water and sewer fund money for the infrastructure work.

Probably not coincidentally, that big commitment at City Hall was followed with HUD rescinding the repayment demand for the stalled Smith Village project.

Yet, Flint can ill afford to transfer money from sewer and water accounts. Just last month, the city raised water rates that residents and businesses pay by 35 percent to cover increased water costs from Detroit and to build up depleted funds.

City officials need to find some way of recouping the $767,000 from Smith Village, either by tacking the expenses onto the sale price of the houses or by seeking reimbursement from HUD once Smith Village is complete.

Considering the city’s track record on the project, Flint might expect little additional help from HUD right now. Originally planned as part of the project that resulted in the University Park, Smith Village languished after only six houses were built for low- to moderate-income families.

This summer, Mayor Dayne Walling and other officials plunged shovels into the dirt and restarted Smith Village, hailing the only new-housing development in Genesee County this year, timed to meet federal demands and avoid the HUD penalty.

The goal since that groundbreaking ceremony has been to get at least 25 modular houses built by the end of the year, with an eventual total of 83 houses.

HUD will forgive repayment of money given to University Park and Smith Village projects years ago if the city indeed builds all 83 homes, making the project a priority in the city “for the commitment of available city resources.”

“Available resources” in Flint is a term that may undergo metamorphosis soon as the city undergoes the second stage of state emergency financial assessment. The city is broke.

Nonetheless, committing the water and sewer money to Smith Village water and sewer work has proven to Flint’s federal debtors that the city is taking the obligation of Smith Village seriously.

What the city now needs in return is an acknowledgment from HUD of its dire financial straits and a future OK, if needed, to eventually recoup water and sewer costs.

The way we read the HUD demands for Smith Village and forgiveness of the previous grant money, cutting back on the project is not an option.

But allowing Flint to recover a water and sewer fund investment it can ill afford ought to be a possibility.
Post Sun Oct 09, 2011 12:53 pm 
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untanglingwebs
El Supremo

I just watched council and from Eason's comments Flint is definitely using a variation of the Neighborhoods in Bloom project. The $2.5 million in demolition on the east side and the $14.7 million (the plan says $16 million) for Smith Village were two projects Eason touted.

It was interesting to note Loyd's comments about how he did not realize the total amount of the NSP2 dollars that were committed to Smith Village and said that he supported thae project, but perhaps not to that degree.

Kincaid stated the same people objected to University Park that are now objecting to Smith Village. He also commented that some of the same people involved in University Park should not be criticized for being involved in Smith Village. That is where I disagree. University Park residents have stated they were given loans that could have been considered predatory and with high interest rates. The foreclosure rate is said to be above 10%, mainly because some homeowners were less able to pay their mortgages after the taxes were restored as the AEnterprise Zone and Renaissance Zones reached their end. Council rejected their requests for an extra five years of tax abatements when Council approved the extensions for downtown businesses.
Post Sun Oct 09, 2011 1:06 pm 
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untanglingwebs
El Supremo

Flint's contract for Smith Village Construction Services LLC states the developer is not responsible for any infrastructure costs-The City of Flint is!
Post Tue Oct 11, 2011 2:34 am 
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