Michael W. Davis: Setting the Record Straight on the Future of Downtown Columbia

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When I attended the Howard County Council public hearing on July 14 regarding the pending TIF legislation, I was struck by a few common misunderstandings that were being discussed by some of the people providing testimony. Having been active in the Howard County civic and legal communities for over 30 years, I would like to address a few points for clarification.

The TIF is not a taxpayer giveaway to Howard Hughes.  It might be better to think about it as a joint venture.  While Howard Hughes and other property owners are poised to invest the initial $618,000,000 of what will total $2.2 billion into Downtown Columbia, the County is only investing the increased tax dollars that will flow from the Hughes' investment in order to jumpstart the process.  

No Taxpayer Responsibility.  The taxpayers of Howard County will not be responsible for paying for the TIF.  As set forth in the preamble to CB56 and in Section 3 thereof, "such bonds and the interest thereon shall never constitute a general obligation of the County or a pledge of its full faith and credit."  The mechanism for paying for the tax is that it will be paid from the taxes collected based on the increased incremental of the property taxes.  Moreover, should the increase in anticipated property taxes not be realized, it will be Howard Hughes or the then property owners within the special taxing district, not the taxpayers of Howard County, who will be on the hook. 

Why use TIFs?  As one member of the Council noted, something was going to be built on the land anyway, so why are we doing the TIF?  The answer is that we don't want just anything built.  We already got that from The Rouse Company when they developed around The Mall - unimaginative, low density housing and box restaurants surrounding The Mall.  That was pretty much what The Rouse Company was proposing for the Crescent back in 2005.  We rejected that approach in 2010 with the Downtown Columbia Plan.  We wanted better.  And infrastructure investments to be funded with TIF proceeds are part of any exceptional community like the one proposed in the Plan.

Howard County’s Role.  Should Howard County Government play a role in developing the needed infrastructure for our community?  Absolutely!  That's exactly what government does.  Roads, schools, public buildings, and other necessary amenities are all a part of what government provides.  Just take a look at our Capital Budget.

Benefits for the Entire County.  By using the taxes generated by the "increment" between what could have been built and what will actually be built, we can accelerate the construction for everyone's benefit – for jobs, for housing, for retail and for business.  And, because of the guarantees provided by Howard Hughes, current Howard County taxpayers will be protected.  Thus, the goal is for the downtown to be positively contributing to Howard County’s tax base long into the future.

The Vision for Downtown Columbia is Already Established.  The Downtown Columbia Plan set a vision that has guided us for six years of a 30-year process.  Because of the dissension regarding the TIF and Affordable Housing, the discussion regarding the vision for the future of downtown Columbia has been reopened.  Listening to the many people who provided testimony regarding whether or not we want a "vital" or "vibrant" downtown brought back all the memories of creating the Downtown Columbia Plan throughout 2009 and early 2010.   There is no need to change that vision now.

TIF is Not Just for Blighted Areas.  TIFs are commonly used for public projects, whether or not in a blighted community.  The "but for" test is the key to determining whether or not TIF financing should be considered.  The question is this: but for the use of TIF financing, would downtown Columbia be developed to its maximum and best potential in a timely manner?  The Downtown Columbia Plan set the vision for the maximum and best potential that was desired by the community.  The Plan further anticipated that TIF financing could be used to achieve that potential.  Thus, it can be fairly inferred that the passing of the Downtown Columbia Plan unanimously in 2010 was the answer to the "but for" test.

TIF’s Continued Viability.   TIFs continue to be viable in California and in every other state in the United States.  Indeed, in 2014, new legislation was adopted in California that would expand the scope and applicability of TIFs in California.  So, contrary to the assertion that TIFs are dead in California, they are alive and better than ever.

Confirmation at the Polls.  It should be noted that many of the opponents to the 2010 Downtown Columbia Plan decided to run one of their vocal leaders, Alan Klein, against Mary Kay Sigaty to show the strength of their position and, perhaps, to find a way to undo what was already accomplished.  Mary Kay Sigaty, as the member of the County Council in whose district the downtown is located, was one of the key leaders in getting the Downtown Columbia Plan passed.  In a very hotly debated primary election in 2010, Alan Klein was defeated by a 62.3% to 37.7% margin.  It wasn't even close.

The bottom line is that many of the same people who opposed the changes included in the Downtown Columbia Plan are now trying to slow down the development process in any way that they can.  That is their right, of course.  However, the vast majority of people in Howard County support the vision and goals of the Downtown Columbia Plan and hope only that the creation of the New City can happen during their lifetimes.

Michael W. Davis is a Columbia resident and senior partner at Davis, Agnor, Rapaport & Skalny, LLC.

 

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