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Tonight the Common Council of the City of Amsterdam will be voting on a resolution to declare terminated an Option Agreement with developer Uri Kaufman for the purchase of the old Chalmers Mill on Amsterdam's South Side. As a public service I am re-issuing a series of articles I have written over the last couple of months outlining my support for the termination and for the demolition of the mill. While there may be some editing of the original, time constraints do not allow me to redraft it into the cohesive whole that I would prefer. Still, I think most of the essential points are made, though with some repetition.
( Read more... )
 
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What follows are collected comments from my various Chalmers posts. The file was too big to post with THE CASE AGAINST CHALMERS. ( Read more... )
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Continuing the previous post. ( Read more... )
Buy my murder mystery The Evil Has Landed
and don't forget The Judge Report (THE BOOK) is now available, too!
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If we accept Mayor Thane's figures on future tax revenues for the Chalmer's project of $890,000 per year for the city, based on current tax rates, and extrapolate those figures to include County and School taxes, the annual real property tax burden on the owner would be approximately $3.8 million dollars.
Based on the 180 units of various sizes (which would be the maximum number under the sketchy proposals thus far submitted), that amounts to an annual tax burden in excess of TWENTY ONE THOUSAND DOLLARS PER UNIT.
The MAXIMUM rental proposed for the largest unit (and contrary to what the Market Study says the market will bear) is $1,800 per month. Multiply that by twelve months and you come to . . .
TWENTY-ONE THOUSAND SIX HUNDRED DOLLARS.
Balance this all out with the fact that the majority of the units would bring in less than the maximum and the one and only conclusion to be drawn is that THE ANNUAL TAXES EXCEED THE PROPERTY INCOME!
Never mind the expenses of operation, debt repayment, depreciation and repair and political contributions.
Do the math.
Mayor Thane clearly has absolutely no idea what she's talking about, and we are making major, multi-million dollar decisions based on her complete fantasies.
[UPDATE] I've gotten several complaints from people who, recognizing the absurdity of these figures, maintain that I am mis-stating the Mayor's figures, that the $890,000 was meant to include City-County-School combined taxes.
Sorry, but I am relying here on Mayor Thane's own words. She was specifically asked on the Sam and Mike show last week whether the $890,000 figure was just the city's share or the the combined total. She responded quite clearly that it was her understanding that it represented only the city's share.
And if she's wrong, isn't it important for we, as citizens, to know that our mayor is selling this project to us on the basis of figures that are, even if fully realized, less than 25% of what she's been telling us and by her own words believes?
My sources in City Hall tell me the Mayor is scrambling to come out with revised figures (and, no doubt, a revised mantra, to use her term). Let me save her the trouble (5th graders and advanced 4th graders follow along):
Annual taxes, twenty years from now, $890,000
Number of apartments, 180.
Average annual rental per apartment based on average of $1400/month, $16,800.
Annual tax divided by number of apartments= $4,9444.44.
But remember, I was being kind and using the estimated rentals Kaufman used to sell the project, and not the figures that his marketing study showed, which, as I recall, projected monthly average rentals of $750, making the annual income per unit of only $9,000.
The Mayor also estimates annual water and sewer fees of $102,000 ( I guess they're collecting their own garbage), for an additional per unit cost of $566.67, which added to the average real property tax per unit of $4,944.44 brings a total per unit annual tax of $5,511.10. Divide that by the total annual income per unit of $9,000 and you have an annual tax and fee payment of 61.23% of income! That's better than the greater than 100% of my initial calculations giving everyone the benefit of a perfect project, but still ridiculous.
And if, by chance, Kaufman gets his pie-in-the-sky rentals, and there are no vacancies, you are still dealing with $5511.10 divided by $16,800= 32.8%.
Again, figures so absurd that they could not be sustained. Obviously, the assessment would have to be far, far lower than the Mayor's estimate for the project to be economically viable at the point in the far distant future when they actually start to pay taxes. Obviously, if you are paying even 32.8% of your income from the property in real property taxes BEFORE figuring in mortgage amortization, upkeep, vacancy rates, depreciation, insurance, office overhead, etc., IT DOESN'T WORK.
I stand by what I have said. Anyway you look at this, it is plainly obvious that Mayor Thane has absolutely no idea what she's talking about.
[FURTHER UPDATE] Boy, am I being a piker. According to flippin amsterdam, unofficial spokesman for the Thane regime, this proposed assessment is based on 80 units, not 180. Therefore, let us get out the old calculator again.
$890,000 divided by 80 units equals ELEVEN THOUSAND ONE HUNDRED TWENTY FIVE DOLLARS TAX PER YEAR PER UNIT. Plus $566.67 in water and sewer equals EVEN THOUSAND SIX HUNDRED NINETY-ONE DOLLARS AND SIXTY-SEVEN CENTS.
Divided by estimated income of $16,800 based on Kaufman's highest estimates and you get 69.59 percent of income going to real property taxes. Based on his own market study estimate of $9,000 per year you get ONE HUNDRED THIRTY PERCENT OF INCOME GOING FOR REAL PROPERTY TAXES and fees.
So lets split the difference and call it $12,900 income per year per unit. Comes to then only 90.6 per cent of annual income. Before accounting for vacancies.
If that's the best they can do, and that seems to be their best, wow.
Buy my murder mystery The Evil Has Landed
and don't forget The Judge Report (THE BOOK) is now available, too!
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