Tax Increment Financing (TIF) offers False and Flimsy Promises

The city of Burlington loves Tax Increment Financing (TIFs) – whether it be for the Moran Plant, waterfront improvements, the mall redevelopment, or the nontransparent private marina process – even though TIFs are seriously flawed. TIFs are sold on flimsy and false promises – from helping low income communities to boosting the economy when it wouldn’t have been boosted otherwise. On top of this, TIFs in practice are undemocratic. Politicians will ask voters to approve a supposed done deal but they often amount to a blank check finalized behind closed doors by a select few. It’s time to end TIFs and invest public funds in low-income communities.

TIFs are districts where cities can ‘leverage’ private investment by borrowing on future property value increases. While there may be some benefits, those benefits are unproven and do not outweigh the many many downsides to TIFs.

The 6 problems with TIFs:

  1. Once you vote on the idea, you don’t get to choose the final product even if the final product is drastically different than the initial idea. See: private marina, mall redevelopment, City Hall Park.
  2. Since the goal line on TIF projects always changes, it’s impossible to hold elected officials responsible for failing to act on their words. For example, first the $20 million mall TIF would buy a couple streets and fix streets around the mall, but in the final weeks before the vote it included fixing an additional two streets to get voters to approve it.
  3. While TIF money may have originally been used to help struggling downtowns, it is now used in mainly wealthy downtowns to improve infrastructure for wealthy land owners. For example, the mall is owned by a multi-billion dollar investment company but supposedly wouldn’t build this project unless taxpayers gave them 9% of their funding costs for free. TIF money never seems to be used for programs to support those in poverty, like funding new low-income housing.
  4. TIFs hurts our public schools by taking desperately-needed millions out of the education fund for 20+ years, as TIFs money is split 75/25 education fund and general fund. The money used to improve our downtown never reaches Burlington’s low income children.
  5. TIFs raise rents and cost of living for everyone else by accelerating property values in urban areas past typical levels of inflation. They, like Downtown Improvement Districts, lead to accelerated gentrification.
  6. TIFs are sold as being integral to spurring new development, but are based on a false and unproven assumption that the development wouldn’t have occurred ‘but for’ TIF money. In fact, the ‘but for’ clause means ‘but for that specific design/development plan’. So we have no way of knowing if some level of development would have occurred regardless. Vermont State Auditor Doug Hoffer has made is clear that this ‘but for’ clause is impossible to prove or audit.

The reality is that MANY people, when they vote for TIF, they vote for a specific project without realizing they’re writing a blank check for politicians who may be more interested in making wealthy interests and donors happy over ensuring the community meets everybody’s needs.

In the end, TIF money gambles on the future with little oversight or proof of its effectiveness. It takes badly needed property tax revenue, money that our schools desperately need, and gives it to investors so that they can boost their profits and wealth for the next 20 years while taxpayers pick up the tab. It’s time to end TIFs and fund local government through taxes, and if necessary, bonds.

The Burlington Business Association, and DID Supporters, Do Not Represent Burlington Residents

This is Part 4 of a 4 Part series on how Mayor Weinberger and the Burlington Business Association don’t represent regular Burlingtonians and are using their influence to push a rushed and rigged Downtown Improvement District that gives a handful of wealthy folks even more power at the expense of actual Burlington residents. Parts 1, 2, 3, are here.

The BBA is made up of very wealthy business owners and homeowners, many of whom have little personal interest or stake in Burlington, who care more about bringing wealthy tourists to the city than serving regular Burlington residents, while a handful of BBA Members have extra influence. The BBA doesn’t represent ‘mom and pop’ businesses or Burlington residents in any real way, and when they support the Downtown Improvement District it is not to the benefit of most Burlington residents and workers.

When one thinks of the Burlington Business Association, they think of restaurants, bars, and retail shops owned by Burlington residents. The truth is quite the opposite.

40 members, or 22% of the BBA, has neither a shop or home in Burlington. Think about that. 1/5th of the BBA has ZERO reason to be members of the BBA in the first place! For all we know, maybe they’re actually interested in helping their own community’s economy and sabotaging ours.

81 members, or 40% of the BBA, aren’t even based in Burlington. While they have a financial stake in Burlington, it’s hard to believe they’re equally invested in Burlington when their main investment is somewhere else; they cannot be as committed to Burlington as a small business owner living in Burlington.

Of the ‘Small Businesses’ that politicians and the BBA and their supporters love to fetishize so much, only 27% of small business owners even live in Burlington. Why is our city good enough for them to extract wealth from but not good enough to live in, to raise their kids?

When you think of Burlington, what comes to mind? Restaurants, bars, retail, right? It turns out that the BBA barely represents the storefronts in Burlington, the whole reason our downtown is doing so well in the first place. Only 22% of the BBA membership represents the service industry, while a full 56% of BBA membership represents tourism, other business organizations, businesses that support other businesses, finance/lawyers, and real estate industry.

These are businesses that aren’t small mom and pop shops trying to make or sell a product. These are large corporations, businesses that try to attract wealthy business partners, clients, or tourists. These are not businesses that support, nor are invested in, the vast majority of Burlington workers or residents.


On top of this, the BBA members who live in Burlington are extremely wealthier than the typical Burlington resident, with an average home value of $560k-$640k, 75-100% higher than the MEDIAN home owner, putting them into the top 10-15% of wealthiest Burlington residents. In fact, only 1 member who lives in Burlington has a home that is priced below the median.

Lastly, as a little quirk, the BBA has a handful of incredibly wealthy members who have multiple businesses registered to the BBA, thereby giving them more influence over the BBA agenda. (Oddly enough, many Burlington departments are members of the BBA in a very strange blurring of lines and potential conflict of interest.)

It’s worth asking if the folks supporting the downtown improvement district have Burlington’s best interests in mind, and why our councilors overwhelmingly approved a rush plan supported by wealthy business lobbyists.

Updated: Why Are Developers and Housing Insiders Deciding Our Inclusionary Zoning Policy?

Correction: Councilor Knodell has let me know she is not a housing consultant and did not vote on Cambrian Rise. I stand corrected and apologize for the error.

The Inclusionary Zoning Working Group* is the sort of group that makes you want to bang your head against a wall. Approved unanimously by city council, it’s the perfect example of how our local politicians and government currently operate separately from constituents. The group consists entirely of housing developers and insiders, who meet 8 meetings during the morning when everyone is working, in class, or dropping their kids off at school. This group is a great example of a very noninclusive process decided entirely by political insiders – another example of our city using local experts for free advice instead of hiring outside experts who don’t have conflicts of interest.

Should we be worried about the the gaping conflicts of interests among participants, some of which I describe below? Should we be worried that we as a city are gladly letting insiders shape policy that will directly benefit them the most?

Who is on the committee? Local housing experts, as the council required. A City Council Member, who will chair the IZWG, 1 Representative from the Planning Commission, 2 For-Profit Developers, 2 Not-for-Profit Developers, 2 Affordable Housing Advocates, 1 CEDO Director or designee, and 1 Planning & Zoning Director or designee.

  • City Councilor Jane Knodell, a housing developer consultant with Monte and Davis (also in the group), who voted to segregate low income residents on the Burlington College development,
  • Erik Hoekstra, Redstone developer (and small personal landlord), who wants to gut inclusionary zoning,
  • Eric Farrell, Farrell Real Estate, building mega-development Cambrian Rise,
  • Michael Monte, CHT Director, housing developer consultant with Councilor Knodell and John Davis, who worked a deal with Farrell over the Burlington College Land, a deal that included entirely segregating low income residents into their own ‘ghetto’ building, supported the mall redevelopment even when it included a poor door entrance, and has advocating continuing this practice across the city,
  • Nancy Owens, Housing Vermont Director,
  • Bruce Baker, Real Estate Lawyer, Planning Commissioner, who hopefully doesn’t nor has ever worked for Farrell, Redstone, CHT, or Housing Vermont,
  • Brian Pine, former affordable housing director of CEDO who worked under Michael Monte, longtime friend of several people at the table, small landlord, and supporter of the mall redevelopment even when plans included a poor door entrance,
  • John Davis, Housing developer consultant with Councilor Knodell and Monte,
  • City Representation, David White, Planning Director and Noelle MacKay, CEDO Director

Other attendees for the other 7 meetings include Erhard Mahnke, director of the Affordable Housing Coalition (and longtime friend of most folks in the room), and a visit by city councilor Karen Paul. Those are the only people so far, not working for the city, who have had any input on the inclusionary zoning working group.

This group is 100% political insiders – folks who worked together on the Burlington College project, folks who have worked together in affordable housing since the days of Bernie, folks who regularly work on public/private development together. All of them are developers or landlords or directly work with them. All of them are MUCH wealthier than the typical Burlington resident, particularly those who benefit from inclusionary zoning.

Who is not included in this discussion?

  • Renters
  • Anyone from Legal Aid
  • Any case workers from BHA or Howard Center
  • People who live in inclusionary zoning units
  • Anyone living in poverty
  • Anyone who has lived in unsafe or unaffordable housing in the past two decades
  • Anyone who has faced growing housing discrimination or segregation

This is a working group created by industry experts. We wouldn’t want a smoking law to be decided by tobacco sellers and cigarette makers. We wouldn’t want our climate action plan to be decided by oil companies. So why as a city are we allowing this to happen? Why would our city council vote for this?

Thursday, March 8th, at 8am is their final meeting, and I will be there to share my displeasure with the process and what the group has decided on thus far – I hope you can join me.

*(For those who may not know, inclusionary zoning was created so that neighborhoods and buildings would remain economically integrated – the purpose is not to significantly build more affordable housing, an issue of great contention among the developer-class in Burlington.)

Burlington’s Fishy Private Marina Process

Please do not excuse the pun – little do you know I get paid by the pun.
There was a PIAP (public investment action plan) that occurred a couple years ago when the city wanted to redevelop parts of the waterfront. I remember reading about the details and finding a couple points that just didn’t quite add up.
1) The PIAP was won by private developers Burlington Harbor LLC, a group made up of three folks, one of whom is Chuck DesLauriers, co-owner of Hotel Vermont. Hotel Vermont was designed by architects at Truex and Cullins. The chair of the PIAP process? Bill Truex.
2) The private PIAP got a final score of 79, while the public marina scored 78.8, and I have been unable to find how they were scored. That’s so close for comfort, one would hope that every aspect of that grading process would be as transparent and open to the public as possible. A records request may soon be in order if I cannot find those documents soon.
One would hope that local leaders would recognize that the appearance of conflict can be just as destructive as an actual conflict, but the appearance may be the least troubling aspect of this process. It turns out that 3 months after the PIAP was completed, Burlington Parks and Rec won a prestigious $1,500,000 national award from the U.S. Fish & Wildlife Service for their rejected proposal.
This leaves us with a few really important questions: How was the PIAP process done, and did those involved in the PIAP process know that Parks and Rec had submitted a huge grant? If it was known, why wouldn’t the city wait the 3-4 months until they knew if Parks and Rec would win the grant, and factor that into their final PIAP decisions? Also, after learning that the Perkins Pier Enhancement may still be happening, what is the point of a PIAP process in the first place if the city can decide to move forward with whatever proposals they want? And lastly how, if this project was good enough to beat nearly every major city in the nation, did it manage to lose on the city level?