October 20, 2014

Elyria
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Lorain school board protests city tax deal

LORAIN — The improvement of relations between City Council and the Board of Education was one of the goals of Mayor Chase Ritenauer when he took office in 2012, but a tax dispute has soured relations.

Council on Monday passed two 10-year tax increment financing infrastructure projects that will reduce future taxes to Lorain Schools. The $617,000 project at 3671 Oberlin Ave., where a Taco Bell is to be located. The $450,000 project at 5320 Oberlin Ave., is where a GenFed Federal Credit Union is located.

Tax increment financing involves using a portion of future taxes on properties in areas designated as blighted for infrastructure improvements. It is designed to increase economic development and property taxes. But the financing means less money for schools and other entities, such as libraries.

The school district, which would’ve received about 75 percent of future taxes paid by the businesses, receives about 25 percent while Lorain receives 75 percent. Board member Jim Smith said in a Tuesday email that the projects will cost Lorain Schools, which has about a $90 million annual budget, $112,150 over 10 years. Lorain, which has a $31.6 million annual budget, gains $158,390. Smith acknowledged that Ohio law gives Council the right to do the financing.

“Is there a difference between what one has the right to do and the right thing to do?” Smith wrote. “I believe there is.”

After the vote, Councilman Joshua Thornsberry, I-8th Ward, urged Ritenauer to “reach out” to the board.

“Sometimes you reach out a hand and it gets cut off, but you’ve got another one to reach out,” said Thornsberry, a Lakewood Schools teacher. “We certainly don’t want an adversarial relationship with the school board, them feeling as though we’re taking money away from the children.”

But that’s how board members said they feel. In a Tuesday letter to Council, board members denounced Payment in Lieu of Taxes programs. They said the programs thwart the will of voters who approve levies. The letter said the board has a “legal and moral obligation to secure, protect and defend the dollars that the citizens of Lorain have designated to fund the education of children through the voting process.”

Other entities such as Lorain County Community College and the Lorain Public Library System will lose a combined $46,240. Tracy Green, a college spokeswoman, said LCCC doesn’t have a position on the financing, but said the college recognizes there is a difficult balance between funding education and economic development.

Joanne Eldridge, library director, said she has mixed feelings about the financing.

“I’m hoping one day to see and benefit from it, but, short-term, it’s going to hurt us,” she said.

Ritenauer wrote in a Tuesday email that the financing has been used for successful projects such as the Deerfield housing development on Oak Point Road, the HarborWalk development at Black River landing and the widening of Jaeger Road. Ritenauer said with the Legislature cutting local government funding to pay for tax cuts, tax increment financing is a harder sell. Nonetheless, he said schools are not losing money.

“They are gaining,” he wrote. “Just not at the full percentage of the increased value.”

However, Greg LeRoy, executive director of Good Jobs First, a liberal, non-profit corporate watchdog, said financing for a Taco Bell or financing approved in December for a Family Dollar doesn’t make sense. Leroy said restaurants and retail stores don’t pay well and, unlike financing for an auto assembly plant or a high tech robotics factory, retail doesn’t have a ripple effect in creating more area jobs.

LeRoy — author of “The Great American Jobs Scam,” a 2005 book about the negative effects of corporate tax breaks —said the tension between Council and the board over the financing is typical.

He said similar disputes are occurring in Illinois, Iowa, Minnesota and Missouri.

“It’s a huge, huge unresolved issue,” Leroy said. “It’s so corrosive to school revenue.”

Contact Evan Goodenow at 329-7129 or egoodenow@chroniclet.com.

 


  • oldruss

    A Taco Bell? Really? That’s how the City Council and Mayor Ritenauer want to waste this latest round of Tax Increment Financing? Taking money away from the schools, especially when the school district is in such poor shape academically should not be countenanced. But this isn’t the first time City Council has robbed schools of the tax revenue to which they are entitled. Look at the CRA out on Oak Point Road, where Councilman Dan Given lives. It gave tax abatement to houses already built, and to upper-middle class housing developments, that needed no tax relief to spur sales. Now it wasn’t the LCSD that lost on that one, no, the City of Lorain shafted the Amherst Exempted Village School District, so who cares, right?

    • 2muchgovernment

      I was thinking the exact same thing when I read this article!

  • stillsleepyeyes

    Oh my, this shows how much they care about the children. Take from the children to help advance the given land of free taxes over there on he far west side………….but leave the people on the south side living in shambles………….remember when the next levi comes around………..but then they are no worse than the unions wanting to talk to the commish as so they don’t lose no money ether…………it’s for the children…………….just when you think they can stoop no lower………out comes the gardwennie play book……….

  • golfingirl

    So Lorain City Schools have an annual budget of $90M. They will lose $112,150 over 10 years, or approximately $11,000 per year.

    This equals 0.01% , or 1/10,000.

    In the now infamous words of Hillary Clinton, “what difference does it make?”

    The schools can waste it, or the city can waste it. Neither puts out a quality product anyway.

    • alreadyfedup1

      It’s taking away money from the Teachers Unions they must scream and wail and the and the grinding of teeth must begin.

    • Pablo Jones

      I was thinking the same thing. 11,000 out of 90 million. The annual raises and step increases the teachers make will dwarf that 11,000. I haven’t looked at Lorain’s numbers but in Elyria the annual raises and step increases raises EPS compensation costs by about $400,000 a year. And Elyria’s budget isn’t close to $90 million.

      But I’m sure we will hear that because of this huge cut bussing will be cut, teachers will be layed off, specialty classes will be cut, and the school day will be shortened.

      • golfingirl

        About 1/3 of a penny per student per school day.

        Doesn’t buy much education, does it?

        Oh well, the only battle here is who gets to waste the money, the schools or the city.

        Either way, it will be wasted!

    • oldruss

      And building a Taco Bell is enhancing the quality of life in Lorain. Well, maybe it is, but it shouldn’t be.

      The school district passed a 15 mil levy, to support the schools, NOT to build Taco Bells. THAT is the point. It’s only a dollar here and a dollar there, so what’s the difference, right?

      • golfingirl

        I agree. Just the same old story in Lorain for the past 40 years.

        By the way, I hate Taco Bell food!

  • Tom

    I think the research would provide that investments in education pay off in the local economy. Lorain school system is something that needs desperate help to turn things around. If the school turns around, people want to move near good schools, it’s common knowledge. If I were in charge, I would invest everything possible to turn that school system around and definitely not take anything away.

    • golfingirl

      Throwing more money to the schools will never “turn the school system around.”

      The Cleveland school district spends about $15,000 per student, making it among Ohio’s highest-spending districts, even as it sits at the bottom in results.

      Avon/Avon Lake spend less than $8000.00.

      It is a dropout factory. Only about 50% of those who enter 9th grade will graduate.

      The solution is always to throw more money at the problem, instead at looking at where the money is spent. History has proven this does not solve the problem.

      They spend more, because they get more, under the false premise it will improve results.

      Where has this ever worked?

      • Denise Caruloff

        I so agree…it is the spending and where it is spent and who it is spent on that is the real issue. If I recall the last school levy that passed..i think there was a loan taken out right after that…wth? and also what is the sour grape now…when it was being discussed the last round with the new family dollar store on 21st and Leavitt..Lorain city council invited the board to attend the meeting so that it could be discussed…no board member showed….and reason….PRESIDENT TIM WILLIAMS DIDNT BOTHER TO READ THE EMAIL OR OPEN THE LETTER THAT NANCY GREER SENT HIM RE: THAT INVITE!…but he sure had an excuse…give me a flippen break!
        People will move into this city when they know the kids are going get a good education..It’s about the kids…yeah right.

        • golfingirl

          If the Lorain Schools are relying on tax revenue from a Dollar Store and a Taco Bell to improve their performance, they are really in trouble.

      • SniperFire

        Why won’t the Chronicle-Telegram ever present this side of the facts in any of their related news and analysis?

        • golfingirl

          Because facts only get in the way of a “good” story.

  • Brian_Reinhardt

    Actions speak louder than words.

  • SniperFire

    Places with roaring economies have plenty of money for schools and other social services. The roaring economy must come first. Liberals, in general, are economic idiots.

    • Pablo Jones

      Will a $90 million budget for their schools They must think Lorain has a roaring economy.

      • golfingirl

        $90,000,000 divided by 7000 students = almost $13,000.00 per student.

        Avon/Avon Lake are less than $8,000 per student.

        Looks like more money spent, does not translate into better outcomes, does it?

    • county_elector

      History proves you wrong about liberals and the economy. The beginning of the decline in our economy came with Reagan’s trickle down theory, which, over the years, has destroyed the American middle class.

      • golfingirl

        Spoken like a true Democrat!

        Geez….It is no longer enough to blame it on Bush, do we have to go all the way back to Reagan?

        How about that Jimmy Carter? Now that was a model for Democratic economics.

      • SniperFire

        ‘History proves you wrong about liberals and the economy. ‘

        LOL. Detroit, Cleveland, Elyria, Lorain disagree with you. Leftists eventually chase out responsible people, and leave sheetholes where they are reign unchallenged.

  • Pablo Jones

    The budget for Lorain is $31.6 million and the budget for Lorain schools is $90 million. That just doesn’t seem right. Either the schools are spending too much money or Lorain isn’t spending enough money. I’m not saying spending more money is the answer. Just that with the size of Lorain and its infrastructure compared to the school’s it just doesn’t seem to be in proportion. Unless a large portion of that $90 million is going towards paying for new school buildings, but that still seems high.

  • SniperFire

    Looks like the discussion needs to be focused on why Lorain schools need 70% more dollars thrown at their schools than a better performing district such as Avon / Avon Lake. Is the money the REAL problem in Lorain schools, Liberals?

    • golfingirl

      The ‘D’ and the “L” words would likely fit in this case.

      • SniperFire

        This puzzles me. We obviously have another side of the story here, which points to money spent on the pupils to not be relevant to success. But in the editorial we only get the opinion of the hard Left, and the journalists go out of their way to find them: ‘However, Greg LeRoy, executive director of Good Jobs First, a liberal, non-profit corporate watchdog, ‘

        Why is presenting only one side of an argument considered good journalism these days?

        • golfingirl

          Because the conservatives already figured out the solution.
          Get a good education, followed by a high paying job and move.

  • Sis Delish
  • GreatRedeemer

    What does the Academic Distress Commission think , considering they are the ones that hold the purse strings.

    • SniperFire

      The C-T didn’t think it important enough to interview them for the report. They did, however, seek out some communist ‘corporate watchdog’ group to give us their opinion.

  • Daniel Sutter

    This is Lorain County, proper response is “Damn Bush and obama hating racists”

    • county_elector

      You are trying to be funny, but there is a lot of truth to your quote.

      • Daniel Sutter

        Implying that all these democrats know is how to blame problems like the idiot liberals tell them to. If you think bush is the blame or the intelligent people that can see through obama lies, your the problem. If you think the idiots that keep blaming Bush or calling people racist are the problem, then you are part of the solution.

  • BroDelish5566

    Avon Lake, the heroin capital of ohio