Oh, To Be Madison Marquette!
$6.8 Million Giveaway
On the agenda this coming Tuesday, May 21st, the City
Council will consider allowing the Washington DC based Madison Marquette to pay back just $11.5 million
on a promissory note owed to the former Redevelopment Agency where the
principal amount, as of May 1, 2013, was $18.345 million, a giveaway to the
billion-dollar company of $6,845,000.
This write-down is justified in an April 16th memo prepared by Emeryville’s Director of Economic Development and Housing, Helen
Bean, in which Ms. Bean states that the present value of the principal balance
at a 7% capitalization rate equals the proposed payoff amount.
The City would not see the entirety of the $11.5 million
payoff. Like any debt owed to the former Redevelopment Agency, the money would
be sent to the County Auditor to be distributed to the relevant taxing
entities, with the City receiving 22% of the payoff, or just over $2.5 million. The Oversight Board and the state Department of Finance would also have to sign off on the deal.
This promissory note is complex and full of legalese, but
when our former City Manager, Patrick O’Keeffe, goes out of his way to sign a
non-binding letter of intent to enter into this deal on his very last day of work, something smells funny to
the Tattler. Furthermore, while a payoff amount that eliminated the interest owed could make sense, it
boggles the mind to imagine the response from Wells Fargo if you called them up to offer to pay
off your home mortgage by paying just 62% of the principal owed on your home. That kind of thing doesn’t happen for the 99%. Those
kinds of sweetheart deals are only doled out by Congress to their Wall Street cronies or our own City Council to its 1%
developer friends.
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