The way we proceed on the Brookfield loan (Gavidae property) is
yet another test of our ability to responsibly manage the City's
resources. While the Council is awaiting a full report on this issue,
two issues are central to the discussion.
First, any and all options available to the City for repayment must
be considered. The StarTribune accurately reports that the new finance
director is requesting more information about the security for the
loan. Before we jump to any conclusions we need to have this
information. Frankly speaking, any renegotiation must be based on the
long term interests of the City and not the interests of the
developer. This is just basic common sense in the business world.
Certainly Brookfield will understandably base its decision on its long
term financial health. Similarly, we must base our decision on
maximizing the resources available for community revitalization over the
long haul.
Second, we must avoid an agreement that will increase our
resources for the short term and leave a huge financial hole for future
Councils and residents of the City. The agency is under a tremendous
amount of pressure to find resources for many pressing city goals.
However, it is fair to assume that five and ten years from now our need
for resources will be no less and will likely be even greater than it is
today. Short term political gain and long term financial problems is
not a legacy I wish to be a part of on this Council.
This of course is where you come in. Elected officials at all
levels of government must be held accountable when short-sighted
financial decisions are made. As long as the consequences of these
decisions are not realized until years later, there will be those who
will be tempted to cash in now and save the pain for later. Upon taking
office in '97, I quickly realized that the City was already saddled with
significant debt and deficits in the City's enterprise funds. You need
to ask us not just what we are doing this year but how we plan on
sustaining these activities financially for the long term. Six of us
who opposed the budget in December had serious concerns about our long
term capacity to sustain the obligations contained in that budget.
It is too early to make a judgment on the wisdom of any
renegotiation of the Brookfield loan. I would caution against criticism
of the agency or Steve Cramer on this issue at this time. The agency is
bringing forward an issue that requires our consideration. I encourage
you to watch the issue closely.
Paul Ostrow
Mpls City Councilmember, Ward 1
Windom Park
(using my wife's email address at home and not the City's server)
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