Jim Graham asks: "Does anyone now wonder why the organizations such as Sherman and PPL want to build large multi-unit apartment buildings that are financed and paid for using our taxpayer dollars? They pay little or nothing for the building........."
Vicky adds: Jim - it's worse than you think. They actually PAY THEMSELVES for taking our money! In the case of Riverside Plaza, Sherman et al. took a $3.5 million developer's fee - and he didn't even "develop" anything - the buildings were already standing. In fact, Sherman's partner (Boosalis) sued him to collect a bigger chunk of the spoils. In addition to the "developer's fees," there are the "management fees" and the "accounting fees" and the "asset management fees" and the "construction supervisory fees" and so on and so on. These fees don't even include the money he pays himself through "related corporations." [Enron called these "special purpose entities".] Quote from a Deloitte & Touche audit: "The Project was managed by SB Real Estate Services Inc. from January to July of 1994 and was managed by Sherman Associates, Inc. from August to December of 1994, both affiliates of one of the general partners, for a monthly accounting fee of $4,560 plus a management fee equal to 6% of operating revenues collected. Operating revenues collected in 1994 totaled $8,621,726, resulting in a management fee earned of $517,304........Other 1994 related-party transactions include cost reimbursements to Sherman Associates Support Services, Inc. (wholly owned by George Sherman) of $668,728 for salary and benefit costs related to employees involved in the operation and maintenance of the Project."..... Vicky continues: These so-called affordable housing developers have large "families" of "special purpose entities." The SPE's, just like Enron, suck all of the cash out of the project. Based on my research, the actual purpose served by these baby corporations is twofold: To avoid paying taxes and to deceive government lenders. Minneapolis has a merry band of these real estate guys, starting with Richard Brustad (former MCDA director) - all the way up to our most recent borrower - Minn-i-Homes (Steve Minn and Jackie Cherryhomes.) By the way, the 2000 census shows the median income in Minneapolis around $35,000. One of these days, the voters and taxpayers will actually figure out what's going on. That is my hope. Vicky Heller North Oaks REMINDERS: 1. Think a member has violated the rules? Email the list manager at [EMAIL PROTECTED] before continuing it on the list. 2. Don't feed the troll! Ignore obvious flame-bait. ________________________________ Minneapolis Issues Forum - A City-focused Civic Discussion - Mn E-Democracy Post messages to: mailto:[EMAIL PROTECTED] Subscribe, Un-subscribe, etc. at: http://e-democracy.org/mpls
