LovelandPolitics.com Blog

In 2004 the McWhinney organization agreed to fund $12.5 million of the tax dollars their Centerra Metro Districts would receive to make certain upgrades to the I-25/US 34 interchange by 2010 and 14 years later fund the “final” larger improvement for over $20 million.

The City of Loveland kept its part of the bargain and McWhinney received governmental taxing authority for their special districts for 25 years of future property taxes (TIF) and sales taxes at a projected value of nearly $700 million. Using this authority, McWhinney’s entity borrowed $112 million through floating interest rate municipal bonds that now need to be repaid.

City staff, in apparent collaboration with McWhinney, are now urging the council to only award the lower cost “safety only” improvements for interchange of $ 8 million to free the remaining funds for other uses by the Centerra Metro Districts. On the chopping block is the upgrade to the bridge and landscaping improvements that were part of the Inter Governmental Agreement.

“Michael” and others have blasted this website for tagging some candidates as “McWhinneycrats” capable of agreeing to just about any whim or fancy McWhinney requests.

Now is their chance to prove us right or wrong. Hardly one month ago EVERY member of Loveland’s council voted to move $490,000 out of the I-25/US 34 improvement monies because the estimate, according to staff, were coming lower than expected and the money would not be required. Had council stuck to their guns and preserved the original $12.5 million promised there wouldn’t be an issue in completing the project as agreed.

Today the project cannot go forward because that money is gone and it has only some $11 million and change. Incredibly, McWhinney is lobbying council to allow them to strip away any landscape or bridge improvements and just provide the pavement essentially for safety due to the shortfall.

In an effort to distort the record, previous attempts by council to question the high cost of landscaping maintenance on the project is being used to argue the city didn’t want the landscaping anyway. In fact, the city argued only about a proposal to share the cost of landscaping with the Centerra Metro District.

McWhinney is looking to spend the least amount possible to complete the “Regional Transportation” requirement in their agreement with the City of Loveland thus allowing their Metro District to borrow even more money at the public’s expense. Arguments by staff that the changing economic situation necessitates the change in scope on the project are specious at best. In 2008 after the economy was already “bad” McWhinney borrowed another $60 million (now $ 112 all together) for the stated purpose of funding just this improvement.

If the regional transportation improvements were being funded entirely from current revenues the argument that the economy’s woes creates an impediment would hold water as funds for the improvement would not be available due to lower tax revenues. Instead, those monies were put aside from the debt for the purpose of funding not only the safety improvements but the landscaping and bridge improvements as well as reflected in the Inter-Governmental Agreement between the City of Loveland and McWhinney’s Centerra Metro District.

The point is McWhinney proposes spending the debt dollars whether or not the improvements are realized thus creating an equal burden to the Metro District’s obligation to collect taxes and repay the debt. Nothing in the “safety” only improvements proposal mitigates the potential impact of the ailing economy on the Metro District. What likely will change is McWhinney’s profit and ability to continue using the public monies of the Metro District as a kind of “slush fund” for their special projects instead of the promised regional transportation improvements agreed to with the city.

see LovelandPolitics.com story along with the legal documents and contradictory staff memos to council.

The vote this evening will be an excellent opportunity to sort out who on council is acting on behalf of the city’s interest by enforcing signed agreements and who is simply sitting on the dais on McWhinney’s behalf.

McWhinney doesn’t have the money for Crossroads Blvd. improvements from their taxpayer supplied slush fund called the Centerra Metro District. This despite having assured Loveland’s City Council previously on camera that they had the funds.

Now McWhinney is asking for a bail out of sorts from the City Council to allow them to take nearly half a million dollars from the I-25/U.S. 34 interchange improvements escrow fund with the city. They haven’t begun the improvements or even awarded a contract but believe the money is “available” since their newly convenient estimate says it will take less money than previously estimated. It is clearly another run at the same money Loveland residents overwhelming said was off-limits for anything other than improving the I-25 / U.S. 34 interchange.

McWhinney is also back this Tuesday (6:30 PM Council Meeting) for a third time to extract a special McWhinney Tax Holiday from Loveland’s City Council to build government subsidized low-income multi-family housing in Centerra. Once again McWhinney says the project is untenable without the proposed 61% tax reduction (CEF’s) but how do we know this? Unlike AIG, General Motors, banks and Wall Street firms the McWhinneys have long profited from government intervention on their behalf but without the need to disclose their own rewards from government assisted process.

If Chad McWhinney doesn’t cover the cost to our community of his new 303 unit apartment complex than someone needs to pay the costs required to provide these new residents local government services. Having working class taxpayers in Loveland further subsidize Chad McWhinney seems like an odd solution in tough economic times.

How can any member of Loveland’s City Council vote to manipulate the taxes to increase McWhinney’s bottom line when they don’t know what it is. Maybe Chad McWhinney needs to really start acting like a “partner” with the city as he says he is and disclose his own income from the proposed apartment project and other subsidized projects.

Perhaps if the Loveland Reporter-Herald began investigating substantive news stories instead of attacking what they call internet “citizen journalists” on their editorial page the city’s finances would be in better shape. Two suggestions would be the recent change for Rocky Scott regarding his role with McWhinney and another might be the potential termination of the Enterpise Group as a result of McWhinney pulling out their funding.

It is preposterous for Chad McWhinney to seek any further subsidies or bail-outs from Loveland’s hard working taxpayers while not disclosing his own profit from these projects. If the City of Loveland is truly his business partner shouldn’t they be privy to his profits and not only his costs? You need to know both to understand where the bottom line really is.

The lack of integrity and shame by the McWhinney organization is appalling as they ring our city council once again like an old rag for even more money while never disclosing how much is going into their own pockets.

Updated May 22, 2009 – Council approved the money only if both companies (CPS and Agrium Technologies) lease a McWhinney owned property. Mike Masciola (VP of NCEDC) did indeed say the company decided to move to Loveland back in April. Read our complete story on the decision by council May 19, 2009.

We posted a story yesterday (May 17, 2009) regarding the rushed cash incentive request being pushed to Loveland’s City Council by McWhinney on behalf of their future tenant Agrium Inc. and its subsidiary CPS.

The NCEDC (Northern Colorado Economic Development Council) is said to be assisting the company’s move from facilities in Greeley into a new location in either Johnstown’s 2534 (south east corner of I-25 and U.S. 24) or Centerra across the street.

McWhinney has included some analysis of the benefits to Loveland if the company moves to Centerra by CSU Economics Professor Martin Shields. What is not included in the analysis is a disclosure statement that Shield’s salary is partly paid by the NCEDC (a group funded and partly controlled by McWhinney).

Hardly independent, Shields’ analysis uses specious reasoning built upon incredible assumptions regarding the benefits to Loveland if the company changes locations. Nowhere in the documentation is there a comparison between the actual choice the company is facing, moving to 2534 just outside Loveland or Centerra just inside the same city limits. Instead, the study pretend the question is only whether or not the company will be leaving Greeley for Loveland.

In February of 2008 Loveland provided cash to local employer V-NET. That incentive package has gone terribly wrong. Loveland has not only lost jobs from V-NET as the company recently dropped from its high of 78 employees in Loveland to 56 total employees but now stands to lose part of the incentive financing as well.

Please feel free to make any comments.

Information is a powerful thing. We want to thank all of you who assisted Loveland Politics in informing the residents of Loveland and the local media about exactly what McWhinney proposed in amending again the MFA (Master Financing Agreement).

Each amendment is more preposterous than the last and it is difficult to believe any custodian of the public’s trust (Loveland Council) would be willing to even consider McWhinney’s proposals. This time, McWhinney wanted to abandon their near-term obligation to use tax dollars their Metro District collected to make safety improvements to the I-25 and U.S. 34 interchange. This time, they took their influence over our Loveland City Council just too far.

It seemed like only 6 Loveland residents blindly supported McWhinney’s outrageous proposal but those 6 are members of Loveland’s City Council and their opinions matter. Greeley, Larimer County Board of Commissioners, CDOT (Colorado Department of Transportation), the rest of the development community and all of you finally persuaded them to become better stewards of the public’s trust.

While much of the local media is reporting again the McWhinney spin about not wanting to divide the region – we report the facts. They were counting heads and realized they were likely not going to win. Inside last minute proposals by their supporters on council to make the delay only two years etc.. failed because their real intent was to largely abandon their obligation hoping others would pay.

Instead of fighting over the chicken feed ($12 million) we need to begin asking what happened to the $100,000,000 they raised through public debt over the past four years and spent. The debt interest obligation is now North of $5 million every year for the next 20 years not including principal. Where did they spend all that money and who is checking their accounting?

Checkout our recent story regarding Chad McWhinneys luxury yacht in Mexico and million dollar house he just purchased in Loveland. His friends and fellow developers came forward with this information because even they figured this time he had just gone too far.

The Larimer County Commissioners sent one letter against and now another not against but also not for an amendment to the Loveland/McWhinney MFA (Master Financing Agreement) amendment to relieve McWhinney of any current obligation to improve the I-25 and U.S.34 interchange. Sound confusing? It is mostly because the story McWhinney’s people are putting out is contradictory, not accurate and constantly changing depending on who their target audience is.

Jay Hardy (also called Loveland’s Baghdad Bob) and Rocky Scott are the two McWhinney employees on the front lines trying to cleverly shift the debate surrounding McWhinney’s desire to abandon its responsibility to improve the I-25/U.S. 34 interchange.

In a stretch of the truth that would make even P.T. Barnum blush, Hardy and Scott are perpetuating the myth that McWhinney is obligated to use the funds obtained from the transportation project to create jobs in Loveland. In fact, the amendment being proposed does nothing of the kind.

The MFA (Master Financing Agreement) amendment McWhinney is seeking says nothing about bringing jobs to Loveland. Instead, the proposed amendment to the MFA only removes the requirement that McWhinney fund the interchange anytime soon while leaving silent the issue of what McWhinney will do with the money. McWhinney could easily apply those funds towards their ambitious projects in Garden Grove, California or the 915 acres development in Broomfield, Colorado at Anthem.

A majority of Loveland’s City Councilors are anxious to comply with McWhinney’s request as usual. McWhinney, for their part, are literally banking on weak kneed councilman and an apathetic public to pull money out of the interchange improvement fund and use it instead to improve their own private endeavors. Whether it is the one in Garden Grove, Broomfield or elsewhere is their decision.

Now is the time for those on the City Council to show courage. There is no shame in representing the residents of the community and making McWhinney fulfill their part of the agreement. Read the full story on LovelandPolitics.com

The Centerra Metro Districts have funded developer McWhinney projects’ landscaping, architectural finishes, Centerra monument signs and the Motorplex sign by determining they are “public Improvements.” As part of their agreement with the City of Loveland, McWhinney also promised to fund general transportation projects named “Regional Improvements” with the money raised through the Metro District bonds and taxes.

Instead, the McWhinneys have played a shell game with the money by changing the definition of “Regional Improvements” and regularly amending the Master Financing Agreement (MFA). In other words, in place of really funding the most critical Regional Transportation Improvements, which was the original intent of the agreement (MFA), McWhinney has simply negotiated changes to the definition of regional improvements in order to claim they are in compliance with the agreement.

Now $3 million of federal stimulus money will be spent to create roundabouts and make safety improvements to the rossroads/I-25 interchange. McWhinney is bringing before Loveland’s City Council another amendment to the MFA to continue their shell game by removing any language that forces them to fund the I-25/US 34 interchange before taking on more debt.

In secret meetings with each city councilor the decision to support their proposal was already made. Absent any significant public outcry, the City Council will approve the next in the series of MFA amendments to free the McWhinneys of any obligation to honor the original terms of the MFA.

Read the complete story and review all the important city documents at LovelandPolitics.com.

When the State of Colorado came looking for “shovel ready” projects to include for funding in the federal “stimulus” package, Loveland’s City Manager apparently tried to include the Crossroads and I-25 intersection.

If you reference our story on the front page (LovelandPolitics.com) you will see a link to the list of projects the McWhinney’s special Metro District agreed to fund in-exchange for 25 years of approximately 600 million city tax dollars. Crossroads is on that list.

Don Williams destroyed any chance for the RTA (Regional Transportation Authority) by trying to relieve McWhinney of these obligations by placing similarly funded projects on the list of unfunded projects. Greeley and Ft. Collins discovered the impropriety of using the RTA to subsidize one powerful special interest and withdrew. Loveland only needed to place transportation projects on the list that were not already slated for funding but Loveland refused thus collapsing the goodwill coalition

The City of Loveland is often referred to at regional meetings as “McWhinneyville” since the management acts like lobbyists for McWhinney instead of people representing the citizens of Loveland

Please take a moment and reference the list of “regional improvements” the McWhinneys and the City of Loveland used to sell their enormous tax deal with the city. Now, only four years later they are doing everything they can to get out from under the obligations. Shouldn’t we also ask that they reduce their share of the sales taxes as well?