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A Critical Investment

by Dennis Marsoun

May 3,2004

The news of late has been the reported request by Spectrum Properties for $9 million for the renovation of the Old Convention Center. You can almost hear the public saying, “There they go, giving money to private business again!”

Ah, but is that what Spectrum is really seeking? I had the opportunity to review the request with Jim Dulin and Darryl Dewberry of Spectrum Properties. It actually comes out much differently. The total amount could equal the reported $9 million, but it is not a gift.

I know that sounds like voodoo economics, but let’s look at some numbers. In terms of hard cash, real money, Spectrum is asking for $4.8 million in infrastructure costs and site improvements. This is primarily for sidewalks and landscaping of public property and an enhanced connection to the Light Rail line on the side of the building facing the tracks.

Most of this has been agreed to in principle between the parties. After all, it is the City’s responsibility to maintain public access, and anyone walking around that building would have to agree that there are many points of access that are needed.

The connection to the Trolley and Light Rail line is an important, and I think, brilliant move. By that single connection, access to the rail system will have internal connections to most of the major office buildings in the City, including from Three Wachovia on the south end of Tryon Street to Hearst Tower on the north end. That is a lot of potential riders for CATS, and CATS will participate in funding that connection.

So, what about the remaining request of $4.2 million?

Spectrum is asking the City and County to keep the assessed value of the property at the current assessment of $14 million for 10 years. This, they believe, will be enough time to allow Uptown to mature into a retail and entertainment zone. By their projections, this artificial cap of the property value will save Spectrum an average of $420,000 per year for 10 years.

The estimated property tax that the landowners will pay will be $470,000 annually or $4.7 million over 10 years. Spectrum estimates that the public will realize an additional $2.3 million in sales and wage taxes each year.

Currently, there is no tax revenue generated from the site. There hasn’t been any in the 7 years I have lived in Charlotte, and if this opportunity goes away, how many more years will this property, in the heart of the City, go unproductive?

Now is the time for our City leaders to lead.

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