More transparency will mean fewer fireworks over an obscure adjunct to Monroe’s government that sits on over $20 million.
About three decades ago the Interstate 20 Economic Development District was created as a vehicle to provide for infrastructure needs along the eastern reaches of I-20 in Monroe. It has partial tax increment financing for sales, meaning it receives 40 percent, mostly from Pecanland Mall, of state sales tax collected, which then is used to pay off debt issued and its interest to provide funding for approved projects.
The I-20 EDD, like the Tower-Armand EDD, is somewhat unlike Monroe’s other economic development districts. While the other four are written into state statute, these were grandfathered into law from cooperative endeavor agreements with the state. The others also have a wider range of TIF source options for revenues. This also means their governance is established through bylaws over which the City Council has authority.
Controversy has ensued over a decision last year and ratified in January to fund a project unlike any other the district has authorized, which comes from its board of directors chosen by members of Council and the mayor. Local businessman Alven Square and developer Charles Theus asked the I-20 board to provide $4.5 million in funding for infrastructure to support a 113-lot residential subdivision being built under Square’s company, DZE LLC. A cooperative endeavor agreement, differing from the usual practice of the district overseeing work and paying for it as it went, was signed in February.
But Republican City Councilor Doug Harvey began questioning the atypical nature of the deal, which immediately after the CEA was signed brought a bill for $502,036.61 for work claimed already completed. The project wasn’t for an industrial or commercial concern, important because sales taxes could be generated from these that could pay off bonds. It wasn’t even located in the district.
Further, $309,377 of that came from a subcontractor of which Theus is an officer that included expenses not associated with infrastructure and the documentation for which appeared cursory. Theus served many years as the executive director of another Monroe EDD, the Southside EDD, a stormy tenure that included accusations by and against Theus of mismanagement and provoked three inquiries by the state. And, the CEA has not been vetted by anyone with independent legal expertise.
This prompted Harvey to ask for an attorney general’s opinion on whether the funding was legal. According to the jurisprudence associated with such an exchange, to be legal a deal must have a public purpose, not appear gratuitous, and have a reasonable expectation of getting a return for any investment, which without sales tax revenues going to the district appeared problematic.
This led to Monroe City Engineer Morgan McAllister at last week’s board meeting telling it he would not pay the invoice until the attorney general opined that the deal was legal. No action was taken after matters devolved when board member James Earl Jackson, Sr. called the refusal racist (Square, Theus, and Jackson are black).
If Monroe will dole out half a million taxpayer dollars, caution is warranted. But perhaps misunderstandings and frayed tempers could be avoided if there was much more sunshine on the district’s workings. While the board meets on a regular basis, there’s no readily-accessible information about it, such as listing its powers, board appointees, agendas, minutes, and finances. About the only information easily available (if somewhat cryptically), coming from the city’s required annual audit, is the more than $20 million balance of funds as of last fiscal year.
Indeed, board member and Democrat Councilor Juanita Woods previously had said she couldn’t locate minutes for any but recent meetings. Yet at the meeting she turned around and accused McAllister of collaborating with Harvey (which McAllister denied) by giving him board documents associated with the deal – which in any event like minutes is a public record.
Obscurant information on the I-20 EDD only serves to induce and intensify conflict Monrovians can do without.
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