But first some lovely dance music:
And Mary invokes Rube Goldberg which in turn got my radar up – well that and the fact the buyer of the old Ocean Expo land is the company that sold it to the City to begin with:
An additional research source is the D’Iberville Comprehensive Financial Report Fiscal Year Ended September 30, 2011. A 123 page pdf; but those interested in the Ocean Expo/Ramco Developments, LLC mentions can go directly to pages 57 and 65.
The linked report states
” In June 2011, the City entered into an agreement with Ramco Development(sic), LLC to purchase approximately 6.5 acres to subsequently lease to the Institute for Marine Mammals, Inc. for the construction of the Ocean Expo Learning Center. The land was purchased in the amount of $6,969,600. The City issued special obligation bonds in the amount of $4,500,000 as described in note 6. The City also issued a promissory note in the amount of $2,469,600 to Ramco Development(sic),LLC which is secured by an assignment of lease. The City has agreed to assign and to set over to Ramco Development(sic), LLC, 75% of the City’s $1 per patron lease payment as provided in the lease agreement with the Institute for Marine Mammals, Inc. Any outstanding balance on the promissory note will be due and payable in full on or before June 2031.
Let’s do some basic math and see where the raw numbers take us:
6,969,600/6.5 = $1,072,246 (Price per acre paid to RAMCO for the Ocean Expo Site)
7,600,000/8 = $950,000 (Price per acre D’Iberville will receive from RAMCO if RAMCO exercises option to purchase)
Sweet deal. The City uses the fact that RAMCO will open a new auto dealership as justification for the $2MM in tax increment financing the City will incur but I disagree. If the market is there for a new auto dealership then I trust in the marketplace to meet the need. Instead we have the City seeding a private business in one heck of a real estate deal for that private business from outward appearances. How about some more math:
6.5 Acres sold by RAMCO to City in 2011 * (1,072,246-950,000) = $794,599 gain on the property flip by RAMCO.
If I were a citizen there in D’Iberville I’d do my level best to get the City out of the real estate business since that is the taxpayers that are getting stuck with the tab for all of these money losing real estate transactions.