RITZ-CARLTON ASKS FOR 2 MORE TAX REDUCTIONS

Submitted by Roldo on Fri, 09/04/2009 - 12:23.

Signs continue to suggest disaster for local government as property taxes are ready to tumble. Tower City folk are seeking more reductions in the property value of the Ritz-Carlton.

The downtown luxury hotel had enjoyed a 20-year, 100 percent tax abatement. Back on the tax rolls it now asks for reductions via a reduced valuation on the luxury hotel.

 

I reported earlier this week that the owners of the Ritz-Carlton, a partnership of Tower City, a Forest City Enterprises connected operation, asked for one parcel to be reduced in value for taxation by $105,736.

 

Two other filings at the Cuyahoga County Board of Revision show requests for parcels 101-23-103F and 101-23-108F to be reduced by $63,752 and $71,952, respectively. Another $135,704. The parcels are on Huron and Prospect Avenues. These reductions would affect last year’s taxes and could mean that money either hasn’t been paid on these values or will have to be returned if found acceptable.

 

The Ritz-Carlton got a 20-year tax abatement and a $7.9 million grant from Cleveland in the late 1980s.

 

Tower City – Sam Miller and the Ratner family – made out almost as well as Dick Jacobs in the 1980s.

 

Tower City received a number of UDAGs (Urban Development Action Grants) from Mayor George Voinovich and Council President George Forbes. UDAGs went to cities with severe urban problems but the federal money, filtered through the city, went primarily to downtown interests.

 

Easy come, easy go was the George and George policy. After all it was only government money. (Voinovich, of course, is the great fiscal conservative. I never noticed it when it came to wealth interests.)

 

Here’s how helpful the pair of Georges were to Forest City Enterprises’ interests:

 

- Tower City got a $10-million retail UDAG.

- $2.7 million and $2.04 million grants for other portions of Tower City.

- $7.9 million for the Ritz.

-  $9.2 million for the Tower City/Old Post Office building.

- In addition, the owners got a $9.2 million UDAG for the Halle Building on Euclid Avenue.

Typically these grants were given zero interest rates. Many lasted for 20 years with not a dollar of interest or principal payable until the end of the period. Those paid back to the city early were repaid at a reduced amount.

 

Easy payments, as the ads say. But in these cases the pitch was very valid. Mayor Voinovich was very generous.

 

How good is life in Cleveland when your name is Sam or Al Ratner? As good as it gets apparently. Miller and the Ratners are very big political donors. A dollar given usually means millions in return in my experience.

 

Watch who gets their dough and you’ll know who’s friendly at any level of government.

 

As they can say, Cleveland been very good to us.

 

That never stopped the Forest City gang for asking for more.

 

We can expect a likely avalanche of tax reduction filings next year, starting in January, as complaints will be received by the Board of Revision asking for reductions, even if the properties have already been reduced by the Auditor’s office.

 

This tax situation is especially vital to the Cleveland School System. It gets 55.13 percent of property tax collections on city property. So it will be hurt most.

 

The rest goes as follows: Cuyahoga County, 21.24 percent; City of Cleveland, 15.68 percent; and Cleveland libraries, 7.96 percent. (This may not add to 100 because of rounding off of figures.)

 

Whenever there is abatement or a tax reduction the above levels of government lose revenue. Cleveland faces severe fiscal problems in the near future as the revenues decline.

 

We will get to more requests by downtown property owners for decreases in property valuation.

 

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the giveaways

I remember those UDAG's so well and the lack of information about them. Maybe I should say misinformation because the Voinovich administration said that UDAG's could only be used for downtown development. By the time that the regular people figured out that this meant that HE would only use them for downtown development, it was too late.

I don't know where Jackson is on this stuff. Is there any hope that with the new ward council reps, if Jeff Johnson gets elected, if we get someone decent in ward 14, that a voting block can be set up that might actually legislate some sense into this city? 

Roldo is correct, the chicken are coming home to roost.