Bond bargaining

by David Forbes August 15, 2016

Council sends the first bond referendum in nearly 20 years to the voters in a short meeting that illuminates the divides ahead

Above: Asheville City Council member Cecil Bothwell. File photo by Max Cooper.

Asheville City Council’s Aug. 9 meeting was a short one, just 40 minutes long. Front and center were three bonds directed towards affordable housing, transportation and parks and rec. By the time the matters reached the dais, they’d been the topic of work sessions, discussions, previous meetings. Now, Council looked to put the matters before the voters in the November election (we have a more detailed look at the bonds and how they came to be here).

Bonds are debt directly tied to city property taxes and while they’re common in a number of cities, including in North Carolina, as a way to fund major projects or needs Asheville’s local government has generally shied away from them in recent years. The last bond Ashevillians considered on the ballot was in 1999, seeking $18 million for parks and greenways, and it failed.

But the city’s politics have changed a great deal since then, and public concern over the affordable housing crisis, aging infrastructure and languishing post-recession park projects combined with an improved credit rating to give the idea of a bond referendum political momentum. Council’s seeking approval for $74 million, with $17 million for parks and rec, $25 million for affordable housing and $32 million for transportation infrastructure.

On Aug. 9 Council readied to take the final step from their end, deciding whether or not to place the three items before the voters.

While those hearings didn’t last particularly long, they did reveal some of the political divides over the bond and how those may play out in the future.

Asheville’s conservatives have been notably — and harshly — critical of the whole idea of the bond, asserting it would lead to too high a tax increase and that Council hasn’t been transparent in how it’s proceeded.

“All this, I believe, is merely window-dressing by the City Council in collaboration with certain unelected city staff to foist a poorly-planned and unnecessary, pie-in-the sky $110 million financial burden upon the city and its residents for years and years to come,” Sidney Bach, who’s criticized the bond throughout the process, told Council, claiming that the increased property taxes would make housing less affordable.

He also criticized the areas the bonds targeted, claiming it should have gone to police, fire and teachers, and claiming city staff would just use it as a “slush fund.”

“I’ve labelled this the $75 million Ponzi bond,” Chris Peterson, a developer and former vice mayor, told Council during the open public comment period at the end of the meeting. “You have taxed and taxed and fee’d us to death.”

He also claimed that many people in Asheville wouldn’t be able to afford the tax increase.

Responding to Bach, Mayor Esther Manheimer noted that about half the city’s budget each year is already allocated to public safety and that under state law the city couldn’t use bonds for teachers and schools.

She added that the city estimated the maximum property tax increase necessary for the bonds at about $110 a year for a house worth $275,000.

“This is not a big hit to do a lot of good,” Council member Cecil Bothwell added, later replying to Peterson that as an independent businessperson on a limited salary, he felt “our taxes are an amazing bargain.”

The other speakers represented a different view and a different set of concerns: broadly supportive of the bonds themselves, but calling for scrutiny about where their funds will go if they pass.

“Should it pass, I would like to strongly recommend that as 13 percent plus of Asheville’s population is African-American, you at least allot 13 to 20 percent of the money focused on the African-American community in the three areas you mentioned,” Bettie Council, a racial equity activist, said.

“I’m here to speak in favor of affordable housing,” Greg Borom of the Children First non-profit told Council. “We’re very encouraged and pleased by your continued focus on trying to make housing affordable to more families in our community.”

But, he said, the city needed to share data on how the bond would advance goals on racial equity and economic mobility.

Borom added that the city also needed to make sure some of the funds hit those desperately in need of housing, making 30 percent or less of the median income and also directing homeowner aid funds from the affordable housing bond specifically towards “closing the racial wealth gap.”

Bond projects must be already planned (earlier in the meeting, Manheimer noted that a new bus station wouldn’t be eligible for bond funds), but otherwise there is a good deal of latitude on which projects the funds can go to, as long as they fall within the broad categories approved by the voters. The mayor pointed out that in a poll commissioned by the city earlier this summer, the parks and recreation bond had 80 percent among the African-American community and “I think there are some really great projects” that are “especially important” to the city’s black communities.

Council member Gordon Smith claimed that the bonds came about because of the demands of the public for faster action on the issues they saw in their city.

“Here at this dais we hear from people all over the community who let us know what issues they’re facing in their neighborhoods and in their lives,” “This Council has been doing our level best to meet these needs. What these bonds allow is for the people of Asheville to decide whether to accelerate towards those aspirations they’ve communicated to us. If they choose to do so, we’ll be right there with them.”

Council member Julie Mayfield said the bond proposals were “really exciting” and stemmed from the discussions and concerns raised in the last election and would make Asheville “an even better place than it is now.”

Council passed all of the measures unanimously.

Bothwell claimed that letting the people of Asheville get the final say on the need for the bond was precisely what Council was doing, and by putting it on the ballot, they could determine what the citizens’ will actually was.

“There certainly are arguments on both sides of any of these bonds,” he said. “But the point of presenting it to the people of the city to vote on is to let us have a debate about this from now until then. The question of whether people support it tonight or not is not the question. The question is: can we have a discussion about this going forward?”

“What we’re doing as a Council is handing it to the citizens of our city and asking you to make a decision about our future,” Bothwell concluded.

Their answer will come in November. In the meantime, despite its brevity, the Aug. 9 meeting was illuminating about a number of larger dynamics. Over the past two decades, local politics have shifted, and Asheville is now a relatively left-leaning city where concerns like affordable housing are front-and-center.

Nonetheless, a lot’s at stake this election and it’s an open question how many people will weigh in on the downballot questions like the bonds. It’s been awhile since Asheville’s conservatives have had a local win, but if they tap into anxieties about taxes and mount a determined campaign, defeating the bond isn’t impossible. On the other hand, higher presidential year turnout in a city with Asheville’s political make-up could give the bonds a landslide on the strength of liberal and left-wing votes.

The other comments indicated that more debates may be awaiting after passage of the bond, as people supportive of the basic goals debate how best to scrutinize and spend the $74 million, and which communities should be the priority. The bonds could well remain a big issue long after November.

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