Ogden City Council putting developer selection process under microscope
OGDEN — The Ogden City Council is putting the city administration’s redevelopment procedure under a microscope, in what several members of the legislative body describe as an effort to make the process more transparent.
Earlier this week, the council met with staff members from the city’s Community and Economic Development Department to discuss the process for how contractors are selected for the large-scale redevelopment work that often occurs inside the city.
Though it’s not the only means of government-led intervention meant to spruce up distressed parts of the city, Ogden often creates redevelopment districts, also called RDAs, to spur economic activity in select areas. The city’s age, combined with its socioeconomic makeup, makes it so that Ogden typically has more active redevelopment districts than any other city in the state.
The redevelopment districts can vary in how they function, but they generally work by freezing the tax valuation for all taxable properties inside an area of land that’s been targeted for reinvestment. For a specified time period or up to a certain dollar amount, future increases in property tax revenue are used in the redevelopment effort, a mechanism called tax increment financing. The TIF money is offered to developers as an incentive to build and it can be used for things like street and utility improvements, hazardous waste removal, property acquisition and the demolition of blighted buildings. In Ogden, RDAs usually collect those tax increases from the city, Weber County and the Ogden School District.
Ogden has more than a dozen active RDAs, many of which involve hundreds of millions of dollars worth of construction work. Ogden Deputy Director of Community and Economic Development Brandon Cooper describes the city’s redevelopment mission in simple terms.
“Basically, it’s enhancing livability by creating opportunity,” Cooper told the council on Tuesday.
But lately, according to several members of the council, there’s been a growing public feeling that the process isn’t fair. Or as council member Luis Lopez put it, a “perception of favoritism,” when it comes to the city selecting the developers who ultimately carry out the multimillion-dollar projects.
Cooper and the head of the CED department, Tom Christopulos, say while that might be the perception, it’s not reality. Cooper said depending on the type of development, the city selects contractors for the work in three ways: public solicitation, which comes in the form of things like a formal “Request for Proposal”; direct negotiation, whereby the city essentially seeks out its own developers; and unsolicited proposals, in which a developer comes to the city with a plan.
All of those avenues the city uses for arriving at a developer for a particular project are allowed by law, Cooper said, as detailed in the Utah Community Reinvestment Agency Act. Christopulos said the method gives the city the flexibility it needs to carry out a variety of work. For example, he said the larger and more complex a project, the fewer qualified developers there are. There are also cases where a developer independently buys a property inside the city and then engages Ogden about the potential to work on something together. If city development officials deem those plans as beneficial to Ogden, they’ll often collaborate.
“(You) just have to understand projects come to us in different ways,” Christopulos told the council on Tuesday. “There are some places where we can’t give everybody a shot at it because we don’t have the ability to (do that). … The question we ask ourselves is, ‘Is it good for the community?'”
Aside from a few extemporaneous ideas, like possibly including a council member on developer selection committees, the city council hasn’t offered specifics for changes it would like to see, but has said it would generally like the process to be more open and better communicated to the public.
Christopulos noted that development deals are always reviewed by the city’s legal department for conflicts of interest and other potential problems and noted that “transparency” — a term used frequently by council members when discussing the issue — is sometimes vague and indefinable, making it hard for his office to zero in on exactly what the council wants. Cooper cautioned that any changes made to the city’s process for developer selection should be for “expanding our purpose and expanding our impact, instead of making changes for the sake of change.” He warned that making the process too cumbersome could significantly slow down development progress in the city.
“To me, there’s an eventual point you get to where there’s a realization that we are here doing these jobs because we’re qualified to do them — that has to mean something,” Cooper said. “Layering on protection after protection after protection on the people that are hired to make those decisions is not good practice, to a certain point.”
But while they issued some cautions, Cooper and Christopulos also noted they appreciated the council’s desire to improve the process. Cooper told the council of one proposal his office had been kicking around, where his office would create an annual notice that would be sent out to the development community, informing potential suiters about work happening in Ogden.
“We can define that to be anybody registered with the state as a developer, trade publication lists — we can define the development community,” Cooper said. “But basically say, ‘We are open for business.'”
Cooper said the city would collect information of interested parties, things like company information, financial capacity, past projects and others, and put that into a database which would provide a clearer vision of the most qualified firms, relative to what city is trying to accomplish and a particular project.
The city will continue to discuss the issue in coming weeks.