Thursday, May 29, 2008

Laurel Commons Briefing

The Laurel Commons developers presented their plans for the revitalized mall tonight. I arrived late but here is what I heard:

- They have settled on the following anchors for the project, a Regal 14-screen cinema complex, a new Burlington Coat Factory store, the existing Macy's, and an 400 unit apartment complex located in the old Montgomery Ward's garage area. (My original number of 1100 was quite wrong. - grw)

- The developers are asking the city and the county to kick-in to help finance the project. This is called a TIF, or tax increment financing program. A TIF is a common tool for redevelopment projects. A TIF creates a public-private partnership for the purposes of obtaining public capital investment for infrastructure improvements.

The Storyline

The TIF story is pretty straightforward. For example, assume today that the mall owners pay $250 thousand dollars a year in city property taxes. This is based on the mall's value today. The developers are going to make investments in revitalizing the mall such that the mall's value increases along with the property taxes paid to the city.

Let's say that the mall reopens in 2010 and the owners now pay $1 million dollars in property taxes on the drastically improved property. Then the new increment in taxes would be $750 thousand ($1 million less the original $250 thousand we get today).

The developers want the city to use 60% of that increase (~$450 thousand) to pay off a bond that will be used for improvements. The city will still get the original $250 thousand plus the $300 thousand from the remaining increment ($750 - $450). The TIF is set at this 60% level for thirty years. After 30 years, all of the taxes then go into the city's coffers.

In reality, the developers are looking for the city and the county to pay for a $36 million bond ($18 million each). The bond money will be used to pay for infrastructure improvements such as road and utility enhancements and new parking garages on the property.

It will cost the city approximately $47 million over 30 years to buy the $18 million dollar bond at a predicted 7.75% annual interest rate. But keep in mind, the city is paying the off this debt with the property tax increase (increment). Another way to think of it is that for every dollar in new property tax, the city keeps 40 cents and 60 cents goes to pay off the infrastructure debt.

My Conclusions

I'm a little disappointed in the anchor stores, but I'm realistic. The developers were stuck with the legacy of the smallest Macy's in the world and a long term lease with Burlington. Neither of those stores are currently useful to me or my family.

But in today's market, Laurel simply can't support the same stores as Columbia or Annapolis. Maybe over time, we could grow into more high-end stores. Redevelopment now could provide us with that opportunity later. I think the new Mall will be an attractive addition to the city. I'm looking forward to walking to the movie theaters and eating in the new restaurants.

I also support the TIF. If we do nothing, the mall continues to deteriorate and our tax base continues to erode. The deal they offered us tonight is significantly better than any other option we have and we might just find ourselves in a very strong position 5-10 years out.

I also don't think of the mall revitalization as a single isolated decision. In my opinion, it's the first move in a long-term strategy involving scores of properties along U.S. 1 from the Patuxent river south to Contee road. I see these properties as chess pieces on the city's game board. We have to plan our moves well today if we are going to thrive in the future.

Today, there are powerful development forces blowing through our region like BRAC, Green Line extended, Konterra, ICC and skyrocketing energy prices. These forces are rapidly changing our commercial and residential environment. We can't afford to wait. Have you seen Konterra? Those are billion dollar footsteps pounding just behind us. If we delay our revitalization decisions, we will lose. We must be smart and courageous.

We must look to the long term and plan multiple, mutually supporting, redevelopment moves today. We must be prudent. We must doggedly ensure the developer and the county comply with their parts of the deal. We must ruthlessly verify every detail. But we simply cannot afford to remain frozen in place. Laurel must have innovative redevelopment in our commercial core.

My Bottom Line

I want to see all of the fine print, but I believe that the Laurel Commons redevelopment proposal is a very reasonable and exciting first step. I also encourage the Mayor, City Council and the Prince George's County Council to support the TIF legislation.

Sorry for the long winded post. The story is complicated and I had to do some math. My 30 year bond payment calculation was based on the following fixed rate mortgage formula: c = (r / (1 − (1 + r) ^- N))P *N

The comments section is now open for you. What do you think about the Mall? Do you support the TIF? Please take the poll on the upper left side of this web page.

Full Disclosure: I served on the City's 2006-2007 Master Plan Advisory Committee.

Monday, May 26, 2008

Kindergarten Refresher for PG School Board?

"Share everything. Play fair. Don't hit people."

There are few things more important to our community than our school system. This is why I was surprised to read this morning that the Prince George's County School Board has recently voted to invest $36 million dollars in brand, spanking new offices for themselves and their school administrators. Please see "Timing of School Headquarters Move In Pr. George's Is Criticized by Some."

I'm one of those criticizing them. Why would the administrators put themselves in better facilities than the children they serve?

"Put things back where you found them. Clean up your own mess. Don't take things that aren't yours."

When my children were in PG schools, I remember going to meetings at the Sasscer Administration Building in Upper Marlboro to discuss the massive amount of deferred maintenance in the schools. So I figured that if the school board was buying themselves new digs, they must have caught up on all their school maintenance problems. They would never put their comfort in front of the safety and comfort of the children they serve, or would they? Here is what I found on the PGCPS Board of Education web site.

In September 2007, PGCPS hired Parsons 3D/I to perform an updated facilities condition assessment of 184 facilities (15.3M gross square feet). The purpose of this assessment was to determine the present condition of the facilities and to prepare a capital improvement funding plan required to maintain them.

Some of their findings:
- Mechanical, electrical and plumbing systems are antiquated, inefficient, and in need of major upgrades and/or replacement.
- Food service equipment is on average in poor condition, and 65% of all food service equipment is beyond normal life expectancy.
- Most buildings do not comply with ADA accessibility guidelines.
- Substructures are showing signs of settlement and water infiltration.
- Exterior building systems are showing signs of aging and deterioration.

Laurel area public schools had over $100 million in maintenance problems:
- Laurel High $31,066,348
- James H. Harrison Elementary $7,136,720
- Bond Mill Elementary $7,248,003
- Laurel Elementary $7,452,009
- Oaklands Elementary $6,029,400
- Deerfield Run Elementary $13,070,210
- Montpelier Elementary $9,463,852
- Oaklands Elementary $6,029,400
- Martin L. King Middle $9,002,537
- Dwight D. Eisenhower Middle $20,395,757

"Say you're sorry when you hurt somebody. Wash your hands before you eat. When you go out in the world, watch out for traffic, hold hands and stick together."

So can somebody explain to me, why the board is willing to spend money on their own offices before they repair our schools? I must not understand some of the details. Maybe one of our board or county officials will explain it to us in the coming days. What do you think? Please post your opinion in the comments section.

"All I really need to know about how to live and what to do and how to be I learned in kindergarten. Wisdom was not at the top of the graduate school mountain, but there in the sand pile at school."

Robert Fulghum is one of my favorite authors. He is famous for an essay about life from a kindergartner's perspective. Those are his rules from that essay in bold above. You can read more here.


Friday, May 23, 2008

As Gas Prices Rise: Laurel Home Values Will Skyrocket

I’ve been thinking about how we are going to survive the coming $6/gallon or worse extortion by the oil barons.

Part of the answer is living here in Laurel close to employment centers and on the Marc Train line. We really don’t appreciate how fortunate we are to have the Marc service in Laurel. Marc only costs us $3/day to commute to either downtown Washington or Baltimore on the heavily subsidized service. Today, Marc cuts your commuting cost in half, if you work in Washington or Baltimore.

I wanted to see how much living in Laurel was worth in terms of commuter savings. So I calculated the yearly cost of commuting to Rosslyn, VA. I assumed the federal government’s 235 working days year. I also assumed your car gets 30 mpg and I used current Marc, Metro and parking fees. I did not account for the public transportation subsidy programs that are offered by many government agencies. The federal program currently pays $110/month to qualified commuters.

I modeled four Laurel to Rosslyn commuting strategies. I estimated the one-way trip time and the total annual costs based on the price of a gallon of fuel.

1. Marc Train from Laurel to Union Station. Metro Train from Union Station to Rosslyn.
2. Metro Bus from Laurel to Greenbelt (routes 88/89). Metro Train from Greenbelt to Rosslyn.
3. Drive from Laurel to Greenbelt. Metro Train from Greenbelt to Rosslyn.
4. Drive from Laurel to Rosslyn.

Annual Cost @ $4/gal $5/gal $6/gal $7/gal $8/gal
1. Marc to Metro (75 mins) $1,575 $1,575 $1,575 $1,575 $1,575
2. Bus to Metro (90 mins) $2,468 $2,468 $2,468 $2,468 $2,468
3. Drive to Metro (60 mins) $3,701 $3,889 $4,077 $4,265 $4,453
4. Drive to Work (60 mins) $2,967 $3,368 $3,760 $4,151 $4,543

The Marc train from Laurel to Union Station is the best value at $6.70/day. You use your $125/month unlimited Marc Train Pass ($3/day) and then add in the $3.70/day for the Metro roundtrip ride to Rosslyn. There is no charge for your cardio walk from home to the Laurel Marc Station. The Metro Bus is the next best solution, but why ride the bus when the Marc is faster and cheaper?

Driving to Greenbelt and taking the Metro to Rosslyn will be the costliest commute until fuel gets closer to $8/gallon. The costs are so high because Metro charges $4.25 to park and $8.30 for your round trip to Rosslyn. Then you add in your fuel cost for the 24 mile roundtrip drive to Greenbelt Station.

Driving to Rosslyn means 50 miles a day on the road. At $4/gal and with an efficient 30 mpg car, it will cost you $6.70 for fuel and $6 for parking each day. I did not include the annual cost of having your head examined.

I commuted via the Marc Train during a year working on Capitol Hill. I read the paper and drank coffee on the way in to my office every morning. My Friday night commute home ritually included a bag of cashews and small bottle of wine. Try that on the Beltway.

p.s. I also really like the idea of brewing my own fuel. Have you seen these new home ethanol factories? Pump in water, electricity, yeast and feed sugar and you can make 35 gallons a week of pure ethanol for $1-2/gallon. Combine the ethanol factory with solar shingles and a typical Laurel family should be able to significantly cut both our energy bills and carbon footprint.

p.p.s. I hope the oil barons find a tasty way to eat all the crude oil that we won't need.

Thursday, May 22, 2008

Shared Memories Make Us Stronger

Every Memorial Day weekend for many, many years, Former Mayor Bob DiPietro and Rev. Warren Litchfield lead a brief ceremony at Ivy Hill Cemetery. This year’s memorial service will be held on Sunday, 25 May 2008 at 11 am.

Every year a large group of citizens, fire fighters, police officers, and former and current military service members gather at the cemetery for about an hour to remember why we must have a day for memorials.

If you come every year, you already understand why and we’ll see you Sunday. If you have never attended this unique Laurel tradition, you owe it to yourself to come and see one of the very best things about living in a small town.

It’s always a brief and moving service. A few short speeches, an honor guard, the American flag is raised and a brief prayer of remembrance is said for all of those who have served, who continue to serve and who have died serving our community and our country.

The city’s sounds seem to quiet for a few minutes. The breeze rustles the late spring leaves. Friends, neighbors, young and old comrades in arms stand straighter as the bugler blows Taps. We come each year to remember that along these rows of headstones and monuments, we remain tightly bound to them and to each other.

President Abraham Lincoln once remembered a large and bloody struggle for freedom. His remarks were brief as well and they remembered events in another small town about 70 miles North of Ivy Hill Cemetery not unlike Laurel. I can’t help thinking as I read the ending of his famous address below how appropriate his words are for us in our own small community 146 years later.

“But, in a larger sense, we can not dedicate—we can not consecrate—we can not
hallow—this ground. The brave men, living and dead, who struggled here, have
consecrated it, far above our poor power to add or detract. The world will
little note, nor long remember what we say here, but it can never forget
what they did here. It is for us the living, rather, to be dedicated here to
the unfinished work which they who fought here have thus far so nobly

It is rather for us to be here dedicated to the great task remaining before
us—that from these honored dead we take increased devotion to that cause for
which they gave the last full measure of devotion—that we here highly
resolve that these dead shall not have died in vain—that this nation, under
God, shall have a new birth of freedom—and that government of the people, by
the people, for the people, shall not perish from the earth.”

Sunday 25 May, 11 am, Ivy Hill Cemetery on Sandy Spring Road

Monday, May 19, 2008

The Giant Pool of Money: Housing Bubble Explained

According to the proposed FY2009 budget, the property within the city of Laurel is worth a total of $2,288,481,268. But of course this value is based on property assessments that were calculated while real estate in this region was surfing the housing bubble. The challenge will be to see how our residential and commercial real estate values fair over the next few years.

I have been trying to figure out this housing bubble business for months now. Two years ago, real estate prices were climbing to dizzying heights. Today they are wiping out in a death spiral.

Why? Where did all the money go? Who caused this problem? Should I blame West Laurel for this irrational exuberance? Is it Jack Johnson's fault? Will approving slots make it better? Why would banks arm wrestle each other to see who got to give a $400K interest-only loan to my unemployed tabby cat in 2005? Who got paid off? Why did we get left holding the litter box?

I'm a big fan of a radio program called "This American Life" hosted by Ira Glass. It is one of the best shows on public radio. They recently broadcast a show that answered all of my questions called, "
The Giant Pool of Money." The show runs an hour and I recommend it to anyone trying to understand what caused the housing credit bubble. I found their experts easy to understand and compelling.

You can listen to the show on your
computer or download it to your portable mp3 player via iTunes. I found it to be a valuable way to spend an hour. Besides, I don't have much else to do since my tabby cat's house went into foreclosure last month. Does anyone need a used litter box?

Friday, May 16, 2008


I'm disappointed. It seems that far too often American political debates and policy disagreements degrade into personal attacks. I fear that these attacks cast a corrosive fog over the entire process. Why would any reasonable person want to stand for elected office in this environment? Where will we find tomorrow's leaders?

The national election campaigns are notoriously vicious but personal attacks are occurring even at the local level. For example, the comments that were posted in response to last week's ethics story got totally out of hand in my opinion. I am so disappointed about some of those comments that I'm considering disabling comments.

I have not made up my mind because I'm torn between a desire to encourage healthy discussion of important local issues and my fear that every post during the upcoming Laurel election season will devolve into petty bickering and personal attacks. I wanted to create a cyber front porch where reasonable people could share their opinions on our community's goals, problems and solutions --- not a dark alley for attacking people.

The software has three comment modes. I can turn comments on, turn them off completely, or moderate them. Moderate means that I must approve the comment before it is posted. I don't want to moderate comments because I have always strived for complete transparency here. I have only deleted two comments in the history of Laurel Connections. Both of these comments met my standard for an over-the-line ad hominem attack. I pulled the comments after they were posted.

It's been my experience that most of the people who seek local elected offices have dedicated many years to community service. Most are involved because they genuinely want to serve. If elected, many shoulder their civic responsibilities at great personal sacrifice to both family time and career progress.

Why should this blog provide a public platform that submits these fine people to unsubstantiated and anonymous personal attacks? That's neither helpful for them nor healthy for our community.

Have I allowed the commenters to go too far? Are the comments useful for you? Should I disable comments? Where is your threshold for an inappropriate personal attack?

Please tell me what you think.

Saturday, May 10, 2008

Main Street 2008

I've got a secret that I know I share with many of my neighbors in Oldtown. Please don't tell the Laurel Board of Trade organizers because they work so hard to put on a good festival. But I like it when it rains on the morning of the Main Street festival.

Over the 27 years I've attended the Main Street Festival I've learned that a soaking morning rain knocks down the crowds just enough. The festival is better when the crowds thin out. You can walk down the street and see the booths. You run into more of your neighbors and can have a chat without getting pushed downstream with the unceasing flow.

This morning's festival started in a heavy rain. The organizers, police, public works team, and the ever faithful Laurel Police Auxiliary were already working at o'dark thirty in a cold downpour.
I wish I had taken a photo of Auxiliary Police Officer Wayne Dzwonchyk this moning about 8am. He looked like a mud soaked dough boy in the trenches of France in WWI. The rain was running off of his hat and down his face as he sleepily flagged away yet another vendor's box truck.

The parade was soggy but everyone still had a good time. I especially liked the lawn mower racing team. All of our local elected folks made it out for the Parade. The ever dutiful 21st delegation from Annapolis braved the rain along with our County Councilman, the County Sheriff, our Mayor and all of the Laurel City Council members and marched down the street. Kudos too to the LHS marching band and the West Laurel Ragtaggers, they were all wet but still sounded great.

The skies cleared by 11 and the crowds were good but not unbearable. She-who-must-be-obeyed forced me to walk back up to Main Street at 3pm to eat a sausage sandwich and have a lemonade. Chalk up another Main Street Festival and Happy Mother's Day to all.

Sunday, May 04, 2008

Laurel Leader Barely Gets The Story

The Laurel Leader's web-only story about Laurel City Council member Mike Sarich's ethics case left me barely informed this week. Their headline says, "Ethics panel clears Sarich — but barely." Unfortunately, the Leader never tells me that the panel decided unanimously in Sarich's favor. In other words, he was found innocent of committing any ethics violation. Not one member of the five person panel voted for finding a violation.

How does a unanimous decision rate a barely? Woman found pregnant, but barely ... makes about as much sense. Guilt or innocence, pregnant or not, these conditions demand a yes or no vote. It is not fair or even ethical to vote for one side but then turn around and call it the other.

I'm not taking sides on this case. I agree with the Laurel Ethics Commission that the rules on soliciting non-profits needs to be rewritten, both in Laurel and in Prince Georges County. The rules that allow our elected officials to act as bag-men for developer dollars has got to be stopped. If developers want to give money to local organizations, let them do it all by themselves.

The Mayor was doing his duty as chief executive officer of the city in bringing the case to the commission. But as far as the Sarich case is concerned, the allegation was made, the evidence was weighed and the panel voted. No ethics violation was found. The process worked.

I hope the Laurel Leader does the ethical thing and they fix their story in time for next Thursday's print edition.

Your comments are always welcome. Click the comments link below to post your opinion on this issue.


Update 5/5/2008. The Leader changed the story on their website today. The comments to this post are flying furiously. The Sarich effect has returned. Anonymous is even back! See the comments section for the complete discussion. - grw