FOR IMMEDIATE RELEASE
Clarksburg Town Center Advisory Committee (CTCAC)
March 24, 2007
CTCAC Comments on the March 21, 2007 Report of the Clarksburg Development District Advisory Committee (CDDAC)
On March 21, 2007 the Clarksburg Development District Advisory Committee released its Report, one day after CTCAC released its Report on Clarksburg Development Districts. Despite the time proximity of release of the two reports, CTCAC prepared its report independently of the work of the CDDAC and was not afforded the opportunity to review or comment upon a draft of the CDDAC Report, or the final report, prior to release. Nevertheless, the two Reports reach similar conclusions on the matters discussed in both Reports, and the CDDAC Report offers no material inconsistencies with the assessment and conclusions reached by CTCAC in its Report. [A few minor inconsistencies are noted at pages two and three of this release; in these CTCAC stands by its Report.]
The CDDAC was charged with providing a broad, policy-oriented assessment of Development Districts. CTCAC, in its independent initiative, focused on assessing the legality of specific Development District implementation. The CDDAC Report’s broader focus has meant less detailed attention to the specific statutory requirements and the relevant, material documents associated with Development District enabling legislation and implementation in Clarksburg that are the hallmark of the CTCAC Report. Nevertheless, the CDDAC Report reaches many of the same legal conclusions regarding Development District implementation as did CTCAC.
One of the broader issues discussed in the CDDAC Report was the advisability of continuing to provide the option for Development District financing. The CTCAC Report expressly disclaimed entry into the policy debate on this and other Development District issues, although CTCAC recognizes that a claim of improper implementation necessarily raises the question of whether it is advisable to leave open this avenue to further maladministration of the law. CTCAC welcomes the policy debate, but it should not detract from thorough investigation, report and immediate action on improper implementation to date.
In the same vein, CTCAC welcomes the CDDAC Report’s observations on other considerations directly traceable to the root problems outlined in CTCAC’s report. One such example is the CDDAC discussion of the nefarious “private infrastructure” device some developers are seeking to use as a backstop to possible failure of Development District implementation. CDDAC has also calculated a projection of economic loss to Clarksburg residents approaching $150 million over the life of Clarksburg Development District bonds. CTCAC has not reviewed the soundness of this projection, but it is self-evident that even if it is high by several orders of magnitude, the illegitimate transfer of developer financial obligations to the public is a serious, deeply troubling problem with far-ranging economic effects deserving of further investigation.
Specific Comments to CDDAC Report
Page 2
CDDAC notes the Master Plan requirement for financing to be in place for infrastructure and adequate facilities before development is allowed to proceed. Third paragraph, second sentence: the statement is made by CDDAC that “This clearly did not happen…in Clarksburg.”
CTCAC’s position, as is also CDDAC’s position throughout the rest of their report, is that the Master Plan requirements clearly were met at the time of development approval. They were met via the application of private infrastructure obligations as conditions of approval by the Planning Board for each developer and development at the time of the development approval. As noted in both reports, the Planning Board imposed the appropriate private infrastructure obligations upon the developers at the time of development approval, in accordance with Master Plan guidelines and requirements under Chapters 50 and 59 of the Montgomery County Code.
Page 7
CDDAC quotes the statutory requirements under Chapter 20A-1. First sentence after statutory quote CDDAC states: “No development district in Clarksburg has complied with these requirements.”
CTCAC’s position is that the Clarksburg Town Center Development District has not complied with the 80% property owner requirement, and that the other districts will have to comply at the second resolution stage. Since their compliance date is in the future, they cannot be said to have failed to comply as of today.
Page 10
First line: CDDAC references §14-9 as basis for requirement for petition of 80% of owners of real property.
CTCAC believes the correct statutory reference here is not § 14-9, but rather §20A-1(f)(2).
Page 11
Page 11, first paragraph: CDDAC notes that “Absent a Development District, development could proceed using “alternative infrastructure financing mechanisms…”
Page 11, last sentence in 2.3.1: CDDAC states that “No development in Stage Two or Stage Three has met all requirements for staging triggers and implementation mechanisms.”
CTCAC provides evidence in its report that all referenced developments (Town Center, Village and Arora) have complied with Master Plan staging triggers and implementing mechanisms. They have done so with developer infrastructure contributions mandated by Planning Board Preliminary Plan approvals, independent of any Development District financing, which approvals have been agreed to and accepted by the developers.
Pages 12 and 27
Page 12, end of first paragraph and Page 27, second line of third paragraph: Both state that staging requirements were not met.
For the reasons stated immediately above, CTCAC has reached a different conclusion.
Page 12
Page 12, last paragraph: The Report does not clarify the distinction drawn between “legal” disclosure and “practical or fair” disclosure.
CTCAC has not investigated the disclosure issue, but CDDAC is certainly correct in considering it pertinent to their charge. CTCAC is compelled to observe that if Chapter 14 had followed the mandate in Chapter 20A to require 80% property owner at the time of Development District creation, and if the Council had not improperly allowed creation to take place long after development approval and much development activity, most of the disclosure issues would have been nonexistent. If, as CTCAC recommends, all Clarksburg Development Districts are rescinded, the disclosure issue will go away.
Pages 15 and 16
Pages 15-16, Section 2.7: CDDAC discusses the equity of Development District application within Clarksburg.
Like the disclosure problem, equity issues evaporate if Development Districts are rescinded. The equity problem does not, in any event, involve developer inequity, because if one developer obtains a County-facilitated windfall, it is not “inequitable” that another one, with no development district, does not. Any inequity is purely among homeowners, some stuck with exorbitant extra taxes, some not, in the same general community.
Page 16
Page 16, second to last sentence: CDDAC mentions impact tax refund to homeowners.
Page 16, last sentence: “A development district will pay for a nearly identical new home.”
Regarding the second to last sentence, CTCAC is not aware of any instance where a homeowner is provided impact tax refunds, nor does CTCAC believe that the impact tax credit system is applicable to homeowners. Regarding the last sentence, CTCAC does not understand it, or how it flows from the prior discussion.
