What’s the DIF? (WMP&I and Google images)

The ghost of Eastfield Mall and the promise of its property’s future hovered over the Springfield City Council on June 2. The administration presented the Council with a District Improvement Financing (DIF) plan to help pay for infrastructure around the site of what will be Springfield Crossing. Under state law, the plan will divert tax revenue from the project to finance bonds for the improvements.

A DIF, well, differs from a TIF or tax incremental financing. City officials told the Council that they had started there and worked toward the DIF proposal. Officials are eager for the redevelopment of Eastfield into what will become Springfield Crossing. The mall closed two years ago after many years of decline. While the DIF passed unanimously, the extended debate and commentary suggests concern that the public is not fully on board.

Councilors Malo Brown, Zaida Govan and Maria Perez joined the meeting virtually. Councilor Lavar Click-Bruce transitioned to virtual participation later in the meeting.

There was some opposition to the DIF during public speak-out. This may have prompted councilors and officials like Chief Development Officer Timothy Sheehan to emphasize the value of bringing the project to fruition.

A DIF operates similarly to a TIF in that the city will not receive the full value of potential tax revenue. Unlike a TIF, however, the money is not savings for the developer but goes toward improvements to the area. There will be bonds for the work, however, they are not the city’s debt.

“The city is not issuing a bond. The city is not a party to [the bonds], nor does the city have responsibility relative to repayment of those bonds,” Sheehan said at one point.

Springfield Crossing has three phases. Only the retail phase is currently under construction and the improvements the DIF will finance, which include grading and sidewalks, will complement the retail.

One the horizon. (via Onyx Partners/WAMC)

Despite the strong support for the project among councilors, there was some discontent over the timing. It is not uncommon for the administration to jam the Council with items and claim it requires immediate action. Still the consternation last Monday was relatively muted by historical standards.

“I would have preferred to have more time to air this out,” Ward 6 Councilor Victor Davila said.

This typified councilors’ mood, though nostalgia for Eastfield Mall and a desire for more in-city shopping options were more prominent.

However, at-large Councilor Kateri Walsh grilled Sheehan and the developer about the timeline, the choice of DIF subsidy and risks to city. (The city faces no risk, Sheehan assured again).

It has become widely known that Target, the Minneapolis-based retailer, would be one of the tenants. The company has come under fire for backing away from its diversity, equity and inclusion initiatives. This came after its years-long efforts to entice Black shoppers. This pullback is roughly in sync with although not a direct response to Donald Trump’s largely unconstitutional crusade against free association and racial equality. Target’s sales have sagged since its DEI about-face.

Click-Bruce asked if Target trouble’s would become Springfield Crossing’s. (still via YouTube/Focus Springfield

To that end, Councilor Click-Bruce asked about the risk of Target pulling out of the project. The project’s attorney, Seth Stratton, had thought Click-Bruce was suggesting Target’s arrival would invite protests. Click-Bruce clarified that while many Black residents may not be happy with Target, he was mostly concerned about the stability of the project’s leases. Stratton assured the leasing contract with Target was solid.

The DIF passed the Council 12-0. Ward 7 Councilor Timothy Allen abstained.

The rest of the agenda proceeded smoothly. The Council received the April Revenue & Expenditure report and authority utility work in five locations across the city. Chief Administrative & Financial Officer

Cathy Buono presented several budget transfers to make up for end-of-year deficits. The fiscal year ends June 30. Buono said much of the $196,000 transfer from the contingency would make up for payouts to retired employees and salary adjustments from contracts. Another $1,365,000 transfer from free cash would primarily cover the snow and ice deficits the Public Works and Parks, Recreation & Buildings departments have accrued due to having more snow events this winter.

Both transfers passed without dissent. The Council also approved a $3.3 million bond for municipal vehicles.

The Council also passed first step on an ordinance to deprioritize academic credentials in city hiring and promotion. At-large Councilor Jose Delgado had spearheaded the proposal. Two city employees who had claimed to lose out on promotions because they did not have certain academic credentials also testified. Delgado had argued that they had received on the job experience that should have counted in lieu of the degree.

Chelsea Parmentier, speaking remotely, told the Council that despite years of service as an election specialist, she was ineligible for a deputy election commissioner position. The position required a degree. Ostensibly, there was no way under current city HR practice to substitute it with Parmentier’s experience in the office.

Delgado had been soliciting public input ahead of presenting the ordinance on June 2. (courtesy Delgado campaign)

This prompted a thoughtful, if heated, debate among councilors on whether the ordinance would short-change city employees who did pursue degrees. At-large Councilor Tracye Whitfield, a former budget office employee, noted that she had pursued a degree in pursuit of career advancement. Delgado later clarified the ordinance would not remove academic credentials from consideration. Rather, it would simply require the city to consider how a candidate could substitute experience. That appeared to mostly satisfy Whitfield, who had said at the outset she supported the proposal in theory.

First step passed without dissent.

The Council then ripped through a range of grants. Among them was the city’s annual allocation of ride share fees from the state ($120,352), Focus Springfield funding from Comcast ($132,605), and municipal fiber funds ($250,000).

Of note were annual entitlement grants the city receives from the federal government. The city is currently locked in a standoff over climate funding. However, normal appropriations from annual program appear to be moving forward without delay.

Well, at least HUD isn’t stiffing Springfield–yet. (via wikipedia)

The funding was largely from the US Department of Housing & Urban Development. This included housing and homelessness support grants in the amounts of $328,743, $825,958 and $1,488,620. The city’s annual Community Development Block Grant of $3,671,092.00 was also before the Council as was a $9,380,533 for Continuum of Care, another housing and homelessness program. The Council accepted all of them.

Ward 1 Councilor Maria Perez recused herself on the continuum grant. She sits on the board of one of the grantees.

The Council sent at-large Councilor Sean Curran’s housing unit standards ordinance to committee. The final item before the Council was first step on an extension of the pawn shop moratorium. The bill would extend the city’s current bar on new pawnshops until 2028.

When asked why the Council could not simply make the ban permanent, Council President Michael Fenton, who has led on this issue for years, said there were constitutional issues with a permanent ban. First step on the ordinance passed without dissent.

The wisdom of the DIF may not become apparent for some time. Although a subsidy, it does differ from the normal tax breaks the city hands out. Springfield Crossing may be a poor candidate for a wider debate, partly due to sentiment around the late mall. Still, this process should prompt deeper questions. For example, how can the city take the pressure off residential taxpayers—an alleged priority among city pols—when it keeps skimming off the top of the commercial property tax pool.

(WMP&I)

As an economic development tool, these tax schemes are common nationally. Thus, it may be unwise for the city to unilaterally disarm. Yet, what does it say when it seems any project of scale in Springfield come to require tax breaks of this kind? Reliance on such breaks for economic development—or more banally political “wins”—may matter less in terms of cost to the city treasury than a signs of Springfield’s true health.