Council vote on TIF indefinitely tabled following citizens petition for referendum

On Monday, November 8, 2021 the Town Council was poised to vote on the proposed Second Amendment Town Center TIF District and Development Program [Article].  The amendments to the  Town Center TIF District would: allow the Town to enter into a Credit Enhancement Agreement with the developers of the proposed Dunham Court affordable housing development; allow the expansion of allowed expenditures from the TIF proceeds to include affordable housing; and permit an extension of the Town Center TIF from 20 to 25 years.  As currently drafted, the Credit Enhancement Agreement has a term of 15 years, with 75% of tax revenue returned to the developer to pay a $802,000 mortgage from Maine State Housing Authority.  However, as those opposed to the development said they would do upon the council's approval of the Town Center Affordable Housing Amendments on October 13, a Citizens Petition to send the newly amended ordinances to referendum was filed with the Town Clerk on November 2 [Article].

As required by the Council-Manager Charter, Article VIII, Sec. 1, the petition was filed within 20 days of the enactment of the ordinance being challenged and the required number of signatures were verified.  The Charter requires that ten percent of the Town's registered [8,689] voters must sign the petition in order for it be verified. There were 1,197 signatures submitted with the petition.  Of those, 1,155 signatures were verified as Cape Elizabeth registered voters, which exceeds the required percentage.  Also pursuant to Town Charter, the Town Council must call a public hearing to be held within thirty days from the date of the  petition being filed.  With Veteran's Day and Thanksgiving Day holidays in the middle, the council voted to hold a special council meeting for the purpose of the public hearing on Wednesday, December 1 at 7:00 p.m.  No action is to be taken at the public hearing, but the item will be included on the December 13 council agenda where the Town Council must schedule the date of the referendum vote.

Preceding the vote to send the petition to public hearing, the council grappled with the implications and timing of holding the scheduled vote on the proposed Second Amendment Town Center TIF in light of the Citizens Petition.  Councilor Penny Jordan made a motion to table the agenda item until after the referendum on the Citizen Petition; Councilor Gretchen Noonan seconded the motion.  With councilors Nicole Boucher and Caitlin Jordan absent from the meeting the motion did not carry because the required minimum to pass is four votes; only Jordan, Noonan, and Councilor Valerie Deveraux voted in favor. Councilor Jeremy Gabrielson, who said he was in favor of the TIF, Credit Enhancement Agreement, and the zoning amendments, indicated that he wanted to table the item only long enough to schedule a date for the referendum.  At Town Manager Matthew Sturgis's suggestion, Gabrielson motioned to table the item indefinitely; which would eventually require another motion to remove it from the table.  Deveraux seconded the motion, but again the motion did not prevail with only three voting in favor.    Noting another rule which precludes conversations once a motion to table has been made, Garvin motioned to vote on approving the TIF so that conversation could be had.

Noonan said that although she was in favor of both the TIF and credit enhancement agreement, "I don't feel comfortable voting at this point to approve a credit enhancement agreement for a project that isn't allowed under our current zoning; at least until the referendum."  Jordan concurred and questioned the possibility of separating the approval of the TIF and the credit enhancement agreement into two votes.  Jensen Baird attorney Alyssa Tibbetts explained that the TIF as currently proposed includes a credit enhancement agreement with the developer; a vote to approve the TIF as written would include an acceptance of the credit enhancement agreement.

Garvin, in favor of voting to approve, remarked, "We have heard from both proponents and opponents of the development say they are for affordable housing; just not this one.  By voting to expand the TIF district we are at least laying the ground work for somebody else to come forward with another project.  The actual amendments to the TIF district are completely disassociated with the specificity of the proposed development before us -- that only has to do with the credit enhancement agreement.  And the credit enhancement agreement will be moot, null and void if the referendum overturns our previous actions."  Jordan agreed, but said she wanted to offer greater clarity to the public, "I want people to understand that we are voting on opportunity, not on a project."

Noonan commented that, "Legally we can do this, but logically it still doesn't make sense to me.  I don't always care about optics, but sometimes they do matter and I think this may be one of those times."  Deveraux said, "I can't vote on this TIF as worded with the credit enhancement agreement attached.  I think we need to wait on the referendum."  Gabrielson reflected that he would prefer to wait for more information on the scheduling of the referendum, "But in good conscience I can't vote against the TIF because I am in favor of it."

Garvin concluded by saying, "Following this purposeful discussion, I welcome a motion."  Noonan made a motion to table the agenda item indefinitely and Gabrielson seconded.  The council voted 5-0 in favor of the motion.

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