South Bend's Redevelopment Commission Under Fire: Taxpayer Dollars Mismanaged?

Good evening, I’m Don Foster with Redress South Bend. Welcome to tonight’s special report on the recent actions of the South Bend Redevelopment Commission. In our last segment, we examined South Bend’s $417 million budget. Tonight, we are investigating the Redevelopment Commission, the recent perplexing transactions they’ve made, and who is driving these pivotal decisions. For those who may not be acquainted with the Redevelopment Commission's role, here’s a brief overview from their website: 

“The Redevelopment Commission was established to address conditions associated with blight and the underutilization of land and/or barriers to development. The Commission operates within the city limits. They study areas of the city, identify problem areas and develop a strategic plan for eliminating blight and bringing about new development within those areas. A primary focus is on the expansion of tax base and the creation of new jobs within South Bend.

There are five voting members of the South Bend Redevelopment Commission. Three are appointed by the Mayor; two are appointed by the South Bend Common Council. In addition, one member of the South Bend Community School Corporation Board of School Trustees is appointed by the Mayor as a non-voting adviser to the Commission. The current Redevelopment Commissioners are:

• Marcia I. Jones, President

• Troy Warner, Vice President

• Vivian Sallie, Secretary

• Eli Wax, Commissioner

• Dave Relos, Commissioner

• Leslie Wesley, Non-voting Adviser

Now that we are acquainted with the RDC and the function of the Redevelopment Commission, we can start looking into some of their recent transactions. Through its Redevelopment Commission, the City of South Bend is set to sell the former Claeys Candy Building to businessman Kevin Smith for a mere $1,000, despite having established a minimum offering price of $382,000, based on two independent appraisals.

This sale price of $1,000 represents less than one-third of one percent of the property's true market value, raising significant concerns about fiscal responsibility and transparency. Just a year ago, the city purchased the Claeys Candy property for $550,000, leading to questions about why taxpayers' money was spent so lavishly when the city is now effectively giving it away to businessman Kevin Smith. Reports indicate that Smith already intends to sell the Claeys property before he even has officially acquired it, prompting further inquiries into whether the city could have retained ownership and sold it directly to the same data center Kevin Smith plans to target. The decision appears to mark a staggering $549,000 loss to taxpayers, highlighting a lack of well-defined plans for the property, as the city had already attempted to sell it for $168,000 less than their purchase price. This situation exposes a troubling pattern of mismanagement by the City of South Bend and the Redevelopment Commission. 

In 2016, Bear Brew Brewery entered into a significant agreement with the City of South Bend regarding the acquisition of the former Gates Service Center. Initially, the arrangement allowed Bear Brew to purchase the property for just $1, contingent upon their investment of a minimum of $455,828 in improvements. The agreement underwent seven amendments throughout the years, with the Redevelopment Commission graciously extending the timeline to accommodate Bear Brew’s efforts to meet its commitments.

However, despite these efforts, Bear Brew ultimately did not fulfill their obligations under the contract. Interestingly, rather than reclaiming the property as stipulated, the Redevelopment Commission executed an agreement to compensate Bear Brew with $98,000 for a property Bear Brew had originally purchased from the City for a mere dollar. This decision raises important questions about governance and accountability in municipal transactions and highlights the fiscal waste involved in public-private partnerships.

In our final transaction of the evening, we examine the recent acquisition of 5.16 acres of land at "3003 N Bendix Drive" by the City of South Bend's Redevelopment Commission from the South Bend Community School Corporation for $277,750. This transaction raises eyebrows, especially since it involves two local government entities serving the same community. The critical question arises: why was this parcel acquired for anything more than $1? While the Redevelopment Commission has successfully offloaded key properties near Four Winds Field for just $1 and $1,000, they chose to pay nearly $54,000 per acre for this undeveloped grassland. 

Despite concerns voiced by residents at public meetings, the commissioners have stated that they have no immediate plans for the site, promising only that the use will be determined at a later date. Let's listen to RDC Commissioner Dave Relos share that the RDC has no plans for this $277,750.00 purchase: 

In conclusion, it is essential to reflect on a few of the many recent wasteful expenditures by the RDC, and consider their broader implications. Who truly benefits from this waste? Take a moment to assess the impact on your own finances. Are you noticing an increase in state, federal, local, or property taxes each year? Imagine the possibilities if our officials were to halt their reckless spending. What if they shifted their focus from fighting over funding to allowing us, the taxpayers, to retain more of our hard-earned money? Would we still face the reality of a $417 million budget coupled with a reckless redevelopment commission? It’s time to take a stand and demand accountability for where our money is being spent. The power to enact change lies within us, let's make our voices heard.