In The News › Plaza meeting called off again

Mar 4, 2008

Source: Times-Picayune

Plaza meeting called off again

Plaza meeting called off again
Senator says session improperly advertised
Tuesday, March 04, 2008
By Leslie Williams
Staff writer

Organizers again have called off a meeting that would have activated a special financing district to benefit two companies that are millions of dollars in arrears on two government loans.

The meeting would have set in motion a tax increment financing district to help redevelop the razed Lake Forest Plaza site in eastern New Orleans.

It was called to activate the district’s governing board. State Sen. Ann Duplessis, D-New Orleans, said the gathering, which had been set for today at 2 p.m. at the First NBC building on Baronne Street, was canceled Monday because it was not properly advertised.

An identical “organizational meeting” scheduled in January was canceled for the same reason.

After learning of the latest attempt to activate the board, Bureau of Governmental Research President Janet Howard complained that “it is patently absurd to even consider a TIF (tax increment financing) district for a development when one or more of the principals is in arrears on obligations to the city.”

Once activated, the district will allow new sales-tax revenue generated in the district to be invested in a town-center project described as a high-density mall of mixed uses such as homes, retail stores, restaurants, offices, a cinema and a hotel.

Duplessis said Monday that instead of rescheduling another meeting to activate the board and elect officers, she will call for a general meeting to discuss what should happen to the shopping-center site at Read Boulevard and Interstate 10.

The Lake Forest Plaza LLC, one of the owners of the shopping center, has failed to pay off a loan connected with the former Sears building at the mall.

In December 2007, Civil District Judge Ethel Julien ordered that limited-liability company to pay the city $1.5 million as well as a late-payment fee of $126,544, reasonable attorneys’ fees and all costs “incurred in the collection of that certain promissory note dated Dec. 31, 2001.”

No payments have been made since the court acted, according to records, but the company has contributed money to the campaigns of elected officials who may serve on the governing board.

Developer Gowri Kailas belongs to the Lake Forest Plaza LLC as well as the Grand Theatre LLC, which is in arrears for nearly $2 million in connection with a cinema loan.

The cinemaplex — according to former state Sen. Jon Johnson, one of the sponsors of the legislation that created the TIF in 2003 — is within the area that would have benefited from the special financing district.

No payment has been made on that past-due loan either.

According to records, two prominent bankers are associated with the two companies. Ashton Ryan, president and CEO of First NBC, is a member of the Lake Forest Plaza LLC, which owns most of the shopping center property, and Alden McDonald, who is CEO of Liberty Bank & Trust, is a member of the Grand Theatre LLC.

According to the law creating the tax increment financing district, the board — if activated — will have seven members: Duplessis; Mayor Ray Nagin or his designee; state. Rep. Austin Badon Jr., D-New Orleans; City Council President Arnie Fielkow; the “owner of the Lake Forest Plaza Shopping Center or his designated representative”; City Councilwoman Cynthia Willard-Lewis; and Stephen Moret, secretary for the state Department of Economic Development.

Nagin and Moret had said they would not attend today’s meeting, and other officials were considering not attending.

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Leslie Williams can be reached at lwilliams@timespicayune.com or at (504) 826-3358.

Mar 4, 2008

Source: Times-Picayune

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