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Gifts of public funds

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#1
Hi there cyburbians! Many state constitutions prohibit gifts of public funds to private individuals, but it's not always clear what exactly constitutes a gift of public funds. I'm curious about planner's experiences with this particular issue. For example, is spending significant taxpayer dollars to change the zoning ordinance to financially benefit one or two individual property owners (i.e., allow them to develop more profitable businesses) a gift of public funds? Where is the commonly accepted line? And hypothetically speaking, if the line is being crossed what would be the proper course of action for an ethical planner who is directed to work on such a thing?
 

dvdneal

Cyburbian
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#2
Tough call. Most of the cases that I've seen (not personally, but happening in other cities) involve donating land or some physical thing, not staff time and fees. Things like giving land or money for a parking garage as part of a mall development. If the ordinance only affects a couple people I would make them apply for it. If the ordinance has a benefit to the entire city I guess the city can run the change. Benefit can also mean an increase in tax revenues or some other vague economic development advantage. It's one for the lawyers to fight over.

On the ethics side, I'm no ethical expert, but I'd say the decision and burden of the ethical dilemma go to the boss who decides to run this as a city application versus a private application. Your obligation would be to make sure that no one is getting hurt over the deal and to your employer. I'm sure there are a bunch of micro ethical problems I'm missing.
 

luckless pedestrian

Super Moderator
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#4
It depends:

what is the significant spending upon? Staff time? If it's staff time, then I don't think it's an issue as we handle applications, zoning requests and the like all the time whose positive outcome would likely benefit them - it's not a bad thing if we help our communities by having development - as long as the development meets the ordinances and complies with the comprehensive plan that the people have voted in, right? You can charge fees to cover some of the costs but some of it is part of our public service.

If it's something like a land swap or parking garage or a Credit Enhancement Agreement/TIF then I think you work on it as assigned but if the deal isn't really a deal for the people and only benefits the landowner then yes, you can certainly say that to your superior and maybe try to make a deal that benefits the municipality at large as well as the landowner.
 
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#5
Hi there cyburbians! Many state constitutions prohibit gifts of public funds to private individuals, but it's not always clear what exactly constitutes a gift of public funds. I'm curious about planner's experiences with this particular issue. For example, is spending significant taxpayer dollars to change the zoning ordinance to financially benefit one or two individual property owners (i.e., allow them to develop more profitable businesses) a gift of public funds? Where is the commonly accepted line? And hypothetically speaking, if the line is being crossed what would be the proper course of action for an ethical planner who is directed to work on such a thing?
If it's a situation where a property owner wants us to change our zoning code to accommodate his development or business, then we require the property owner to apply for a zoning text amendment. They pay all costs, including staff time, advertising, legal review, etc.
 
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#6
If it's a situation where a property owner wants us to change our zoning code to accommodate his development or business, then we require the property owner to apply for a zoning text amendment. They pay all costs, including staff time, advertising, legal review, etc.
This is how my jurisdiction, and every other jurisdiction I've ever worked for operates as well. Changes that are perceived to benefit the community are paid for by the general fund (taxpayers). The concern is where changes that benefit only one or two specific property owners are paid for by the general fund and the public benefit is unclear at best.
 
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#7
Slightly off-topic: I've mused many times over the years over how much profit the one-percenters have gained based on my recommendations to the decision-makers. :not:
 

AG74683

Cyburbian
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#10
If it's a situation where a property owner wants us to change our zoning code to accommodate his development or business, then we require the property owner to apply for a zoning text amendment. They pay all costs, including staff time, advertising, legal review, etc.
We do this on a case by case basis. The main driver for when we initiate the change ourselves is when the amendment is something huge. Simple stuff we let the property owner or developer apply for. Larger stuff, we fend them off and amend it ourselves. I don't want my Planning Board and BoC on an artificial timeline driven by applicants for larger items. I want us to be able to take our time on it without people breathing down our neck. The developer/applicant usually sees this as a "win" for them, because they don't have to pay for the amendment. We end up with a far more comprehensive amendment this way.

Two examples: We had a solar company wanting to amend our ordinance several years ago to add solar to the table of uses (we didn't have it, and thus it was a conditional use). I held them off while we developed comprehensive design guidelines, otherwise we would have essentially ended up with a "blank check". Right now we have a large developer wanting to change both our cluster development guidelines and our watershed density. The cluster development change is easy enough, we are going to let them proceed with it, but the watershed is a beast and we will be initiating that in house.

I don't look at these as a "gift". If anything, this process puts more regulation and guidelines on something than there otherwise would have been.
 
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#11
We do this on a case by case basis. The main driver for when we initiate the change ourselves is when the amendment is something huge. Simple stuff we let the property owner or developer apply for. Larger stuff, we fend them off and amend it ourselves. I don't want my Planning Board and BoC on an artificial timeline driven by applicants for larger items. I want us to be able to take our time on it without people breathing down our neck. The developer/applicant usually sees this as a "win" for them, because they don't have to pay for the amendment. We end up with a far more comprehensive amendment this way.

Two examples: We had a solar company wanting to amend our ordinance several years ago to add solar to the table of uses (we didn't have it, and thus it was a conditional use). I held them off while we developed comprehensive design guidelines, otherwise we would have essentially ended up with a "blank check". Right now we have a large developer wanting to change both our cluster development guidelines and our watershed density. The cluster development change is easy enough, we are going to let them proceed with it, but the watershed is a beast and we will be initiating that in house.

I don't look at these as a "gift". If anything, this process puts more regulation and guidelines on something than there otherwise would have been.

I appreciate the example. I can see a benefit to controlling the pace and specificity of the amendment.
 
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