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The Right Note: Bailouts and Busts

by Mark Kelly December 18, 2014 at 2:00 pm 0

The Right Note is a weekly opinion column. The views and opinions expressed in the column are those of the author and do not necessarily reflect the views of ARLnow.com.

Mark KellyAt last Saturday’s County Board meeting, Walter Tejada lashed out at the decision to derail the Columbia Pike trolley project.

In his lengthy diatribe, Tejada extolled the virtues of planning by Arlington County. One would think based on the tenor of Mr. Tejada’s comments that all the projects Arlington County embarks on turn out well — even the ones that have substantial opposition during the planning process.

Then on Wednesday, County Manager Barbara Donnellan recommended the closure of the Artisphere. While millions were already poured into the project, this decision will stop the ongoing millions in annual taxpayer subsidies to an arts center that was supposed to be self-sufficient by now. Once again, it appears Arlington leaders are bowing to realities many of us saw coming before a single tax dollar was wasted on a project.

Yet, just 18 months ago, then-Chairman Walter Tejada had this to say about the Artisphere:

“The Artisphere is an ongoing investment in Arlington’s future,” he said. “It’s helping to building our arts and cultural community. This is a proven and documented economic development strategy that attracts the young, educated demographic who are the workforce for the technology and innovation sectors.”

“Artisphere is on its way,” he concluded. “We expect the Artisphere to become a self-sustaining organization.”

The Artisphere was a planning failure that could have been avoided had the County Board heeded the warnings of fiscal watchdogs at the time.

Now comes Wednesday’s decision to bail out the Signature Theater — again. In a disappointing 5-0 vote, the County Board forgave $411,000 in past due utility and lease payments and will not charge the theater anything for its $90,000 per year lease for the next 19 years. This move comes on top of a smaller $250,000 bailout 18 months ago. Total forgiveness of obligations due to Arlington County under the original Arlington Way planning process for Signature will be $2.371 million over 20 years — a pretty nice Christmas gift for the theater.

The Board also refinanced the theater’s loan at a rate of 1 percent per year in exchange for United Bank forgiving $2.7 million due to them. These new loan terms are a pretty good deal for the theater considering the Board on Saturday refinanced other County debt at 2.52 percent.

Last night as debate was wrapping up, Tejada and Chairman Fisette emphasized what was being done for Signature was not a “gift,” it was a “loan.” You could make the argument that initial planning had failed and cutting a deal to bail out Signature should be done, but saying it was only a loan does not make it so. Just like claiming the Columbia Pike trolley was a good idea that deserved to go forward because it had been planned for 15 years did not make it so.

Mark Kelly is a former Arlington GOP Chairman and two-time Republican candidate for Arlington County Board.

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