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HAMILTON COUNTY

In Carmel and Westfield, how much debt is too much?

Chris Sikich
chris.sikich@indystar.com
Political signs can be seen in people's lawns, Friday, May 1, 2015.

In Carmel, Rick Sharp's supporters have been posting campaign yard signs with a simple message that sums up the issue facing longtime Mayor Jim Brainard — $1 billion.

That's roughly the amount of debt, including interest, the mayor has racked up redeveloping Carmel.

Brainard — who, more than any other Central Indiana leader, symbolizes aggressive, suburban redevelopment — has faced challengers before with messages warning voters to think about how much is too much. But he never has faced a challenge as credible as Sharp's.

The City Council president has amassed $146,000 in campaign cash and believes he has the name recognition and political clout to give the mayor a serious run.

And Brainard is not the only suburban mayor facing serious criticism for pushing a message of tax-supported growth.

Westfield Mayor Andy Cook, who won by only 61 votes four years ago, is in the fight of his political life amid accusations the city has become over-leveraged during his two terms in office.

Neither Brainard nor Cook have to look far to see the potential consequences of primary voters concerned about spending. Four years ago, four-term Mayor Charles Henderson lost re-election in Greenwood to a well-funded candidate with name recognition after pushing for a $25 million downtown redevelopment.

So both incumbents are taking their challenges seriously. Other area mayoral races also appear on the Tuesday ballot — most notably Republican and Democratic primaries in Indianapolis and the Republican primary in Noblesville — but few are as consequential and competitive as those in Carmel and Westfield.

In these Republican strongholds, winning the primary means you've won the election, not just the nomination. So this year's GOP primary may determine the future of suburban growth policies that have been emulated far beyond city limits.

Growth subsidies spread to suburbs

Backing growth has been a time-tested strategy in urban areas.

For decades, Indianapolis has been using tax incentives to draw development — from the Hoosier Dome and Lucas Oil Stadium, to Market Square Arena, Bankers Life Fieldhouse and Circle Centre mall.

Advocates say cities need to invest in amenities and infrastructure to attract economic development, tourism and new residents to broaden the tax base.

When Brainard took office in 1996, he began to use some of those same incentives in the suburbs — culminating in the $175 million Palladium and Center for the Performing Arts. Along the way, some members of his council warned him about spending and debt, even as they OK'd some of his most ambitious projects.

But his efforts gained national praise. Officials from 21 cities have visited Carmel for tours of all those roundabouts, City Center and the Arts & Design District since 2005. Brainard has been a featured speaker at conferences in a dozen states and three other countries.

Other Central Indiana suburbs also followed Carmel's lead. Westfield is funding a $49 million youth sports complex and has plans for a potentially $25 million park-plaza at its Grand Junction development downtown. Fishers has spent $28 million to attract development to its burgeoning downtown.

Westfield Mayor Andy Cook

In Westfield, Cook saw his own major redevelopment efforts as long-term solutions to the city's relatively high tax rates. He says Grand Park and Grand Junction will attract development, draw tourists and new residents and put downward pressure on taxes.

Like Brainard, Cook insists the strategy is working. Grand Park has been attracting thousands of visitors. A recent economic impact study showed the park has spurred $43 million in local spending and $5.2 million in local tax revenues in 2014, though not necessarily in Westfield.

Grand Park has drawn $37 million worth of investment and needs to draw another $183 million to pay back debt, city officials said. The city estimates the park will draw $1 billion over time, and already has announced more than $250 million worth of development.

Not every Central Indiana mayor has seen his redevelopment dreams come true, however. In 2011, Mark Myers, the son of a former Greenwood mayor, defeated Henderson, who had bold plans to tear down and redevelop much of the city's downtown.

After campaigning in 2011 that Henderson was out of touch, Myers launched his own plans to revitalize the downtown without demolishing buildings, including spending $6 million to locate city offices there.

"What hurt him was wanting to demolish downtown and wanting to rebuild a new one," Myers said. "There was a huge outcry at him for that."

Challengers enter the fray

Brainard, too, has long been dogged by political opponents — criticizing escalating costs on such projects as Keystone Parkway and The Center for the Performing Arts — but he has managed to keep taxes low and has won re-election easily.

Jim Brainard

His two most recent opponents, Councilman John Accetturo and small businessman Marnin Spigelman, raised little more than $20,000 combined in their attempts to unseat him. Brainard routinely pulls in more than six figures and wins by double-digit percentage points.

But the tone of the debate changed in December 2012, after the Carmel Redevelopment Commission's projections for growth in tax revenue proved too aggressive. Unable to pay both its debts and operating costs, the mayor and commission went to the City Council, controlled by political opponents.

The Council approved $195 million in taxpayer-backed bonds to bail out the commission, giving Brainard's opponents unprecedented leverage.

In Westfield, Cook has faced more pressure than Brainard. After launching plans for Grand Park and Grand Junction, he eked out a win over poorly funded local businessman Russell Cameron in 2011.

Cook moved forward. Opposition began to mount in October, though, when he proposed backing a privately built $25.7 million indoor soccer arena at Grand Park. Cook insists fees will cover the city's cost, but the project is nonetheless backed by taxpayers. The city needs to build the facility, he said, to attract year-round crowds that developers want to see before building hotels, restaurants and offices nearby.

The plan was met with significant community push-back at packed City Council meetings. Pike Township firefighter Jeff Harpe was one of several residents to speak against the plans. He came away from the meetings saying Cook and council members weren't listening, and he soon filed for Cook's job.

Rick Sharp.

In Carmel, Sharp has been leading the "loyal opposition" on the City Council for much of the past decade. While he says he has provided an important check on the mayor, Sharp no longer believes that is enough.

The mayor, he points out, has used boards he controls such as the Carmel Redevelopment Commission to bypass the City Council and fund projects.

"I and other members of the council have tried for six or seven years to get the mayor to adjust his thinking about debt and to change his patterns of behavior about spending and to be a little more risk-averse," Sharp said. "We have been spectacular failures."

Can Carmel, Westfield pay back debt?

Standing in an empty field along U.S. 31 at a campaign speech one brisk morning in April, Sharp said a project there was supposed to be generating revenue to pay down Carmel's redevelopment debt. Behind schedule, it hasn't been built. So the taxes are not yet coming in.

Sharp points to another dozen projects that also are behind schedule, though still listed as generating taxes according to Carmel Redevelopment Commission projections.

He says Carmel has based its ability to pay down debt over the next 12 years on $460 million in new investment in tax-increment financing districts from projects that have yet to be built. As those taxing districts begin to expire over the next 20 years, he said, the city will struggle even more to pay back-loaded debt — leaving the potential for increased residential taxes.

Sharp says it's time to focus on paying down debt. Any future incentives, he said, should be carefully considered and should not put property taxes at risk.

"When the mayor came into office 20 years ago, the incentives made sense," Sharp said. "But the dynamic of Carmel in 1996 is not the dynamic of today. We have attracted. We have grown. If the vision is sound at all, then the subsidies are no longer necessary."

Brainard counters that debt is just a tool, if used carefully.

"Without debt we wouldn't have parks, we wouldn't have most of our good roads, we wouldn't have roundabouts and we would have blight in our city center," he said.

Brainard says Carmel can afford it. The city has $6.45 billion in assessed value, leaving the amount of cash the average residential property owner actually pays toward debt at about $10 a year, he said.

While some projects are behind schedule, Brainard said Carmel's commercial assessed valuation in TIF districts has increased by $32 million more than projected this year. He's betting on Carmel's potential, saying he believes tax collections — including those on future growth — and other revenues will more than pay back the city's debt. He points out that Carmel's TIF districts have grown from zero to $1.1 billion since 1998.

Brainard wants to continue redeveloping the city's core, potentially offering taxpayer incentives for City Center, Midtown and to the few lots remaining to be redeveloped in the Arts & Design District.

He also wants to embark on a series of road, roundabout and trail improvements on the city's east side — including reviving a plan to find local, state or federal money for a roundabout-style interchange at 96th Street and Keystone Avenue.

Jeff Harpe.

In Westfield, Harpe is concerned about the city's role in financing the indoor soccer arena to the tune of millions of dollars a year. Fishers is providing incentives to launch a similar plan with an indoor sports facility at I-69, Exit 210, but has stopped short of backing the debt with taxes. Harpe said he would seek a new deal with a private developer to fund Westfield's project.

Rather than demolish buildings downtown for the Grand Junction plan, Harpe said he would like to see a smaller-scale project, perhaps similar to City Market in Indianapolis.

Council elections could sway future decisions

In both cities, the city councils also are up for grabs. Five candidates are running for Carmel council with a similar message to Sharp's.

They include incumbents Luci Snyder, Eric Seidensticker and Carol Schleif, as well as Ron Houck and Accetturo, the former councilman who lost a run for mayor.

Snyder, Seidensticker and Schleif said they can — and do — work with the mayor, and the compromises they reach ultimately make the projects more viable for taxpayers.

"I don't think there is any major thing the mayor wanted that he didn't get," Snyder said.

Still, Brainard is backing a slate of candidates in an effort to remove what he sees as roadblocks to his vision.

"I want people who are brave enough and courageous enough when they think I'm making a mistake to come and talk to me about it," Brainard said. "I do not want a rubber stamp council. But I also don't want to hear about a problem for the first time when I go to a council meeting or when I open the morning paper."

The mayor's campaign is sending out mailings and letters to back council challengers Jeff Worrell, Bruce Kimball and Keith L. Griffin, as well as incumbents Sue Finkam, Kevin Rider and Ron Carter. He's also backing Christine Pauley for clerk-treasurer, the first-ever challenger to longtime incumbent and political foe Diana Cordray.

In Westfield, five incumbent council members running for re-election largely support Cook's plans, including Steve Hoover, Bob Smith, Chuck Lehman, Robert Horkay and Jim Ake. All are facing opposition.

Several people are opposing them, including a group of candidates running a campaign called Get Fit Westfield. They largely agree with Harpe and doubt Grand Park will draw new businesses quickly enough to pay back debt, and whether the indoor arena will generate enough income to pay back the lease. They are Bob Beaudry, Dan McKinney, Brian Ferguson, Barry Jones and Ron Thomas.

Like the current council, they say Grand Park must successfully attract nearby businesses in order to pay off debt and grow the tax base — after all, the 400-acre park is already there.

The challengers want to audit the city's finances and would consider dropping or reducing development impact fees and lowering tax rates to encourage businesses to locate nearby. And they're concerned about moving forward with Grand Junction while the success of Grand Park is in question.

Cash pours into races

Both Brainard and Cook are taking the challenges seriously.

With the primary four years ago attracting only 14.62 percent turnout, they know they have to get out the vote.

Brainard has raised $266,000, nearly 30 percent more than in the last primary. Harpe has little campaign cash with which to challenge Cook — about $7,000 — but Cook was not all that far ahead in fundraising. Until April 23, that is.

That's when the Shamrock PAC, started by Hamilton County GOP chairman Pete Emigh and now controlled by Cook's son, Brian Cook, donated $99,070 to his campaign.

Both Brainard and Cook have used their funding advantage to launch aggressive campaigns with print, TV and radio ads, mailings and signs. They say a majority of residents want to see Carmel and Westfield continue along their current paths, and they're imploring people to vote.

Sharp and Harpe are hoping residents will hear a more nuanced message. They are telling voters they want to see continued growth, but with less risk to taxpayers.

Sharp is up on TV too, though not as frequently as Brainard. Both Sharp and Harpe have been going door to door for weeks, trying to introduce themselves to as many voters as possible.

Among those who have heard their message is a small but vocal tea party group called the Constitutional Patriots, which has been endorsing candidates in Hamilton County races, including both Sharp and Harpe.

Zionsville Autosport owner Dwight Lile, one of the group's leaders, disagrees with many taxpayer incentives, the seizure of property for redevelopment, escalating debt and the city-backed focus on high-density housing.

"There's a movement in government to expand its influence and to reduce the quality of land ownership (by seizing property by eminent domain)," said Lile. "That assumes that government has a greater interest in land than you do. That's going on in Carmel and Westfield."

They've been active, holding forums and posting signs. Their message is vague but simple, using a figure Sharp has been pushing but Brainard finds misleading: "$1 billion."

Call Star reporter Chris Sikich at (317) 444-6036. Follow him on Twitter: @ChrisSikich.

CARMEL MAYORAL RACE

Jim Brainard

Republican

Age: 60.

Occupation: Mayor of Carmel since 1996. Formerly an attorney practicing in Carmel.

Education: Bachelor's degree at Butler University, 1976; Doctor of Jurisprudence, Ohio Northern University, 1982.

Marital status: Married.

Number of children: Four, Jack, a resident in emergency medicine in Kalamazoo Michigan; Will, attorney for the Indiana Attorney General's Office; Marie, Graduate student in Occupational Therapy; Martha, Freshman at Colby College.

Reason for running: "To continue making Carmel one of the best cities to live in the U.S., continuing to build our park and trails system, our new downtown and arts district while maintaining our low taxes and excellent AA+ bond rating."

Rick Sharp

Republican

Age: 60.

Occupation: Sales consultant. City Councilman since 2004.

Education: Bachelor's degree with a major in political science at University of Florida.

Marital status: Married 27 years to wife Susan.

Number of children: Three, Sara, Brenna and Rachel.

Reason for running: "Carmel has a bright future but our fiscal policies must change to ensure this. We cannot leave it to the next generation of Carmel residents and leaders to address the problem of debt created today. We can correct this problem now and I will do so."

WESTFIELD MAYORAL RACE

Andy Cook

Republican

Age: 63.

Occupation: Mayor of Westfield since 2008. Co-owner of Tradewinds.

Education: Bachelor's degree from Indiana University-Bloomington.

Marital status: Married.

Number of children: Three.

Reason for running: "I'm running to prove that an elected person who does the right things for all the right reasons can be elected despite the outside agitated negativity."

Jeff Harpe

Republican

Age: 45.

Occupation: Pike Township firefighter/emergency medical technician.

Education: Graduate of Hobart School of Mechanical and Welding Technologies.

Marital status: Wife, Lisa.

Children: Three sons; Brayton 16, Bryce 13, and Mason 13.

Reason for running: I love my community and I am greatly concerned with how Westfield city officials are conducting business with taxpayer money. I don't believe that it is the mayor's responsibility to play economic developer with taxpayer money.

CONTESTED RACES IN CARMEL

Carmel Clerk-Treasurer

Name: Diana Cordray

Business: Incumbent since 1996.

Platform: Cordray says she will continue to ensure records are available and transparent for the public and will continue to provide her expertise to budgetary matters. She wants to look out for the long-term viability of the city.

Name: Christine Pauley.

Business: Senior contract negotiator at Raytheon.

Platform: Pauley says she, too, will work with the mayor and City Council to promote transparency and fiscal responsibility. She believes she can forge a better relationship between the administration and the Clerk-Treasurer's Office. Endorsed by Mayor Brainard.

City Council Southwest District

Name: Keith L. Griffin

Business: Lawyer.

Platform: He wants to faciliate discussion between the mayor and the City Council, and work to continue to build infrastructure that attracts new business. Endorsed by Mayor Brainard.

Name: Carol Schleif.

Business: Incumbent since 2012. Architect and retired pharmacist.

Platform: She wants to ensure the city fulfills its contract to annex southwest Clay Township, currently under legal dispute. She also wants to continue to update zoning requirements, keep property taxes low and focus on updating the city's infrastructure.

City Council Northeast District

Name: John Accetturo.

Business: Certified government financial manager. Former Carmel councilman.

Platform: Defeated in a race for mayor four years ago, he wants to ensure the City Council remains a watchdog on Brainard's administration. He's concerned by the city's spending and debt.

Name: Sue Finkam.

Business: Incumbent since 2012. Director of external engagement at Indiana Donor Network.

Platform: She wants to continue to develop the city into a place that values culture and recreational opportunities and to invest in local neighborhoods. Endorsed by Brainard.

City Council Central District

Name: Bruce Kimball

Business: Former member of the Carmel City Center Community Development Corporation and retired from wholesale banking.

Platform: He wants to start a how-to boot camp for homeowners' associations and to work with the mayor in a professional manner on redevelopment and other issues. Endorsed by the mayor.

Name: Eric Seidensticker.

Business: President at Mako Press, a local printing company. Incumbent since 2007.

Platform: He wants to be a watchdog for fiscal responsibility and transparency while developing a plan that puts the city on firm financial footing. He also wants to promote more focus on maintaining older areas of Carmel.

City Council Southeast District

Name: Luci Snyder

Business: Councilwoman from 1992-2003 and 2008-present. Commercial real estate broker.

Platform: She believes the city is on the edge of being unable to repay its debt and wants to make sure officials continue forward with fiscal responsibility and transparency. She's concerned about infrastructure issues in older neighborhoods. She believes the council needs to operate as a check on the mayor's power.

Name: Jeff Worrell.

Business: Owner of Advantage Medical. Member of the Carmel Redevelopment Commission. Operates Good Day Carmel website and active in numerous city boards and organizations.

Platform: He wants to change the tone of politics in Carmel to be more positive. He wants to work with the mayor to draw new businesses, redevelop the city's urban core and keep taxes low. He wants to build a roundabout-style interchange at 96th Street and Keystone Avenue. Endorsed by Mayor Brainard.

City Council At Large (pick two)

Name: Ronald Carter.

Business: Incumbent since 1996.

Platform: He wants to work with the mayor to continue to move the city forward, including developing City Center and Midtown. He wants to continue to build the city's parks, bike paths and trail systems. Endorsed by Mayor Brainard.

Name: Ron Houck.

Business: Information technology at Eli Lilly & Co.

Platform: He's concerned by the city's escalating debt, and deteriorating infrastructure in certain neighborhoods and areas. He also wants to tighten conflict of interest rules and ensure the city acts with transparency.

Name: Kevin "Woody" Rider.

Business: Owns Divvy and Woody's Library Restaurant. Incumbent since 2008.

Platform: He wants to continue to develop Midtown and City Center. He believes the city is more than capable of paying back its debt without raising taxes and wants to see officials move forward with tax incentives in the right situations — promoting high-end products in urban, difficult-to-develop areas. Endorsed by Mayor Brainard.

Call Star reporter Chris Sikich at (317) 444-6036. Follow him @ChrisSikich.