Hagan’s Record Leaves Taxpayers Naked

One of the factors we don’t know about the deal for the Medical Mart and Convention Center is what the lease will say or thereafter how often the lease will be ignored to the benefit of the developer.

Cuyahoga County has bestowed to private interests, in a memorandum of understanding, some $903 million for construction and operation of a Medical Mart and Convention Center. The public, however, doesn’t yet know what it is buying. The politicians have shown over and over that they don’t care.

With Commissioner Tim Hagan’s close association with the Kennedy family and its connection to MMPI (Merchandise Mart Properties Inc.) of Chicago, headed by Chris Kennedy, son of late Sen. Robert Kennedy, don’t expect much critical oversight.

Want some hints of what we may be buying?

Hagan, to me, is the key.

Hagan - a principal mover in Gateway – remained suspiciously quiet as some very strange and exotic spending spiraled out of control in that highly subsidized deal.

For example, although it was never in the lease or original plans, Gateway built a 57,000 square foot building at the ballpark and turned the building over to Dick Jacobs for his private use. When I asked Gateway director and Hagan chum Tom Chema why, he said the building was constructed to hide an unsightly ramp. You couldn’t have used shrubbery, Tom?

The building cost $7-million, including $900,000 in furnishing. Since Gateway will never pay any property taxes, the structure is rent free & tax free. The furnishings, to spare no cost, included an 18-foot long, 5-foot wide “boat shaped” ash veneer conference table with inlaid strips of wood to appear baseball-like and an inlaid metal portrait of the buffoonish Chief Wahoo. Nothing too good for political friends.

Furnishing for the arena offices cost $1,443,800. That didn’t include personal office suites for each Gund –George & Gordon - or six conference rooms and an executive kitchen, to say nothing of three free loges.

Hagan remained quiet.

The Gunds, unbeknownst to officials, built within the arena a $600,000 living quarters – essentially free accommodations, a private nest, when they were in town.

Hagan never uttered a word.

Gateway built a $5,155,893 restaurant at Jacobs Field and a $2,370,134 restaurant, operated by a former board member Denise Fugo of Sammy’s, in Gund Arena. The baseball restaurant, the Terrace Club, became the largest restaurant in downtown Cleveland with 900 seats. On game days, fans can’t even eat at the restaurant unless they become paid club members. The membership fee in 1994 was $800 a year. The Terrace Club, even in off season, serves private parties, thus taking business from tax-paying venues.

Hagan kept his usual yapping mouth closed.

So will Hagan allow buddy Kennedy, using Cuyahoga County tax money, to build into the Medical Mart or Convention Center such luxury restaurants or other retail businesses, with profits going to MMPI? Don’t dare bet against it.

Hell, they have almost $1 billion in tax money with which to play.

Will Kennedy & Company be able to build fancy apartments for themselves, as the Gunds did, as part of the Medical Mart? How much free office space will they build into the structures for their use or others?

These are not minor points.

When Jacobs got new offices free I figured out what it might mean in dollars to the wealthy developer.

Here’s what I wrote:

“For Jacobs, at 57,500 square feet at $38 a square foot annual rent would be $2,185,000. For its 25-year lease it would be a $54-million gift.” The $38 figure was based on what Jacobs was charging at his Key Center, a short distance from Gateway’s free office space.

That’s tax free, rent free and property taxes free. Free, free, free!

Hagan didn’t scream, “Not fair!” Instead, he and former Mayor Michael White flew a private corporate jet to Columbus to lobby and win in perpetuity a tax exemption for the sports franchise venues.

Nor was there any outcry from Hagan when Jacobs insisted on marble tables for loges at $2,500 each, though the supplier in Lucca, Italy, told officials that the marble was not suitable for coffee tables, and, of course, they immediately began to break apart.

Hagan remained speechless.

Does anyone now expect supervision from Tim Hagan?

A description of Hagan’s attitude toward the public by Jeff Buster at RealNEO reveals what to expect:

“… Mr. Hagan, in an irritated and irritating tone, went off how this is ‘representative government’, and that the voters had elected the Commissioners to make these 400 million dollar 40-year bond deals for us without input.” (Actually $40-million for 20 years, equaling $800 million.)

Hagan, always the autocrat, believes he’s been made king by being elected a commissioner. And in some ways, that’s exactly what has happened. As a Democrat with the blessing of big business here, he can serve a life-time as Commissioner. No matter how badly he acts.

At a meeting to discuss Cuyahoga County financing bonds of $75 million and $43-million back in 1992, to meet unexpected costs, Hagan revealed his asinine arrogance with the public.

The Commissioners called a public meeting on Christmas Eve morning and then allowed regular business and testimony by other officials to eat away time, and then tried to cut off public questions and comment.

Hagan got huffy with one of the objecting citizens of a group opposing what the Commission was doing. He chastised Roy Kaufman, a lawyer who had often represented low income people, for daring to want to question the public officials at the meeting.

Hagan believes since he was elected, no one else has any reason to have opinions.

“Thank you for your views,” said Hagan dismissively, “I went through 100 hours and I have some knowledge of it (Cavs lease). I think generally it is the (best) for this community. My colleagues and I will review this in light of the fact we have to hire counsel (Squire-Sanders then as now) to give us the best judgment legally, and you as a lawyer understand that, and the financial review independent of Gateway. When we do that we’ll make our judgment. I’ve said from the very beginning that I think it’s good for the community. Period. And I don’t equivocate on that issue.

“And I don’t see why you or anyone else thinks that because you speak as an individual … (for) the public that you think you represent. But you’re only representing yourself. (You) have this view of outrage. I fail to understand it. I’m expressing my view as an elected official.”

Kaufman said, “I’m sorry you think I represent myself. I’m here for an organization, a watchdog of for the people.”

Hagan responded dismissively, “Fine. Thank you very much for your self-appointed watchdog of the people. Every four years the people appoint, eh, elect people in a democracy to represent their views. If you would like to be involved in being more than that, then run for political office. But when you come in and say you represent people and you are, you’re self-appointed. I respectfully tell you that you’re one of the individuals in this room as a public citizen. I’ll listen to you... (but I’m) not exercised about it.”

In other words, the public has no business even talking when Hagan is deciding for the public.

The meeting involved hiring Squire, Sanders & Dempsey as the County’s advisors on the bonds. Squire-Sanders had already been paid some $1 million in legal fees by Gateway. Why the same law firm would seem appropriate to advise the County would be puzzling to anyone with any sense. Yet it isn’t surprising that Squire-Sanders also has and will play a significant part in the MMPI deal and lease.

The bonds eventually were let by the County and as of this time they have cost the County $100 million on the way to a $300 million subsidy. This, of course, was in addition to the County’s sin taxes, the original source to pay for the facilities.

Hagan enjoys posing as a man of the people. When he ran for Mayor of Cleveland he said typically that his purpose was to “feed the hungry, give drink to the thirsty… clothe the naked. I think we forget those things.” Always thinking of the downtrodden.

At another public meeting Hagan abruptly left as the public was about begin comment. Hagan interrupted by inviting construction workers there to lobby for the County bonds to join him for coffee. “I don’t have to listen to this,” said Hagan, again dismissing citizen participation.

Hagan, during the original debate over taxing for the sports facilities, had the audacity to call Rep. Louis Stokes a front for tobacco interests and for not caring about blacks.

Hagan, who clothes himself in concern for the least of us, attacked Stokes. He is “rewarding people that are doing a terrible disservice to the poor and minorities in the community … by glamorizing the use of booze,” Hagan charged. He went on, “Cigarettes and booze (both to be taxed for Gateway) contribute to the infant mortality rate, contribute to the fact that black males don’t live as long as white males. Lou Stokes knows that.” What conceited presumption!

Lecturing Stokes merely reveals Hagan’s self-righteous desire to see himself as the pure hero. Yet, he merely reveals his sanctimonious smugness.

What the public – and this means the news media (heaven help us) – must demand from Hagan and the Commission is clear language in the lease that limits what the developer MMPI can do with nearly $1 billion in public funds.

It doesn’t look at all hopeful.

From Cool Cleveland contributor Roldo Bartimole roldoATroadrunner.com
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