Putting the proverbial caboose before the engine, the Iredell County Commission Tuesday night unanimously gave the Red Line a vote of no confidence. County commission chairman Steven Johnson said it would stay that way until his board sees some assurances that Iredell County taxpayers, beyond those who would benefit directly from the Red Line, wouldn't be on the hook for any of the $452 million needed to build and operate the project, that the project will have no cost overruns and some guarantees that the anticipated economic development would actually materialize.
The fact that Johnson one month ago publicly stated his position that he wants to kill any talk of the project now rather than have staff "waste any more time on this" during the 180-day period of due diligence local jurisdictions were asked to embark upon — effectively ending the chance for the Red Line Task Force and its consultants to provide the assurance Johnson and his five-member board seek — is a circular argument.
And it's one that is widely reported in other media outlets as the death knell to the Red Line. Not so fast, said North Carolina Deputy Director of Transit Paul Morris on Tuesday. He characterized the vote as not one to kill the project, but rather to express concerns and ask for information that is already in the proposal, but has yet to be reviewed.
In a television interview, Johnson said a vote against the project would force its proponents to "wake up and smell the bacon."
Consider it smelled.
"In fact what they did after all was said and done was to officially state that they could not support the draft plan in its current form and would require that several conditions need to be met for them to positively consider it," says North Carolina Deputy Secretary of Transit Paul Morris. "There is plenty of room for revision to address their substantive comments in the draft before it is finalized."
That's diplomatic speak for having an opportunity to, in person, present the entire draft plan that was unveiled in Mooresville in mid-December, a four-hour briefing that no Iredell County commissioners attended. Morris said he plans to do the whole thing over again, just for them.
"The way I characterize it is that every local government approaches things in their own unique way," said Morris. "It is fair to say that Iredell County does it more uniquely than others. Others have chosen to develop review committees, create staff teams, engage in specifics of the plan, review it and request briefings, and the county commission has not taken that particular approach. As we left it, they put the ball back in our court to come back with revisions that would satisfy them."
That satisfaction, he said, will come in the form of the financing plan as it is drafted, which already contains the details Iredell commissioners said they seek.
"I will be asking (Commissioner) Ken Robertson, who has expressed some willingness to serve on the Mooresville Review Committee (for the Red Line), to do just that, and I will request on behalf of the state to give us a chance to preview the whole scope of the draft plan to be sure they are operating without misconceptions and that they understand it. ... This is a new concept in North Carolina and to everyone along the corridor, and from south to north, the further you go the less experience they have with it."
But to have any chance for the plan to work, Morris said Iredell has to buy in. Technically, Iredell's participation in a joint powers authority isn't required — it would be part of a nine-agency body that governs a unified benefits district along the 25-mile Phase I project — but fiscally, and politically, it is. Mecklenburg County officials have already said that if Iredell isn't in, neither are they.
Iredell can't prevent Mooresville from participating. Municipalities have the authority to create special assessment districts as well as apply tax increment financing to overlay districts without county approval, providing the county is not the financial backstop. Those are the revenue-producing mechanisms that would generate the money to repay the industrial revenue bonds and cover additional infrastructure costs near the station areas as well as operations and maintenance costs of the rail service itself.
The financial risk, consultants and Morris have insisted, lies exclusively with the private investors, who would put up $226 million — half of the capital costs — with a state, not a local, backstop. There is no financial risk, they have said, to local governments.
"The business plan as it is currently constructed and the terms under which the bond would be underwritten require all nine entities to make their full contributions in order to make the numbers work," said Morris. "If Iredell were to opt out, it would have a material impact on the local revenue share in the funding model."
Despite the Iredell vote, Morris said work will continue as all jurisdictions along the corridor, as well as the state, break down all elements of the draft plan and scrub the figures. The same due diligence that is taking place locally, he said, is also going on at the state Department of Transportation.
More challenges than Iredell remain. How to address the additional 75 cents per $100 valuation assessment on small businesses that would fall within the unified benefits district — those that operate inside their own buildings and don't necessarily derive any direct benefit from proximity to the rail — are among the growing concerns locally.
But unless Iredell can be brought into the fold, or a material change in the financing plan that is agreeable to all other parties in the event of a defection from the north, is made, none of the other issues surrounding the creation of the joint powers authority and, ultimately, building the Red Line will matter.
"I believe, technically, it is feasible for the final plan to reflect solutions for the specific concerns raised by Iredell County," Morris said.
