The UNC publicity machine scored another triumph. At a media-only event University development officials rolled out plans for Carolina Commons. UNC talked of its concern for affordable housing for employees. The media lapped it up, rewriting the press releases. (See Chapel Hill Herald Story and Chapel Hill News Story.)

The real story was missed.

Never fear. The Pulp will deliver as much as it can of the full story of Carolina Commons over the next few months. It’s an uncommon story of private development interests tied quietly to public university interests. It’s a story of public deceptions. It’s a story of municipal taxes diverted for university benefit. It's a story of municipal taxes diverted for private development benefit. It’s not a story you’ll find in the local media.

Media Embrace
As reported by the local media, Carolina Commons is an affordable housing project north of Homestead Road that will provide affordable housing for junior faculty and staff who want to purchase their own home. All the magic ethereal buzzwords are used - sustainability, affordability, green.

According to Ms. Mary Jane Nirdlinger, purveyor of ever-changing Carolina Common promises for over a year and proud owner of the title “project manager in facilities planning”, UNC will sell the homes at 20% below the market value of similar units in the area. (The only such homes are in Winmore, directly to the south, where the public isn’t buying. The cheapest home in Winmore sells at about $305,000 for 1350 square feet, or about $225 per square foot.)

That’s it. As far as the media is concerned, that’s the whole story.

Follow The Money
No one in the local media asked the obvious question. What about the money?

Anyone with a modicum of private enterprise experience would want to know the financial details. How is UNC paying for this development? Who is providing UNC the development capital? At what cost? Has it been competitively bid? Who is making money off this development?

If you follow the money, then the real story emerges. But first, what is being built.

Physical Reality
So how green is Carolina Commons really?

UNC is building 58 single-family homes, 40 condominiums and 51 rowhouses (about 150 units) on about 15 acres. That’s a density of about 10 houses per acre. Their site for such density is not a flat field surrounded by flat buffer, but alongside Bolin Creek, an environmentally sensitive stream with steep slopes. Such a site reflects the best in UNC green planning. Such a site is the essence of sustainability, affordability, and green.

UNC hides its urban streamside density by referring in its calculations to the bulk acreage of the 63 acre parcel dominated by the Bolin Creek streambed and its slopes. While that acreage isn’t buildable, it’s not a problem. Carrboro rules allow such acreage to be counted as green space. As far as Carrboro and UNC are concerned, building the densest residential projects next to streams is to be encouraged, not deterred. Slap a few rooftop solar panels, add some extra insulation. Shazam, you have a green project.

Never mind that one won't walk from Carolina Commons to the UNC main campus. Never mind that one won't walk from Carolina Commons to the coming Carolina North campus. It sounds green. That's what's important.

Living Wages Versus Living Equity
Amidst the hoopla of affordable, green housing for UNC employees, lies the reality of the residential real estate fiefdom being created by UNC.

While UNC will sell the 150 or so southeastern Carolina Commons homes to its employees at below-market rates, UNC will not sell the land upon which those homes sit. UNC will retain ownership of those lands, forever. If the home is to remain as affordable housing for UNC employees, then UNC employees must enter into an agreement to sell to another UNC employee. Moreover, according to Ms. Nirdlinger, UNC employees must enter into an agreement to share the market appreciation of their home with UNC when they wish to sell. (Query, what will UNC do with that shared equity appreciation?)

Gone unspoken is another approach.

Why doesn’t UNC pay its employees a living wage that allows them to own a home in Chapelboro? If it’s important for UNC employees to live five miles away from campus, as opposed to fifteen, then why not pay a wage that allows them to enter the private home market? Why create a perpetual housing fiefdom? (Query, how much will the administration of this fiefdom cost?)

The Town/UNC Unspoken Deal
Lost by the local media is the handshake, behind-the-scenes deal between UNC and the town of Carrboro. In order to cut the county out of the Winmore development process in 2003, the Carrboro Boa had to get the Winmore land into town limits.

Mr. Michael Brough, then filling the unusual combination of being Carrboro’s outside attorney and Carrboro’s acting town manager, wanted to help Winmore developers stuff a mixed use village alongside Bolin Creek (which included his longtime friend and acquaintance, Mr. Phil Szostak.) He needed to get UNC to seek voluntary annexation of its Carolina North lands and the Carolina Commons land site in order to allow the Winmore land to be voluntarily annexed. Coincidentally, it allowed the town of Carrboro to involuntarily annex about 400 homes and bag over $500,000 annually in taxes without providing any more services to those involuntarily drug into the town.

UNC complied without offering a reason, even though it had no plans for developing these properties in the immediate future. Unasked by the media, (and unspoken by Mr. Brough, the Boa, or UNC) why would UNC seek such annexation years before building within the Carrboro planning jurisdiction?

The answer became obvious several years later. The town of Carrboro spent over $250,000 to extend a sewer line through the Carolina Commons property as a reward for the voluntary annexation move. That gift from the town to UNC reduced the development costs for UNC. A gift from town taxpayers to UNC.

Political Corner
The most interesting part of the Carolina Commons development from a news perspective is not the 150 or so homes in the southwest corner. Rather it’s the tale of the northeast corner.

Several years ago, Carrboro citizens living adjacent to the northeast corner approached UNC regarding the future of the northeast corner. No less that Mr. Roger Perry, UNC trustee in charge of UNC building plans, told these citizens that UNC intended to build about seven executive homes off a cul de sac at the stubout on Claymore Road. These homes would be high end, designed to attract key employees to UNC. It was a developer’s promise from a UNC trustee, worth the paper it wasn’t written on.

Then the town of Carrboro stepped into the fray. Seeking the highest return in tax dollars, the town $1,000,000 planning department decided to increase the number of homes from seven to seventeen.

Moreover, the town decided to force a road connection (32 foot wide with sidewalks and curb and gutter) between the Colleton Crossing development to the north of Carolina Commons and Claymore Road (20 foot wide, no sidewalks or curb and gutter). As can be seen below, such a connection would cost the town about $1,000,000 to improve that road up to the town’s legal requirements for a sub-collector road.

Curiously, the town planning staff ignored connecting Colleton Crossing to Homestead Road through Camden Lane (32 foot wide with sidewalks and curb and gutter, just like the proposed Colleton Crossing and Carolina Common roads). As can be seen below, such a connection would cost the town nothing and would provide a road connection that met the town’s legal requirements for a sub-collector road.

Why would the town of Carrboro seek to connect to a substandard road that would cost town taxpayers substantial moneys to improve when they could connect to an existing road that was up to standards?

The answer goes unreported by the media.

As described at a meeting between UNC officials, their private advisors, and neighbors surrounding Carolina Commons a few months ago, a political score must be settled at taxpayer expense by connecting to a substandard road. Taxpayer expense and public safety be damned. In the words of Alderman Dan Coleman, he wanted to get back at his political opponents in the Highlands who live off, you guessed it, Claymore Road. Challengers in the last municipal election, they publicly asked Mr. Coleman to resign after he lied to the public about attacking a woman on town property with his vehicle.

Enter The Handpicked Private Developer
Subsequent to the Perry meeting, and prior to the submission of the concept plan to the town of Carrboro, a new player came into the Carolina Commons deal. Enter the private for-profit residential development firm of D.R. Bryan. D.R. Bryan is a privately held for profit enterprise that builds major residential developments. It built Southern Village and Treyburn. It’s building an oversized hotel for Southern Village, as reported in the Pulp.

D. R. Bryan is “advising” UNC on the Carolina Commons development. What's the contractual relationship? No one will say. At the UNC Carolina Commons neighbors meeting the question was asked. However, Ms. Rosemary Waldorf, former Chapel Hill mayor and D.R. Bryan kingpin, declined to answer that question. Based upon their advice, the seventeen homes are no longer to be used to attract key UNC employees. Instead they are being sold on the open market. Mr. Perry's promise to Carolina Commons neighbors is a true developer’s promise.

The Unspoken Web
D.R. Bryan is also a partner in the mega Buckhorn Village development along with East-West Partners. Who heads East-West Partners? None other than… Mr. Perry, UNC trustee in charge of Carolina Commons.

How much is D.R. Bryan being paid by UNC?
Is it providing any capital?
Is it building the homes?
Why is it involved?
Was this “advisory” contract competitively bid?
Who at UNC approved the contract?
Is anyone other than the Pulp paying attention?

No word on why those in the media lamenting the death of printed newspapers can't see the reason why.

“Oh what a tangled web we weave, when we first practice to deceive” - Sir Walter Scott

While the Chapel Hill Councilors discuss the aesthetics of the proposed hotel for the Southern Village village-mixed-use community just south of Chapel Hill, just off US 15-501, no one will be asking the Councilors why the local hotel developers are allowed to “park” real property taxes on the parking lot site for the hotel?

Having secured northern Orange County “Buckhorn Village” development rights from the Orange County commishes, Developer Dream Team members Mr. D.R. Bryan, Mr. John Fugo, and former Chapel Hill mayor Ms. Rosemary Waldorf have returned to their Chapel Hill roots (see Pulp Southern Village story) as the developers of Southern Village. Now they seek approval of a four story hotel or condominium project at Southern Village’s Market Street “ground zero”.

One of the main features of the Southern Village “downtown” is the Market Street commons, dominated at one end by the steeple of the United Methodist Church. The church overlooks the open space of a giant “U” shape of retail shops and offices. Part of this open area is a large, one acre parking lot for visitors to the Southern Village retailers. Being in the heart of a high value area, this parking lot has a county tax revenue department assigned “land value” of just over $500,000. That land value is about equivalent to the land price for the shops and stores forming the “U”.

Do the Developer Dream Team owners pay the current Chapel Hill tax rate of $1.809 per $100 of assessed value for such a valuable piece of land? No. Why not? They get a break on the “total valuation”. Although the “land value” is over $500,000, the county tax revenue department assigned a “total valuation”, the value upon which taxes owed are calculated, of just over $70,000. So instead of paying about $9100 a year in taxes, the Southern Village owners have only had to pay about $1300 since Southern Village was developed. All the while, your taxes have doubled.

“Alternative valuation”, it’s just another small gift from local politicians to their campaign contributors.

If you build an ED infrastructure, your taxes will be spent. If you approve a lot of office space to be built, will they come to fill it?

Building the Bureaucratic Field of Dreams

Over the past five years Pulp readers may have noticed an awful lot of activity on the economic development (ED) front in Orange County. No, there’s not been a lot of activity actually recruiting for profit businesses to Orange County. The activity has been to build ED bureaucratic infrastructure. First Carrboro had an ED official and a revolving loan fund. Then Orange County got a new ED official. Now Chapel Hill has an ED office too. Instead of a unified, regional governmental approach, southern Orange is spending over $500,000 a year in your taxes just to maintain a tripartite, divisive, and flaccid ED infrastructure.

Once you have a bureaucratic function, it must seek to justify its cost and expand. So now the latest buzz in Chapel Hill is to lament how the town failed to capture the latest ED prize catch in the Raleigh metro area, a company called Optimal Technologies. In the words of former Chapel Hill mayor, Developer Dream Team member, and real estate profiteer Rosemary Waldorf, “How are we going to fill all the space [recently approved by the Chapel Hill politicians]”. (See Chapel Hill News ED Story.)

In southern Orange there are few business conflicts of interest that aren’t tolerated. So it’s not surprising that Ms. Waldorf, involved in the mega retail project Buckhorn Village, is asking about government money possibly for her future tenants in Buckhorn Village as well as the spate of office buildings being built.

The One That Got Away

Optimal Technologies US Inc. (OT) is a software and technology provider for electrical utilities and consumers. It is moving its headquarters (18 jobs) from Canada to downtown Raleigh. It will invest $2.4 million over the next three years. It plans to create at least 325 jobs. The new jobs will include highly specialized circuit (ASIC) designers, software programmers, engineers and management and marketing positions. While wages will vary according to job function, the overall average annual wage for the 325 new jobs will be $71,250 not including benefits, which is higher than the Wake County average of $40,092.

The grant to OT is $325,000 from the One North Carolina Fund (Fund). The City of Raleigh matches that grant with another $325,000. OT must have at least 325 employees within three years in order to receive the full grant. OT can spend the money on: 1) installation or purchase of equipment, structural repairs, 2) improvements, or renovations of existing buildings to be used for expansion, construction of or improvements to new or existing water, sewer, gas or electric utility distribution lines; or 3) equipment for existing buildings. Readers should note that Fund grants are also available to existing businesses for adding jobs.

The Local Solution to Flaccid ED

Why use a more proven technique with bureaucratic controls to eliminate favoritism if you can create a more expensive and ineffective way that rewards those in the palocracy?

Instead of joining in Fund grant programs, Chapel Hill ED leaders (with an awesome track record of sub-par ED job growth) are taking the southern Orange Progressive approach. For example, according to Chapel Hill ED guru Dwight Bassett, Chapel Hill is discussing paying a percentage of a lease for downtown businesses, helping to inflate already high lease rates. Or town taxes might go to pay for merchant marketing programs as a matching grant, aiding the bottom line of local media businesses, the staunchest supporters of town politicians. Finally, Councilor Mark Kleinschmidt is eyeing the Carrboro loan revolver as a cure for stiffening local ED successes, despite the fact that Carrboro subsidized a business that moved to Chapel Hill when it got on its feet, Phydeaux Pulp Story.

No word on why Orange County ED leaders thought that a computer circuit hardware/software company associated with electrical power generation should prefer Chapel Hill's UNC over North Carolina State University, a renowned computer engineering school, located in… Raleigh.

The power of locally connected developers over Orange County governance boards continues unabated. Developers of the Chapel Hill village mixed use (VMU) hill sprawling, twisty road community known as the “Goat Trails” (aka Southern Village) have proposed a six-story building in the middle of the village center. Less than a decade ago the 60-foot spire on Christ United Methodist Church symbolized the faith of local urban planners in “humanizing” suburbia. Now that spire will be dwarfed by the new symbol of local urban planning, the Trump-like profiteering of a high end condo block blocking people's views.

Currently, the village center has parking for those visiting the stores and shops of the village center. In the words of developer dream team member and former Chapel Hill mayor Rosemary Waldorf, ”[a] hotel or new residential condominium building could be a third 'anchor' in the Village Center, along with Weaver Street and the Lumina Theatre.” Ms. Waldrop and associates D.R. Bryan and John Fugo are all members of the team seeking approval for a 1,000,000 square foot project at Buckhorn Village.

No local political observers see the well-heeled developers having any difficulty in getting their friends on the town council to rezone the entire village center as a VMU, a designation not in existence at the time of approving the Goat Trails. As reported in the Chapel Hill News, the increase of 90,000 additional square feet (sf) would take the village to about 440,000 sf, not counting about 58,000 sf in structured parking below the building.

In the words of local campaign financial contributor Ms. Waldorf, ”It gives the building owners here a little bit more flexibility in responding to the market.”

No word on how the developers will make up for the lost recreational credits in paving over the open space and parking.

Following the Hot Orange post on the “anonymous” Buckhorn Village developers, the N&O today asked questions openly and named names, at least to the extent that the developers wanted information to be revealed. Please note that there are no legal obligations for true, complete financial transparency in North Carolina.

As Hot Orange noted, Roger Perry’s East-West Partners is now confirmed to be among the select few. Also included are Tryon Investment Group (including George Horton of Gateway Center Complex fame (new home to Weaver Street Market in Hillsborough) and Montgomery Carolina (including John Fugo, of Southern Village fame, and Rosemary Waldorf, former Chapel Hill mayor and project manager for Bryan Properties, also part of Southern Village). The absence of any “outsiders” on this list confirms Commissioner Barry Jacobs comment as to only quality developers being involved.

The development fruit doesn’t fall far from the government tree in Orange County. Now the big question is, who in government knew about the invovlement of these players, how long did they know, and what conversations have taken part outside of the available public record?

Curiously, there will be no conflict of interest presented by this pantheon of preferred Orange County land developers despite one of the partners (Horton) being an Orange County landlord by means of county offices to be placed in his Gateway Center Complex.

See N&O related story