Frequently Asked Questions
1. Why hasn't the city created a downtown redevelopment proposal with input from the ground up, starting with the input of residents and merchants?
The proposal was not generated by the city. The proposal was designed by a highly secretive and questionable group of investors called the the Paso Del Norte Group. The PDNG was created by Woody Hunt, a local land and water speculator and Bill Sanders, the chief CEO of the Verde Group who specializes in establishing Real Estate Investment Trusts (REITs) and owns more parking garages than anyone else in the world. Sanders and Chihuahua City developer Eloy Vallina are both PDNG members who are also the driving forces between the highly controversial mega -development "master-planned binational city" projects in Santa Teresa and San Jerónimo. The Paso Del Norte Group includes ten members that have been targeted by an on-going FBI corruption investigation. One of them, Chris Balsiger, has been indicted for defrauding his customers of $250,000,000.
The PDNG plan was not created for the sake of the residents of the Segundo Barrio or for El Paso as a whole. The members of the PDNG did not identify the land in the greatest need of redevelopment. It selected land that looks most profitable to the investors themselves. The interest of these investors is not to help citizens of El Paso. It is to make money. Residents of El Segundo Barrio have other priorities such as, educational opportunities, improved housing, better living conditions, and historical preservation in South El Paso. They prefer "revitalization" projects that do not displace them or forcefully expropriate their property.
2. How can a redevelopment that plan attempts to reproduce the status quo of other cities damage the historical and cultural uniqueness of our community?
Downtown and the Segundo Barrio are very unique. Downtown El Paso is safe and alive. It is different from most other downtowns. City leaders have not promoted these characteristics of downtown. Instead, they have criticized this unique downtown and Segundo Barrio as dirty and unproductive. They fail to value the bi-national environment of South El Paso as important to the people of our area. They would rather replace these local merchants with national chains that bring a higher yield of taxes to El Paso while replacing the current consumer and business owner of South El Paso with a more affluent one. This would destroy an economy that currently thrives and serves needs on both sides of the border.
The Segundo Barrio is the oldest neighborhood in El Paso and the heart of the Mexican Revolution. The history of El Segundo Barrio is rich and fascinating. People in El Segundo have lived there for generations and are part of its history. It is the Ellis Island of the Mexicano immigrants in the United States whose history is only been coming to light recently. While people in El Segundo mostly rent housing in historical buildings, some, not all, of the owners of the buildings have not maintained their buildings to minimal habitation codes. The city has not forced landowners to keep up their buildings. Hence, the buildings have deteriorated. Developers like Bill Sanders say there is more “cash flow” in leveling these historic buildings than restoring them. “I don’t give a darn what a building looks like,” Sanders told a real estate magazine recently. “I want to be very confident that it is a strategic asset. When I say income in regards to real estate, I mean free cash flow. [Restoring architecturally significant buildings] is a very expensive investment. On the other hand, self-storage, you sweep it out, paint it and that is it.”
We believe the citizens of El Paso deserve more than this “sweep it out” and maximize the “cash flow” mentality toward our community. For the sake of developers’ greed, El Paso stands to lose one of the most unique downtowns in the country and the oldest neighborhood in El Paso.
3. What has happened to the poor and minorities in other communities when downtown redevelopment efforts have been implemented?
They have mostly been displaced. They have not benefited economically from downtown redevelopment. In some cases a system of rent control is initiated by the developers/city for a short period of time in order to create the illusion of non-displacement. However after a period of three or four years, buildings are sold, rents increase and the area becomes gentrified as more and more people from outside the area want to “invest” in the relatively inexpensive properties. So after about four years or so, residents find themselves displaced from their homes looking for cheap housing somewhere else in the city. Many of the 1800 current residents of the Segundo Barrio have already moved from their apartments or homes because of fear of future displacement. Other's will not qualify for the so called "affordable housing" that the politicians are promising them and will have to move to other parts of the city. For the majority of of the people living in the zone of future demolition zone—even for those who do qualify for the relocation apartments—this plan is essentially a form of “deferred displacement.”
4. Isn't it true that Segundo Barrio residents and downtown businesses don't pay their fair share of taxes?
City Council politicians and the supporters of the Paso Del Norte Group plan have repeatedly claimed that the Downtown and Segundo Barrio businesses and residences only pay $414,000 in taxes. They want the El Paso public to believe that this is the total amount taxes generated by the area although they know the real amount they pay is much higher. The true figure that includes the total taxes for this business-residential area is more than 1.8 million dollars per year. When the pro-plan politicians compare the downtown-Segundo Barrio taxes to other parts outside the redevelopment zone, they only use the City tax figure (25% of all taxes) for downtown-Segundo Barrio. Yet they use the tax figures that include taxes paid to all entities (100% of all taxes) to areas outside the redevelopment zone. In other words, they have been comparing a quarter of an apple to a whole orange. These politicians have been engaging in an outrageous and fradulent campaign of deception.
In fact, the commercial and apartment properties within the "redevelopment area" pay more in property taxes per square foot than comparable commercial properties in other parts of the city. For instance, while the El Paso Limousine Express facility on S. Oregon is valued at about $14 per square foot, the Verde Realty (Bill Sanders') facilities out near the Zaragosa bridge are valued at about $10 per square foot. Verde Realty goes through the process to fight property valuation increases at the Central Appraisal District. One of the Verde properties was lowered in value by one million dollars in this process. This is exactly what you can expect once Bill Sander's controls the land in Downtown and South El Paso.
The claim Downtown-Segundo Barrio residents and property owners as a whole are not paying their "fair share of taxes" is an outright lie. It has been used as a justification to whip up support for the impending demolition of a large sector of our community. Read "Exposing the City's Campaign of Deception."
5. What are the risks of bringing big national chains to the local merchants in downtown?
National chains will be brought in as a result of this plan. National chains can acquire merchandise in larger bulk than local merchants. So, they can sell it below market prices and run local merchants out of business. After the competition is eliminated they control the market and the prices. Also important to this Downtown-Segundo Barrio Plan is exactly what kind of stores will be brought downtown. Right now the stores in the area serve the needs of the people and their respective limited budgets. With more upscale shopping taking over the people of the area will have to travel further distances to get what they need. A new clientele will take over downtown.
6. What are the risks of giving a large acreage of land to a Real Estate Investment Trust?
A REIT will profit by leasing land to the highest bidder at the time that the land is worth the most. REITS don’t concern themselves with aesthetics, history, culture or uniqueness. So, if we want to preserve the uniqueness, history, culture and aesthetics of downtown and El Segundo, we cannot, in principle, hand the land to a REIT that will lease it to the highest bidder.
7. What are the advantages of having mostly local merchants operating businesses in a community?
Essentially, while we are saving a few bucks by shopping and eating in national chains, we are our destroying the local economy. For a community to prosper there must be a reasonable ratio of local vs. outside businesses. El Paso has few local merchants and mostly national chains. The only area of El Paso that has mostly local merchants is downtown. By bringing national chains to compete with them, we will run them out of business, further damaging our economy.
Money spent locally will circulate in our community longer. Local merchants will buy cars and homes in El Paso. They will buy clothes and food in El Paso. They will raise kids here and will stimulate the local economy. Money spent in a national chain is deposited directly into their own banks—not located in El Paso. These national chains will divest from El Paso.
8. Why doesn’t the city enforce minimum habitation standard codes with apartment owners in the Segundo Barrio?
This has been the million dollar question for decades. The city has refused to enforce housing codes in South El Paso. Now, developers are finding it more profitable to simply level buildings than to bring them up to code. B After decades of city neglect, city officials now point to the deteriorated conditions in this part of town as a justification to demolish it. Yet we believe that you do not have “to destroy the barrio to save it.”
But what is even more unjust is that the city will use the existence of a few tenements that have been allowed to deteriorate to justify the demolition of scores of properties that are in perfectly good condition in order to create a "critical mass" for their private commercial projects.
9. Can the city work with the community on a downtown redevelopment plan that is beneficial to all?
Yes, it can. But, it must start from the bottom up. It should ask the residents what kind of changes the residents want to see in order to create a true community-based vision of cultural, social and economic revitalization. However, the city must approach the community as such. Instead, the city has attempted to gain allies by approaching people as individuals and promising great things. This is a strategy that divides communities rather than respecting them. Maybe, the strategy of the city has been to weaken the downtown and Segundo Barrio community by approaching them as individuals who are more vulnerable when they are alone.
10. What’s wrong with using eminent domain for private development?
Eminent domain is a right that a government has to take over private property for public works. These include hospitals, schools, parks, streets and other things that benefit the public directly. However, until recently, eminent domain power has not been used by governments to take private property to give to other investors. Some cities have recently done this but this has created uproar and lawsuits, and most state governments are passing laws to stop this. While the city may claim that it is using the power of eminent domain for public interest, there is an inherent risk in giving properties to powerful investors. Since these private entrepreneurs often pay for politicians’ campaigns and heavily lobby politicians, the politicians can easily be pressured to take private property through eminent domain power to give it to their wealthy financiers.
Because of this, the state senate has passed legislation in November of 2005 that prevents cities to use eminent domain for private development. The legislation is weak, however, and has loopholes that the PDNG and the city are planning to use. Even if the city votes to adopt the PDNG plan, they will be facing a major battle in court and waste the El Paso tax-payers money in a long process of litigation.
The pro-plan politicians have stated that eminent domain will be used only as "a last resort." But the threat of eminent domain itself has already been used as a powerful weapon which has frightened many residents to sell and move out of their homes, apartments and business. Thus, its threat has been almost as effective as its future use. The PDNG has admitted that it needs a critical mass of space to build their big-box retail stores, arenas, strip malls, etc. There is no other viable way for PDNG’s plan to succeed unless every affected resident and small business owner whose property the PDNG wants agrees to relocation.
11. Some of the City Representatives have said that the Paso Del Sur group by asking for a downtown plan that starts all over again and includes the Segundo Barrio residents and business owners from the drafting stage is attempting to “maintain the status quo.” Is this true?
Not at all. We all want to see renovation and improvement in downtown, the Segundo Barrio and anywhere that conditions have fallen below acceptable standards. But to know what is needed and what is important to the community, an open and democratic forum should have been established from the beginning. The plan that has been presented by PDNG has been developed privately (members only being revealed through the Freedom of Information Act), and by a private consulting firm from out of the state, SMWM in San Francisco, with no input from the residents, as a community, of the affected area. PDNG’s plan has made decisions that will impact the lives of thousands of people. We call for the scrapping of the plan and to start all over again because those people who will be most affected and/or displaced were excluded from this plan. The plan cannot have been developed in their best interests if a true democratic process has not taken place from the beginning before the maps were drawn and the threat of eminent domain became apparent.
The Paso Del Sur Group is against the status quo. This is why we are so opposed to the PDNG plan. In fact, it is the PDNG group that is proposing to impose the status quo and aesthetics of corporate capitalism in South El Paso by bringing national chains and reproducing what already exists throughout El Paso and pretty much every other city in the US. Instead of capitalizing on El Paso’s uniqueness and difference, city reps are proposing to embrace the status quo of reproduction, imitation and repetition.
The Paso Del Norte Group and their supporters are the ones who are trying to maintain the status quo propped up by a small, non-representative, very wealthy group in this city, that until now has determined the urban face of our community. It is time for this status quo to change.
12. Where’s your Plan?
People have charged that opponents of PDNG plan don’t have a plan and they just want to derail progress.
Actually, there is a plan for South El Paso. There has been one for decades, and people have worked on the plan for many years. It so happens that city reps didn’t know about the plan and they think that the PDNG plan is the first one. The Southside Low Income Housing Development Corporation and previously the Campaña pro la Preservación del Barrio have been in existence for decades. These organizations have worked to improve the conditions of El Segundo with input from the residents for close to 20 years. They have received funding from HUD, from foundations and from individuals to improve conditions and they have been involved in the construction, rehabilitation and maintenance of solar adobe homes and apartments, and in trying to force landowners to bring buildings to habitation codes. They have asked for help from the city for the past 20 years without success. By the same token, downtown merchants have asked for improvement and rehabilitation of empty buildings, improvements of the buildings that they lease, and improvements to the surrounding, dead area, around their busy retail area. There are plans by other organizations as well that include housing, programs for youth, micro-businesses, etc. developed by non-profits in the area (including the Sacred Heart Church) that are often supported by local small businesses whose visions for improvement have either been ignored or quashed by City Hall for decades. In 2007, La Mujer Obrera presented an alternative development plan to that of the PDNG for central El Paso called Plan Mayachén that does not involve eminent domain, displacement, exclusion and secret deals with ruthless binational developers. Yet the City has been completely unsupportive of their community-based vision.
It seems that city reps have decided to at best ignore and at worst, oppose and quash these efforts and embrace the PDNG plan as the ultimate and only solution. Instead of trying to build on and include other people’s visions and alternative models of of redevelopment, the Paso Del Norte plan will demolish everyone elses.
13. Do the members of the Paso Del Norte Group have a conflict of interest?
There has been no full disclosure by the Paso Del Norte members about their actual or potential conflict of interest related to this plan. In 2005, the Chief Executive Officer of the PDNG went before City Council and claimed that not a single PDNG member had any property inside the historic incentive district or the redevelopment-demolition zone. Now that we have flushed the PDNG membership out into the open, we have discovered that her statement is absolutely false. Several members of the PDNG—including Mike Dipp (owner of the Plaza Hotel that has been empty for many years), Jerry Rubin (owner of several buildings along San Antonio Street and one inside the “redevelopment zone”) and Steve Helbing (president of Wells Fargo) and others—have a clear conflict of interest. They will profit from the demolition of other business property inside the demolition zone. While other El Pasoans see their business properties bulldozed, these PDNG businessmen will receive incentives to redevelop their own properties. And when the property values inside the redevelopment zone go up, the property values in the adjacent area will also automatically move up. Thus, anyone having property around the redevelopment zone who is part of the Paso Del Norte Group has an obvious conflict of interest.
Salvador Balcorta, executive director of La Fe Clinic, had a direct hand in delineating the zone where major demolitions would take place within the Segundo Barrio. Very conveniently, he left his own organization’s properties out of the demolition zone. The daughter of the multi-billionaire Bill Sanders, Amy—who is also the wife of the plan’s frontman, Councilman O’Rourke—is a staff member of La Fe Clinic. Mr. Balcorta’s organization, after having helped determine the demolition zone, has bought land around the Magoffin area demolition zone to construct housing for the Segundo Barrio residents who will be displaced by the PDNG plan. If this is not a conflict of interest and an unethical manipulation of insider knowledge, then what is?
Furthermore, Mr. O’Rourke voted on various issues related to the downtown plan while he was a member of the Paso Del Norte Group. His father-in-law Bill Sanders, the major player behind the plan, his mother and wife all belong to the Paso Del Norte Group. Yet Mr. O’Rourke voted for this plan. It is akin to having Mr. O’Rourke sitting on the bench, while the jury is composed of his friends and relatives and the chief prosecutor is his father-in-law. We are the defendants. “Do the defendants have any last words to say before Mr. O’Rourke declares his verdict?” As Judge Alicia Chacon stated: “the city deserves the highest level ethical conduct on the part of its representatives.”
14. What’s up with all the references to racism?
We do not believe that the PDNG plan is racist simply because 81% of the PDNG members have non-Hispanic surnames. Many Anglos have a long history of collaborating with the Segundo Barrio in a way that is respectful of our fronterizo culture and heritage. However, the way the PDNG has adopted and tried to implement this plan for the Segundo Barrio community without first consulting the people of the barrio makes this “development plan” more like an act of conquest or a hostile takeover than anything that will benefit the residents of the barrio. They would have never decided to bulldoze and use eminent domain to strip people of their property to build a mall in the predominately white, wealthy Kern Place neighborhood. Yet, these businessmen and their political supporters (some of them inhabitants of Kern Place) involved in this plan have shown a total lack of respect for the Mexicano community of the Segundo Barrio. They did not consult the Segundo Barrio people at all during their planning process. City officials talk of “sanitizing” and even “desanitizing” the image of the Segundo Barrio by taking the most degrading photographs of the community possible. A $100,000 television and newspaper ad campaign paid for by the PDNG showed images of graffitti on walls that were not even part of the "redevelopment zone" and beside this graffitti were individuals with their faces covered by signs reading "Barrio Art!" Does the PDNG mean to imply that barrio artists are incapable of creating nothing but unattractive graffitti without the help of San Francisco-based urban planners. Why didn't their propaganda campaign show images of the beautiful mural at the Sacred Heart mural as one example of the kind of revitalization that can take place if people are included, rather than excluded from the betterment of their own community.
But one of the most offensive and racist marketing studies in the attempt to get rid of the culture that presently exists in the barrio was done by the Glass Beach firm, an affiliate of the local Sanders-Wingo PR company (founded by the father of Bill Sanders). The marketing study included a photograph of an elderly Hispanic man who supposedly represents the image of El Paso that needs to be "modernized." Next to his photograph were the words "dirty, gritty, lazy, Spanish speaking." Another photograph showed the ideal future denizens of the newly redeveloped zone—an Anglo actor and a European actress—representing the "New West". They are described as "educated, entrepreneurial" people who "enjoy entertainment."
Since the turn of the century, race and class have always played an important role in the many urbanistic "de-Mexicanization" plans proposing destruction of the historic Segundo Barrio. This one no different.
15. You say there was community participation but weren't there several public meetings held by the City to "vet" the plan?
Not one of these meetings was held within the Segundo Barrio "redevelopment" zone. The community as a whole was left out of the two year planning process from 2004 to 2006 where all the decisions were made. The PDNG was approved in its entirety with December 2006 with no substantial changes. The major issues of the plan, such as the determination of which properties will be threatened by the bulldozer and eminent domain abuse—that is, the threat of their property and homes being stolen to be handed over to a private enterprise—were decided from the very beginning. It was presented as "a done deal." At these "public input meetings" people were invited to play a monopoly-like board game designed by San Francisco urban planners where we they could decide whether they wanted a Target or a Wal-Mart, a taqueria or a Starbucks in the Segundo Barrio
and downtown once the people that are there today are pushed out of the
way. When people’s lives and livelihoods are at stake, these kind of games are reprehensible.