Lord Sun
05-30-2004, 03:31 PM
Opinion
While the score is tied, let's move forward -- Robert Brincefield
The mayor of Phoenix delivered a message to his constituents last week during his first State of the City speech that has validity for municipalities nationwide, including Brownwood and Early. In a report by Laurie Roberts in the Arizona Republic forwarded to me by a reader, Mayor Phil Gordon asked "How do we justify these upside-down spending sprees?"
The spending sprees of which the mayor referred are the hundreds of millions in tax dollars from Arizona's cities that have gone to mall developers and big box retailers to build in their city. He said for years they have pitted one city against another, persuading mayors and city councils to cut them in for a share of the sales tax take. The strategy has produced incentive packages like the $15.7 million Phoenix spent to lure luxury car dealerships to the Phoenix side of Scottsdale Road, while Scottsdale spent $7.6 million to keep Lund Cadillac on their side.
In the Fort Worth Star-Telegram last week, Jim Fuquay quoted a study conducted by Good Jobs First, a non-profit research group based in Washington. Wal-Mart, the world's largest company, has received more than $1 billion in economic subsidies from state and local governments across the country. According to the report, the chain has received 30 subsidy packages in Texas worth $107.7 million. That makes Texas No. 1 in terms of the number of subsidies and second, behind Illinois, in dollar value. And this week Mitchell Schnurnam, a business columnist with the Star-Telegram reported that Fort Worth agreed to $40 million in local giveaways and the City of Buda $36 million to land Cabela's, a superstore for hunters, in their communities.
Several months ago, Don Johnson shared an interesting piece with me where the writer asked, "When exactly did cities cease to be cities and become taxpayer-subsidized holding companies?" The specific issue for the writer was the debate surrounding the foray by Fort Worth into the convention center and luxury hotel arena. It seems that after spending 75 million tax dollars to expand the taxpayer-owned convention center to attract more conventioneers, they discovered they didn't have enough hotel rooms to put them in. So the city wanted to build a 600-room, $120 million taxpayer-funded hotel. In Grapevine, virtually in the neighborhood is the newly opened Gaylord Texan Resort and Convention Center. And Dallas is looking to build a luxury hotel next to its convention center and Jerry Jones wants to include a convention center and luxury hotel with any deal for a new stadium for the Cowboys.
The logic behind attracting the new luxury hotels, shopping centers, auto malls and big box retailers is that they become the magnet for hordes of new visitors and shoppers into the area. New tax dollars that can be used to fund schools, roads, police and fire services. Sharing some of the revenue with the new developers is considered sound strategy, priming the pump if you will, for the larger flow of tax dollars that will come as the retail pie grows larger and larger. The question becomes when will the law of diminishing returns click in? In the case of Fort Worth the question becomes when will the market become saturated with competition? How many Wal-Marts will have to be built in Texas before they stop being a draw for the local community?
While the score is tied 1 to 1, Early has a Lowe's coming and Brownwood a Home Depot, this might be the time for locals to really consider the approach Mayor Gordon is advocating for the Phoenix area. Gordon is asking every mayor and town council in the area to join him in putting a screeching halt to subsidies and incentives. He said, "if a development doesn't bring the jobs of the future to our city, I'm not paying for it. Nobody should."
Perhaps, it is time for Early and Brownwood to stop competing with each other and begin formulating a joint retail development plan that promotes the entire region. The stakes are large, sales tax increases as well as property tax increases for the cities and school districts make for intense competition. However, the opportunities for the future of the entire region are even greater if both sides of the Bayou would join forces and work in concert.
Bob Brincefield is the Publisher of the Brownwood Bulletin. His column is featured every Sunday on the Viewpoint page. Email bob.brincefield@brownwoodbulletin.com.
While the score is tied, let's move forward -- Robert Brincefield
The mayor of Phoenix delivered a message to his constituents last week during his first State of the City speech that has validity for municipalities nationwide, including Brownwood and Early. In a report by Laurie Roberts in the Arizona Republic forwarded to me by a reader, Mayor Phil Gordon asked "How do we justify these upside-down spending sprees?"
The spending sprees of which the mayor referred are the hundreds of millions in tax dollars from Arizona's cities that have gone to mall developers and big box retailers to build in their city. He said for years they have pitted one city against another, persuading mayors and city councils to cut them in for a share of the sales tax take. The strategy has produced incentive packages like the $15.7 million Phoenix spent to lure luxury car dealerships to the Phoenix side of Scottsdale Road, while Scottsdale spent $7.6 million to keep Lund Cadillac on their side.
In the Fort Worth Star-Telegram last week, Jim Fuquay quoted a study conducted by Good Jobs First, a non-profit research group based in Washington. Wal-Mart, the world's largest company, has received more than $1 billion in economic subsidies from state and local governments across the country. According to the report, the chain has received 30 subsidy packages in Texas worth $107.7 million. That makes Texas No. 1 in terms of the number of subsidies and second, behind Illinois, in dollar value. And this week Mitchell Schnurnam, a business columnist with the Star-Telegram reported that Fort Worth agreed to $40 million in local giveaways and the City of Buda $36 million to land Cabela's, a superstore for hunters, in their communities.
Several months ago, Don Johnson shared an interesting piece with me where the writer asked, "When exactly did cities cease to be cities and become taxpayer-subsidized holding companies?" The specific issue for the writer was the debate surrounding the foray by Fort Worth into the convention center and luxury hotel arena. It seems that after spending 75 million tax dollars to expand the taxpayer-owned convention center to attract more conventioneers, they discovered they didn't have enough hotel rooms to put them in. So the city wanted to build a 600-room, $120 million taxpayer-funded hotel. In Grapevine, virtually in the neighborhood is the newly opened Gaylord Texan Resort and Convention Center. And Dallas is looking to build a luxury hotel next to its convention center and Jerry Jones wants to include a convention center and luxury hotel with any deal for a new stadium for the Cowboys.
The logic behind attracting the new luxury hotels, shopping centers, auto malls and big box retailers is that they become the magnet for hordes of new visitors and shoppers into the area. New tax dollars that can be used to fund schools, roads, police and fire services. Sharing some of the revenue with the new developers is considered sound strategy, priming the pump if you will, for the larger flow of tax dollars that will come as the retail pie grows larger and larger. The question becomes when will the law of diminishing returns click in? In the case of Fort Worth the question becomes when will the market become saturated with competition? How many Wal-Marts will have to be built in Texas before they stop being a draw for the local community?
While the score is tied 1 to 1, Early has a Lowe's coming and Brownwood a Home Depot, this might be the time for locals to really consider the approach Mayor Gordon is advocating for the Phoenix area. Gordon is asking every mayor and town council in the area to join him in putting a screeching halt to subsidies and incentives. He said, "if a development doesn't bring the jobs of the future to our city, I'm not paying for it. Nobody should."
Perhaps, it is time for Early and Brownwood to stop competing with each other and begin formulating a joint retail development plan that promotes the entire region. The stakes are large, sales tax increases as well as property tax increases for the cities and school districts make for intense competition. However, the opportunities for the future of the entire region are even greater if both sides of the Bayou would join forces and work in concert.
Bob Brincefield is the Publisher of the Brownwood Bulletin. His column is featured every Sunday on the Viewpoint page. Email bob.brincefield@brownwoodbulletin.com.