Sunday blog: The cost of doing business when playing the tax incentive game

first_imgCommentary by Tracy McCue, Sumner Newscow — Wellington and Sumner County have always been about three things: planes, trains and combines. It is how our economy works. But if we don’t periodically bring in new business and keep our existing ones happy we will be about moving vans, unemployment checks and empty pockets.The question is: Can Wellington/Sumner County adequately compete in today’s business world against other municipalities, court houses and state capitols to attract the kind of industry that helps us grow and remain economically viable?Will it get to the point that businesses will have a “signing” day with the winning community?Wellington is no different than any other town in America. We all hope for prosperity, and sometimes that means luring new industry or commerce to town. What results is an incentive war not much different than college universities trying to snag the latest five-star football recruit, or the auto dealers trying to get you to buy a car.It has come to the point where governmental entities are literally “prostituting” themselves with various tax incentives and other quirks in hopes something will move to town. In the process we are cannibalizing one another.Small towns such as Wellington, Belle Plaine, Caldwell, etc. are especially behind the eight ball when it comes to other cities that are bigger and more wealthy. Let’s say Wellington wants to bring in an aircraft plant or help expand an existing one. The city can offer incentives of 10 years of no taxes, free sewer, gas and donuts in hoping the company will pick Wellington for its economic needs.But let’s say a city like Oklahoma City swoops in at the last minute and offer the same company everything Wellington has AND… $3 Million in cool clean cash. Wellington can’t afford to give out such money.So what happens? Bye-bye Wellington and hello OKC. Anybody got any free Thunder tickets?Since we are on sports analogies, when it comes to attracting commerce, Wellington is Southwestern College. OKC is the University of Oklahoma. Where are the five-star recruit going to go?John TracyJohn Tracy, Wellington City Council member, brought up an interesting point in his November 13, 2013 blog about the dangers of offering incentives and how that has hurt the city of Wellington (see blog here). For instance, 10 years ago, Wellington offered various incentive packages to lure housing development to town. Three new developments sprung up in town simultaneously.Of the three, one proved to be successful, the other one continues to struggle. And the third, Settlers Creek, east of Woodlawn Ave., was such a financial disaster, that the city had to take over. City taxpayers are now in the real estate business – holding property that needs to be sold.Tracy’s feeling is the city of Wellington needs to either get out of the tax incentive business, or at least severely restrict its use. I don’t disagree with him entirely. Tax incentives are probably the spawn of Satan. However, I’m also not so sure we should get out of the game, especially when someone is knocking with potential business.Tax incentives are also never guaranteed.Remember the “Hotel Coming Soon sign” north of McDonald’s Restaurant in east Wellington? Oh, it’s still there but seems to be fading away.It appeared the Wellington City Council even got a verbal commitment from Johnnie and P.J. Parmar of Derby to build a Best Western Hotel after the city approved a list of perks and incentives included everything but supply the guests with free breakfast burritos from across the street.It still wasn’t enough. The owner has not been able to secure financing for the complex and there seems to be a question just how serious they ever were to building here.Of course, there was that casino soap opera from yesteryear, as if we need to rehash that again. Despite the dancing and singing by the city and county economic development forces to build a casino in Wellington, the state of Kansas ended up building to the north.It wasn’t a total loss. Whatever you may think about the Kansas Star Casino, it undeniably has brought the area more employment opportunities and property tax relief.And that right there is illustration No. 1 of why bringing in industry is so essential for all of us. With more industry brings in more revenue, which brings in a larger tax base, which in turn gives us more financial flexibility to build better roads, keep the hospital open, make necessary repairs, etc.It has become a vicious circle for communities like Wellington. We have to offer the incentives— sometimes outrageously so, or take ourselves out of the potential for new business. The true winners are those on the receiving end – the developers and the corporate big boys, who aren’t paying their fair share in taxes and other civic bills.We spend so much time wringing our hands about losing jobs overseas. But we are not only losing jobs to Mexico, but New Mexico.Wellington, as every town in rural America, needs help.How about some help here?The U.S. Congress and President Barack Obama needs to address incentive reform. If we truly are a capitalistic society, then why not let free market dictate where industry will go?There needs to be a blanket incentive restriction policy across the board allowing small towns like Wellington the ability to compete with big cities like Oklahoma City. And there needs to be a system in place where developers and big business are paying their fair share in taxes much like you and I. Close Forgot password? Please put in your email: Send me my password! Close message Login This blog post All blog posts Subscribe to this blog post’s comments through… RSS Feed Subscribe via email Subscribe Subscribe to this blog’s comments through… RSS Feed Subscribe via email Subscribe Follow the discussion Comments (8) Logging you in… Close Login to IntenseDebate Or create an account Username or Email: Password: Forgot login? Cancel Login Close WordPress.com Username or Email: Password: Lost your password? Cancel Login Dashboard | Edit profile | Logout Logged in as Admin Options Disable comments for this page Save Settings Sort by: Date Rating Last Activity Loading comments… You are about to flag this comment as being inappropriate. Please explain why you are flagging this comment in the text box below and submit your report. The blog admin will be notified. Thank you for your input. -8 Vote up Vote down iceman318 · 331 weeks ago Wellington has water to offer as an incentive a lot of communities would kill for. Report Reply 0 replies · active 331 weeks ago +9 Vote up Vote down anonymous · 331 weeks ago We’ve already done that and drew the lake down to closing. Trading or selling natural resource on speculation or hope is a very bad practice. And on so many levels. Report Reply 0 replies · active 331 weeks ago +6 Vote up Vote down JustMe · 331 weeks ago I don’t know….incentives for business are ok to get them to come here, but without people (you know, the ones that really pay the taxes), does it matter? It would be nice if the City/County would offer tax incentives to individuals. How about if you BUY a home in the city/county, you don’t pay property taxes for 3 years. If you BUILD a home, no taxes for 5 years. That would get PEOPLE here. Report Reply 3 replies · active 331 weeks ago +11 Vote up Vote down Property Owner · 331 weeks ago We already have a county wide revitalization program. Remember for every tax exemption or incentive you give you are passing that tax burden onto the people who are already here. I’m getting kinda tired of all the tax shifting onto property taxpayers. Enough with the give-aways! Report Reply +1 Vote up Vote down Jim · 331 weeks ago Indeed, we do seem to have a problem here with “big government.” We don’t just pay too much tax here, we’re getting fleeced and have little say in the spending. Report Reply 0 Vote up Vote down JustMe · 331 weeks ago Do you know what it takes to get into the revitalization program? If you’re building a home, you have to give them a complete breakdown of the costs to build your home. I thought about it. But then realized, it’s none of their business! And I’m glad I did. They have it appraised about 30% lower than what I paid to have it built. Saved me some taxes down the road! Report Reply +2 Vote up Vote down clean up · 331 weeks ago Maybe the city would come up with a tax incentive for home owners and landlords if. Home owner clean up yard plant grass, face lift to house, maybe a fenced yard. Landlords get the rentals cleaned up, don’t allow cars in yard to be worked on, stuff picked up. Face lift to house paint or siding. Report Reply 0 replies · active 331 weeks ago 0 Vote up Vote down billy · 329 weeks ago It’s Americans right to work on cars in there driveway Report Reply 0 replies · active 329 weeks ago Post a new comment Enter text right here! Comment as a Guest, or login: Login to IntenseDebate Login to WordPress.com Login to Twitter Go back Tweet this comment Connected as (Logout) Email (optional) Not displayed publicly. Name Email Website (optional) Displayed next to your comments. Not displayed publicly. If you have a website, link to it here. Posting anonymously. Tweet this comment Submit Comment Subscribe to None Replies All new comments Comments by IntenseDebate Enter text right here! Reply as a Guest, or login: Login to IntenseDebate Login to WordPress.com Login to Twitter Go back Tweet this comment Connected as (Logout) Email (optional) Not displayed publicly. Name Email Website (optional) Displayed next to your comments. Not displayed publicly. If you have a website, link to it here. Posting anonymously. Tweet this comment Cancel Submit Comment Subscribe to None Replies All new commentslast_img read more

West Hancock, Clear Lake, St. Ansgar remain rated in Radio Iowa sports broadcasters high school football poll

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