Friday, December 16, 2011

Wilmington City Council Decides How to Make City Worse

You could have sworn the baseball stadium was dead from the rhetoric on the campaign trail for City Council, right?

Repeatedly, people like Bill Saffo, Laura Padgett, and Ron Sparks all said that they didn't support public money going to the proposed baseball stadium downtown, or some slick-tongued variation of that.

Well, that's not what the new rhetoric is.


Annexation policy, a proposed baseball stadium and the Cape Fear Skyway bridge were some of the topics Wilmington City Council tackled as it prepared for next year.

[...]The Atlanta Braves came earlier this month to talk to city and county leaders about a potential minor league team moving to the city. Elected officials have been in talks for years with different organizations interested in making Wilmington home to a minor league team. O'Grady said the Braves offer is the city's best chance to get a team.

The Braves, according to Saffo and O'Grady, are only interested in putting the stadium on the riverfront on vacant land next to PPD. Saffo said the stadium would seat about 32,000 and could be used for events other than baseball.

Most of the council seemed to agree that a stadium would be a boon for downtown. But Padgett – who repeatable said she wasn't' against the stadium – brought up several obstacles to building it, including money, traffic issues, and if a stadium is the best use of riverfront land.

O'Grady said a partnership between New Hanover County and the city would be essential to secure the necessary funding and debt.

"We have to spread that risk," O'Grady said.

Notice that this wouldn't be an issue if the Braves (minor league) wanted to come here and build the stadium themselves. They could simply buy the land, build it, and everyone presumably would be happy. The only reason that this is an issue for the City Council is because some public dollars are going to go into it.

It's truly disgusting. If you listened to the campaign rhetoric, you have had the impression this was all but dead. Folks, this stadium is going to cost $42M (probably over $70M with debt service), and there's ample research showing the publicly-funded stadiums don't work.

Of course, if the City Council actually cared about research and learning from things other cities did, we'd have no convention center right now.

Then there's more.

Laura Padgett wants more incentives for new businesses that may (emphasis on the may) come here, or for existing businesses that threaten to leave.

Councilwoman Laura Padgett said Wilmington needs someone to focus on economic development and do outreach to attract industry to the city. Padgett said economic development groups in the region tend to wait for things to come to Wilmington. She wants a "performance" spreadsheet to track money spent on economic development and what the return on investment might be.

"We don't look at the business opportunities that are here. We are missing some opportunities and those things take a while to develop. I don't think there is enough effort made to keep business here."
Wowie zowie. What a novel idea, Laura. Actually tracking performance. And it only took you sixteen years of being in office to come up with this.

Let's take a look at actual research on the success or failure (emphasis on the failure) of economic incentives to businesses.

Duke University:

The Lee Act was passed in 1996 in order to promote investment and job creation in the less developed regions of the state [NC]. It separated the counties into tiers, with job creation and investment tax credits increasing dramatically if done in a less developed county. A job created in a prosperous region can bring as little as $500 in tax credit; the same job in one of the poorest counties can in fact bring $16,500.8

The impact, however, turned out to be different than anticipated: two-thirds of the more than $60 million of credit claimed in 2001 were awarded to the top counties, with those at the bottom barely receiving anything.

[...]A survey taken in 2000 by Rondinelli and Burpitt found that international company executives operating in North Carolina placed government tax incentives, agency assistance and financing close to the bottom of the 11-item list of factors that managers felt to be influential in their location decision.
State Journal:

First, MEGA's [Michigan Economic Growth Authority] incentive packages did not improve Michigan's per-capita personal income, employment or unemployment rate.

Second, MEGA did not improve the per-capita income, employment or unemployment rate of any county in Michigan. In each county, the researchers estimated the range of impact somewhere between zero and modestly negative.

[...]The results of the Michigan study are not unique and are for the most part consistent with every other study that has looked at the economic effect of government-subsidized incentives.
And how much are spent on corporate relocation incentives? At least $50B per year nationwide. It's a true disaster.

How much more proof do you need? Let's take a look at one free way to improve our economy: loosen our zoning code and improve our zoning administration.

In 2003, Anaheim, CA took away the restrictions on mixed use downtown (our downtown is mixed use, although the rest of the city isn't.) They "allow[ed] almost any imaginable use of property." Billions in private investment poured in. In 2005, 1/3rd more businesses formed than in the previous year.

Let's not forget that 9 out of 10 downtown business owners say that the city of Wilmington is more difficult to do business with than other cities.

Is it not obvious what we have to do to improve our economy? A truly common sense, free-market oriented approach would actually get results and wouldn't cost a thing. Of course, the current City Council doesn't see that as an option. To them, the only option is for them to plan your life better.

The article then goes on to say how annexation and the Skyway Bridge are still issues for the City Council, and we'll probably be hearing more about this stuff as the year goes on.

It's truly astonishing to me. These people have zero clue. They are going to drive this city into the poor(er) house. The only thing that's still a question is how Neil Anderson feels. To be perfectly honest my expectations aren't high, but he could be the one thorn in the side of this big government juggernaut.

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