Earlier this year, the Fargo City Commission declined Hyde’s request for $5 million in tax increment financing for site development for the project but he says he was able to negotiate both a lower price for the property and the bid for site work and was able to get the model to still work.
Pretty crazy how the developer could figure out a way to invest in the property even after the TIF was denied. Even this story from September 2020 shows how Amazon turned down incentives in Fargo;
Amazon has reportedly not asked for any local tax breaks.
While Amazon technically didn’t get direct TIFs or tax breaks from the City of Sioux Falls either, the park they are at has gotten millions in infrastructure upgrades from taxpayers and will continue to benefit from the $94 million dollar TIF recently given to the park. I have argued for a long time that the developers in this community have plenty of private investment without needing TIFs. But when you turn on the candy trough, they all come to feed. If I were the mayor or a city councilor I would have ended TIFs a long time ago in this city, the welfare program for the super rich.
UPDATE: There has been some discussion today with my local government nerds on why the Planning Commission has 9 members but they rarely all show up. In fact, one member’s term was up last April and have not been replaced yet. In the last meeting only 4 members voted throughout the meeting even though 5 were present (the chair wasn’t voting) and over the past year it seems like only 5 members have been voting on things. Ideally you would say that you can only conduct business with a Quorum, 5 or more members, so what does it mean if only 4 votes.Robert’s Rules says this;
64. A Quorum of an assembly is such a number as must be present in order that business can be legally transacted. The quorum refers to the number present, not to the number voting. The quorum of a mass meeting is the number present at the time, as they constitute the membership at that time. The quorum of a body of delegates, unless the by-laws provide for a smaller quorum, is a majority of the number enrolled as attending the convention, not those appointed. The quorum of any other deliberative assembly with an enrolled membership (unless the by-laws provide for a smaller quorum) is a majority of all the members. In the case, however, of a society, like many religious ones, where there are no annual dues, and where membership is for life (unless it is transferred or the names are struck from the roll by a vote of the society) the register of members is not reliable as a list of the bona fide members of the society, and in many such societies it would be impossible to have present at a business meeting a majority of those enrolled as members. Where such societies have no by-law establishing a quorum, the quorum consists of those who attend the meeting, provided it is either a stated meeting or one that has been properly called.
So while having only 4 members vote out of a possible 9 is unfortunate, apparently it is legal, but I am still wondering why this body can’t get 9 people, even on the phone, together? Another sloppy move by this administration.
FF: 23:30
This occurred on Wednesday night and I forgot to attend for public input. Nobody else from the public showed up to speak against or for the TIF. This is unfortunate because it will literally raise property taxes on us $94 million over the next 15-20 years with $30 million of that as an ‘incentive’ slush fund. It is probably one of the most ludicrous TIFs I have ever seen.
What made it even more strange was there was very little discussion from the commission except that it was ‘good’. And besides the presentation from a planning department staffer, the representative from Development Foundation also said very little. It was pretty obvious this was pre-determined by the commission.
The other part about using $30 million of this for ‘business’ incentives also surprises me based purely on economics and development in Sioux Falls. Year after Year we are growing and year after year we are crushing building permit records. In fact we have a housing shortage and can’t keep up. So why do we have to ‘incentivize’ a business to come here? I recently saw that Tessiers (a South Dakota company from Mitchell) is building a new facility at Flopdation Park. Did they get any deals? Did they ask for any? Not sure, but I liked this quote from them;
“We thought that Foundation Park location would be ideal for us as we do business in the places on the I-90 and I-29 corridor,†said Gopal Vyas, who recently retired and was board chairman when the deal was done.
“Also it is easily accessible for our team members from Mitchell to commute when needed. It also is very convenient for our team members flying from Minnesota or driving on I-90 coming west.â€
That is what often puzzles me when they ask for these TIFs, are they even needed to bring business here?
As we have known for several years, Amazon was looking to put a distribution site in our area, it was only a matter of time. We also know, like most businesses that move here, they want handouts, and if there is one thing we love in Sioux Falls and South Dakota is giving out massive amounts of corporate welfare. Flopdation Park has already received around $50 million for infrastructure from the taxpayers. Amazon has received a Federal Grant and now the SF Development Foundation pretty much wants an open ended TIF to attract more businesses. Their argument is always the same, growth for growth’s sake (which I have never understood, because growth only drives up the prices of affordable housing due to infrastructure and public education costs) and JOBS! JOBS! JOBS!
So let’s look at the kind of jobs Amazon supplies. Most workers will be pickers that make around $15 to start. So where will Amazon get these workers? I have argued that they will suck from other businesses in town that pay less (and there is quite a few of them) and once that bleeding is done, people will start moving here. I also believe many workers at Smithfield will try to move over to Amazon. So in essence, Amazon will not be depending solely on our current workforce, they will have to do a lot of transfers.
Another reason I think it will be hard for Amazon to fulfill their worker needs is because of a very difficult qualification process, like background checks, drug tests and physical fitness. It will also be interesting to hear what Amazon’s policy on marijuana use (outside of the work place) will be if it becomes legal in our state.
But all of those things aside I think there are a few benefits to bringing Amazon here. First off, they will support many other businesses in town, maybe even create some new ones. I also believe once they start stealing workers from local businesses, it may force some of them to raise their wages to keep people.
Amazon coming to town will have some benefits, but I often am confused by Sioux Falls’ mantra ‘Growth for Growth’s Sake’. Which just ends up costing taxpayers more in infrastructure and public safety and public education while the fat cats get their TIF’s, tax breaks and government grants. Let’s face it, Sioux Falls has just turned into a welfare state for the rich, which is no surprise when it is so cheap for them to buy the city council and mayor’s office.
The news out of Sioux City and across the nation is talking about the Dean Foods disaster – bankruptcy causing it to likely be sold to another farmer based COOP like it was originally. The greed of the management team which took over the Land O’ Lakes cooperative years ago as a private company was the underlying cause of this bankruptcy. Milk market changes were secondary to the greed of the management / investment group. The Sioux Falls WinChill operation was a way for Blue Bunny to escape Minnesota and Iowa personal property (inventory) tax yearly bill.
LE MARS, Iowa — Dean Foods, America’s biggest milk processor and owner of a large plant in Le Mars, Iowa, filed for bankruptcy Tuesday amid a steep, decades-long drop-off in U.S. milk consumption blamed on soda, juices and, more recently, nondairy substitutes.
The Dallas company said it may sell itself to the Dairy Farmers of America, a marketing cooperative owned by thousands of farmers. It was not immediately clear what such a move might mean for the company’s Northwest Iowa plant, which makes products for retailers and other customers.
“Despite our best efforts to make our business more agile and cost-efficient, we continue to be impacted by a challenging operating environment marked by continuing declines in consumer milk consumption,” Dean Foods CEO Eric Berigause said in a statement.
Since 1975, the amount of milk consumed per capita in America has tumbled more than 40%, a slide attributed to a number of reasons but mostly the rise of so many other choices, including teas, sodas, juices and almond and soy milk.
That has hit dairy farms and milk sellers hard, leading some smaller family farmers to quit the business.
Another blow to Dean Foods came when Walmart opened its own milk processing plant in Indiana last year.
Dean Foods has lost money in eight of its last 10 quarters and posted declining sales in seven of the last eight.
I do know that WinChill is and has been diversifying their services (in other words they don’t just store ice cream and milk – I guess Smithfield has been using them to). But this will certainly be a big hit for them.
Don’t get me wrong, I’m glad to see there is continued development at Flopdation Park. There was an announcement today that Nordica will expand warehouse space at the site.
But am I the only one thinking after Sioux Falls Taxpayers, Minnehaha County taxpayers, and South Dakota state taxpayers floated millions in infrastructure (well over $50 million) towards the development park we only got a handful of warehouse jobs and some storage for ice cream and cottage cheese?
What happened to all the manufacturing jobs? The Bio-Tech jobs? Good paying jobs in general? You know, all these promises written on wet toilet paper without a signature?
We were buffaloed once again about high paying tech jobs to sucker us for millions in infrastructure to support some pallet humpers.
And it’s the same hucksters that were involved in other taxpayer bailout schemes in our fine community. Legacy developments who is behind the public/private partnership scam with the DTSF parking ramp after skirting any responsibility in illegal asbestos removal and the collapse of the Copper Lounge building is behind the WinChill warehouses.
I think it is time the fine taxpayers of this community send these fine folks a bill for the millions we GAVE them in FREE infrastructure. We know they certainly won’t be using their massive profits to pay decent wages so they might as well pay us back. I’m sure they will come up with another chameleon LLC scam to skirt payment.
I’m still thinking a new casino by Royal River at that location would have been a better economic impact.
