ILLUSTRATION BY QUICKHONEY
Sandy gets it right for once.
They have already written a proposal before even meeting with local legislators;
Taylor presented a draft bill today which would enable cities to raise a sales tax for a specific purpose with local voter approval.
But it isn’t sitting well with all legislators;
“I have a problem with building it on the backs of the people who may not even be able to go to an event,†she told the group at the Orpheum Theatre Center. “A lot of people are hurting out there. So now we’re asking them to pay more for stuff and especially food. You can delay (buying) stuff, you can’t delay food.â€
While I don’t always agree with Sandy on many issues, she is spot on on this one, but it doesn’t stop the spin cycle by the EC Task Force;
Task force co-chair Terry Baloun said food accounts for only about 8 percent of the roughly $50 million a 1-cent Sioux Falls sales tax would raise each year.
If you do the quick math, that is $4 million a year out of working families pockets to build AN ENTERTAINMENT FACILITY. But that is JUST FOOD. That does not include utilities, clothing and transportation, the stuff working class people spend a majority of their incomes on. Start adding up all those taxes and you are way over $4 million.
A combination of a B & B tax, an advertising tax and a corporate entertainment tax is the best way to pay for this facility, not to mention you can keep them in place permanently.
How about we just build the damn thing downtown, and use a B&B Tax and a T.I.F. so that we don’t tax the working public? Just the businesses that will benefit from it and be able to afford it?
If we used a B&B Tax and a T.I.F. (which can only be used downtown), this thing would be payed off in a heartbeat along with the private donations. Therefore not taxing the working public who may or may not support this project.
Exactly.
The balloon man is a moron.
“If we used a B&B Tax and a T.I.F. (which can only be used downtown), this thing would be payed off in a heartbeat”.
Although I’m in agreement that a B&B tax is the only reasonable way to fund a new EC, I’m not sure I can agree that this thing would be paid off in a “heartbeat”. It would likely take decades to actually pay for it, and even longer to generate the additional revenue to cover the cost of construction and operation.
Truth be told, based upon our neighbors to the South (Sioux City) I’m not sure an EC can even support itself in this current economic climate. Maybe in 10, 15, or 20 years it can… but when you’re thinking about spending $120, that is a big gamble.
That should have been $120M obviously. lol
TIF’s can be set up anywhere. But Tif’s aren’t funding sources for government projects. Are you proposing the event center be build by private interests?
This Task Force was supposed to have the spine to recommend whatever is best for SF without having to be hamstrung by politics. Unfortunately, they have failed to do so.
Like Omaha, B&B/Entertainment taxes are the proper way to fund an Events Center. No one who’s spending the money to travel here will care about another $5 on their hotel stay, as that is the case most everywhere. People who eat out a lot or frequent the bars will not care about an extra .50 cents on their tab, they will still do so.
These places tend to fund themselves if you put them in the right place and you don’t spend more than you need to. The Task Force has also failed miserably on those simple points as well.
I can’t find it now, but I swear I saw a Sioux City Journal article a few months back about how Tyson was going to make it’s final payment on it’s mortgage. I’m sure they had a 20-30 year term on the bonds, and they also got $20 million from Vision Iowa plus naming rights, so they probably only financed 50% or so of the costs. They didn’t pay it off in a heartbeat, but they certainly did well ahead of schedule and just in time for the worst part of the recession.
Yes Sy you have reminded us of Sioux City “paying off” their EC ahead of schedule, but that doesn’t mean it was a worthwhile investment.
Show me the numbers indicating increased tax revenues or growth in the area that would indicate they were able to pay off their EC as a direct result of the EC itself and you might have something, but considering they can’t seem to keep events in the place or sell out those they do attract, I sincerely doubt it has been revenue positive.
While I agree with ‘Bread for the World’ and the ‘Salvation Army’ that this is unfair and immoral to the poor, I think a bigger argument is that it isn’t fair to any of us. Just because someone can afford the tax doesn’t mean they should pay it if they do not believe in where the money is going. Forget the whole ‘guilt trip’ about poor people and food. The argument is simple. Tax the people who will use the facility; people who spend money on entertainment.
Amazing how repubs spend all their time railing against taxes but now this is one they like.
Costner:
“Yes Sy you have reminded us of Sioux City “paying off†their EC ahead of schedule, but that doesn’t mean it was a worthwhile investment.”
It certainly does mean that. Are you suggesting that paying it off early somehow indicates it was a bad investment? Are you in the predatory lending field, by chance?
Remember, risk and reward was calculated, amortized and budgeted for. By both the stakeholders and the investment bankers who floated the bonds. Time is money as I hope you are keenly aware. To finance something over a 20-30 year term and to pay ahead of schedule by 2/3 definately means there were operating funds going above and beyond the agreed upon monthly payment towards the principal.
Look at the argument the Task Force is trying to sell the sales tax on, for pete’s sake. They are saying they can pay this place off in 5 years, why would they be pushing so hard for that in a climate of still very low (by comparision) interest rates?
The answer is again lodged within the fuct up politics of other City projects like the Pavillion. They know this thing will still have fatal flaws that will cost us business, like the fact that we still will have all our facilities in one place and we still will have to tell people “no thanks” at times since that particular weekend has a Skyforce game and the Home Show already booked. We’ll also lose millions in revenue while the site is torn apart for a year.
“It certainly does mean that. Are you suggesting that paying it off early somehow indicates it was a bad investment?”
…
“To finance something over a 20-30 year term and to pay ahead of schedule by 2/3 definately means there were operating funds going above and beyond the agreed upon monthly payment towards the principal.”
Apparently you misunderstood me. Merely paying something off early doesn’t necessarily mean the money used to pay it off stemmed from increased tax revenue and or user fees from the actual EC.
If Sioux Falls was to build a EC and then pay it off early from funds that came from the general fund due to use having a budget surplus – even if it was shown the EC never produced one cent of additional tax revenue, it would NOT be a good investment.
Merely paying off bonds doesn’t prove anything. Show me where the money comes from and then you might have something, but if Sioux City just happened to have a few years of higher than anticipated tax revenue and they felt like getting rid of some debt (not a bad idea if you ask me) they could easily have shifted funds to pay off projects early.
I’m not saying I know what they did, but making a blanket statement like “Sioux City paid off their EC early” doesn’t really mean a thing. I don’t even know what the original terms were, and I don’t know where the money came from to pay it off… so how is this relevant exactly?
And no… not in the predatory lending business.
Costner;
“And no… not in the predatory lending business.’
My apologies then, you told me to stay classy and I’ll try harder to honor that request. 🙂
“Amazing how repubs spend all their time railing against taxes but now this is one they like.”
I always love the “not in my backyard’ Repubs who rail against any tax that may affect them but are all in favor of constantly increased smoke and drink taxes if they don’t partake.
They really are ‘Fuckers’
“TIF’s can be set up anywhere. But Tif’s aren’t funding sources for government projects. Are you proposing the event center be build by private interests?”
Reply:
TIF’s are specifically for Downtown, and require special permission from the city to be used any where else within the city.
I also probably shouldn’t have said it would be paid off in a “Heartbeat” so my mistake on that, however it would be payed off at a considerably good rate using a TIF and B&B.
I’m saying that the Events Center should be payed for by the Private Sector, and by businesses who will ultimately profit from the center (such as Stores, Restaurants that are around the area of the TIF project).
The reason why the Task Force isn’t going to use a TIF for a center by the Convention Center, is because they wouldn’t get enough revenue out of it since there are a tiny amount of businesses around it, and really no economic development would happen at that location.
That is why the TIF is made specifically for downtown, because if you build something of massive size that will attract thousands of people to it, you will ultimately have thousands of people coming into the city, paying our ORIGINAL sales tax on money they spent here, and paying for hotels etc. And the businesses that benefit the most from the center, ultimately get taxed more since they can afford to help pay for the center since it is benefiting their business in such a great way.
Helga:
“Amazing how repubs spend all their time railing against taxes but now this is one they like.”
Not all of them, conservative ones don’t like any taxes raised, usually because they go into some endless black hole that never impacts whatever problem/social issue it’s trying to solve.
It’s equally amazing to see some democrat resistence to raising taxes, are they not in tune with the leadership? Who seem all too happy to tax & spend their fool brains out, recession or not.
Fiscal conservatives also know a good investment when they see it. The EC is an investment that will yield a very positive return over it’s lifespan if it’s done correctly.