Annexation Fairness

As a longtime reader of DaCola pointed out a few days ago;

Warren Phear;

Speaking of foundation park. Something I would love to see the Argus follow up on. This I know. 820 acres were purchased by whoever for $24,000 an acre. The anchor tenant just bought 54 acres for $106,000 an acre. How did this land come to be worth so much? It came to be worth so much on the backs of SF water users. Getting the needed infrastructure to foundation is costing tens of millions of dollars. To pay for water and sewer to foundation the city raised those rates. Not once, but each year. The gift that keeps on giving. In the 2018 CIP the city allocated $29,000,000 to just get sewer to foundation. Stop and think about it. That is more than the admin building. 5 million more than the indoor pool. All for what? So somebody, don’t know who for sure, can make $80,000 an acre in profit. For 820 acres. Not a bad deal, once you consider who made that land worth that much.

I’ve been following the Annexation study group meetings lately, and one of the main points of the people that may be affected is, “How will this benefit me?”

As you can see from Warren’s comments, annexation was essential to launching Flopdation Park, and the benefits are numerous. The park is receiving millions in corporate welfare in the form of city infrastructure. Of course, the city ‘thinks’ they will recoup these costs in property tax revenue and platting fees. There is also the economic impact and job growth. I don’t think those costs will be recouped for decades, if ever.

So why would we charge annexation neighborhoods directly for these same kind of infrastructure upgrades? Shouldn’t the city just absorb these costs since they would essentially recoup some of this with new frontage fees and property taxes? While I am on the fence whether to NOT charge them nothing, I don’t think the current proposals are equitable, especially for properties that are older. I think maybe an additional fee of $500 a year for the next 20 years may be more palatable, or less.

But there is the bigger question here. If the city feels that they would have to charge homeowners directly for the annexation upgrades, is the annexation even worth it to the city coffers? I guess what I am trying to say is if the city can’t just absorb these costs equitably, is it really worth annexing them? Show to me that it will make our city stronger financially by annexing these islands than I would be all for it, if not, like Flopdation Park, it’s just a handout that benefits no one, and maybe that is why they think they should charge for the upgrades upfront. Now if we could only apply that philosophy to tax dodging Iowa ice cream makers.


#1 Emoluments Clause on 06.21.17 at 4:48 pm

Its corporate welfare for the same group that under pays its workers, then turns around a funds a study about affordable housing in Sioux Falls.

Its corporate welfare for a group that struggles to compete with a much smaller town like Luverne for economic development; i.e., Bay Harbor Shrimp – even though Luverne, and not Sioux Falls, exists in a state with a corporate income tax and closed shop protection for its workers.

It’s the reality from the quality of a work force , which is subjected to suppressed wages and no future.

Corporations, who care about their customers, still value union work and know its long term benefits for a company’s future, but corporate thought which acts in a much more predatory fashion destroys in time their product quality and their workers’ morale resulting in less opportunity for all – and explains why corporations would rather locate in worker friendly states like Minnesota over corporate predatory states like South Dakota.

This, in my estimation, is the real reason for the dormant growth at Foundation Park. Although, over a great time, it may be quite profitable for this economic development group that underpays, or is complicit in this underpayment, and then turns around and wants to know why housing is not affordable in Sioux Falls for many of its workers.

#2 The D@ily Spin on 06.21.17 at 6:00 pm

Using the force of the city to inflate land values? Everything about city hall is about making developers and a few city officials wealthy. It’s criminal that public resources are used this way.

#3 Reliable Voter on 06.21.17 at 7:48 pm

Any way to estimate the amount property owners that are disputing annexation would have paid had the property been annexed at the time of purchase?

#4 Warren Phear on 06.22.17 at 6:59 pm

RV, every island has its own set of unique circumstances. This much is certain. Very few, if any, take advantage of city services. Some do have a city service, and for that city service they pay dearly. If an island gets city water now, they are paying $7.10 for a thousand gallons. City residents pay $4.20 a thousand. It is estimated the average increase in taxes going from a township to city will be approximately 25%. The major part of that increase is because of the levy for public education. What if that island is already within a SF school districts boundaries? Then those island dwellers are paying an added levy just because they are in that SF school boundary. So yes, island dwellers are far from freeloaders, as this city’s top executive would want you to believe.

Annexation of Foundation Park, and infrastructure as a consequence of annexation, was crucial to making 820 acres quadruple in value in a couple years. There are 975 property owners within these 62 islands. Not one, I say again, not one of those properties will increase in value from annexation. It would be a good idea to heed the words of John Brown from Splitrock on this matter. Josie Alpers also has some really good talking points. I encourage you all to watch the annexation YouTube video Bruce posted a few days ago, at least the public input part that starts with about 20 minutes left in the video.