There are several taxpayer funded programs implemented with a goal toward stimulating local economies and creating jobs. These include enterprise zones which allow property tax exemptions for new business investment, economic development agencies like SCDC and the Port of Coos Bay and urban renewal districts designated to clean up urban blight. Local leaders frequently refer to these programs as “tools” but they may be more of a hindrance to economic development if not managed properly by limiting the public services necessary to healthy commerce.
For example, Bob Main revealed during a recent public meeting that during his tenure as County Assessor “The total $$$ that have gone to the urban renewal districts, over the years, (while I was assessor) was over $50 million”. This means $50 million was diverted away from local taxing districts that depend upon property taxes for their revenue like schools, municipalities, the county, etc… toward the Coos County Urban Renewal which administers designated “plan areas”. For more info check the Assessors site here
According to the State of Oregon…
The Oregon Constitution allows the Legislature to set up a system to finance urban renewal. Oregon Revised Statute Chapter 457 describes how the system works. This law gives each city and county the ability to activate an urban renewal agency with power to propose and act on plans and projects to remove “blight.” Examples of blight include buildings that are unsafe or unfit for occupancy or the existence of inadequate streets. The area where the work is to be done is known as a “plan area.”
An urban renewal agency is activated when the city or county governing body declares by ordinance that a blighted area exists in the city or county and there is a need for an urban renewal agency to function in the area. The urban renewal agency proposes a plan for improving the area. Following public notice and hearing, and after considering public testimony and planning commission recommendations, the city or county may approve the urban renewal plan by ordinance. Unless required by local law, no public vote is necessary.
Dr Mason Gaffney, professor of economics at the University of California, Riverside answered some questions for me recently
“Urban Renewal” is a great idea that has been hijacked … whereby landowners inside the District get the increment while the rest of you, pardon the expression, get the excrement. Urban renewal should be self-sustaining. There is no reason to freeze taxable assessed values of land, that does not help renewal along. The incentive to rebuild and renew comes from untaxing NEW buildings; the land is already there, and it isn’t going anywhere.”
According to yet another advertisement paid for by the Port of Coos Bay, director Jeff Bishop claims the CCURA formed in 1985. Now, sadly this ‘Eighth in an Occasional Series’ is riddled with misleading and incorrect statements but if we assume the inception of CCURA was in 1985, more than twenty five years ago, shouldn’t the qualifying blight be eradicated by now? If the urban renewal plan was successful or accomplishing stated goals after receiving millions of taxpayer dollars wouldn’t the plan area shrink rather than expand as it did in 1994 when it added the North Spit?
After twenty five years and still suffering from blight, perhaps it is time to try a new approach. No sustainable free market business model would accept decades of failure.
The same is true of enterprise zones which I have written about extensively before. Since the formation of the enterprise zones, intended to stimulate job growth in 1986, after twenty five years of this grand experiment, Coos County’s unemployment rates have more than doubled while social services have declined. In a nutshell, they don’t work yet they endure as a “tool” in the collective psyche of self proclaimed business development experts.
This problem is not unique to Coos County or Oregon, it is wide spread across the nation. In Buffalo, NY close examination of economic development efforts and continued failures led to serious public criticism and in Niagara Falls, “…the City Council reduced the salary of their economic development chief from $100,000 to $1.00 due to dissatisfaction with economic development efforts.”
Michigan is also suffering from a severe lack of results.
The Michigan Economic Growth Authority, which awards refundable tax credits to selected businesses, came under large amounts of scrutiny this year: audits showed missed expectations; studies indicated that it was responsible for little-to-negative economic activity, and scandals indicating that bureaucrats fail to vet applicants thoroughly. Yet, this economic incentive continues. It’s hard for politicians to declare that a program is a failure when they have not defined success.
As they pointed out in Buffalo, the best economic driver is to focus on public services.
The best approach to attracting economic development is for local government to focus on hiring talented people and providing quality services in the basic areas of police, fire, building permits, streets, and education. Communities where businesses have a fair and honest shot of getting government contracts without engaging in the “pay to play game”, and where stable and professional governments provide quality services, attract people and jobs. Local governments have plenty of items to focus on without getting involved in economic development efforts that they traditionally perform poorly. Politicians and patronage employees simply don’t know how to create private sector jobs; they do not have the qualifications or experience for such efforts. [emphasis mine]
The Port of Coos Bay and South Coast Development Corporation have both been dismal failures at job creation and they are not alone. The Port’s heavy investment of time and energy in the Jordan Cove project will produce only 39 jobs, (read the EIS), less than the 46 jobs at the soon to close Albertson’s which didn’t intrude on the environment, public safety or private property rights.
So two questions. 1) Why do we continue with the same policies when we literally have decades of empirical evidence they don’t work? 2) Why, with such a bad track record, should we continue to believe in the schemes put forth by the Port, SCDC or local business leaders who support them?
[more on Bishop’s latest factual flaws and some notes regarding who should be “minding the port” in later posts]
Excellent Colandrio… we want performance standards established and met before we fund any more lame brained development schemes
Charles, the tangible data I’d like to see would be forthcoming from these agencies when they lobby for more funding. I’d like to hear from the SCDC that their efforts brought 30 jobs to the county. I’m sure if the SCDC ever lands a company we will hear about it. So silence from them is just admission of failure in their mission and their irrelevance.
I agree that this money is better spent on benefiting the local populace instead of trying to seduce industry into coming here. It is a proven fact that when a place is a great place to live, jobs will come on their own.
I look to communities in California that have done this: Santa Clara & Palo Alto, among others, own their own power grids and use the money earned to benefit the commonwealth, as well as supply a cheaper electric rate. This alone is enough for many industries to relocate. Imagine if Coos County owned it’s own utilities. Think of the opportunities in converting to a community power grid and encouraging solar production everywhere.
Portland with its progressive administrations has become a dynamic city by its emphasis on public rail and strict growth controls.
And how about an accounting of what happened to all those industries that were prevented from coming here by the “CAVE” people: Daishawa, Nucor, etc. (are there others?). As far as I know, Daishawa built a plant in Washington state that closed after a few years and NUCOR? Didn’t they go bankrupt? How would you like a rusting steel mill on the north spit? As it is, we may have a rotting LNG terminal in the same spot in 20 years.
Change comes from active dissent, Charles, and I can’t think of a place that needs strong dissent more than Coos County.
@Charles – not bitter, just saddened and disgusted that the same people keep selling the same old schemes while expecting different results.
There are lots of positive and successful models posted on this blog, unfortunately, they don’t happen in Coos County.
Charles, do you ever yearn for someone, anyone to tell you the truth about what is going on around you? Really going on around you?
Me too.
Go back to the World, you can’t deal with the truth.
Do you ever post tangible data for creating jobs and economic growth in Coos County or have you dedicated yourself and your website to just bitching about everything? Because from my viewpoint, I don’t see a lot of positives here. Just complain, complain, complain. You apparently like but a few people, despise the rest, hate local and state leadership, seem opposed to just about everything and..well..seem to be a pretty bitter individual.
Dear Mr. Den:
Why should Coos Bay – our home community – send our slush funds monies to the county? There is good reason why we should spend it in Coos Bay – and that includes the profressional politicians forgotten area formerly identified as “Empire”- and not necessarilly spend it for boondoggles that benefit a few, if any. Second, the county has its own slush funds collected from all of the taxpayers who do not read or understand their tax bills – and labeled Urban Renewal. Third, some day the people of the county should demand that these professional politicians that we keep electing in cities and in the county clearly identify to the average Joe (primarily older folks with few, if any, children or swine at home) struggling to pay their tax bill what the benefits received from all of these urban remewal agencies are; how the average Joe is benefitted by the seven millions collected for SWOCC annually; how the half million collected for the 4H benefits them; how the millions collected for schools and libraries benefits them; how the millions collected for special sewer and fire districts benefits them; how the millions collected for the airport and Port District benefits them; etc.
Regarding your SCDC comments, until such time that SCDC employes a leader who has created a job – not filled an open job requisition – please do not expect anything. At high noon on Aprl Fools Day 2009, we were informed that the new SCDC “executive director” had arrived in town (apparently none of the long time locals were considered to be qualified for the ljob). According to professional politician and SCDC board leader Barton, our new director came to us with “a very strong background” in jobs creation with “quite remarkable” qualifications and experience. Two years have passed. The LNG man found us. ORC found us. The anticipated call center found us. Walworth and Jim from Squim found us. What has SCDC found? What jobs have been created? What has SCDC done with outr tax monies that the county and cities urban renewal agencies and others – such as Coos Bay’s $100,000 annual salaried (including perks) economic development and facade program manager not done?
http://theworldlink.com/news/local/article_77fd3140-1f12-507b-9114-
d37d4ee0ca0c.html
I was reading in the paper today that the City of Coos Bay see
themselves with no budget problems and enough to go around to cover
all expenses.
Even had an extra $38,000 to hand out, to the “hands out crowd”. What
was not talked about of the contribution to SCDC, which is done so
from the Urban Renewal funds, requiring no public comment or overseeing.
Now, for a start, if all this spare change, the “Cities” had in their
pockets, and the addition of their SCDC contributions were put toward the operation of the County Juvenile Detention and other needs in the
Juvenile Department, and the Sheriffs department for more officers on
the road, that money would provide a lot more value in our community
than it does now.
Of course, the Hands out, and SCDC would not agree, and those who
give it away would not agree. It’s just the way we use our minds. We
can have “change” right here in River City, Coos County.
And, for more money and value, disband the Cities’ and County’ Urban Renewal districts (pronounced, “Slush Funds”) and take that bonuses of
tax dollars from each district and fund the County Jail, Juvenile, and
Sheriff department. Then you would find quick solutions to our
economic development difficulties, and a more productive Community.