Battle Looming Over County Plan to Restrict DDA Developments, Retain Taxes
|
||||||||||
| Printer Friendly Story View |
Valley Center Technology Park is centerpiece of Bay County high tech development.
Dice Corporation headquarters in Monitor tech park employs 80 technical personnel serving customers on six continents.
Would we have the Bay City Mall without a Bangor Township Downtown Development Association (DDA)?
Without a Monitor DDA would we have a Valley Center Technology Park, with more than 20 companies, 850 jobs and annual payroll of $30 million?
Probably not, say Ken Lange of the Bangor DDA and Cliff VanDyke of the Monitor DDA. They claim DDAs helped create more than 3,000 jobs in Bay County over the past two decades.
DDA financing of a parking ramp also was crucial to successful development of Jennison Place condominiums and key to other downtown Bay City improvement projects, DDA advocates say.
Essexville, Auburn and other more rural areas are pinning hopes for new development on DDAs established in designated development districts, often blighted or neglected areas where little or no property taxes are garnered. There are 10 DDAs scattered throughout the county including Pinconning and Hampton. A total of $16 million in taxes has been "captured" in seven years from 1995 to 2002.
DDAs were crucial to developments because they "captured" property taxes from DDA districts to pay for infrastructure, a fancy term for roads, lighting, sewers, water and other facilities necessary for development, the advocates say.
"Capture" of taxes means that the property taxes that otherwise would go to colleges, township and county government and other entities instead go to the DDA for use in developing the property in the DDA district. School taxes are not captured by DDA districts.
By paying for improvements with tax dollars, companies were induced to locate or expand here instead of elsewhere or not at all. The developments then create more property taxes which continue to be "captured" to pay for additional improvements and expansion of more businesses. Eventually, when the expansion cycle is complete and the development is mature, tax revenues to governments are much higher than they would be without any assisted economic development.
Now comes County Commissioner Michael Lutz of Essexville who has another idea: eliminate DDAs and instead let the money flow to the county and other taxing units directly as it did before creation of the DDAs.
The general concept of paying for industrial and commercial facilities from contributed money is not new in Bay County. In 1928, the Chamber of Commerce led a drive to collect hundreds of thousands of dollars to bring the Brown Hoisting Company here from Cleveland and merge it with the old Industrial Works. The resulting Industrial Brownhoist created 1,000 jobs that lasted for 50 years. In 1937 the same process was followed in luring the Electric Autolite Company here from Toledo, Ohio. The old Wildman Rubbert Company was donated to the firm by the city. Again, about 1,000 jobs that continued for half a century. Not a bad model to follow, say economic planners, except that now the process is funded mainly by property tax dollars rather than by private community contributions.
Lutz contends the County Commission, not DDAs, should decide where the county's portion of property tax dollars should be spent. His resolution, slated to be considered by the Ways and Means Committee this week, calls for strict controls on DDA tax capture including prior approval by the county board, a "tax sharing" agreement and an additional 2 mill tax on firms locating in the DDA district.
DDA advocates counter that there would be little tax revenue because no development would occur without the incentives. The additional 2 mill tax would effectively end all development, they contend.
"Why would anybody want to bring in a business if they automatically have to pay 2 mills more in taxes just to locate here?" asks VanDyke.
Restriction of DDAs runs counter to the county's efforts to support economic development, the DDA advocates point out. "It just doesn't make sense," said VanDyke.
| Printer Friendly Story View |
|
|
Dave Rogers |
|
|
|
Printer-Friendly Story View
0200 Nd: 04-21-2024 d 4 cpr 0
12/31/2020 P3v3-0200-Ad.cfm
SPONSORED LINKS
12/31/2020 drop ads P3v3-0200-Ad.cfm