San Marcos Mercury | Local News from San Marcos and Hays County, Texas

July 6th, 2009
Ed Mihalkanin's Blog: San Marcos' moving Target

By ED MIHALKANIN
News Reporter

As the San Marcos City Council considers new economic development incentives for a proposed entertainment venue at Springtown Center (See “Council Looks at Loan for Entertainment Venue”), it may be helpful to put the current proposal in context.

In the spring of 1998, the council approved, by a divided vote, economic development incentives with the Dayton Hudson Corporation for a Target retail store to be constructed at Springtown Center. The incentives included the waiver of all development fees and a one-year tax abatement on the increased property value after improvements were made for the 2000 tax year. The argument made at the time in favor of the incentives was that Springtown Center was an important, yet somewhat blighted, retail area, so incentives would lead to new jobs and increases in property and sale tax revenue.

In 2008, the council approved tax abatements of $2 and $4 million to Target to help it relocate to the Stone Creek Crossing development and out of Springtown Center. The council then did not seem concerned that Springtown Center would be hurt by Target moving away from it.

Now, the argument is being made that a proposed $5 million interest-free loan is needed as a development incentive to keep Springtown Center a viable retail location. If the relocation of Target was detrimental to the viability of Springtown Center to the extent that the proposed loan is necessary to entice out of town developers to invest in the location, why did the council incentivize Target to the tune of  $6 million to leave the center in 2008?

If the council is correct in approving this proposed $5 million interest free loan in 2009 to fill a commercial void, then it was incorrect in approving $6 million in tax abatements in 2008 that created the void in the first place. If the council was correct in approving the tax abatement for the Target relocation in 2008, then no incentives are necessary to induce developers to invest in the center today.

Retail, although important for sale tax revenues and jobs that will help young people, cannot provide the full time high paying jobs with benefits that our community desperately needs. For those type of jobs, the council needs to provide incentives for manufacturers.

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19 thoughts on “Ed Mihalkanin's Blog: San Marcos' moving Target

  1. There is also the possibility that is was a mistake to offer incentives for Stone Creek *and* it would be a mistake to offer incentives here.

    Do we really know that Target would have left town without incentives? Do they have a track record of doing that in cities like San Marcos? I suspect that store was and is quite profitable and it is seems unlikely that they would close it down.

    Meanwhile, just imagine what kinds of people we could employ for $11 million, to search out and recruit real businesses who might open up shop here. Imagine the incentives we could give those companies.

    Imagine the startup money we could provide to small businesses in preferred industries for $11 million. The mayor and council did say that we want to be the small business capital of Texas, didn’t they? Maybe it’s time to put our money where our mouths are.

    How many homeowners work at a typical Dave and Buster’s? How many college students dream of graduating and starting a career collecting skeeball tickets from patrons and doling out stuffed animals?

    I’d love to have a Dave and Buster’s in town, but I’m not interested in subsidizing it at the expense of the real economic development that my precious and very limited tax dollars could fund.

  2. Well put, Ted. Personally, in my utopian vision of San Marcos, there is no Dave’n Busters. And Springtown would be turned in to an urban park with a tranquil pond in the middle and a jogging path.

  3. Would have been nice to have that input prior to the obscene development incentives being offered to Stone Creek to relocate three existing tenants from Springtown !

    You can be assured Target was not leaving town if the Stone Creek deal wasn’t approved. It was just posturing.

    As I said then, approving the Stone Creek deal would lead to exactly what is taking place now. The difference is that this developer must now go out and incentivize new businesses to come to San Marcos.

  4. I’ve offered that input at every opportunity. It is unfortunate that historically, the opportunities have been few and the input has been disregarded.

    Now, for better or for worse, the developer looking at Springtown has to work with a city with many residents who feel we have been burned many times, who feel like developers have trashed our interests in the past and who don’t necessarily trust the mayor and city council to be up front and above board with us.

    An “emergency meeting” with no just cause (at least not any that I have heard) does not help matters.

  5. city leadership, selective hearing, loves retail, excessive politics, suboptimal thinking, consistently disappointing, means well, what now

    Back to complete sentences, I see the City of San Antonio in conjunction with the Urban Land Institute is hosting a 2-day Community Development Summit in September. I really like how it is oriented to bringing a lot of different perspectives (people, entities) together for dialog.

    As a relative newcomer to San Marcos, I see a lot of silos, people not talking and working together, and too much “we know what is best for the community” belief by a relatively few select people.

    Where is the consensus building? Where is improved transparency from local government to the community? How can we get more and all kinds of people from the community involved in meaningful ways so that we end up with more informed and enlightened decision making?

    Retention is easier and more cost-effective than attracting new players. Some local businesses are struggling and some could really use various forms of help (not just government handouts).

    I wish I had more time right now to be more involved, but I’m one of those struggling entrepreneurs who is burning the candle at both ends trying to chart a course to (business) financial sustainability myself.

    Whether our little company makes it here, or relocates, or goes under, will not mean much to most of the current city leadership. But, add up a lot of small businesses going through tough times, and pretty quickly it turns into substantive local economic reality.

  6. Jason Rutherford – right on target. I would suggest an amphitheatre because the concerts in the park venue – where many people sit in a drainage ditch – is laughable.

  7. I think the amphitheater/public gathering place discussed in the proposal sounds similar to what was built at the Hill Country galleria in Bee Caves, where the City of Bee Caves gets the rights to use the facility a certain number of days each year. It’s nothing huge–maybe only an acre or so.

    I love parkland, but Springtown becoming an urban park is quite possibly one of the funniest notions I’ve heard in some time. It would remove an extremely valuable piece of property from the tax rolls and create a park that would be incredibly difficult to link to the other regional parks in San Marcos.

  8. Good piece Ed, I am glad you and many other members of San Marcos have been able to voice our concerns over this issue. I am very glad to see that was shot down last night (all of a sudden all 7 voted against, what happened?).

  9. “What happened”…..

    was that if a member of council votes “for”….and the measure doesn’t pass, then that council member is prohibited from re-introducing the measure. Seeing that the Springtown loan-deal was highly unpopular (at the July 7th council meeting), and was potentially politically damaging to be “in favor of”,…those council members who saw the writing on the wall, scattered like rats, voted “against” the Springtown interest-free-loan measure, and allowed themselves the opportunity to re-introduce it at a later date (exactly two weeks later at the next meeting) in a slightly re-packaged form.

    At the meeting tonight (July 21, 2009) the measure was re-introduced and then “tabled” which translates into putting it on the back burner until the heat dies down.

    Our city council originally helped to create this problem at Springtown Mall in the first place, with a $2 million dollar giveaway to the developers of Stonecreek (New Target Center on IH-35) over a year ago. During the mayoral campaign last fall, and winning by a 4 to 3 vote (Narvaiz, Couch, Porterfield, and Terry), they again gave away an additional $4 million for an “engineering miscalculation” to the same development.

    Now,…after our council has been irresponsibly bluffed out of $6 million dollars (of our tax revenue), and after creating this problem at Springtown, and during these tough economic times, the wisdom of our city council, sees fit to throw another $5 million of your/our tax money (cash, this time), to favor out of town corporate developers, over local business owners, and in direct conflict and competition with these hardworking local businesses.

    And,….

    this discussion,….

    is all taking place behind closed doors, in “Executive Session”….which is illegal, and which flies directly in the face of free open government and transparency.

    These issues were addressed last fall in the local political campaigns, but looking back at it,…the promises that were made, to address and correct those problems,…was only lip service, and once the elections were over,…it was back to “business as usual”.

    That’s San Marcos politics,…and that’s what we’ll CONTINUE to have, until we,..the voters, organize, and band together decisively for the next few elections, and resolve without fail, to root out this source of decay in OUR system and in OUR city.

  10. Dave, while I agree with the sentiment, I can’t be as optimistic as you. It’s not just the person that occupies the public office, it’s also the power structure of the office itself that tends to corrupt. A new elected official, more often than not, ends up being just as bad.

    Changing the structure of an office and instituting effective ethics rules (with actual teeth) are probably a better way to approach the issue.

  11. whose idea was it in the first place to build stonecreek?
    and why did the city feel WE had to populate it? and why target [no pun intended] businesses that already have a place? a park is not practical but giving money to outsiders is just WRONG. there are plenty of small businesses in town and i am sure there are plenty that want to be here – history has shown that during the last decade, the majority of jobs were created through the small business sector and that doesn’t ALWAYS mean minimum wage jobs. and why can’t we look at Austin and San Antonio and built a PARKING GARAGE for downtown!!! and why is it that the lot behind taco bell continues to be empty?

  12. Who on the Council stands to benefit either directly or indirectly from the success of this project?

    Do the people of San Marcos benefit from this project?

    How many jobs are actually created by this project rather than simply moved around?

    How many local jobs or small businesses will be lost or hurt by these franchises moving into the community?

    How many are living wage jobs?

    What out-of-town interests are represented by these entities who have come before the Council for these incentives?

    What is the exact amount of campaign or other contribution from these business entities to the various Council members who are supporting the project?

    Compare this to that received by the people not in support.

    Will this project make San Marcos a better place to live for the people who live here now and whose tax money will fund this venture?

  13. IMHO –
    how about bringing a children’s museum to springtown mall? a whole educational center with a science tree house like the one heb has done for san antonio….a place for students at tsu to intern at, a place for the local youth to volunteer at during the summer [similar to the public library], a place for children’s parties and field trips. a center for afterschool and summer day camps….we need to expand our ideas. residents of san marcos routinely drive out of town, looking for entertainment and educational opportunities for our children. don’t we have enough places to go drink at?

  14. It is more than refreshing to see real issues being raised and real questions being asked in public. Up front, Ed, Ted, And Steve all show a healthy curiosity about an unhealthy climate in the sequestered halls of what was once OUR seat of government. (See my own recent copious comments in NS about similar comings and goings.)

    ED is a valuable resource, and deserves to stand directly in front of the Seven Dwarves and comment on their ever-increasingly expensive attire. He served ALL the people honorably and well, “long ago and far away in a different galaxy” called San Marcos, when government was an honest if imperfect attempt to bring health, prosperity and community, as well as SUSTAINABILITY, to those who did the work and paid the bills. No, he didn’t even pay me. I’m not even sure he either remembers or likes me very much. LISTEN, for he speaks with straight tongue and without motives.

  15. It saddens me that the former mayor has lost his sense of decorum, and is reduced to name-calling of volunteer public servants. Perhaps a little temperance is in order, in every sense of the word. It is possible to disagree without being disagreable.

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