By ED MIHALKANIN
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.Email | Print