I believe the City should always recover all its costs and then some on any subsidized developments. The question is how do you measure return and over what period of time. This is probably impossible to accurately determine. That is why it is so easy to abuse. Return on investment can mean a greater pride in community, more convenience, finer aesthetics and cultural institutions, cleaner environment and of course improved services, just to name a few. Ultimately such improvements, if real, will translate into a larger tax base. What has been so objectionable to me is how politics has manipulated and contorted decisions which efect the long term.
John Mannillo Highland Park and Downtown Original Message ----- From: "Bob Spaulding" <[EMAIL PROTECTED]> To: "St Paul Discuss" <[email protected]> Sent: Saturday, February 12, 2005 4:37 PM Subject: [StPaul] Approach to Brewery & Recovering City Costs > MUST THE CITY ALWAYS ENSURE IT 'RECOVERS ITS COSTS' IN DEVELOPMENT? > > Charlie raised some interesting questions in his last post on the GSE > Sale. Let me focus in on the questions that that I think is driving > the City approach to the project... > > In the February 2005 issue of Avenues, a member of the Kelly > administration talked about the Brewery project. The official > suggested that some possibly historic elements of the Brewery might not > be able to be saved in a cost-effective way: "...the city will have to > pay some 'serious money' if it is granted the right to buy the > property. Having too many restrictions on redevelopment, she said, > could make it impossible for the city to recover its costs." > > It's that last part of the sentence that interests me the most. Should > the city always ensure it "recovers its costs", especially in public > investment and historic preservation? Or is there a time and place to > not fully recover costs, at least in the sense that the City official > intends? Where should we draw the distinction? I suspect 'cost > recovery' explains why the city did not opt to buy the property itself > -- the political pressure to preserve certain elements is more forceful > when the property is under city ownership than when in the hands of a > private owner. Yet, as Charlie notes, a public RFP process would have > been more ideal. > > This is a ultimately a values-laden question. Would Landmark Center > still be standing if the government had to recover its costs there? (I > think not.) Does Crosby Farm Park or Harriet Island Park "recover its > costs" of ongoing ownership, or should part of those parks be sold off > for prime riverfront development? Is there a scenario under which a > Twins stadium would "recover its costs"? (Again, no.) > > Sometimes the economic benefits of city investment can't be captured > simply in the P & L statement for a specific project - these are > "externalized benefits" in economist speak. Historic preservationists > talk about the importance of landmarks in establishing a sense of > community. Stadium supporters talk about the spinoff effects of other > entertainment development, or elevated stature for the City. Where > should we draw the line? How much does broad community support play > into the decisions of which projects to pay attention to? I don't > profess to see an easy answer. > > Yet this principle of "cost recovery" seems like its being applied with > increasing frequency, particularly to community-based projects under > Kelly, and that has its benefits and drawbacks. The only > crystal-clear principle is to simply expect 100% recovery on all > community projects, as Kelly seems to. But most St. Paulites wouldn't > be happy if that principle were applied more univerally: no Xcel > Center, no Twins stadium, no Landmark Center...you get the point. > Given examples of past excess, its good to be fiscally prudent...but at > what cost? Given the City's direction, and tight economic times, I > think its an important question for the community to grapple with. > > As John Mannillo alluded to, I keep thinking back to the Coleman era, > and projects like the Lawson building, where the City ultimately did > not recover between $20 to $30 million. (Which John correctly notes, > took away from projects like the Brewery). Lawson, of course, was one > of Coleman's "signature" projects. Clearly, we're taking a very > different approach on the Brewery than we did on Lawson. What's the > appropriate level of City commitment here, or on other projects? > > Something to think about. > > Bob Spaulding > Downtown > > _____________________________________________ > To Join: St. Paul Issues Forum Rules Discussion > Email: [EMAIL PROTECTED] > ____________________________________________ > NEW ADDRESS FOR LIST: [email protected] > > To subscribe, modify subscription, or get your password - visit: > http://www.mnforum.org/mailman/listinfo/stpaul > > Archive Address: > http://www.mnforum.org/mailman/private/stpaul/ > _____________________________________________ To Join: St. Paul Issues Forum Rules Discussion Email: [EMAIL PROTECTED] ____________________________________________ NEW ADDRESS FOR LIST: [email protected] To subscribe, modify subscription, or get your password - visit: http://www.mnforum.org/mailman/listinfo/stpaul Archive Address: http://www.mnforum.org/mailman/private/stpaul/
