Monday, September 10, 2007

The Cabela's Deal, continued

I have an update (below) of Shirley Frederick's excellent summary of the Cabela's issue that I've been meaning to post.

I also recommend the recent Rapid City Weekly News article and the forum planned Monday night at Rushmore Plaza Civic Center, sponsored by the RCWN and the Chamber. Mayor Hanks was declining to speak, but now he's decided to (in my opinion) take the risk on this issue.

Tom Lawrence also wrote a GREAT editorial in the RCWN last week, calling for less name calling and more consideration of the real issues. Hooray for Tom and his excellent paper that just keeps getting better.

Keep your eyes open, there is lots to learn from this thing! You can vote tomorrow down at City Hall if you like, or do it with the the majority of voters on Sept. 18.

OK, without further ado... here is Shirley's wonderful piece...


by Shirley Frederick - August 8, 2007

Rapid City has been negotiating with Cabela's, a corporation that calls itself The World's Foremost Outfitter. As an incentive to Cabela's to locate a retail store in Rapid City, the City Council voted on June 18, 2007, to give Cabela's the city Visitor Information Center, $2 million from the 2012 fund, and 30 acres of city-owned land at the VIC.

Meanwhile, Bill Gikling, president of the Rapid City Development Board, sold land to Cabela's, and the store will be located on that land.
In an effort to recoup the cost of the deal, the City Council created a tax increment financing district (TIF) with an estimated value of $22 million. It includes the 30 acres, the land purchased by Cabela's, 40 acres of property owned by Gikling, and land owned by other developers.

The difference between the taxes on the undeveloped TIF district land and the taxes on the developed land (the tax increment) will go to the city. Cabela's will pay property taxes at the same rate as everyone else, but all the tax increment will go to the city. The county, the school district, and the West Dakota Water District will receive their share of tax dollars based on the undeveloped value of the TIF district.

Opponents of the TIF say that the money from the TIF will not be nearly enough to pay off the $22 million and that the balance will come from city sales tax plus property taxes from residents outside the TIF district. In effect, large amounts of TIF money that should go to the school district, the water district, the county, and the city for tax-funded services will go to the city to pay for development. Some opponents say that multiple TIFs are the primary reason our property taxes continue to go up.
The land giveaway has been referred to a public vote, which is scheduled for September 18. Meanwhile, Cabela's announced that they are willing to deed the VIC and three acres of parking space back to the city.

Informal conversations and intense blogging have kept this deal on the front burner as Cabela's supporters duel with government watchdogs. Of particular interest are the frames being used by both sides. The most common frame is government as a parent and citizens as children. So we hear public officials making promises to the children:

* The prestige and huge marketing power Cabela's brings will be a major boost to the entire region.
* Cabela's wants to invest in Rapid City's future.
* This public-private partnership will be good for Rapid City
* Through increased sales tax revenue and rising property values in the TIF district, the city will recapture the dollars given away.
* This partnership will improve the quality of life for the people of Rapid City.
* The Cabela family is giving the public an opportunity to share in their good fortune.

Note that Cabela's, a corporation that trades on the New York Stock Exchange, is worth $1.35 billion, and uses public money to increase its profits, frames itself as a kind and generous family.

Getting back to the government's family—some of the children are spoiled, saying, “I want Cabela's and I want it now. And anybody who is against me is a stupid liar.” From the blogs:

* Opposition like this is why we are still in the Dark Ages.
* Opponents are just shooting off their keyboards. This is a no-brainer. Let's get moving.
* Opponents are lazy negative whining naysayers who don't want progress.
* John [an opponent] is spreading falsehoods faster than Bill Clinton at an impeachment hearing wearing Monica's dress!

So the spoiled children and the indulgent government parent are allies in the effort to promote Development with a big D.

Opponents of the Cabela's deal also use the government-as-parent frame. But they want their government to be open, honest, and fair, not deceitful and indulgent.

* By creating this TIF the city transfers the tax burden onto the very people who have been paying their taxes for years.
* This is a shady deal hatched in secrecy and rammed through the City Council in a 72-hour hustle.
* This deal was made in closed meetings by an aggressive circle of insiders..
* City staff and officials are deliberately misleading the public and have created a confusion stew.
* Promoters make inflated claims of sales tax increments for which there is little evidence.
* In a rapidly developing area a TIF is a scheme to permit land speculators to cash in.
* Much of the cheerleading comes from the bankers and realtors who will benefit.
* City government has a duty to evenhandledly represent all businesses, not just those with hardball-playing dealmakers.

Other opponents use ridicule to discredit the promoters:

* If Cabela's is such a tourist draw, why not tear down Mt. Rushmore and build it there?
* If you call yourself a destination store and promise to hang dead animals everywhere, you, too, can get free land.
* They want to give away the farm, the keys to the machinery, and all of the cows.
* A TIF is like a black box. Public money goes in, development comes out. Who knows what happens in between?

Then there are those who want their government to be more responsible in building community:

* Big box retailers take money out of the city and send it to their out-of-state shareholders, while locally-owned businesses return profits to the community.
* We need a rational development policy focused on the downtown area and public places.
* Where do we get this pro-growth mentality? And why does “growth” always refer to new buildings and more shopping? What about better education, a thriving arts community, improved transportation, renewal of aging buildings, parks throughout the city, support for local businesses and farmers? Those are the kinds of growth that build community.

And, finally, one wag turned the frame upside down and made government the child and the people the parent:

* Government is like a five-year-old child. It needs a lot of supervision.

Facts and figures are being used by people on both sides to defend their position, but voters who go to the polls will vote based on how they view government.

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