It’s extortion
James Bordonaro, Emporia
Thursday, October 6, 2011
Fanestil Meats is seeking financial assistance from FEMA and the City to relocate to higher ground because its facility has been flooded 11 times. Fanestil requests a 10-year tax abatement on a $4 million replacement project. Estimates are the proposal would cost the City nearly half a million dollars.
Data analysis indicates that, initially, no new jobs will be created. However, Fanestil forecasts continued sales growth resulting in a net job increase well above the requirements for City to continue to provide tax abatements in later years. The City would also benefit from future property tax revenues because the current facility is outside city limits.
In deciding how to vote on Fanestil’s proposal, Commissioners should consider the recent national debate about the advisability of providing taxpayer financed “bailouts” to “Wall Street” brokerage firms and other multi-national conglomerates. President Bush contended that disgorging $700 billion of the citizenry’s coffers was necessary to prevent financial collapse and restore the economy.
While President Obama efforts have staunched the loss of jobs, economic growth continues at a moribund pace despite a nearly $1 trillion dollar combination of federal “stimulus” spending and an extension of tax cuts geared primarily to the wealthy. The jobs industrial tycoons and their acolytes on Capitol Hill promised to create in exchange for the working class agreeing to bequeath the nation’s largesse have yet to materialize and the nation’s debt has ballooned to $14 trillion.
Of course, Fanestil has not engaged in trading risky securities and can rightfully consider itself a pillar of Emporia’s “Main Street.” However, “moral hazard” is still involved. If the City grants Fanestil’s request, it’s fair to ask whether another large employer might go a step further and seek to “extort” a subsidy with the threat of relocation.
goodoleboy (anonymous) says...
I agree James, enough is enough, if these jobs were more lucrative I could find my way to considering this. This is a huge mistake, we just paid off one mistake, we should not be obligating ourselves into another.
October 6, 2011 at 1:37 p.m. ( permalink | suggest removal )
create (anonymous) says...
Yes, and therein lies the rub as goodoleboy states. "...if these jobs were more lucrative."
But they're not, and the people employed cannot be depended upon to lavish their 48 paychecks on this poor downtrodden town.
Good article, James B.
October 6, 2011 at 3:39 p.m. ( permalink | suggest removal )
goodoleboy (anonymous) says...
Please don't make me out to be an elitist here, I am not out to sound condescending regarding the employees of Fanestil. The numbers just do not add up, we might as well put these folks on the public payroll for the amounts being given away.
October 6, 2011 at 4:18 p.m. ( permalink | suggest removal )
jamesbordonaro (James Bordonaro) says...
I would just like to clarify that I did not add the headline "It's Extortion" to my letter to the editor and do not consider Fanestil's application or any of Mr. Smoots' actions to be extortion.
I only added the last sentence to demonstrate the remote possibility that some other company might threaten to take their jobs to another community if the City didn't offer additional incentives.
Nor do I necessarily disagree with Fanestil's application - I only wished to clarify what I said to the City Commission at the Public Hearing last month which was that the moral hazard effect should be taken into account in their decision making process by drawing a parallel to the national discussion about the advisability of government intervention in the free market vs. the desire of the Democrats to "prime the pump" by engaging in Keysian borrowing and spending. My thoughts on those issues are more detailed than the Gazette's word count permitted.
October 6, 2011 at 4:58 p.m. ( permalink | suggest removal )
goodoleboy (anonymous) says...
Pretty funny to hear the GOP candidates talk about how govenment does not create jobs, and that increasing government jobs is bad, then 10 minutes later watch them promote their 'job creation" while in office.
October 6, 2011 at 5:52 p.m. ( permalink | suggest removal )
ZaneRokklyn (anonymous) says...
It's not a remote possibility, James, pro sports teams do it all the time.
October 7, 2011 at 7:18 a.m. ( permalink | suggest removal )
owenrhys (anonymous) says...
Wow. A few issues jump up immediately from this fine piece.
#1 - James says, "Estimates are the proposal would cost the City nearly half a million dollars." You are wrong, James. The half million is what the City is actually going to fork over. The City also is going to grant a 10-year tax exemption ... meaning that the taxes that would otherwise be paid by Fanestil ... if I'm not mistaken, that includes taxes for the City, the County, the School District, and every other taxing unit ... would be foregone, and the rest of the community would have to pay the difference.
You know how much the tax exemption is going to cost, on top of the half million? Neither do I, but the City and County know, and so does the Gazette (or, one would trust that a professional news-gathering entity would have found out and reported that amount).
#2 - the headline "It's Extortion" was added by the Gazette, not by James. The local newspaper seems to be following the example set by the national media in reporting on the Tea Party, and others who dare to question power: make them look like extremists, whack-jobs.
Can anyone provide me with any other explanation as to why The Gazette will not report the value of the tax exemption, and then uses the Wacko-brush technique on an opinion piece that opposes this project?
Well ... The Gazette already did away with "anonymous" postings on the site, so people couldn't embarrass the "ins" without giving up their identity. It's probably time to ban ALL opposing opinions (and start shuttering the building of the former leading voice of the People in the Flint Hills).
Come on, Gazette! Show some integrity and some guts.
October 8, 2011 at 9:47 p.m. ( permalink | suggest removal )
Steve_Corbin (anonymous) says...
owenrhys,
GOOD LUCK IN GETTING THE GAZETTE TO REPORT THOSE FIGURES.
Using 2010 figures I would estimate the yearly property tax on this new plant will be in excess of $170,000.00.
October 9, 2011 at 8:24 a.m. ( permalink | suggest removal )
Steve_Corbin (anonymous) says...
CHRIS WALKER,
Here's your chance to prove my numbers are wrong.
All you have to do is call the county treasurer and ask her to figure the tax of a 4.7 million dollar industrial building on 12.5 acres located in the city based on a 2010 or 2011 mil levy.
Would it be too much to ask a local paper to report on some local news?
October 9, 2011 at 8:33 a.m. ( permalink | suggest removal )