Historic Public Policy Blunders:
1626 - Manhattan Island sold for some beads. It is now the most valuable real estate in the world.
1863 - General Lee doesn’t take Longstreet’s advice at Gettysburg and orders a charge from the front as opposed to flanking Meade. That would be as far North as the Confederacy would go - and Lee would surrender about two years later.
1938 - British Prime Minister Neville Chamberlain makes an appeasement deal with German Chancellor Adolf Hitler in the name of peace. World War II starts a little less than one year later.
2007 - Cabarrus County Commissioners are offered the chance to participate in a $1.5 billion dollar project for a $67 million investment that will not put the county at fiscal risk. They consider going into debt instead.
The use of Certificates of Participation (COPs) instead of Tax-Increment Financing (TIF) bonds for the North Carolina Research Campus is a bad idea - and here are five reasons why:
5. COPs will require more money up-front. One of the great features of TIF is that it’s based on revenue from increasing value within a district. In order to do that, the earlier payments in the life of a TIF bond are smaller than those towards the end. With COPs, the payments are the same throughout the loan. So, COPs will actually strap the County with debt payments earlier (and cause taxes to go up more steeply).
The tiering of TIF payments takes advantage of a familiar economic phenomenon - the time value of money. When I was born in 1978: a $50,000 salary would have put a worker in the top 5% of all earners. When I graduated college in 2002, that number was a little above the mean and median - dead center of the working population. Another way to put it, a dollar was worth more in 1978 than it is in 2007; and a dollar in 2007 is worth more than it will be in 2027. So, if you can finance something today so that you pay less now with gradually increasing payments out to 10 years and holds steady through the remainder of the loan (20 years) - that’s a better deal than using more precious 2007 dollars to save a few less-valuable 2027 dollars.
Don’t just take my word for it. Look at the schedule for the proposed TIF from the City of Kannapolis and compare to the schedule for standard long-term obligations from the County.
4. The County will need to secure the loans. According to the NC Constitution, the only way for a municipality to finance something using the “full faith and credit” of the people is to hold a referendum - that would be using General Obligation (GO) bonds. TIF bonds do not use the full faith and credit of the people; but is secured by the minimum valuation agreement of the project and the projected revenue of the TIF district.
COPs are another story.
COPs require collateral. Think of it as a mortgage. When schools are built using COPs, the schools are collateral for the loan. The jail will be financed using COPs and that structure will be collateral for that loan. The problem with using COPs to fund infrastructure improvements for the NCRC is that many of the improvements don’t work well as collateral. The collateral will most likely be existing structures already owned by the County - County Administration Buildings, Senior Centers, Schools etc. The County will have to offer up assets for collateral and those assets may have nothing to do with the project. It’s like mortgaging your house to pay for a vacation.
TIF, as required by the NC Constitution, must be financed by strictly defined sources, and would not have the same issues of collateral as COPs. The revenue sources would be secured by binding agreements.
3. COPs count against the County’s credit. The County is allowed to borrow a certain amount of debt - a debt ceiling as it were. TIF participation would not count against that debt ceiling; but COPs would. The TIF is secured only by revenue increases within the pre-defined TIF district. The City, County, and State cannot put monies outside of the TIF district revenue to make the payments - that’s how the City and County aren’t directly obligated. COPs, however, directly obligate the County. COPs count against the debt ceiling, and contribute to lower credit ratings. Lower credit ratings lead to higher interest rates on future debt and higher taxes in the future.
2. COPs let Murdock off the hook, and put the rest of us on the line. As I’ve mentioned before, if David Murdock wanted to avoid property taxes and get the County to give him whatever he wanted - pushing for a TIF is a really stupid way of going about it. With a TIF, it’s Murdock and his business interests that have to enter agreements to help secure the financing. With COPs, it’s every man, woman, and child who do the securing. COPs will NOT be secured by the NCRC project - only to the credit of We The People.
1. COPs gamble on the future. Let’s say in 2020 that Mr. Murdock - in spite of his vegetarian ways - goes to meet his Maker at the tender age of 96. And, let’s say that the interests that control Castle & Cooke properties decide to abandon the NCRC and sell off the buildings to a non-profit institute. The institute wants to claim an exemption from their property taxes. If COPs were used to finance NCRC improvements, then they could possibly quit paying property taxes by policies exempting some non-profits from paying property taxes. If TIF were used, then the institute would be bound by minimum valuation agreements and would have to pay property taxes regardless of their non-profit status.
Here’s the bottom line:
- Using standard economic analysis (i.e. Net Present Value) COPs would probably cost more than TIF over the life of the loan by requiring more money now.
- COPS would hamper current cash flow when the County is already facing a crunch to pay of the mistakes of the past
- COPS will literally mortgage County assets obligate future taxpayers with greater, unnecessary risk.
I don’t know where this idea came from and - quite frankly - I don’t care. I do know this: any elected official who would actually choose COPS over TIF in this situation is too obtuse to earn this guy’s vote the next time their name winds up on a ballot.
If you care about this project, please contact the commissioners about abandoning this stupid idea. After you do that, please e-mail this to your friends who care about this project, ask them to contact the commissioners, and so on. Kannapolis and the County need to work out an amenable deal and do so soon as to not cause more bureaucratic madness from infiltrating what should otherwise be a common-sense decision.
See y’all Monday.
Subscribe to RSS Feed
Subscribe via E-mail
30 responses so far ↓
1 Aaron // May 30, 2007 at 11:26 pm
How about we just abandon this corporate welfare thing all together and save ourselves a bunch of money.
Oh and I like the George W. math you used. It’s inflation, caused by the governments financing of programs through the printing presses of the treasury that cause that money to be worth less in 20 years.
Government Produced Inflation = George W. math
2 Justin Thibault // May 31, 2007 at 5:45 am
Thanks for commenting, Aaron.
Net Present Value is a concept that was a well-accepted economic principle before the current president’s father was born.
I would imagine that you haven’t read any of the documents that I posted on this site previously:
- Information on TIF
- Other Project Information
3 The View From The Cheap Seats » More Comparison Information on COPS vs TIF for NCRC // May 31, 2007 at 7:20 am
[...] Here are the memos that point out what I’ve been telling y’all: [...]
4 Aaron // May 31, 2007 at 9:24 pm
We all know what inflation is. Milton Friedman has documented it to death. So have pretty much all other economists of the last fifty years or so. Perhaps you should re-read “Free to Choose.”
The point is, saving money today versus saving money in twenty years is irrelavent. This is a project that benefits me how? What will I get from the NCRC? What will any local taxpayer who already has a good job stand to gain from the NCRC? What makes this a public good worthy of one red cent of my tax dollars?
Real COPS (Police Officers), Firefighters, EMS etc, I get how they are a public good. I don’t see how a parking deck is a public good. Your attached documents didn’t explain that part. Is there an archived post on your site that does explain it?
Thanks
Aaron
5 Justin Thibault // Jun 1, 2007 at 1:08 am
OK, now you accept the concept of Net Present Value (which isn’t based on inflation; but I’ll let that slide)
Not if you take into account infla…shoot…here we go again.
What does someone with a good job now get from a kid in art class? Government isn’t about what you get. I remind myself that every year when I get the statement from the Social Security Administration telling me that it’ll tank the year I’m eligible to collect.
For $160 million, the city and county are adding $1.5 billion in tax value with the NCRC alone. That doesn’t count the subsequent growth from surrounding research firms moving. However, that can’t be accommodated without the proper infrastructure.
I know that won’t do you any good; but if you could expand your mind beyond a public-policy-as-your-own-personal-drive-thru mentality - think about the future. The easiest way is to think about the past: What if - one hundred years ago - the County decided not to build the road from Concord to Cannon Mills…what would this community look like. It would be Gastonia - or worse.
As a parent, I’m excited about the fact that every major university in NC will have a footprint 10 minutes from my house. Of course, is it going to do me any good right now? Probably not, but we must have other priorities.
6 Aaron // Jun 1, 2007 at 1:31 pm
Once again, swing and a miss…
The point is, we as a community have more important things to worry about than the NCRC. My children are depending on ME to sent them to college. How does the NCRC benefit them, Net Present value of a years tuition today or in 2018 doesn’t make a difference. Can I keep up with inflation better with lower tax bills or higher ones? What benefits my child more: More money in my pocket to provide a better enviroment or more money in the counties pocket?
You and old Harold have been arguing like two typical political pundits about schools. But have the idea of vouchers or alternative education methods ever entered your “expanded mind”?
When property values go up but salaries don’t how do we rationalize the “gentrification” of Kannapolis by booting the life long residents out so that a bunch of yuppie professional types can move in at a higher tax rate. Sounds Like Harrisburg Farmers to me…
As far as the wonderment of having the NCRC so close by for my kids sake:
Concord police officers make 15 percent less than national average. The Concord Police department loses between 13-18 officers per year. The Concord Fire department is just as far off the pace. They lose as many employees as the police. Cabarus county sheriffs are about the same as their Concord and Kannapolis counterparts. It costs an officer 900 dollars per month to provide health insurance to their family. 300 a month to one child.
We have 1-2 year rookies protecting us because our own leaders think that a nifty new research campus is more important than the safety of their constituents.
Police officers and firefighters perform an ACTUAL public good. Not a private good that has some meandering public benefits. Lets take care of actual public good first before we start solving a billionaires problems
So what I hear you are saying is… ” I want a bigger tax base, and a nifty research campus. And I don’t care if my car gets broken into or my kids get killed by a drunk driver or assaulted by a classmate.” Just SHOW ME THA MONEY BABY!!! WHOO HOO!
I like to expand my mind by thinking of what benefits all of us, not what benefits real estate moguls and such
7 Aaron // Jun 1, 2007 at 1:33 pm
Oh and as if my last post wasnt long enough… I completely agree with you that TIF’s are better than COPS. But its par for the course for our politiicans to look at the short term rather than the long term.
I just disagree with you completely that there is even a slight public good in any of this nonsense.
8 Justin Thibault // Jun 1, 2007 at 6:12 pm
Your opposition to this project is based on the fact that will increase people’s home values? Well, I have to agree with you there - that’s a bit of a problem. Yep, I lie awake every night thinking that someone, somewhere wants to pay significantly more for my house that I did.
We must face this gathering threat together as a community.
The NCRC is between the County and the City of Kannapolis. Concord doesn’t factor in. While that was informative, it’s literally outside of the realm of this project. I’m sure in your reply we’ll hear how badly EMS people are paid in Spencer.
Again, you bring up a great point. Most law enforcement professionals would agree that increasing property values lead to higher crime. I’ll be sure when I’m talking around the NCRC in the next couple of years that I’ll avoid maurading bands of Ph.Ds who might mug me. Work those start-up capital investors the wrong way and you just might wind up at the business end of a drive-by.
Thanks for pointing out how the NCRC might threaten the safety of the community.
9 LiberalNC // Jun 2, 2007 at 1:01 am
Justin,
I think you’re missing the “gentrification” point that Aaron is trying to make. The fact that the NCRC will increase the property value of peoples houses can indeed be a problem.
As property values increase in a given neighborhood, the property taxes for the neighborhood’s long-term owners will rise. If the owners cannot afford the tax increases, they are forced to sell their house.
Critics also argue that these increases in property value bring about the closing of businesses and changes in the mix from a diverse range of services and everyday needs to a focus on “elite” consumption. So it might also close down some local stores (and bring in other ones).
When it comes to the Crime point Aaron is trying to make, those who view gentrification as a positive phenomenon praise its effect on neighborhood’s crime rates, while critics believe that the crime has not truly been reduced, but merely shifted to different lower-income neighborhoods. So crime could be shifted from the new NCRC location to Aaron’s own neighborhood.
Just wanted to provide some more food for thought
10 Justin Thibault // Jun 2, 2007 at 6:58 am
I’ve been travelling back and forth from Detroit over the past few months and I can tell you that I’d rather deal with the “gentrification” problem than what they have: falling property values caused by an exodus of people looking for work.
As a fellow blogger, you probably know that I appreciate comments - thanks for stopping by.
11 Aaron // Jun 2, 2007 at 10:25 am
Well Justin, you seem to have an inferrence problem. You like to infer what you want to hear into what someone is actually saying. Where in my post did you hear me say that the NCRC will increase crime? You inferred it because it is easier to defend your point. The Concord Police argument is made because they are paid about the same as Cabarrus and Kannapolis Officers. 15% BELOW NATIONAL AVERAGE.
The NCRC and the Gentrification it will undoubtedly cause, will lower crime in the area surrounding it. THATS GREAT. But that area of Kannapolis has never had a terrible crime problem to begin with. As the gentrification moves outward, it will begin to reach further into the “middle class” neighborhoods. The criminal element in these neighborhoods will get shifted elswhere and high crime neighborhoods will become even higher crime neighborhoods. Thats where the argument for our law enforcers comes in. THEY PERFORM AN ACTUAL PUBLIC GOOD but gain nothing from the NCRC and its supposed public good.
Kannapolis will not be able to meet the demand of Law Enforcement services. Where in the TIF are the new police officers to accomodate the growth? How about the new prison beds? New Probation officers? Assistant DA’s?
Well they aren’t there. But thats what property tax and state income tax increases are for.
As for increase property values: You completely missed the point of the “Harrisburg Farmers” comment. They are selling off, not because they want to. But because they cant pay property taxes on 100 acres of cow pasture when that acreage is valued at 1.9 million dollars. But that’s not your problem, now is it? They can move to Stanly County. Just like the life long Kannapolis residents can move to China Grove.
Perhaps it is you that needs to “expand your mind.” Beyond the dollar signs and into the realm of reality.
And as for the comment LiberalNC made, they’re right. They (the criminals) might move into my neighborhood. SO, to answer my own question from my second post: Thats how the NCRC might benefit me! Yippeee!
But once my neighborhood is full up, they’ll get sub-prime mortgages in Afton Village, so its not all bad…
12 Justin Thibault // Jun 2, 2007 at 10:59 am
It’s called sarcasm. I was taking your comments to their logical conclusion and pointing out the absurdity in them.
TIF cannot - by law - be paid off using existing tax revenues. That’s what’s so hard to get through. TIF pledges a portion of the tax revenue: that which comes from increased valuations in a district to paying off the bond. In most scenarios, there’s more than enough to pay off the TIF with some left over to handle the other needs you were talking about.
In addition to that, the TIF district does not take up all of Kannapolis. So, increased values across the city will cover the expense that comes from growth.
No, it’s not; but in the realm of problems - it ain’t a bad one. Even though the tax valuation is $1.9 million - I know that many of them can get much more for 100 acres (upwards of $3 million) on the market. Let’s say a fella with a cow pasture clears about $1.5 million after taxes and expense from selling his land: if he could put that money in some interest-bearing investments at around 5%, that’s $75K a year in income without having to do any work at all.
Now, looking beyond the realm of dollars and into “reality”. I happen to know that the County offers several programs to help take the edge off of tax burdens. First off, there are conservation easments for large land owners that allow farmers and the like to use their land and pay less in taxes. For homeowners, there’s assistance programs to help lower-income taxpayers. Both of those are newer programs that were enacted by the current majority of the Commissioners. The former majority gave only rhetoric to the issue.
Again, if the market demand in Afton Park (that’s where I live) causes my house price to go up - I will have no problem with that.
13 Aaron // Jun 2, 2007 at 1:06 pm
Well I’ll start at the end and work my way up. When they get those sub-prime mortgages, they’ll live in “Afton Village/Park”
for about 3 months until the bank forecloses on them. Then the house will sit vacant for a few months. It will be resold at a lower price to another sub-prime buyer. About 5 months after that, it will be foreclosed on again. This time, some property investor will buy the house at an even lower price and rent it out. Keep in mind that this happens to about 1/3 of the houses in the neighborhood.
Eventually, the owner gets tired of the worries of the private market and turns the house into a Section 8 qualified property. The devaluation process is complete! Don’t Believe Me? I suggest to go to Southern Chase, Mockingbird Ridge, Prosperity Pointe or any of the 1000 other subdivisions that were built 10 years ago that are exactly that. It’s the end result of gentrification. The increase in property values in a small area resulting in the decrease in values over a much larger area.
Plaza Midwood and NoDa are the two best examples. I know because my family almost single handedly gentrificated NoDa. I grew up doing it and I like it! I just don’t support my government taking part in it “on my behalf.
And as for the farmers: What if they don’t want to sell? As for local programs to help: The Federal Farmer act is the best program you can be in. But you have to run full production to be in it. Can a 70 year old farmer run full production so he can keep his ancestral land? It doesn’t affect me either. And if it were part of some master plan that we become a residential community then fine. But we are becoming one because our politicians have secretly wanted it for years. Vacant land is a burden, not an asset in their mind (and probably yours too.)
You gripe about the previous commisions “let ‘em build” mentality. But when a developer wants to build a snazzy research deally you are all for using taxpayer dollars to subisdize it? I don’t like uncontrolled growth. But the previous commisions actions were based in the same mindset that you have for the NCRC. “A bigger tax base at any cost.”
All I want is some straight answers. 160 million for what? Parking decks? Road Improvements? Parks, Greenways?
If I, and many many many other Cabarrus County Residents don’t park in those parking decks, how does it benefit US?
Same question for the greenways? The roads? The Water/ Sewer?
You still haven’t given me any good reason. You just did the George W. / Immigration Reform thing and told me I just didn’t understand. Like I said: TIF does make more sense than COPS. But where is the public good in the NCRC?
If everything else was going great then you wouldnt hear me complaining. But there are more important things in this county that the NCRC.
Yet another EXAMPLE:
Concord PD needs approximately 18 new officers to meet the 1 officer per “X” number of people requirement they set in the late ’90’s. Thats 18 new officers on top of the 13-18 they will lose to other departments. The newest budget proposal doesn’t meet the 18 officers they need. In 8-10 years they will have hired those 18 officers. But by then they will need 20 more to keep pace.
It’s like this with schools, water sewer, roads and everything else the government has a monopoly on. They are always 10 steps behind what is actually going on.
So, as a community, is the NCRC a higher priority than ACTUAL public good’s like law enforcement, public safety, schools etc.
And how many schools can we build for 160 million bucks? How many new jail beds can we build? Well, none, because that would make the folks on South Union Street really really mad.
Oh, and my statements are perfectly logical on their own. It’s when people get the logic confused with their personal opinions that everything goes to hell…
On a seperate note: Where do you stand on the Goodwill store? I heard you folks were against it…
14 Justin Thibault // Jun 2, 2007 at 6:59 pm
My development was built 10 years ago and the property values nearby went up and well mine has been going up, too.
More than 4,000 high-paying jobs from the NCRC and increased values down Kannapolis Pkwy make it so that I’m not living in a house as much as sitting on a nice piece of real estate. I’ll make a bet with you that the median values of houses in my neighborhood will go up at leat 15% over the next 5 years.
First off, you must balance growth. Residential growth (in houses that cost less than about $300K) actually costs more than it brings in. Commerical, Industrial, and - especially - Agricultural growth uses less in services than it pays in taxes. Getting projects like the NCRC that bring in commercial growth and create a demand for higher-end real estate improves the tax base.
The previous majority represented the people who built houses before they represented those who live in them.
Second, the TIF is paid for by the project and not by any other taxpayer, because of the way that TIF is structured.
How does a park in Midland benfit me? Should I refuse to consider it because it’s not in my backyard? Of course not - I should look at how it balances out with other county recreational needs.
Nobody is asking for money outside of the jurisdiction. Kannapolis is in Cabarrus County and the NCRC is in Kannapolis.
The NCRC has a great public benefit because it turns property that wasn’t generating any tax revenue into property that is, provides a magnet for new firms moving into the area in a high-growth business, and improves the pubilc square of one of our larger cities.
Either one of two things is going on here.
1) You have your geography mixed up. The NCRC is in Kannapolis - not Concord. Concord is not joining in the TIF, COPs, or anything else.
2) You have your civics mixed up. The County pays for Sheriffs, the cities pay for their respective police departments. I pay almost as much in city taxes as I do in county taxes.
The NCRC is behind in my list of priorities which is why I would - and have - supported COPS for a jail; but not for this project.
I support the TIF because it requires that the infrasturcture improvements are paid for by the NCRC project.
We’ll be able to do less of both if this project isn’t a success, because a strong, balanced tax base is needed to take care of those things.
Some of us were; but most of the opinions at the information meeting I was at (but no press attended) ranged from indifferent to supportive. I like the idea, actually; because it’s turning land that was zoned I-1 to C-2 and that will be better for all of us living nearby.
15 Aaron // Jun 2, 2007 at 11:41 pm
See above original post where i place the word EXAMPLE in caps to attempt to place emphasis on the fact that it is a friggn example that illustrates the current situation for the whole county. I just used Concord because it is the worst of them all. But you dodged an actual response by just assuming I was an idiot. But I can’t blame you, its the modus operandi of most “compassionate conservatives” I know.
Do the math: More people means more law enforcement and public safety needs.(not to mention schools, roads, water, electricity)
Question: Will the NCRC bring more people into Cabarrus County?
Answer: Yes
Question: Did Afton Park bring more people into Cabarrus County?
Answer: Yes
Will all future developments, regardless of whether they are over 300k valuation, bring more people into Cabarrus County?
Answer: Yes
Question: If more people are in Cabarrus County will the existing police and public safety numbers be able to provide the same level of service?
Answer: No.
Question: Where will the new fire departments, police officers, EMS workers and jail beds, schools, etc come from?
Answer:_______________________________
(Enter your response here)
And as for your property value: Talk to me again once the gentrification is complete. Or just name one low income neighborhood in Cabarrus County that has undergone a complete gentrification and I’ll retract my statement. There aren’t any.
And as for the goodwill store: The Tribune did a great job of making you guys out to be a bunch of wannabe rich snobs. But they usually get things wrong so don’t feel too bad about it. I guess the one’s who were against it just like mailing the check in without having to actually see the poor folks.
Oh, a final question: Are you familiar with the “Principle of Subsidiarity?” If so, you’ll understand my complaints about the County and TIF.
16 Local_Son // Jun 3, 2007 at 1:32 am
First of all: Justin, GREAT job keeping your facts straight and trying against all odds to show people what’s really going on here. You have done a good job of putting things in perspective, despite the obfuscation from some of our local politicians and the media.
Aaron’s statements above further reinforce my belief that too many people in Kannapolis and Cabarrus at large hold one of the following three opinions:
1) “Why’d they have to sell this place back to Murdock? Anybody else would have reopened the ol’ mill by now, put everyone back to work, paved all the roads and stocked the lake with bass and changed the ball team’s name back to the Towlers. We’d be smack in the middle of the Second Golden Age of Kannapolis. Rassum-frassum Murdock, rassum-frassum liberals, gonna run the ol’ folks out, fill Kannapolis up with hippies…” (etc.)
2) “I believe every word Coy Privette and Harold Smith says implicitly, and as such I cannot think the issues relative to the NCRC through for myself. Therefore I sit, parrot-like, bringing up the same arguments time and again in hopes someone will listen. Squawk! Parking decks! Squawk! Taking money from the kids!”
3) “When it all comes down to it, I’m really bitter. I’m bitter that David Murdock’s got all this money and won’t give us a handout. What’s $169 million to a man who’s worth about 30 times that amount? He could spend twenty grand an hour from now to as long as any human being has ever lived, and he couldn’t spend it all. So why the #&@# can’t HE build Kannapolis some roads and put in a sewer system and plant some trees, if he wants this thing so bad? While he’s at it, why not build US some schools and donate some money to our government and help the working stiffs out, if he’s so rich? Murdock wants his Research Campus? Fine. But we’re not going to let him have it his way without a fight.”
I am firmly of the opinion that everybody in this county who is against the NCRC and/or the TIF (they are almost one and the same), falls in line with one of those three (highly-exaggerated) examples. Obsessive nostalgia, blithering shortsightedness, or plain and simple jealousy - only forces strong as these could keep rational people from accepting the logical fact that, while this is a lot of money to invest and a very serious investment for the county to make, the risks far outweigh the benefits.
Sadly, people like Aaron going to such great lengths to argue these points - all their sound and fury and grand reasons that don’t have beans to do with the subject at hand - tells me, unfortunately, that I am right.
As far as I am concerned, the disagreeable elements of this plan (like helping to fund a parking deck or some shrubs along a street) far outweigh the beneficial ones. The money we stand to make from the TIF far exceeds anything we’d get from COPS. As for Murdock’s millions - am I the only one who read the story of the Little Red Hen growing up? Why can’t people see these things for themselves?
Justin, I am sorry to ramble on so long and also sorry if I brought the level of discourse down, but frankly I am fed up with the pigheadedness I keep reading and hearing from some our leaders and my neighbors.
In a perfect world, things would be different - we would not be buying goods from China rather than making them ourselves, and local governments would never have to come up with millions for civic improvements because a billionaire wants to leave a legacy. But this is far from a perfect world. Though the NCRC is far from a perfect solution to Cabarrus’s problems, and the TIF is far from a perfect solution to all of Kannapolis’s problems, right now, they are the best ideas we have. And I say, anybody who does not have anything constructive to say about it ought to shut up already, starting with Coy and working down from there.
17 Justin Thibault // Jun 3, 2007 at 1:50 am
Increased revenues from higher property values. The world is not a zero sum, status quo closed system. Following your logic, Cabarrus County should have fallen into an anarchist state shortly after Cannon Mills brought in the first few workers because there we had a Sheriff and no deputies.
An organization, community, and person either is in a state of growth or a state of decay - there is no stasis.
They quoted two, maybe three, people and - in the meeting - there was one who had concerns about the store, one who said - “I won’t shop there”, and one - and I’m not lying - who said “Some of us paid $500K for a house and we don’t want our view to be ruined”. That last person was Afton Village.
In defense of the Trib, Eric Deines does a decent job. He covered one of the single most boring things County Government ever did (naming Pharr Mill Road pard) and explained the process well.
Yes, it’s part of federalism. Actually, it’s one of the beefs I have with Commissioner Privette. I see no problem with the County building roads from time to time - he wants to wait on the State.
The project is too much for the City of Kannapolis to chew and it’s really unfair to ask them to shoulder the burden alone.
Take a look at this another way: If Kannapolis were to shoulder the whole burnen of the TIF and the project were to be delayed, cut back, etc…the County would be free to use the increased revenue from more than $1.5 billion for whatever they’d like. If you think that money is going to go to the jail - I suggest that you take a gander at the jail project history (Click Here For Story) and you’ll see that they’d rather be talking about something else.
TIF will obligate the City and County to build necessary infrastructure around what will be one of the largest concentration of workers in the region - instead of waiting to do it piecemeal as what normally happens.
18 Justin Thibault // Jun 3, 2007 at 2:09 am
Thank You.
I can’t say that my experience has been that much different.
In the words of Jimmy Page and Robert Plant - “Ramble on”
Well, you said it - I didn’t.
Quite frankly, I have no problem with someone who has honest concerns about a $164 million project. Also, I have no problem with someone who has philosophical problems with it. Aaron seems like one of those people.
What I do have a real problem with is a disingenious proposal like COPS instead of TIF being pushed by cynical local officials who care more about gaming the system than they do about the future of this community. Also, I have not been impressed with local media basically being stenographers for the County Manager’s office. It’s pretty sad when it takes a guy who runs a website in spite of having a growing family and demanding job to raise the red flag that this is another badly constructed debt situation that will seriously jack our taxes up for no good reason.
19 Aaron // Jun 3, 2007 at 11:10 am
OK, First of all, I have voted against Coy Privette every year he has run since I was 18. I am 29 now so I would say that I have proven my distain for him and most everyone else on the board of commisioners.
Secondly: I am not a nostalgic type. I have always said that the NCRC is a good idea. A full NCRC is better than an empty pillowtex. Hell, I didn’t even cry when the smokestacks were imploded.
And Lastly: I don’t care how much money David Murdock has. I don’t subscribe to the typical republican sentiment of “Keeping up with the Jones’ ” or a materialistic ideal that the more stuff I have the better off I am. I don’t have anything to compensate for like some people.
So, as for “Local Son” what else could there be? How does stating the actual fact that our Law Enforcement capactiy, public safety capacity (Fire, EMS) and School Capacity are grossly under-sized for a COUNTY (See, I said County not City so you cant shuffle the question) this size make me ignorant, jealous, or nostalgic?
And how does stating the actual fact that even inspite of these magical higher property values (my house’s tax value has increase 9500 dollers in 5 years) that the city and county are still about 12-15% below national average in pay for police and public safety employees. And we are also about 10 deputies short, 15 Concord Police Officers Short, 5-8 officers short in Kannapolis (Before accounting for the 4000 more people that the NCRC is to bring in) How does this make me jealous, nostalgic or ignorant? These personnell defecits didn’t occur overnight. The growth happened years ago. It has taken them yearsjust to be this far behind with no real plan on how to catch up.
As I have been saying from the beginning (Which Justin finally mentioned) My disagreement is not fiscal but rather phylisophical.
The principle of subsidiarity is defined as the most intrusive, expensive or expansive functions of government be performed at the most local feasible level. This is neccesary because those who dissent with a descision can always vote with their feet if all else fails. Me simply stating that fact should tell you it’s only phylisophical. We (The US) have expanded so far beyond this principle that for me to truly exersise it I would have to move to Canada( Hey at least they admit to being socialist).
It is for this reason that I say that since the NCRC will be located in Kannapolis, they should be the only one’s responsible for any money that is needed. And if the county gets a bunch of money for nothing, then great. If you live on a state maintained road and never call the police, fire or EMS for service then they get all your tax money each year and YOU dont get anything for it. So whats the difference?
Sure, the NCRC will benefit all of us in some tiny portion. And I say that without subsribing to the whole “A bigger tax base is better” ideal. But the reality is that the NCRC will benefit Kannapolis more than any other town, municipality, unincorporated district or any other person. And it is my belief that Kannapolis should be responsible for paying for it.
AND YES, I also feel the same way about schools, parks, roads, water, electricity and all other “public goods.” So Justin, I don’t support a county funded park in Midland, or a kid in kannapolis in art class, but I digress.
In the end, its just a matter of one simple thing: The NCRC and its supposed growth will directly benefit YOU and therefore YOU support the idea of using government money to help make it so. It wont directly benefit ME so I don’t support it.
So, like I said about 10 posts ago, You see the dollar signs it will create for you. I see the end result of an even more undersized police and public safety force. That being more crime and slower response times for Fire and EMS.
I have also attempted to show you, over and over and over again, that more tax revenue will not solve the afore mentioned problem. We will always be 10 steps behind reality. I just think a safe county is better and more attractive than a well balanced tax base.
20 Justin Thibault // Jun 3, 2007 at 12:56 pm
Well, that’s all fine and good in theory; but in practice TIF is the best way to build the needed infrastructure.
Yes, everything can be understood by reading The Fountainhead. Everyone is motivated by self-interest.
Quite frankly, I’ve lived in communities on the decline and this is the chance for Kannapolis to avoid that fate. The increased home value is just a upside.
You know reading your comments it’s of little suprise to me that Libertarians very, very rarely hold office; but have a strong presence on the internet. First off, there’s the whole zero-sum view of the world. They hold onto things like the gold standard (which was dismissed by Adam Smith more than 200 years ago). People angry about their station in life are a click away from a terribly simple explanation. You don’t have something because someone else does. Then there’s the complete adherence to principles over practicality. Libertarians are quick to quote Jefferson; but ignore the fact he orchestrated the largest act of federal power - the Louisiana Purchase.
This rigidity is why Libertarianism is part of conservatism; but it’s no way to run a country
21 Aaron // Jun 3, 2007 at 2:56 pm
Well as far as libertarianism is concerned you are exactly right. They are much more rigid in their philosophy than all other sects out there. But I am a registered republican. The problem I have has is the increasing collusion between the Dems and the Republicans. I like Thomas Hill’s word “republicrats” that he quotes so often on his blog. And the reason we don’t hold public office is because of 2 things.
1. We dont sell our souls to corporations like republicans or to special interest groups like democrats.
2. It is virtually impossible to get on the ballot as a libertarian in North Carolina, which leaves only non-partisan races. Those races are still covered with the support of the two political parties. I know this because my father ran as a non partisan about 10 years ago but we spent every day in the republican party office coordinating his campaign. So the backing of one of the major parties ensures a better voice than “going it alone.”
But here is the issue I have had with this from the beginning. Yes, the infastructure improvements must be made. The water and sewer systems in the area of the NCRC are far out dated. The roads will need improvements, and the parking decks whether logical or illogical need to be there so the scientists and the like have a place to park. But we are forgetting that STATE universities will be the main tenants in these buildings.
That means that my state taxes will be supporting the campus. My local taxes will be supporting the campus and with any promising research comes the Federal Government grants and therefore my federal taxes will be supporting it. So if all I have to look forward to is my property valuation going up and in turn my property taxes going up then: Thanks, but no thanks…
But if you were to increase my property taxes to widen 85 or build new schools or to increase the public saftey presence then I wouldn’t complain about the tax hike. It benefits more people than the NCRC. So that’s where I differ from the typical Libertarian “no new taxes under penalty of death” philosophy. But most folks think property taxes are bad. Thats why they use TIF or COPs instead of property tax hikes. And its why the feds use inflationary spending instead of income tax hikes. It keeps the general, uninformed and uninterested folks in that “warm fuzzy everythings gonna be alright” mentality.
In terms of practicality, well thats all relative to who is giving the definition. The “Bridges to Nowhere” were practial to some people. But they were still a waste of $450 million dollars of federal tax money.
Principles never change. Most folks in this country threw away their principles years ago in favor of what someone else told them was practical. So far, I just haven’t found myself being either that ignorant or that hopeless.
I love my situation in life. Andrarely is the explanation “terribly simple”. Why do you think that I read the Cabarrus Cheap Seats? You tell me things that I dont get from Harold, or the Tribune, Charlotte Observer or any other media outlet. That’s why I support TIF over COPS for the research campus In Practice
But the fact that I read your blog doesn’t mean that I will automatically take anything Harold Smith says as a lie. I wont take your side over his. There is way too much “side taking” in this country.
A person of any intelligence will always question reality until a second opinion is obtained. Thats why I have ten different places to look before I make up my mind on an issue. The fact that your conclusion on TIF vs COPS is correct doesn’t change the fact that, in principle, (see, there’s that ugly word again) we the general citizens of Cabarrus county will not derive nearly as much good from the project as many are saying.
But such is the general political climate. Move from one project to another at such a speed as to keep the general population clueless as to what is really going on. Talk about an issue for a few weeks then shut up, then sneak it through late one evening when no one is paying attention. (Kind of like the New Concord Front yard parking ordinance) (Or the immigration reform bill)
But what you haven’t picked up on from reading my comments is that I have a good reason for harping on our regular underspending on Criminal Justice. I’m a former Concord Police Officer who left in 2004 because I could’t pay a mortgage on 18,400 per year after taxes and benefits. I use Concord PD as an example because I know the stats and I also know that Kannapolis and Cabarrus County are in the exact same situation. I’m tired of by brothers and sisters in the Criminal Justice field being passed over in favor of the next new thingy or the next business “tax incentive” given to the new company that promises to hire 2 employees. I’m tired of by fellow officers being assaulted and threatened by the criminal element with no real consequenses because the South Union Street crowd is more interested in what the jail looks like than who it keeps them safe from.
So there’s my personal stake in all of this discussion. Sorry it took me so long to come clean.
But I still feel that my friends lives are more important than your property value. I just hope you are right and the NCRC gives us more money than we know what to do with. Then we can build a cool new convention center (nevermind, already done than) or a new arena (oops, did that too) or a new greenway (damn, already done a bunch of those.) After all those snazzy things we can maybe get some more officers and firefighters. But there are still schools that need building so forget I even mentioned it…
22 Justin Thibault // Jun 3, 2007 at 10:53 pm
The difference between the Bridge to Nowhere and the NCRC TIF is that the Bridge to Nowhere took a few dollars from every family in America for a few people and the NCRC TIF will take money from a single taxpayer and pledge the money to necessary infrastructure improvements for the project that will serve the surrounding community.
In today’s political environment, it would not have been unreasonable for Murdock to ask for massive incentives like Google got and like Corning got from the previous majority. However, he didn’t ask for that; but instead made a massive investment and is going to work with the local government to build this thing the right way AND pay his taxes.
He could have gotten away with a lot more - so the NCRC TIF deal impresses me.
Thank you.
Again, thank you.
I’ll have you know that I spoke before the Concord City Council when they changed the zoning making the Jail Project possible. I told them that the basic function of government is public safety and order.
If my local leaders wanted to raise my City taxes to pay officers a decent salary - I would have no problem with that.
23 Aaron // Jun 3, 2007 at 11:29 pm
Well indeed there are many things we agree on. I have also very much appreciated your views on the jail. I also thought it was interesting that there was so much flack over the project when the very people who were against it live less than 2 blocks from the highest crime rate in the city. Then you pointed out the fact that most of the council folks lived within a few miles of downtown and suddenly the light went on.
But I think that if the County goes through with the COPS instead of TIF that many taxpayers will scoff at the idea of more COPS to build our desperately needed schools (Harold being the ring leader, no doubt). So aside from the obvious benefits, that is another fringe benefit.
But I still disagree with you that I have a zero-sum view of the world. I know we are either growing or getting smaller, and I agree with you that we must accomodate the growth. But the tax incentives to pre-gel and these other smaller businesses that wont employ more than 15 people, coupled with more money to the NCRC (inspite of the fact that this is not the same thing) still sends me the message that we are living in a system of a regular class (you and I) and a privileged class (those business owners who get a tax free 3-5 years.) If we authorize a new development in which all the houses will be valued at 500k then we don’t give the buyers a few years on the house. We tax them from day one. Both situations add tax value to the community but only one is deserving of a tax break? If you live in a neighborhood where the mean value is 500k or higher, how much of the counties services will you really use?
I just get the feeling that we have gone from pandering to developers to pandering to businesses, and in either case, no one is really concerned about your average citizen. It would be nice to see the County or City pay some attention to the majority rather than the special interests. (Geese, a cold chill just ran down my spine, that sounded really really liberal)
But even though we don’t agree on the phylisophical ideals, we still agree on the fiscal ideals.
And thanks for editing that hatchet job of a post I made. My 2nd grader has better html skills than I do. (Man I feel old)
24 LiberalNC // Jun 4, 2007 at 12:48 am
It would be nice to see the County or City pay some attention to the majority rather than the special interests. (Geese, a cold chill just ran down my spine, that sounded really really liberal)
Even though the Dark forces are strong, you are beginning to see the light.
May the force be with you!
25 kron // Jun 4, 2007 at 9:25 am
Quick point of clarification re: public safety needs created by the Campus. When you look at the TIF proposal from Kannapolis, there are still excess revenues. Moreover, those revenues take into account the need for schools, police, fire, etc., that the Campus will create. For the County there is $148 million in excess revenue and for the city there is $57 million in excess.
It’s all captured in this document:
http://www.cityofkannapolis.com/downloads/Self%20Financing%20Bonds/Revenue%20Impacts%20of%20the%20Recommended%20TIF%20Package.pdf
26 Aaron // Jun 4, 2007 at 3:07 pm
Well, I have to say that most people that think the way I do (And I don’t know anyone who shares ALL of my beliefs) generally find things that they agree with on both sides of the aisle. But where I part ways with most people of the “liberal” persuation is anything having to do with the economy. Perhaps thats why Justin feels I have a zero-sum mentality.
Some people win and some lose. But so what? It is humanly impossible to make everything fair. (Oh crap, I just blew my arguments for the NCRC out of the water:) ) All we can ever hope to do is allow equal opportunities(OK, part of the arguments saved).
I define special interests as the NEA, AFL-CIO, EPA, USFS, NOW, and most of the other “liberal” organizations. But on the other side of the coin, there are just as many special interests (if you could even call them that.) So I am of the opinion that neither of the “powers that be” are right.
Hey Justin, I don’t know if you’ve seen it but the Independent Tribune has a forum up on which form of financing you think is best. (Hint, Hint!) Maybe the editors are secret readers of the Cheap Seats…
27 Aaron // Jun 4, 2007 at 10:59 pm
Justin,
I was re-reading some of my comments on this topic. We have been discussing so many different things it was hard to keep it all straight.
One thing that I put together has turned into what I think is an interesting question.
I don’t nor have I ever supported “corporate welfare” for any company. Corporate Welfare meaning tax incentives and the like whereby the government gives the corporation a few years free living on us if they agree to come here.
But what has me wondering if this might be the best overall idea for Cabarrus County is this: Do you think that these companies would come here on their own based soley on market forces? We are an attractive place, close to Charlotte, 2 major interstates, a large airport and a much more attractive tax rate (before incentives) than Mecklenburg County.
Surprisingly, I say no, they most likely wouldn’t choose us. And I say this because the fact that the previous commisioners put off tax hikes to make them look good is pretty obvious to a research firm looking at places to move a business. It seems to me that a business would see this as a less than positive sign. I wouldn’t want to move or expand my business into a county where the property taxes could increase by 2 digits in the next 3-5 years.
What are your thoughts?
28 Roger Haas // Jun 21, 2007 at 9:22 am
Thanks for keeping the discussion on an even keel in regards to the NCRC. It is our job to sift through all the information and provide the best scenario possible for our city and its future. I fear that one day we will look back on this time and wonder why we did not take advantage of the opportunities that was standing before us. Why we did not step through the doors that have been opened.
In my deliberations, my goal is to help lay the foundation for the lasting success of Kannapolis. I cannot use rhetoric and opinions but facts based on the best available information. Thanks for being a part in providing that information
Roger Haas
Kannapolis City Council
29 Justin Thibault // Jun 21, 2007 at 9:55 pm
Roger, it’s nothing in comparison to the Yeoman’s effort that you and the remainder of the Council did in making this project a possibility.
History will remember y’all, our legislative delegation, and the Board of Commissioners (well, 4 out of 5 of them) for the work you did to get this thing through so effectively.
I was glad to be a small part of it.
30 Cabarrus Cheap Seats - Friday Five (belated): The Past Two Years // Aug 23, 2007 at 4:06 pm
[...] 5. May 25, 2007: Friday Five: COPs for NCRC = Stupid Idea. This one is cool because it has the greatest number of comments (18) since I’ve moved over here to the cabarruscheapseats.com. There are four people in the fray right now - you should join it. [...]