By Antonio D. French
Filed Sunday, February 12 at 6:38 AM
Developer Kevin McGowan told Martin Van Der Werf of the Post-Dispatch that Comptroller Darlene Green's idea of doing away with 100% tax abatements for developers in favor of a 50% or less abatement is not the right thing to do.
"I think it’s a terrible idea," said McGowan. "I think the timing is not right." He said the time will be right when he and his colleagues can sell $300,000 to $500,000 lofts in 30 days. Right now, he says it takes him six to 12 months.
As we reported last month, Green has been critical of the 100% TIFs that developers are receiving. "If we were to look at that and say it's time to change that and give 50 percent to the developers and take 50 percent away from the developers, then we would have a more mutual benefit for the city and the schools," Green told the Post.
McGowan admitted that developers are addicted to TIFs. But he added, "Get it out of your mind, city, that the subsidy’s going away. It’s here. And if it’s not, then development isn’t, either. The task that the city needs to figure out is how to manage it wisely so it get the best return for the money."
Read the full interview here. Learn more about Tax Increment Financing here and here.
12 Comments:
Are residential developments receiving TIF even attracting families with children? If not, these developments won't be adding to the schools' costs of educating more children.
7:30 AM, February 13, 2006
Children or not, people living in TIF developments require public safety and other city services. Thier property taxes are not paying for that. Thier property taxes, 100%, go to the developers.
7:58 AM, February 13, 2006
No, only the increase in property taxes is temporarily diverted from the City, schools and other taxing jurisdictions (zoo-museum, library, etc.) And it's not the developers' pockets getting lined, as TIF pays for public improvements like streets, sidewalks and lighting that would otherwise be paid for out of public coffers.
9:12 AM, February 13, 2006
Big words from McGowan. Maybe he could sell faster if he and his brothers weren't qoute din the press saying that KC is a better place to do historic rehab than StL.
9:33 AM, February 13, 2006
So, do downtown loft dweller's pay property taxes that fund public safety, schools, etc?
The answer is no. Thier property taxes go to the TIF developer for 23 years, indeed lining thier pockets will millions of taxpayer dollars.
9:51 AM, February 13, 2006
This is extra special funny to me because I just had to say no to an Saint Louis Public Schools job that was offered to me, largely because the salary for the full time position was under $14,000 a year.
Mr. McGowan is talking about how he wishes he could sell $300,000 lofts in under 30 days, and here I am wishing I could make at least a salary equal to the poverty line working for the public schools.
Oink.
12:24 PM, February 13, 2006
Many of these developments are in Special Business Districts that have higher property tax rates than the average City block. To say then that predominantly childless loft dwellers who add nothing to the expenses of our City's schools are cheating the schools of revenue is a joke.
6:35 AM, February 14, 2006
Are you saying then that they shouldn't pay their fair share because someone else is paying it for them?
6:45 AM, February 14, 2006
Many City households without children already pay more in property taxes than your average City taxpayer, yet don't even use the schools they largely help finance. So then, I'm saying the schools are already getting a free ride of taxing many to educate only a few, but have the nerve to want even more taxes from those who don't even use their services.
11:29 AM, February 14, 2006
Sorry, Anony, it doesn't work that way.
I don't drive very often on far southside streets. But it's still fair that a proportionate amount of my tax dollars go towards keeping them drivable. Because it makes the entire city more attractive and a better place to live.
The loft dwellers may not have children now, but what about in the future? The school system that they will be using 10 years from now is being built today.
And what if they never have kids? What kind of city would we have if it had great places to live but nobody in their right minds would send their kids to the public schools? Oh, wait...
I thought the whole point of the downtown development was to bring people back to the City? What's going to make them stay?
12:32 PM, February 14, 2006
If you don't want to pay for the St. Louis Public Schools, don't buy property in the city! I'm not sorry that the city isn't some free market paradise; in a democracy, everyone is taxed for common benefit. Public education has long been considered a common benefit.
I don't drive a car, but some od my tax money goes to roads. That ain't fair, is it? Well, guess what? When I fall down and break my arm, I am sure glad that there's a road that my ambulance can take to get me to the ER quickly.
You may hate the little kiddies, but when you pay for your grande latte, doncha want the SLPS-educated college dropout to know how to give you correct change?
Thaought so.
12:48 PM, February 14, 2006
We need taxes to pay for our services, period, however we also need economic development in Downtown.
TIFs are good for development. Sorry, but developers will develop land that is cheap, and sell for a profit. Don't like that, well, thats capatalism. If we offer no TIF's and other cities do, then we will loose development, and residents. If the TIFs are high, then we 'loose' tax dollars, yet gain development, but if they are too low, the we loose development and potential citizens because developers do not want to develop properties, its a balance.
Bottom line, developers want to save money, and put that money into other properties, thus developing as much as possible, thereby maximizing profits. Every dollar counts, and TIF's should remain if wish to continue the development boom.
They should not be reduced yet. Lofts should sell in 30 days or less. Do you see prime real estate in the county on the market for 30 days, hell no!
Once the city developed more, we can reduce the TIF's, however, now is not the time.
Regarding schools, there are other ways to get the performance up besides throwing more cash.
12:24 PM, February 17, 2006
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