UPDATE: Is Sioux Steel Development looking for a ‘Massive’ Record Breaking TIF?

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UPDATE: Big Thanks to Snevelicious for following up on this story!

So this is taking place next Thursday, April 11 (City Council Meeting Calendar)

4 PM Architecture Ideas and Presentations

Held at the receiving building of Sioux Steel Company, 196 1/2 E. 6th St.

Please park on the west side of the Sioux Steel Building or in The Market

5 PM Heavy appetizers and drinks at The Market, 196 E. 6th St

The Sioux Steel Development folks have already mentioned they want to build a 900 stall parking ramp (or around that size) they have also mentioned using TIF. What they haven’t said is how much. I believe the largest TIF ever given out in Sioux Falls was for the Sanford Sports Complex (I can’t remember the actual dollar amount, but I think it was $9 million and I believe 20 years). The rumor going around is that the Sioux Steel will be asking for a TIF in the amount to cover the construction costs of the parking ramp a number that could range between $20-30 Million dollars. The largest TIF ever given out in the history of the city. It also seems the event next week is away to smooze the city council into this.

Some would look at this as an ‘opportunity’ for the city to get out of paying for a parking ramp like we did Downtown already, but as I look at it, we shouldn’t be contributing anything. TIFs are the largest form of corporate welfare. We should be focusing tax incentives on rebuilding our neighborhoods.

Oh, but it gets even better. Another developer is rumored to be offering the city to buy some of the RR redevelopment land. He said he doesn’t want any TIFs or tax reductions, but he is only willing to pay HALF of the appraised value. They always have to have something. This developer has already raked the city over the coals for other DT developments along the river greenway.

I think it is ironic that all these FREE market, ant-socialist Republican developers in town are the biggest socialists of them all. Maybe we should rename the area ‘Karl Marx Greenway’.

CVB & Hoteliers talk ‘BID TAX’ on Air BNB

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I guess the CVB had a luncheon (today?) and a little birdy told me the discussion quickly went to how Air BNB is hurting the hotel industry in Sioux Falls and maybe it is time to start charging them a Bid Tax.

Gee. I wonder whose idea that was? Probably some idiot blogger.

The operators of Air BNB already have skirted paying other lodging taxes (they pay sales taxes) and avoid the same health inspections Hotels, Motels and Bed & Breakfasts have to endure.

Maybe it was just idle bitching, but I have never known the leader of the CVB to remain idle to long.

UPDATE: Correction on Tax Incentives for Dakota Gold

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There seems to be some confusion of where Dakota Gold Alliance was previously located and what the tax incentive is for. I have to do some more digging.

There was a group of properties in the area by the old Avera Sports Dome. The ownership group was listed under Leggett Family Trust. While researching County tax records, they had Dakota Gold listed to the property (which is a possibility because it is a warehouse that could be used for storage, and warehouses fall under the ‘INDUSTRIAL’ designation for tax reductions). Another source tells me that Dakota Gold was located at another office in that cluster, but that would have been their formal offices. So the tax reduction was for the warehouse, I’m just not sure at this point if Dakota Gold was using the warehouse at that time, and perhaps that is why they were listed on the tax records.

Folks, this is what happens when secretive administrations don’t tell the public or council anything for almost a decade.

According to a city ordinance that was passed by the city council in 2008;

March 3rd, 2008 – Sioux Falls City Council

http://amv.siouxfalls.org/OnBaseAgendaOnline/Meetings/ViewMeeting?id=1838&doctype=2#

DEFERRED ACTION: 2ND READING: AN ORDINANCE OF THE CITY OF SIOUX FALLS, SD, AMENDING THE REVISED ORDINANCES OF THE CITY BY REVISING THE NAME OF PERSON TO RECEIVE APPLICATION FOR REDUCED TAXATION ON NEW CONSTRUCTION.

Document:  Ord. 1017

Proposed Amendment:

Section 39-139. Discretionary formula report:

In July of each year, the assistant director of planning and building services shall submit a report to the city council of all eligible completed new construction projects which qualified for the discretionary formula beginning in December of 2008. The report will include the description of each qualified property, the base full and true taxable value, the new adjusted full value of new construction and improvements, and the amount of discretionary loss of taxable value as defined in city ordinance of 100%, 80%, 60%, 40% or 20% for each year of the eligible tax abatement.

In other words, by city charter, the city council was supposed to see yearly reports. This gets more interesting by the day.

 

More tax incentive for developers

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I guess if you have a lot of money, you get all the price breaks. According to the City in this informational presentation (PDF DOC: Tax Reduction Program – Informational Jan. 8.pdf;

Reduced Property Taxation

Any person desiring to claim reduced taxation on new construction shall make application to the Planning and Development Services Department on or before October 1 in the year in which the project is completed and shall first appear on the tax rolls as a completed or modified structure. The application shall be submitted on a form prescribed by the city. Upon Planning and Development Services’ approval of the application, the staff shall notify the applicant within 30 days stating whether the facility is eligible to receive reduced taxation.

Since 2008 the City has reduced approximately $14 million in property taxes. Seems strange when we are trying to find money for new infrastructure, like a sewer plant, we would be allowing these many cuts.

One of the arguments for these cuts is that the businesses will create jobs;

Review the requirements for projects to receive incentive:

â—¦ Job creation

â—¦ Types of jobs

â—¦ Increase in Tax base

Do we really believe with the wages these places are paying they will make up the $14 million in unpaid taxes? I think a requirement that should be under review is if these properties are paying living wages. Otherwise it is no different then TIFs, just another corporate welfare program.

IM 25 is a bad way to fund education

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Forget the fact that IM 25 will probably become a slush fund for state government, it is a horrible way to fund Technical education.

Am I against increasing tobacco taxes? Not at all, if the money was directed at cessation, prevention, healthcare or even drug treatment programs, I would be all for it.

So the question remains, how do we fund Technical education? The first question we have to answer is “Why is South Dakota the highest in the region for tuition?” My educated guess (no pun intended) is because of high administrative costs and staffing. I know the teachers are NOT making highest wages in the region, in fact most tech teachers make less than K-12 instructors.

So after we get that part straightened out, how do we get costs down for the students? I think it is simple. First, make apprentice programs easier, and pay the apprentice. Many of these students could skip technical education all together and start in these jobs right out of HS.

As for the more technical skills for the medical field, electronics, engineering, etc. make the industries that need these positions the most pay into a scholarship fund that students can apply for with the agreement they will work in SD for so many years.

If we want extra money for tech schools, shouldn’t the employers who need these employees pay into a special fund or tax since they are the ones benefitting from reduced tuitions with skilled labor? Seems like an easy solution that makes sense.

Still don’t know how they linked tobacco to tech schools. Of course, we only have to look at the clown who cooked this up, Former Lord of the Lords, Mark Mickelson who wants to make money off of the backs of poor smokers. Some things never change in South Dakota, the business elite want handouts and welfare and they want the poor to pay for it.

And this is why IM 25 is Lame, just like it’s creator. VOTE NO!

UPDATE: If you watch the Rotary debate today, both Noem and Sutton voted against IM 25 and cited some of the same reasons I stated above for voting against it (and I posted this before watching the debate – HA!)