Las Manitas blah blah blah

The Statesman gets it right.  Here's my post from December on this nonsense.

Let's just suppose that the city should be in the business of picking out local businesses to slather with money.  That still does not explain why the city is willing to forgive the Las Manitas loan after five years.  If the goal is merely iconopreservation, isn't the $750,000 loan enough to do the trick?  The parties apparently think so.  The city expects Las Manitas to make $45,000/year interest payments right off the bat, and Las Manitas apparently believes it can make those payments.  In other words, they both seem to believe that Las Manitas will survive even if it has to pay interest.  Then why forgive the loan after five years?  Either Las Manitas is still in business after five years -- in which case it has been successfully "retained," and needs no further subsidy -- or it's out of business, in which case the $750,000 was a bad investment which the city should try to recoup. 

Comments

[M1EK]

The good news is that there's a lot of well-informed opposition to this move on austinist, and other online forums, that doesn't just devolve into right-wing nuttery.

The bad news is that the Chronicle won't cover any of it, of course. What the hell happened over there?

See also: VMU (Allandale NA's EC just threw out their own committee's recommendation and basically went opt-out everywhere but Northcross, joining NUNA, Hyde Park, OWANA, etc. So much for the Grand McMansion Comrpomise).

[AustinContrarian]

I'm trying to get initial opt-out VMU applications and do a formal tally.

[ccosart]

No kidding about the Chronicle, M1EK. I used to actually look forward to reading it and getting some useful unbiased info. It's just propaganda now...

[DSK]

"The bad news is that the Chronicle won't cover any of it, of course. What the hell happened over there?"

They're too busy being Brewster McCracken's mouthpiece, for whatever reason. (a good example: http://www.austinchronicle.com/gyrobase/Issue/column?oid=oid%3A481975 )

But they're in good company. The Allandale NA's execom VMU rejection that you mentioned pretty much quotes word for word an argument given to them by McCracken's staff. (the whole bit about not agreeing to VMU because said commitment requires a supermajority to overturn opt-in areas later)

Add the VMU sabotage and the Las Manitas Fund to McCracken encouraging the ANA and RG4N to sue the city, and we've got quite the record of fidudciary neglegence, in my totally amateur opinion. Let alone the more subjective sprawl-inducing environmental irresponsibility.

[DSK]

And, I should add to clarify - I am aware that McCracken has often positioned himself as a Champion of VMU. Just one of many attempts to claim multiple sides of an issue as the audience dictates.

[AustinContrarian]

If the Chronicle is going to push propaganda for Brewster & Co., it should at least try to put out the very best propaganda that it can. Not silly statements such as, Las Manitas is an "economic development machine" that "packs an outsized wallop." It doesn't surprise me that they would fumble with economic-development jargon, given their anti-growth credentials, . . . but "economic development machine"?

[AustinContrarian]

It's always perplexed me that the city wanted to make this loan forgivable after five years.

One explanation is that the city council doesn't know what it's doing and is just giving a gift to a local favorite.

Here's another theory: Las Manitas has been around a long time. The restaurant business is hard work. Maybe the sisters are just tired and not willing to do all the work needed to move unless they get a sweeter pot. The "forgivable after five years" is the sweetener. In other words, that money isn't for moving or renovation expenses, which LM apparently can fund out of operating income; it's to make it worth the now-reluctant sisters' while. If that's the case, then requiring them to repay the loan if they sell or go out of business during the 20 year term will make this thing a lot less attractive to them.

This is pure speculation by me. I don't know anything about the discussions or negotiations between city and LM, and haven't even heard anyone float theory no. 2 before now.

If theory no. 2 is correct, then: (1) the sisters will turn down the money ($750,000 would induce them to keep LM open for 5 more years, but not for 20); (2) without the extra inducement, the sisters will shut LM down rather than move; (3) LM's closing will be blamed on the public opposition to the loan, rather than the change in the "forgivable" terms; (4) city council won't take any heat because, hey, they did their best.

If theory no. 1 is correct, the sisters will just take the money.