I don't like the Domain incentives, either. I don't like subsidies for retail. (But then I don't like subsidies for manufacturing plants or call centers or corporate offices, either.)
True, the city needs to maintain its tax base. But rebating the taxes from a new development is a piss-poor strategy for maintaining the tax base. Besides being self-defeating, it forces the rest of us to pay (even if just slightly) higher taxes, potentially displaces other prospective retailers, and encourages prospective retailers to engage in rent-seeking.
A better strategy for the city is to provide good value for the taxes it collects, expand its borders aggressively as necessary, and simplify its labyrinthine permitting process. (I recall Planning Commissioners questioning the Domain Phase II developers about details like the ground cover around the retention ponds.)
But the charter amendment being pushed by the Stop the Domain Subsidies folks is a bad, bad idea. Here's the language that will appear on November's ballot:
Shall the City Charter be amended to prohibit the City from entering into future agreements to provide financial incentives in connection with the development or redevelopment of property that includes one or more retail uses, and to stop the City from providing financial incentives under certain existing agreements in connection with the development or redevelopment of property that includes one or more retail uses?
What does this mean? It obviously prohibits Council from offering tax rebates to lure new retail. And I think that's what most supporters of the charter amendment are aiming for.
But the language is awfully broad. Here are some other things that might fall under the ban [NB: see update below]
- Incentives for mixed-use affordable housing with ground-floor retail uses -- even if the retail would pay market-rate rent and would provide part of the housing subsidy. The ballot language doesn't ban subsidies to retail; it bans subsidies to developments with retail. Those aren't the same thing.
- City financing of infrastructure that benefits new developments. For example, the city indirectly financed the parking garages at the Domain to encourage a mixed-use design. The amendment proponents presumably would be just as mad if the city had built and paid for the garages directly. But the city builds infrastructure all the time, and that infrastructure often benefits new and existing developments. When will new infrastructure be considered a "financial incentive" and when will it be considered run-of-the-mill construction for the public's benefit? Dunno. Expect to see that issue litigated. Repeatedly. NIMBYs take notice.
- Tax Increment Financing districts (since they almost always have retail uses). I don't see any other way to read the language. That's a big deal because that's how the proposed Waller Creek improvements and proposed TOD infrastructure will be financed. I actually think TIFs are a gimmick; they use accounting sleight of hand to cut a tax break to the district property owners. But I'm not so confident about my opinion that I'm willing to cut off debate for now and evermore.
A little humility is a good thing. Even when we are convinced that our opinions are the right ones, we should be careful about writing them into the charter. Flexibility is important. The political process -- elections, grassroot campaigns (like the Stop Domain Subsidies campain) and public debate -- are a better remedy for bad Council decisions.
Important update: Ah, the risks of not doing your homework. The actual Charter Amendment language defines "financial incentives" to exempt TIFs and, arguably, infrastructure improvements, although the definition of the latter will leave room for lots of disagreement. My first example -- city subsidies to affordable mixed-use projects that include retail -- would still be banned, as I read the language.
