City Council gives okay separate actions from consequences
No taxpayers showed up to the public hearing to provide input on which pocket they will pay from to the cover ongoing operational deficits at the stadium. Property owners are marginally better off because costs have shifted from a property tax based charge to a sales tax based one. But except for the big property owners there is no essential difference.
The City of Midland wins big, however. They have thrown off the responsibility of suffering the consequences of having to help pay for a stadium complex enthusiastically promoted by previous council members and are now free to venture into promoting Midland's next great need.
This is odd:
Councilman John James, a 4B Board member, said he now looks forward to dealing with revenues and costs at the complex, which the board has said could be on its way to $1 million of red ink.
At least it is odd in the sense that this is exactly what the Managed Competition Comittee is, was, or should have been looking into for over a year. There is plenty of talent on that committee and they have probably already identified and have cut as many costs as they can.
But I never really held out much hope for the success of the Managed Competition Committee in this endeavor. Not because they were not good, capable people. But because they were operating on the premise....or at least the hope...that there was demand for the stadium out there somewhere that just hadn't been located.
It isn't out there. The demand doesn't exist. Any true market analysis...the kind people who are risking their own money do...would have shown that the stadium was never going to generate the revenue that proponents were hoping for and using to "sell" the stadium complex to the public. That is the best case scenario.
The worst case? They knew then that their revenue figures were unrealistic and it didn't matter to them.
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Where is this market study you speak of? If that is what you are relying on as the basis of your argument, I think you need to produce it. The simple fact of the matter is that this scenario was unavoidable from the beginning, cost overruns are a typical part of government. The government underworks and takes too long to ultimately do something right at all levels. Hence the saying "Good enough for government work". At this point there is no alternative option on the table, the old stadium is done and we have to deal with managment of the new one as effectively as we can going forward, keeping in mind the mistakes of the past (like building the thing in the first place).
One other thing, I do not know the status of the County's eligibility for the 4b sales tax allocation, but I do know that the hospital is not eligible for these funds under state statute. They are only eligible for money from property taxes. It would take passage of an exception by the state legislature for our hospital district to be able to do this. Odessa did this, and this is one big reason, in part, that they are kicking our arses in their quality of hospital care. They are allowed to receive sales tax money, and readily do. This is why the hospital district is going after property tax money, because that is all they can go after.
Anonymous, first off, the claims of revenue were widly reported in the Newspaper by the boosters around the time of the election. We can pull numerous juicy quotes about the revenue from the stadium. In fact I think there are plenty of these quotes in the JW Archives from many key players at the time, like Mayor Burns.
As for the County and the Hospital, I'm not talking about them taking over or creating a 4A or a 4B entity, they don't have to. For the City to create the 4A and 4B entities the County had to give up their authority to collect that portion of the Sales Tax on their own. As you say, hospital districts can collect a sales tax with help from the legislature, but it still by-passes the voters.
What I mean is, if the voters disband the 4A and/or 4B entities, the County and/or Hospital District can (and will) establish or re-estabilish their claims to the sales tax proceedes without an election of any kind, just a resolution re-claim their existing authority or a simple one-line bill tucked away in a mountain of legislation in Tax happy Austin.
As for the market study, when it comes to big Midland Project boosters selling the revenue side of any community project, I have three words for you:
Love those archives!
Thanks, Walser and Ospurt. Great post. Great comments. Great issue. I'd love to think we have done the last "if you build it, they will come" project around here, but the convention center will likely rear its head again soon...
Related issue: We need a pool on when Citibank pulls their sponsorship/naming dollars from the ballpark. My entry is May 15, 2009. I am in for a buck.
I don't read a whole lot into the lack of attendance at the public hearing on the slight modification on the use of the 4B tax.
To a large degree tax monies are fungible, and as Walsingham says, the effects on the local taxpayers are between marginally better to negligible.
If anything this move lets the City use some of that accumulation in the 4B account for current costs at the expense of being able to make a larger lump-sum principle payment when the next call date is reached in a couple of years.
I am heartened that it appears that when the final bond payment is made on the original loan the tax will have to be reauthorized by the voters. At that time the voters will get to decide how much money they are willing to dedicate to the stadium and other 4B eligible activities going forward. (they won't be so foolish to limit the ballot language so severely next time around)
If the "Don't Tax me Bro" crowd does succeed in making the City's 4B board give up the sales tax revenue, don't look for the tax to go away. The County and the Hospital District are waiting in the wings to implement any sales tax the 4A or 4B give up.
So, IMHO, In a few years the real decision on the 4A and 4B taxes is wether or not the voters want City appointed boards managing the money, or wether or not that money should go to the County or the Hospital District.