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Insider’s game

The abatement discussion continues

By Jim Sack

Fort Wayne Reader

2012-08-02

Larry Brown seems not to have gotten the memo.

The president of Allen County Council has called two secret meetings of the joint city-county task force to deal with the issue on tax abatement reform without informing the public…just a couple private backroom meetings where the good old boys could line up things before confusing matters with messy public involvement.

Council President Brown might have considered that the issue was forcefully raised and championed, not by lawmakers or the guardians of the public trust, but by frustrated citizens.

Tom Lewandowski, fellow labor leader Cheryl Hitzemann and their constituents have led the way in bringing this problem to the table, not elected officials. For two years they have delved into the books to evaluate the local abatement policy. Meanwhile, most politicians have avoided the issue.

Now, Brown has tried to take the issue back in house to be resolved with by the very people who benefit most by the status quo. He has tried to marginalize those who forced the issue. It is a classic strategy. “We know best. The naïve public are simply too uninformed to participate.” It is the old patronizing pat on the head that leads to more of the same.

Lewandowski has since been added to the mailing list, along with a few others, mostly beneficiaries of the current system, as well as the general media. At least give Mr. Brown credit for that sop.

At issue is who sets the agenda. Anyone who has worked in an organization knows that the agenda directs the discussion. If critics do not have a hand in formulating the agenda and in participating in the ongoing discussion, it will be about the same old, same old, and will recommend few changes, if any. The ill-focused, unmonitored handouts of your tax dollars will continue.

It is clear changes are needed. First question: are abatements really beneficial? The economic development types will all coo that abatements are an essential tool in building a better economy. Sadly, they can’t prove that, but they all chant it like so many transcendent Buddhist monks.

So, no need for discussion on that issue. Question two, then, is what types of businesses should be awarded abatements in order to spur local economic development and, therefore, enrich us all? Enrich us all is the key phrase. So far, there is no proof that your tax dollars at work have benefited anyone but the recipients of the abatements. Simply put, are we getting the most for our tax abatements? As Councilman John Crawford recently said, “with property tax caps this has become a question of real money.” His comment implies the system has been too free with your money and that review and reform are needed. It also implies officials have been lax in their oversight. So, who qualifies? Who brings benefits to us all in exchange for our contribution?

The City has been handing out tax abatements for years; so has the Country. Abatements were initially devised to help lure new industry to town, especially to reinvigorate targeted, blighted areas. Over the years both fundamentals have been tossed out the window. Almost every applicant receives approval. Abatements have been awarded to companies building on the very priciest land in Allen County after council cynically reclassified the tony acreage a “revitalization area.” Is Dupont Hospital really surrounded by blight?

Awards are also based on “retained” jobs, regardless of whether the company really plans to move or not. Abatements were given to companies, such as Lutheran and Parkview, who didn’t need them, but happily add the abatement windfall to their bottom lines. Just take pride in knowing that $12 aspirin Medicare paid for could have cost $12.01 without your millions in abated tax dollars.

Consider this: economic development people have to show they are doing something to justify their jobs, so why not make the application and oversight more “flexible?” Council, in an effort to show a nervous public that they, too, are business-friendly, have applied the rubber stamp to almost every application. To question a proposal would anger the business gods. It all seems a game of showing numbers, not necessarily making progress.

What’s worse, the City oversight has been so compliant that no one can tell whether all of the millions in abated dollars have generated the first job. Companies who receive the abatements report their own successes, in their own ways.

The stick of the famous carrot and stick equation should be “clawback” of tax abatement dollars, should a company fail to meet promises. But not one dollar in over the decades has been “clawed back.”

The issue of abatement abuse was raised nearly two years ago by Mr. Lewandowski and Mrs. Hitzemann in their role as coordinators of labor organizations in northeastern Indiana. They showed city council that government administrators do not even have a definition of what a job is. Rhetorically, one asks, should applicant Edy’s Ice Cream get an abatement based, in part, on hiring a few summer workers for a bit over minimum wage? And, given the temp workers have been hired year after year for many a year, what new economic development achievement is met with the same old same old?

In submitting the application the City knew that figure was padded, admitted as much during a council meeting, but passed on the bloated application for council’s action, anyway.

So, Mr. Brown, two fellow county councilmen, three city councilmen, and staff from both city and county, have met twice. The city contingent of Councilmen Jehl, Mitch Harper and Geoff Paddock made it very clear that they will not meet another time if the public and the critics of the current system are not seriously involved. Mr. Harper, for his part, has long advocated more citizen involvement and legislated to that end. Mr. Paddock was very pointed in his disappointment with the private approach to public business.

And, Mr. Jehl noted that those who are on Council President Brown’s short list of notified insiders are mostly those who benefit from a loosey-goosey abatement policy. Is the deck is stacked?

In his own defense, Mr. Brown might be heard saying that the general media is expected to keep the public informed and involved. Of everyone in the local media only two other writers have bothered to tackle this matter, while most of the electronic media couldn’t tell an abatement from an abutment. This newspaper, which has written frequently about the matter, and a local blog that has also criticized the system, were excluded.

But, Mr. Brown has, after all, invited you to submitted a written statement before August 31, 2012. About what? Double space or triple space? I wonder if the word has gotten out?

Mr. Lewandowski, Mr. Harper and Mr. Paddock are right: it is a question of who is at the table and formulation of the agenda. This is a discussion that should be open to the public that should encourage and involve the public. Mr. Brown seems to prefer to keep this an insiders’ game, to build barriers to participation and, ultimately, sacrifice more of your tax dollars to the economic development gods.