BY WILL BUSS - News-Democrat
Bruce Holland, president of Holland Construction Services in Swansea, sent a letter to the Southwestern Illinois Council of Mayors this week asking the group to withdraw its recent letter in opposition of the so-called "STAR bonds."
A bill that has been tacked onto a Senate bill calls for creating these bonds as another option for developers by diverting state and local sales tax to a development fund. Its passage would pave the way for $1 billion, 900-acre retail and entertainment development proposed in Glen Carbon called UniversityTown Center, which Holland is leading.
In his letter, Holland said that he and other principal members of the University Town Center development team are "life-long residents of the metro-east" and have built their careers and raised their families here. "We want nothing more than to contribute to the success of our communities," Holland wrote.
He also wrote that Illinoisans have traveled across the river into Missouri for entertainment and recreation, and STAR bonds would be the "right funding mechanism" to bring University Town Center to fruition and attract millions of tourists to the metro-east.
"Destination tenants will locate in the St. Louis Metropolitan area and Missouri is currently positioned to win," Holland stated. "Illinoissimply does not offer significant enough economic incentives to compete and it would be a tragic loss to our region to miss the opportunity."
The mayors sent their letter last week to lawmakers after the developers agreed to give the mayors a 60-day waiting period to have an independent firm study the economic impact University Town Center would have on the metro-east economy and surrounding businesses and communities.
"How can the council now be opposed to University Town Center before they understand the impact?" Holland wrote. "Will the council oppose University Town Center if the study turns out to show a positive impact?"
Holland asked council president and Columbia Mayor Kevin Hutchinson to personally reconsider his and the council's stance.
Hutchinson said he and fellow mayors understand the potential impact that a STAR bond-funded project would have. He said that although the mayors council still believes it would have a negative impact on surrounding communities, they would still like to see what an independent firm's analysis reveals.
"What he claimed is that without the study, we don't understand it," Hutchinson said. "We do understand. We have had numerous incentive agreements in our communities. We support incentive agreements as many of the mayors have developed in their communities with incentives through enterprise zones and (tax increment finance) districts. We fully understand, and we think the impact to the region will be adverse."
He also noted that a fiscal note released by the Illinois Department of Revenue on Friday, which stated that after a few years of University Town Center's operation, the displaced taxable sales would erode the early gain from the construction phase. According to the note, "If the full increment is used to pay debt service for 15 years, then the aggregate net state revenue loss over this period is between $42 million and $178 million. If 20 years, then the aggregate net state revenue loss over this period is between $75 million and $267 million."
University Town Center spokeswoman Rebecca Rausch said the mayors' group is taking a stand before they have a chance to review a study what they had requested.
"It just seems rather counterproductive to argue that you don't fully understand the immediate impact and need a study to determine that, but you can still actively and aggressively oppose that," Rausch said. "I think Bruce is trying to make an appeal to elected leaders of our region to basically stop turning their back on developments of those kind, especially in light of their region, when they don't fully understand the impact."
Comments
richarde wrote on 2/11/2010 9:29:09 AM:
The Mayors are correct. STAR bonds is wrong. It's designed to enrich developers, a few contractors, and that's it. Saying it will draw people from Missouri shows how narrow our interests are. "What's in it for me? Forget the others!" Mayors know full well a retail development, supported by your taxes, would take revenue away from their own towns, which are already struggling. Illinois is against it. East West Gateway Council of Governments said TIFs have not been good investments, costing more than they brought in, and STAR bonds has been called "TIF on steroids" by its prominent supporter, State Senator James Clayborne. Look west: Six Flags is trying to emerge from bankruptcy. Population is stagnant; retail is hurting most everywhere; public coffers are depleted; people are resisting higher taxes. Using STAR bonds to support private developers isn't in our interests. Saying the Mayors don't understand is rubbish. They understand very well, and so do the citizens.
LB6DBDA3 wrote on 2/11/2010 8:43:25 AM:
It can't be said enough. NO MORE PUBLIC DOLLARS TO PRIVATE INVESTMENTS! Sadly, I think our mayors motives are not as pure but it gets the job done.
getalife06 wrote on 2/11/2010 8:27:53 AM:
If you don't want your taxes going to this development, then don't shop at the development. TIF and STAR Bonds are not one and the same. STAR Bonds utilize sales tax dollars - TIF funds divert property tax revenue. Mayors should be trying to figure out how to take advantage of the additional shoppers coming in from other areas to include Missouri rather than road blocking developments. It should also be recognized that nothing prevents the local shoppers from continuing to shop at existing local businesses. Mayors should be creative and a lot less provincial.
mmm wrote on 2/11/2010 7:52:13 AM:
If these developers want to to develop than they need to go find some private investors (venture capitalists) to back them. The public is tired of supporting their business ventures. With the State and municipalities strapped for cash and looking to cut their budgets, you're barking up the wrong tree for money. I'm tired of supporting all the developers with my money while jobs and city services are in jeopardy.
joemerriman wrote on 2/11/2010 7:03:58 AM:
Tax the foreign products sold in your stores if you want to tax something. Stop raising my taxes. You might find the companies that took their factories out of our country would bring them back if their products had a level playing field tax. Think out of the box and generate different ways to tax something. Don't keep going to the same old well. The well runneth dry. Your city, state and country are broke.
schnitzelbeer wrote on 2/11/2010 6:58:02 AM:
Reason local cities are low on money is because of these TIFs. Let developers pay their own way andif they can't, skrew them!