Monday, November 24, 2008

Not so good way to develop in Buhl. The South Industrial Park

Since I’ve been on the city council, we have completed two large and one small public financed developments. There are many reasons that I did not support those projects. It wasn’t the idea of new development in Buhl that I was against, it was how the projects were executed that I did not support. I want to be clear….it is only on the rare occasion that the City of Buhl should ever do public financed development projects for new developments. In my opinion, development is best done by private individuals. Buhl should support, encourage and even assist in these developments, but we should not risk taxpayers dollars in new development projects. Let private individuals risk their money. That is what private developers do. If they lose their money, that is their risk. When they make money, that is the reward. I am not saying that we should never do new development projects, just rarely.

Let’s start with the first project. The Buhl south industrial park was the Mayor’s idea, and it is a good one. Having a place outside of Buhl, right off of HWY 169 that allows for industrial and light industrial development is good for Buhl. The problem was that the tenant that the project was built around is a non-profit business. The space for the industrial park that the City owns south of HWY 169 is limited, and the best spot in the industrial park is @14 acres on the west side of the park. The project called for selling those 14 acres to the non-profit for $14,000, and then spending @$125,000 of Buhl taxpayers money (not to mention the $180,000 of grant money) to put in infrastructure. All of that spending for a company that will NEVER pay taxes.

Buhl gets money in two ways. We receive money from outside sources such as the State of MN, Federal grants and loans, IRRB grants and loans….etc. Outside sources. Or we can tax the citizens of Buhl for money, our local levy. We received about $200,000 from the local levy the year we put in the South Industrial Park. It was ridiculous to use Buhl taxpayer dollars to pay $125,000 in infrastructure for a company that will never pay taxes.

Now, I would have supported the project if was handled in a different way. It could have been a private development, which I would most likely have supported. It could have been a public (Buhl financed) project that had a large tenant that would pay taxes right away, and I would most likely have supported that. But to use public money and basically give away prime property to a company that will never repay that money in tax revenue is a blunder.

I have no problems with non-profit companies. They do the good things for all of us that most businesses won’t do. However, we need to grow our tax base and non-profit companies do not help with that. Let me know what you think.