The Virginian-Pilot
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NORFOLK
With no debate, the City Council on Tuesday unanimously approved a $2.85 million tax break that developers say will allow them to complete the Wells Fargo Center.
The city granted the tax break to S. L. Nusbaum Realty to add 122 luxury apartments and 50,000 square feet of retail space to the 23-story office tower under construction on Monticello Avenue adjacent to MacArthur Center.
Nusbaum officials said that without the subsidy, the second phase of the $171 million project would be delayed or perhaps never built because of the economic downturn.
Council members said the city can't afford for such a high-profile project to remain unfinished.
At the end of each year, the city will total all taxes paid on the apartments and retail space and rebate a portion back to Nusbaum. The subsidy can run as long as 10 years.
City officials said the apartments and retail space will generate at least $7.4 million in tax revenue after the rebates are paid to Nusbaum.
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No money spent
People seem to be under the misconception there's money changing hands here. This is a $0 decision and will in fact be a net increase in city revenue.
Not enough strings attached to the money already given
Unfortunately at this point in the project, the city really has no choice. Wells Fargo is probably bluffing, but if they're not the city can't afford to call the bluff and have yet another eyesore of an empty lot in the middle of downtown.
That said, the council needs to start learning from their many mistakes. Next time, before the city gives away $2.85 million in tax breaks, $3.6 million in land, $5.4 million in utilities, and a $53.4 million parking garage, why not put a few conditions in the contract? For instance, if the project is not completed within a specified period of time, the unimproved land should revert back to the city, for them to develop or sell to a developer that actually has their act together.
What a deal!
I suppose it would be out of the question for Norfolk City Council to remotely consider such a deal for the citizens of Norfolk. Of course with the $39MIL budget deficit and the cost over-run with HRT and light rail and council angered and disturbed about it; $2.5MIL for Wells Fargo..... naaah what was I thinking? Luxury apartments are much more important.
Your Point
How does Mr. Obama end up in every conversation???
Yes/No
It is nice to see that they are not going to let this one die too however, with the so called tax revenue shortfalls now, ten year return does not seem positive. The city owns over 240 properties that they will only sell to select developers. Then they give them price breaks and tax breaks and keep saying that the city will prosper in ten years. In the mean time, the city is laying off people left and right. They are cutting street repairs causeing us to spend more on vehicle repair. They increase our taxes because of tax revenue shortfalls. And they continue to be re-elected into office. This sounds good at a meeting at night. But the next day and ten years of next days we will still have a shortfall. In ten years we may have a new city counsil setting up their retirement bank accounts. This is good for the city, not so good for our pockets.
Tax base.
If you have to grant these tax breaks, why do you want these businesses down town. Is not the reason to attract businesses, to increase the tax base?
I'm changing my mind on this one
It probably is better to spend the millions for THIS project instead of letting it go down too.
Obama & GM
As I recall, that's the same line BHO had about GM. His line of reasoning was that they're to important to not to bail them out from bankruptcy... Well, we now know the rest of the story. Our tax dollars flowed into GM and yet, they still declared bankruptcy.
Good Point
I Accept your premise.
Let's see if the conclusion transfers to Norfolk.
Corporate welfare
Its really too bad that politicians continue to give way money for corporate projects when so many citizens are suffering.