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Prince George Has No Business Handing Out Free Taxes

By Ben Meisner

Wednesday, May 19, 2010 03:45 AM

If handing out long term, free property taxes is so sexy, how come there have been few, if any, takers in this city?  

Yes, the  Chances Gaming  Centre was  built downtown and  got a tax break on $10.5 million dollars of that construction, But besides the  Gaming centre, in five years we have seen  $3 million spent  on seven projects that were largely renovations.

That in itself speaks to just how valuable the tax free holiday really is.

But wait, Sheri Green says she is troubled by the  latest report which  says "that even if the land were free they would not come".  She argues that while the move to have a 20, 30 or even 40 year exemption plan may be expensive, the city cannot afford not to try to have such a tool as this available.

Well the good Councillor should be aware, or should be made aware, that there is only one taxpayer in the City of Prince George and that is you. If you grant exemptions to anyone, that expense comes right out of the pockets of the others.

The City should not be in the business of making money for private individuals or corporations unless it is equal to all of those taxpayers, which it is anything but in this case.

Councillor Green might want to walk down the street and talk to one of the many business owners moving out of the down town to get their feel on why they are leaving. If your property in a section of the city suddenly drops, as it has in recent years in a number of areas, does the City run out and support those residents by cutting their taxes or handing them a free tax holiday?  Of course not.  Similarly the down town should ride on its own merits, not on the backs of the taxpayers which it is doing with increasing frequency.

I’m Meisner and that’s one man’s opinion.


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Comments

It's the City which wishes to revitalize the downtown by attracting new, successful and lasting business to the area.

Therefore it has to offer some incentives for business to have another look at the downtown.

If anybody has any ideas what the incentives could be rather than a break on taxes - let it be heard!

Tax reduction is something that the bean counters can crunch the numbers on, after all.

Hanging flower baskets obviously did very little.

Can the City start the ball rolling by re-paving some of the terribly deteriorated streets like 4th Avenue?

Give it a try, please.
As one of the largest land owners/developers of downtown, the City is in a conflict of interest also having the power to grant tax holidays.
After 40 years of our downtown deteriorating it's great to see someone like Shari Green willing to stand up and try something innovative.

I don't hear people talking about the large number of vacancies or how run down or unsafe the Carter light industrial area is, or how the Hart shopping centre is a plight on the city. Yet that is what I hear over and over about our downtown.

It's time to take this bull by the horns and do SOMETHING about it.

Beats the heck out of whining about it for another 40 years.
"Give it a try, please."

It has been given a try and we have seen the result as told to us by a report delivered to Council on Monday. The result is that it does not work.

The City badly needs housing. The report makes a very simple statement about why tax incentives downtown will not cause housing to magically appear in the downtown. It very nicely explains, in fact, why we have so few multiple housing units in PG compared to other communities of our size and larger. Simply, there is no cost differential between single family detached dwelling and low rise strata units.

On top of that, developers do not get the advantage of a tax holiday that they can pass on to reduce the price of a condo. That advantage is given to the eventual condo owner.

So, the annual cost of the city's part of the property tax might drop by $1,500+ depending on the price of the unit. That amounts to $120 to $200 per month. Then you get the condo fees thrown on that pay utilities as well as the education, hospital, and other regional district charges.

I know that until I can no longer take care of my own affairs I would not be enamoured with that style of living and loss of control of what goes on in the building I live in.

With offices and retail, we have an abundace of space. Build new, and no one can afford it. Tax is not going to make a difference over location, location, location.

Sorry, it simply does not work. The gaming centre intially located where it did not because of tax incentives. The reasons had nothing to do with that. If it had, Majors would not have pulled out the gaming centre and built it a second time over at the casino.

So, let us not give tax incentives and lose the money to be spread over the rest of the population one more time when it is going to do squat in the decision making.

The normal incentives given in other communities are zoning based to allow more density and/or allow density to be transfered from one property to the next. We can use that tool when the city starts to grow. Before that, I cannot see an advantage until the City downzones the density for all of downtown and gives itself that tool.
Prince George and MiddleGround. Update yourself on what has already been done and read reports dealing with the matter before you post something which is out of date.

It helps a lot in moving the conversation forward rather than rehashing old stuff.

Yes, the Hart Shopping Centre is a disgrace! There are some potholes which can tear a wheel right off your car! Landscaping is non-existing. The absentee owners should get on a plane and come here to take a look!

Either fix it or make it level with the ground!

The 20,000 people who live on the Hart deserve better than this.

Has the Mayor EVER come this far north?
Dan probably believes that the Hart has it's own mayor.
I agree that Hart mall is gettho looking. I have never quite understood why the Hart is so hurting with next to no stores and a population of 15-20000.
Gus:"So, let us not give tax incentives and lose the money to be spread over the rest of the population one more time when it is going to do squat in the decision making."

You argue that no business is going to take advantage of any tax incentives no matter what. So I am puzzled as to why you are worried about the city spreading the lost moneys over the rest of the population.

How is the city going to suffer a loss of taxes if there are (according to you) no new businesses ever going to take advantage of a break?

Let the city go ahead with it. If there are no fish in the lake to bite you will never lose your bait.


"You argue that no business is going to take advantage of any tax incentives no matter what. So I am puzzled as to why you are worried about the city spreading the lost moneys over the rest of the population."

I think you misunderstood the "taking advantage" part.

If I was a new retail or personal service business and wanted to locate, some of the options would include:

- Westgate box store heaven
- CH shopping plaza (fully occupied)
- Spruceland (almost fully occupied)
- Hart Highway Shopping Centre
- Pine Centre
- Downtown CBD
- Downtown periphery
- Gateway
- and a whole bunch of other smaller neighbourhood centres

My first choice will be what is the best location. If I am a destination operation with little competition, I just need to be in a place that is accessible, has easy parking as close as possible, and is relatively safe. Downtown then remains in the list of possible location.

If I am an operation that is competitive with some other similar operations, then I have to be more careful. If it is frequently accessed, such as a food take out or convenience store, then I look for underserviced areas. If it is a comparison shopping situation, such as specialized clothing, such as shoes for instance, then I look for high traffic areas and preferrably where there are already other shoe stores. Notice that most shoe stores downtown have pulled out over the years. Shoe stores are concentrated in the Pine Centre. The same has happened to clothing stores except that they have spread into Parkwood and Westgate as well as the Pine Centre and a couple in Spruceland.

BUT, not downtown. If I were in that business, downtown would be the death of my operation as soon as I opened the door unless I offered something very unique. No amount of tax incentive nor even cheap rent would get me into such a location.

So, businesses moving into downtown are limited by location not by the cost of doing business associated with the facility.

Thus, what I was saying is that the right kind of business will move there anyway. The tax incentive will not make any difference. Also, if the tax incetnnive is there, a business would not refuse to take the City up on the offer for reduced taxes. BUT, that was not what caused me to move there. It was not an incentive. The money is being given for nothing. The City has less money coming in. The other tax payers in the city will have to make up the difference.

Downtown cannot rely on this particular type of incentive to get private enterprise to move there.

The incentive must be public investment or joint public-private investment. And the investment must be more meaningful than nice awnings and street furniture, lights, etc. It must be investment that will draw people to the development such as:
- government offices
- Public Housing
- Public Markets
- Training-Education facility
- Cultural Centres - Museums, Galleries, Theatres, Community arts facilites, libraries
- sports venues
- convention facilities

We have some of those in place. We need some others. And we need to replace or expand some.

The key to all of that is that these facilites need to be intergrated with their surroundings in such a way that there is opportunity for the private sector to follow with their offices, entertainment centres, restaurants, retail, and other services as well as full time housing and short term housing (hotels)

The prime example of what not to do is to provide public developments such as those around the Civic Centre where there is little if any opportunity for private development to augment what is there and make it into a lively and economically viable space.

BTW, it is not too late to do that. But there are few people in this community who look at that location as an opportunity. They look at it as a liability.
BTW, the biggest gap in public investment is the lack of planning. We have the SGOG thingy. It is so rough and high level that it is virtually useless. We need some people involved who know this city, know what makes a downtown tick and have the ability to create a plan of action that is doable and stick with it.

We do not have that at City Hall. Neither Council nor Administration has been able to muster that into a viable action plan over the past 20 to 25 years. I see no change coming from that source.

Let us see what happens with the new Downtown Prince George group. From the media reports, they will be having Harcourt back next week. Let us see if it is a repeat of last year`s visit or if there is something a bit more tangible they have to offer.
I suggest you consider running for council. You make a lot of sense. You may become very frustrated once you are elected and on a council. Elected officials seem to fall into much the same old rut/routine once they have been indoctrinated into what the expectations are and what the standard established way of doing things is.

I can see why Sherri Green would be so passionate about trying to try some different concepts to get the ball rolling,as she has a personal stake in having a vibrant downtown.What I don't understand is why so few businesses,haven't taken advantage of tax breaks on construction.Why would the new Audiotronics store being built on highway 16,locate in close proximatey to Future Shop and Visions,rather than build downtown?I believe most people know the answer to this question,and I think it speaks volumes,about how difficult it is going to be to encourage private investment to locate downtown.Just my opinion,I hope I am incorrect.
That Audiotronics store on Range Road sure got erected in a jiffy. Too bad the construction of the "new" sporting goods and attached empty store on O'Grady Road near Shoppers Drug Mart is still a vacant eyesore. Some one talking to the wrong people at city hall?
"Some one talking to the wrong people at city hall?"

City Hall is not in the financing business. It is much more likely they are talking to the wrong people to invest in a building intending to house a business in a questionable business climate which is likely also depending on getting another store signed up to invest in renting or owning another part of the building.

Likely a small independent operation trying to compete with a much larger operation on both sides of it.
-------------------------

To PrinceGeorge. People who make a lot of sense have a hard time to get elected to Council. That is not the key to getting elected as I see it.

We have a lot of people in the community who make sense but work on community things from other angles to make them happen.

When one looks at what has happened in the community over the decades, people on Council were rarely the seed that made them happen or even the ones who persevered on the road to making them happen.

Councillors have to be everything to everyone in order to get re-elected by a large constituency.

People who are the prime movers have to get some key people on their sides to allow their pet project to move forward.
I wonder if there is any business in the downtown that was there 40-years ago... other than the Northern.

A 40 year tax exemption is just plain ludicrous... any tax exemption is ludicrous when the rest of the tax payers are picking up the tab for location favoritism. Taxes should be a burden that is fair to everyone and competitiveness should be found in other ways that do not tilt the economics through taxation favoritism.

If you want to get the downtown to grow, then the city first needs to grow. A rising tide will float all ships. We have everything a city 'of this size' needs in the way of commercial development basics. Favoritism to a downtown business is paid for by their competitors paying taxes in another part of the city and does nothing to grow the pie.

If the city supports growth in other parts of the city that are successful developments, than this eventually will trickle down to a properly zoned downtown commercial and entertainment district. This is the approach with the greatest utility for the entire city.

As for the Hart mall... it gets to be where it is today when you have Lower Mainland slum lords that own it and jack the rent up 100% upon renewal of contracts. Unrealistic expectations of getting rich off the business that were located there with Lower Mainland rental rates... siphoning profits of the business for unrealistic rental fees. The Hart mall has no hope under current ownership and that's a bad deal for the Hart. IMO the Hart has huge potential for any commercial development that can get through city admin plans and actually get something built in the Hart. Driving to the malls in College Heights is akin to driving to another city... and yet the Hart has a much larger and affluent population base than College Heights.

The city has designed to collect taxes and handicap any further development of the Hart since the Hart was incorporated into PG in the 70's. Its a cash cow for city hall and nothing else. Part of the downtown plan... and now they want to Hart to also pay for subsidizing further favoritism for the downtown.

The city planning department can be summed up in two words. Special Interest. And that in itself sums up our long term failure as a city to build sustainable developments throughout the entire city.