Do-gooders and the well intentioned abound in our society. They mean well; they want to improve conditions; they become activists for their visions. The usual result: bigger government, more regulation, increasing taxes, less individual freedom. During a recent meeting of the Wallace town council, all this lurked behind an impressive presentation by the executive director of the nonprofit Downtown Smithfield Development Corporation (www.SmithfieldNCDevelopment.com).
Chris Johnson projected his enthusiasm to the council members and about 20 in the audience. “I’ve got my heart in it,” said Mr. Johnson about his mission to revitalize the town of Smithfield. Johnson lives in Smithfield and has commercial interests there. By his account he has been successful.
Downtown Smithfield Officials have a “Master Plan”; they have a 93 percent business occupancy rate (up from 50 percent in the 70s and 80s); a three-mile trail connects two neighborhoods with the business district and a community park. Downtown has improved “walkability” and the removal of overhead wires vastly improves its appearance.
Johnson’s “DSDC Accomplishments” also lists: “Historic Preservation.” However, no building (Mr. Johnson’s office) older than 1850 exists from a community chartered in 1777. Overall, downtown now has more “character” and exudes a “Sense of Place,” according to Johnson’s power-point presentation. But at what cost?
These revitalization projects rarely pay for themselves. Money taken from uninterested citizens is distributed in the form of grants to satisfy the visions of a few local interests (“stakeholders”). First a bureaucracy must be organized. Johnson’s DSDC has a full-time director, a part-time assistant, and a 15-member board. It is supported from a “Municipal Service District” (MSD) tax. Declaring a historic district brings in state tax credits and federal funding. Nonprofits have the advantage of operating a kind of shell-game with private and public monies shifted around under real estate deals.
In the Smithfield Historic Area Revitalization Plan (SHARP) tax money from Johnson County, the town of Smithfield and the MSD gets manipulated (“granted” back) to land developers in a complex mathematical scheme—leaving us to wonder, who picks up the final cost? Johnson says it’s a positive because developers get back their tax dollars… “not someone else’s.” But if they don’t ultimately pay the taxes, who does?
The Smithfield streetscape improvement was a $3 million utility project with a $310,000 NCDOT “Enhancement Grant.” The Buffalo Creek “Greenway” cost state taxpayers $1 million in grant money. A total of $4.5 million of the public’s money was spent to revitalize downtown Smithfield during the past 5 years.
Mr. Johnson stayed for questions and in his energetic “cheerleader” role tried to sell the Wallace town council on the idea of a similar project. It all sounded exciting and hopeful for an improved downtown—whatever that means. We didn’t learn whether or not the majority of Wallace citizens need, or even want, downtown improvements or, if so, what they would be. Still, after a quick pre-meeting tour of the town, Johnson, who admitted that he had never been there before, had lots of ideas.
Pied Pipers playing the revitalization tune have led many astray. In this case, the council will have to establish a nonprofit bureaucratic front to get public grant money; they must tax their citizens in a “service district”; they will need money from other taxing jurisdictions; they’ll have to set up a regulated historic district. Johnson also suggests a visitors bureau and, of course, the no-political risk “occupancy tax” to lay their project costs on hapless travelers.
Should they decide that revitalization is necessary, the Wallace town council should ask themselves: Can we accomplish downtown economic improvements with private resources without subsidies using money confiscated from others? The “stakeholders” should be those property owners and residents willing to invest their time, talents and personal wealth in making a better place; rather than expect other uninterested citizens to forcibly share their wealth to support the local interests.
In my opinion this is a moral dilemma for all elected officials. Should they use their power and influence to take funds from a larger body of citizens who have no connection or interest in their visions and distribute it to further the local interests?
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28
2011 At 5:25 pm, ChrisJohnson Said:
Hey Bob…. From reading your blog post, I can only assume you were in attendance in Wallace the other evening. I wish you would have approached me and given me the opportunity to introduce myself and discuss my visit more.
I will be sure to let my mother know that I have reached the status of “do-gooder,” so thanks for making my day! As a former chairman of the Johnston County YR’s, the Johnston County GOP, campaign manager of Representative Leo Daughtry, former Congressional Assistant to US Representative David Funderburk, and a retail small business owner of over 20 years, I have seen firsthand the effects of bigger government, more regulations, increasing taxes and less individual freedom. As the Board Chairman of Neuse Charter School in the Smithfield-Selma area, (education concept the Locke Foundation strongly supports), I have fought long and hard against bloated governmental bureaucracy on the education front as well.
I was asked to come to Wallace to speak on what we do here in Smithfield… not to try and sell any snake oil in a bottle. I received no gas or monetary allowance for my time. As one that grew up in a poor section of eastern NC, I personally identify with small towns and small businesses and see it as opportunity to try and help others.
All of my comments were suggestions of how others have done it. Revitalization and economic development is not a “one size fits all.” I can’t agree with you more… everything has a cost and at the end of the day we have to ask, “Is it financially worth it?” I can’t answer that for your community, and only you and the citizens of Wallace can.
As for statement that revitalization projects rarely pay for themselves… I will have to take exception there. I have two personal buildings in Downtown Smithfield that I personally renovated them using the Historic Tax Credit application. This was a program that was started during Governor Martin’s era. I took the risk of putting up my own money… took the risk of trying to find a tenant… and then after I renovated it to the National Department of Interiors guidelines, was I able to apply for the credits. No one said I had to do it that way, but it was a choice. These credits are not your tax dollars or anyone else’s…but my personal income tax dollars that I am able to get back because I took the risk. I took the risk, and local property values increased…what an innovative way to foster economic development? Take the risk and do something to improve your community and get your own personal income tax dollars back.
As for the SHARP Program… From reading your blog, I can only assume you missed my explanation since you called it a mathematical scheme and a shell game. I will try a different example.
Say for instance someone lives next to you in your neighborhood in a blighted and dilapidated house and it is effecting the value of your property. Both houses are pretty much the same and basically equal…but you cut the grass, maintain it and try to improve the conditions. You are paying $900 a year in property tax due to how nice your house is and your neighbor is only paying $500 due to its condition. All town services are rendered equally to both properties. Water, Sewer, Fire, Police, EMS, Trash pickup, etc. (Let’s not get sidetracked on the home value discussion…just using simple examples, so hang with me.)
Continuing on… Say there was a program in place where, to encourage the owner to fix up his home to a certain standard…a program where he would not be financially penalized but rewarded or encouraged. No one is forcing him to do it, just an “incentive.” And after he renovated his house and the new annual property tax bill is now $900 just like yours. But with the program, for the next five years your neighbor would pay $900 in taxes but then granted get back the difference ($400) each year.
Here are the benefits as I see them. Your home value increases because your neighbor’s house has improved. The town is not “losing” any money because it has never gotten any more than $500 a year before from the neighbor. And after 5 years, the Town is actually has more money in its coffers… which could possibly mean that you and your neighbor’s taxes could be reduced to $700 each. (Provided that we have citizens such as you that keep an eye on government growth and spending.
I can’t argue much with the societal issues and that it is a shame we have seemingly reward or incentivize individuals to do something that they should normally take pride in and protect their investments. However we all know folks that march to the beat of a different drum.
Everyone has their opinion on how things should be done. We all want a better community… how to get there and at what cost can and should be debated. I have enjoyed reading your views.
The only thing I take exception to in your blog is the “misquote” of “had never been there before, yet I had lots of ideas.”
What was left out of your post was the fact that I stated I had driven up and down I40 a thousand times, yet I never knew how charming Wallace is and how much potential is there. I also compared the same dilemma we have here in Smithfield of 7 million visitors visiting the Outlet Center yet they have no clue to exactly where they are or the fact that the Town of Smithfield a mile down the road. The key is getting visitors to learn and know more about both of our communities, find out what a treasure we have and hopefully spend dollars in our small businesses.
As for the MSD and the other taxes… the Town of Wallace doesn’t have to have an MSD to be successful or benefit from the Historic Tax Credits rehab program. Furthermore, the Town of Wallace doesn’t need to have a layer of bureaucracy to have a successful downtown revitalization plan. I stated in my comments, a strong volunteer commission can do just as much good. But the Town, and you as a citizen can only determine that outcome and which course to take.
In your closing words, you stated that it’s a moral dilemma for all elected officials on whether or not to take funds from a larger body of citizens who have no connections or interest in their visions. I agree with your some of your comments. However, community pride is completely free and downtown is something everyone in Wallace owns. Since you were there last Thursday night, I can only assume you take pride in your downtown area and community, and I hope you were there to look at ways of foster this pride.
Now that I have the pleasure of visiting Wallace… you can rest a sure that the next time I am speeding down I40 to make it to the beach, I will consider stopping in Downtown Wallace and look for a place to have a cup of coffee and visit with the residents. Since you know who I am, I hope you are in the downtown area as well. I encourage you to walk up and introduce yourself and say hello…Coffee will be on me. You may consider the coffee an incentive… I will think it is just making friends and a making charming downtown better.
Regards,
Chris Johnson
Smithfield NC