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    Thursday
    Nov032016

    A Sneak Peek at the Seismic Shift in Corporate Tax Breaks

    New rules are forcing states and localities to calculate how much revenue they’re losing to business deals -- and whether they pay off. It’s something Washington state has been doing for a decade.
    BY  NOVEMBER 2016

    Earlier this year, Washington state lawmakers got a wake-up call. A tax incentive package they’d approved in 2013 for aerospace giant Boeing -- largely regarded as the most expensive incentive deal in history -- was actually on pace to surpass its estimated $8.7 billion cost. According to a Department of Revenue report, the deal, which extends to 2040, had already amounted to half a billion dollars in giveaways in just the first two years alone. In other words, the state was losing out on a whole lot more money than it had planned.

    And the kicker? Just months earlier, Boeing had announced plans to cut roughly 4,000 jobs in Washington. The year before, the company had transferred thousands more jobs out of the state.

    Some lawmakers were livid, openly contemplating whether the state should consider revoking the tax breaks if the company didn’t add back some jobs. (Boeing, for its part, says it has continued to invest in the state, including $1 billion last year for a plant to build its new 777x aircraft.) But on the whole, response from officials and local media was measured. Most lawmakers said that in the bigger picture, the company was still good for Washington.

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    Friday
    Oct142016

    Big-Box Stores Battle Local Governments Over Property Taxes

    The retailers are deploying a ‘dark store’ strategy that’s hurting cities and counties around the country

    BY  SEPTEMBER 2016

    On Michigan’s sparsely populated Upper Peninsula, big-box stores are a modern necessity. Where towns are spaced far apart and winters are long, one-stop shopping to load up on supplies adds a crucial convenience to what can be -- at least for many -- a rugged existence.

    Landing one large retailer is a coup. Having more than one can make a city or town a regional shopping destination. Marquette Township, a small community adjacent to the larger city of Marquette, is in the unique position of having a handful of big-box chain stores. Taking advantage of the fact that the city of Marquette was mostly built out, the township began encouraging large-scale commercial development on its western edge early in the 2000s.

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    Monday
    Oct102016

    The China Factor in America's State and Local Economies

    As the world's second-largest economy falters, pensions and tax revenues here are feeling the pinch.

    BY  AUGUST 2016

    Earlier this summer, New York state’s pension fund announced a mediocre year. Investment earnings were essentially flat, and as a result the fund lost $5 billion because its other receipts -- contributions from government and from current employees -- didn’t cover retiree payouts.

    The New York pension system was the victim of a global event that began halfway across the world a year ago this month. In August 2015, the world’s second-largest economy officially began to stumble. China’s central bank stunned investors by devaluing the yuan, lending credence to what outsiders had long been suspecting: China’s years of astounding annual economic growth -- at times cresting at double digits -- was slowing down.

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    Sunday
    Oct092016

    Is Kurt Summers the Future of Chicago Politics?

    The city’s young treasurer has turned a moribund office into a hive of activity, fueling speculation that he has higher aspirations.
    BY  JULY 2016

    On a cool late-spring evening in the Wild 100s of Chicago, an area on the far South Side known for its gang wars, Kurt Summers Jr. is addressing a small crowd gathered inside a once-gleaming 1920s retail building. There used to be a beauty school here; later the building housed a counseling service and a check cashing store. But even those businesses are gone. This community, built by middle- and working-class Dutch families 15 miles from downtown, never recovered from the closing of the South Chicago steel plants in the 1970s and 1980s. Today, it’s a symbol of violent crime and urban decay.

    But to Summers, who grew up on the South Side, violence is only a symptom of the community’s real dilemma. “We don’t have a violence problem in Chicago, we have an economic problem in Chicago,” he tells the crowd of about two dozen residents, who applaud in agreement.

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    Saturday
    Oct082016

    Alabama’s One-Man Pension Show

    He’s not the governor. He’s not a lawmaker. But thanks to the way he runs his state’s pension plans, David Bronner may be the most powerful man in Alabama.
    BY  MAY 2016

    The office suite of David Bronner, head of the Retirement Systems of Alabama (RSA), rivals those of governors in much bigger and much richer states. Perched on the top corner of a building completed in 2008, Bronner’s spacious office is full of the framed photos, cartoons and assorted knick-knacks indicative of a long career in politics. A large rug in front of his desk prominently displays RSA’s circular logo. Bronner’s real trophy case, though, can be seen through his floor-to-ceiling windows and adjoining balcony: the panoramic view of downtown Montgomery, which shows just how much he has changed the skyline of this city of 200,000 people. Five mammoth concrete-and-glass buildings, much like the one his office occupies, stand nearby. The green-capped buildings are designed primarily to house state agencies, yet they’re outfitted with flourishes fit for big-city law firms, from fountains, marble, granite and towering lobbies to polished metal cauldrons at major entrances. Beyond them stands the city convention center and the adjoining hotel that Bronner also oversees.

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