An interesting story is developing in Jamestown, N.D.
It seems the Jamestown City Council has decided that tax dollars are better spent on infrastructure than on corporate welfare programs (euphemistically called Economic Development).
The City Council in February voted 4-1 to take half of the 1 percent sales tax presently dedicated to economic development for city infrastructure and to extend the sales tax until 2022. Now an ordinance is going through the process to turn the resolution into law.
[...]
What started the campaign was an informal petition initiated by former council member John Grabinger in August. It asked the City Council to take up to half of the 1 percent sales tax to use for necessary city infrastructure issues and was signed by 1,100 people. The four council members were among those signers, but only Liechty said she circulated it. She said she did it as an individual and not as mayor.
A quick economics lesson:
Economic Development is a form of "rent-seeking."
Instead of looking for private investors to build a local economy, businesses and community interests join forces to draw out public dollars from taxpayers as a way to fund projects that would normally be funded by venture capital.
So-called "Economic Development Corporations" have been popping up like weeds.
The North Dakota Policy Council has an entire section of research dedicated to tracking and debunking the myth that taxpayer-funded economic development is a good or even effective practice.
There is even a pending lawsuit asking the courts to decide if Economic Development programs are even constitutional since North Dakota's constitution expressly prohibits this sort of thing: "the state nor any political subdivision thereof shall otherwise loan or give its credit or make donations to or in aid of any individual, association or corporation"
According to the Associated Press, the Jamestown/Stutsman Development Corporation is objecting to the use of these sales tax dollars for funding infrastructure that would otherwise be funded by property taxes.
As the short AP story goes: "the economic development group says the change amounts to "grand theft." It plans to circulate a petition to put the matter before voters."
Hopefully the Jamestown City Council will stick to its guns and put the taxpayer's money above corporate welfare interests.
The Economic Development group needs to realize it is not their money, they are not entitled to a handout.
Taking tax dollars away from private entities is not "grand theft," it is the correcting of a previous theft from the taxpayers.
Furthermore, the Jamestown City Council should be applauded for reassessing its taxing priorities.
By placing a priority on infrastructure and tax relief, Jamestown is setting an example for other cities to address the property tax issue itself - because the state bailout for property taxes will not always be there.
DakotaBeacon