Monday, June 20, 2011

Windstream second-guessing sweeps NA: Which language is who speaking, when, and why?

If it was my job to prepare a lesson plan encompassing the following news item, it would include a few simple questions.

Coffey: Windstream move caught New Albany City Council by surprise; Messer cites lack of communication from administration; Gahan said proposal had council support (Suddeath; N&T)

1. Exactly what is meant by "growth" in the context used by Windsteam's Dan Bates?: "The administration here has done an awesome job of trying to bring growth to New Albany, and I think this would have been a great way to do that."

2. Is it the meat or the motion?: "According to (Dan) Coffey and Councilman Steve Price, Windstream tendered its product patents for collateral instead of real property or cash. 'This was a risky loan,' Coffey said."

3. When City Hall says, "No comprehension," and Coffey says, "No information," and Jack Messer says, "No communication," should the entire city of New Albany join the refrain from the Stones, circa Beggar's Banquet:

Take me to the station
and put me on a train
I've got no expectations
To pass through here again

4. Exactly what is meant by "entrepreneurial" in the context used by Mayor Doug England?: "In a news release, England did not directly fault the council for Windstream but said 'I do hope the city learns that we must become more entrepreneurial in our economic development decision-making.'"

5. Exactly what is meant by "economic development decision-making" in the context of the preceding passage? Whose definition? Who decides? Is there more than one way to look at such questions?

6. Given the scope of the request, the fact that it was City Hall and not the council asking for more time to be duly diligent, the resident whoredom of businesses seeking "economic development" favors from "entrepreneurial" cities, and the benumbing difficulties in separating fact from fiction in an election year, doesn't council president Jeff Gahan's statement constitute the final word on Windstream:

“I felt like it was moving as fast as it could have given the amount of money they were asking for from the council.”

That's enough for now. Let me know if you find any nuggets.

5 comments:

Jeff Gillenwater said...

I'd add the News and Tribunes "But if New Albany won’t take a chance to expand an operation backed by Purdue, why should the city expect future companies to consider the city to be business friendly?" to the mix as well.

What does that mean in terms of the race to the bottom?

dan chandler said...

True, the company was new. But then again, all companies in this market (consumer wind energy) are new. Windstream's leadership has solid prior business experience and had earned the trust of Purdue. Windstream also landed a contract with the US government a few months ago.

Yes, there was risk to the loan. Name one major private employer than wasn't at one time a risky start up.

The New Albanian said...

Mine still is.

And this speaks to a point that Jeff makes quite frequently: Why is it that bigness seems to bedazzle, when that $3.7 million scattered across 20 small businesses might create the same number of jobs?

And also spread the risk ...

dan chandler said...

Have 20 local start-ups asked for $185,000 TIF bonds?

In the 19th century, many small towns gave free land to the railroads. They did it so that the new tracks would go through their town instead of the town next door. Some might call that a subsidy. I call it an investment, one that paid handsomely for many towns when new businesses sprouted along the new tracks.

I’m not saying WindStream was the right deal. However, if New Albany continues to lag other cities in incentives, New Albany will continue to lead other cities in underemployment, shrinking tax base and underfunded infrastructure. There are a 100 different ways to attract a 100 different types of businesses, ways good, bad and ugly. It’s time New Albany decide on one or two good ones. Don’t expect many new businesses if you’re not willing to make some sort of public investment. More $1000 liquor licenses will only get you so far.

Serious question: By what mechanism should the city loan $3.7 million to 20 different companies? Did you have a model in mind that has worked in another city? I believe $185,000 deals usually are too small to be facilitated by individual TIF bonds? If not TIF, then what’s the source for the $3.7M to be lent to the small businesses?

Jeff Gillenwater said...

Here's a working list of city/county/state initiatives from around the country courtesy of
Community Wealth, a part of The Democracy Collaborative at the University of Maryland.


Link to PDF

Address to copy and paste:

http://www.community-wealth.org/_pdfs/articles-publications/state-local/CityCountyStateActions.pdf

As always, lots of policies besides direct subsidy and incentives affect not just investment but where and how it happens, even within the same region or county. Where and how citizens arrange themselves geographically affects how much money we need as well, focusing on ongoing costs rather than revenue.