Wipke Comments on Can Plant Deal

12 Oct

In my previous post on the city of Arnold’s deal with Anheuser-Busch on the expansion of the Arnold can plant, I mentioned Fox C-6 superintendent Jim Wipke’s reserved stance on the issue at the October 1 city council meeting. In the current issue of the Leader, Wipke made more specific remarks, so I thought I would highlight them here. This is what he said:

All I can do is look at the impact of going with a 100 percent abatement on a $150 million project. If you didn’t go with that, you may or may not have gotten the expansion, but I can tell you from a superintendent’s perspective that it would have been really, really nice for our students and taxpayers if we could have come to an agreement that wouldn’t have been a 100 percent tax abatement. I’m a superintendent with 11,500 kids to take care of, and I would have liked to have at least gotten some additional revenue out of it. A $150 million project doesn’t fall out of the sky every day, and I sure wish something better could have been done.

Once again, Wipke was very diplomatic in his statement. The fact is, “something…could have been done.” Arnold residents could have elected better leaders who would not have given away the farm. Here’s what Arnold city administrator Bryan Richison said about the negotiations:

But, Richison said, when a city negotiates a deal, like the one Arnold made with A-B InBev, it is competing with other cities and has to make the best deal it can to ensure it gets the project.

In this case, Arnold city officials felt they needed to offer a 100 percent abatement to ensure the expansion in Arnold, he said.

“The hard thing about these negotiations is there’s a lot of key information we don’t have. When they’re sitting down with us and saying, ‘Make us your best offer,’ if we say, ‘We’re only going to give you 50 percent,” we don’t know if that’s good enough.”

It’s always nice when you can make deals with other people’s money. Not just taxpayer dollars, in this case, but taxpayer dollars that belong to other governmental entities.

Who was Arnold competing with here? Only the other cities that have A-B can plants, no doubt. This was an expansion project, not new plant construction. There are can plants in Jacksonville, FL, Mira Loma, CA, Newburgh, NY and Windsor, CO. We know that Jacksonville is already undergoing expansion (with no tax abatement for schools), so that leaves three other competitors. California and New York are not known as friendly business environments. City councilmen at the October 1 meeting mentioned that there is a Florida law that limits the amount of tax abatement that can be handed out. Do CA, NY, or CO have similar laws? Was any analysis done of Arnold’s competitors, or did Arnold just jump straight to an offer of 100% abatement? Remember that Rock Fire attorney Frank Vatterott said it was “highly unusual” to have a deal with no pilot payments (“payments in lieu of taxes”) for fire districts. It is hard to believe that Arnold really had to push in all its chips in order to get this plant expansion.

What is also amazing is that the school district, fire district, and other were not notified of this deal until late September, nine months after the deal was struck and only days before it was ratified by the council. Here’s what Richison said about that:

Richison said he was surprised that officials with other taxing entities didn’t know about the deal before then because last December the city announced plans to sell the industrial revenue bonds, which included the tax abatement, when a groundbreaking was held to mark the start of construction on the can plant expansion.

Dozens of people attended that event, and news stories were published about the expansion and the financing and tax abatements.

So in effect, he’s saying “we thought you guys would see it in the paper!” What a total lack of respect and consideration.

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