Question: What do most people do who want to buy a house? Answer: Go get a loan!
There may be those fortunate folks who can afford to buy their house by paying cash, but the vast majority of people will take out a mortgage.
In the city of Tulsa, and in government, things don't seem to work this way.
Take the city of Tulsa, for example.
Here in Tulsa, our mayor, Kathy Taylor, has been working hard to make good improvements. These are the kinds of things that willl increase tourism and keep our young folks from leaving to go to other "hipper" places to work.
One of the big projects that is happening right now is the construction of a nice, new baseball stadium for our minor league team. There wasn't anything wrong with the current stadium other than it wasn't in downtown, where the revitalization is desired.
Here's a pic of the stadium under construction.
Word has it that the owner of the team was threatening to leave the city or maybe to move WAY down south to the city of Jenks by the Arkansas river. OH NO!
Now, this isn't anything new.
We've all watched sports teams and owners stomp and kick their feet and cry about having to have a bigger and better stadium and threatening to leave if they didn't get one. And lots of cities have succumbed to their wishes. After all, you don't want to lose your big time sports team if you're a city right? Sports teams generate income and income is vital to cities. And besides, all the cool cities have sports teams, so our city needs one too. You know how people think...
Our little project is going to cost a cool $40 million or so. I reckon that's chump change in a recession.
Artist rendering of the finished project
Now the question before us is this - "Uh, where you gonna get that kind of money from Mrs. Mayor?"
Answer: Why, we're gonna raise taxes on the business owners who are gonna make tons of money from being right around the stadium.
So that's what they did. They drew a boundary around certain parts of the downtown area. And every business within that new boundary now is going to get to help pay for the new stadium via higher taxes.
Here's a rough calculation of how much this is: Business owners are being charged a flat fee of 6.5 cents per square foot with 2.2 cents going for city services and 4.3 cents to the ballpark.
That should increase taxes downtown by about $3,233,000 a year, with about $2,139,000 going to the ball park note.
OUCH. If I was a pre-existing business owner who just got hit with that tax, I'd be seriously thinking about moving my business.
Why?
Because there's no guarantee I'm gonna get rich off that nice, new stadium. I might, but I might not either. And further, I don't own the ball team. Why should I have to pay for their new playground? Oh, and did I mention that this tax was voted on and passed by the city council without allowing it to be voted on by the people? There's some talk around town that this may be illegal.
One other thing you might be interested to know is this. The current Driller Stadium rarely sells out its 8,000 seats. At that rate, it will work just fine for at least another twenty years.
Now I know it isn't exactly the same thing, but shouldn't the owner and team go take out a loan if they want to build a neat new stadium? Or how about this? Go buy some land and build it yourself. That's what the rest of us pleebs do whenever we want to develop a business or build our dream home.
Maybe there's more to how sports teams and high end stadiums work than I know. And maybe cities are a lot smarter than I am.
But I'm smart enough to know this...making someone pay for someone else's party doesn't usually make those who pay feel very good about those who party.
Written by Bob Haywood
"Your Real Estate Results Expert!" tm
www.BobHaywood.com
918-272-7272
PS - I have a friend who is a city councilor. I just saw that he voted for this tax. I think I'll schedule lunch with him and ask him why.
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