Think Freely Media presents Common Sense with Paul Jacob

Small Target, Big Subsidy

Denver, incentive, California, development, rent, graft, corruption

Something has gone wrong when, to get a tenant to move into an empty space in your prime-location building, you need a $4 million subsidy.

And when I say “prime location,” I’m not engaging in Trumpian over-statement. The downtown Denver, Colorado, property location sees over 35,000 pedestrians per day . . . and that’s with the primo slot empty.

But to get that slot filled, the owners have negotiated with the city government to nab a $2 million “incentive” to fix the place up for Target, which is thinking of leasing the location to put up a smaller-than-usual “flexible-format” store. Oh, and another $2 million for “operational” costs, which seems to be some kind of a loan to be paid back from taxes to be collected — and shared by the city for 20 years with the owners.

In other words, it’s the darnedest business deal you’ll ever see (and never get): up-front money not from a bank or investors, but from Denver’s city government “BIF” — Business Investment Fund — which is obviously part of a convoluted scheme fed by taxes and devised by . . . people I wouldn’t trust with my money.

Structuring deals like this is how modern cronies — er, cities — operate, I know. Am I alone in judging it corrupt on the surface and corrupting in the details?

If prime commercial property has gone unused for about a decade — as this three-storied mall space has — I’d think that maybe the owners have set the rents too high or the city has been a bit too greedy with taxes.

Or both.

This is Common Sense. I’m Paul Jacob.


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By: CS Admin

2 Comments

  1. John F. Brennan says:

    Any enterprise which requires a subsidy  to commence and operate is not viable. If it would otherwise be viable in a competitive market then it does not need a taxpayer subsidy. 
    Madness, not to mention disaster to the other business and landlords who are placed a a competitive disadvantage. 
    Other than the immediate theft of taxpayer funds, this appears to make no sense to anyone except to the thief. 

  2. Pat says:

    But isn’t this what government likes to call ‘an investment’?
    Sales jobs means sales taxes, income taxes and who knows what other taxes will come in.
    To little people, like you and me, it’s a subsidy. But to the city and to Target it’s ‘an investment’.

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