Comments on Let's attract companies with our workers, not with subsidies - Greater Greater Washington

Comment by TwitterHitter

Mon, 25 Jun 2012 09:32:15 EDT

This just in from Twitter: via ‏@timcraigpost:

Mendelson supports the $34 million tax abatement/break for Living Social. Will recommend council approval tomorrow. Says it will create jobs

Comment by Arnold

Fri, 22 Jun 2012 12:18:04 EDT

I recommend the following, revised default email (capturing the article's second main point, too):

--------------------

Please only approve the LivingSocial tax break if it:

1) Requires LivingSocial to add new jobs (not just churn existing ones) in software development or similar fields that will grow DC's skilled workforce.

2) Is in a form (such as income tax and training credits)that ensures DC doesn't subsidize a company that is losing money and perhaps about to go bankrupt.

Comment by Todd

Fri, 22 Jun 2012 01:00:22 EDT

Is it just me or is the term "worker" to refer to citizens or members of a community kind of reminiscent of how the soviet union used to run?

Comment by Jasper

Thu, 21 Jun 2012 20:22:20 EDT

@ Subsidy:As it stands, DC’s vacancy rate for commercial office is 12.5%. In FFX it is slightly higher at 14%. DC’s has jumped from 10 to 12.5 in the past year while FFX’s only jumped 1% even though they had twice the new inventory come out of the pipeline meaning their absorbsion rate is far greater than the Districts. Translated…more companies have been choosing to set up shop in VA the past year (past decades really) than the District.

Then why have prices not gone down in DC? Is the market not free?

Comment by cminus

Thu, 21 Jun 2012 16:36:16 EDT

@martin, to expand on what @Ken said, for technical reasons all legislation introduced by the Mayor is deemed "introduced by the Chairman at the request of the Mayor". All it means is that the Chairman's staff and the Council Secretary's office handled the internal paperwork. The phrase conveys no review of, input into, or agreement with the content of proposed legislation by the Chairman.

Comment by Jasper

Thu, 21 Jun 2012 16:02:18 EDT

@ Bloomingdale: Or if they're white moving into a previously black neighborhood.

Oh yeah. Forgot about that. And let's not discriminate against Asians and forget that they are unwanted in certain neighborhoods. Unless they provide health care, that is.

Yeah, Washingtonians are a welcoming bunch.

Comment by Bloomingdale

Thu, 21 Jun 2012 15:17:44 EDT

It's just that Washingtonians do not want talented young people to live amongst themselves in DC. At least, not as long they're in college.

Or if they're white moving into a previously black neighborhood.

Comment by Ken Archer

Thu, 21 Jun 2012 15:08:27 EDT

@martin

Chairman Brown. But it's not an indication of Brown's views on the legislation. The only indications we have now of CMs views are the members of the Finance & Rev Committee, particularly cmte chair Evans.

Comment by martin

Thu, 21 Jun 2012 15:03:49 EDT

Ken

"Chair" Kwame (R - Councilman turned criminal) Brown ?

Chair Mendelson crowned last week? Doesn't seem like it could have gone from Mayor Vincent (C - campaign still under criminal investigation) Gray and given Mendo's usually thorough, painfully slow nitpicky (but much appreciated) review and then gone through the Finance committee in the same week. But perhaps Mendo has stepped up the pace of things.

Comment by Subsidy

Thu, 21 Jun 2012 13:36:36 EDT

Ben,

The Districts commercial office rents have always been higher, substantially higher than the neighboring burbs, even through the late 80's and 90's when District vacancy rates were higher than those in the burbs. Traditionally had more to do with the cost of land than the vacancy.

As it stands, DC’s vacancy rate for commercial office is 12.5%. In FFX it is slightly higher at 14%. DC’s has jumped from 10 to 12.5 in the past year while FFX’s only jumped 1% even though they had twice the new inventory come out of the pipeline meaning their absorbsion rate is far greater than the Districts. Translated…more companies have been choosing to set up shop in VA the past year (past decades really) than the District.

Yes, there are businesses, and ancillary federal contractors (who charge the taxpayer for the privilege) who purposely choose to be in the District and accept the additional cost of business to do so, but there are many, many more who don’t.

That mixed in with corporate taxation, the worst schools in the nation etc make DC a very hard sell which is why DC has to be far more targeted and serious about who it tries to lure to town.

Comment by Ken Archer

Thu, 21 Jun 2012 13:11:52 EDT

which councilmembers wrote/sponsored this bill?

It was offered by the chair at the request of the Mayor, as all the Mayor's proposals are.

It was passed by the Committee on Finance and Revenue (chaired by CM Evans) with no revisions, and comes before the full Council next Tuesday.

Comment by Ben Ross

Thu, 21 Jun 2012 13:03:14 EDT

The District, with... its drastically higher office lease rates... has to try even harder to convince companies to come to DC

Don't the higher office rents demonstrate that companies, at least some of them, do want to be in DC?

Comment by martin

Thu, 21 Jun 2012 12:57:05 EDT

which councilmembers wrote/sponsored this bill?

Comment by Jasper

Thu, 21 Jun 2012 12:31:24 EDT

Talented young people want to live in DC

True. It's just that Washingtonians do not want talented young people to live amongst themselves in DC. At least, not as long they're in college. Then they need to be horded up on campus, preferably behind a fence.

Comment by Subsidy

Thu, 21 Jun 2012 12:22:38 EDT

While I agree the LivingSocial thing to be a waste, and your goal is laudable in a macro sense. It is completely unrealistic in a real world sense.

You also seem to be mixing and matching facts to support your thesis.

For example.

“The District didn't just suddenly become an attractive place for talented young people to live”

Yes actually, it did. DC had a world class (ok, I am giggling matching world class and “metro” but on paper it is) transportation system for 25 years before the young started moving to town.

DC has had a the same world class universities for 50-100 years or more and yet it wasn’t until ten years ago that fewer people started leaving the District for VA or MD than staying.

And lastly, we can’t discount the “Obama effect”. I don’t know how many articles I’ve read, news reports I’ve watched claiming that President Obama made public service “cool” again, nor can I count the number of young 20 something’s that I’ve met in the past 4 years who moved here to work in government because of it.

“The payoff from these investments is that DC has experienced the largest domestic population growth of any state”

No, it didn’t. DC’s population growth between 2000-2010, while impressive in a local sense because it was the first time the District had actually added population rather than shed it for the first time in ~40 years, but for that decade we ranked 34th in the nation. DC did take the cake in one year growth from 2010-2011, but that had absolutely nothing to do with young people flocking to DC because of metro, inclusionary zoning or our streetcar program. It had everything to do with DC being immune to the recession and the jobs mecca of the nation.

"Location subsidies, is practiced by states who can't offer a 21st century workforce because they haven't invested in one"

Really? I had no idea VA and MD offered so many successful subsidies is because their workforces are subpar uneducated backwater hillbillies.

The truth of the matter is this. Subsidies crafted in certain ways and for select businesses pay off in massive dividends. VA and MD have been proving that at the Districts expense for decades. The District, with it’s 50th ranked public schools, its drastically higher office lease rates, and higher corporate and income tax rates has to try even harder to convince companies to come to DC rather than our suburban neighbors.

This subsidy for LivingSocial is ill crafted and useless (and can we stop calling it a “tech” company, I get daily grocery deals emailed to me from Giant, that doesn’t make them a tech company), but that doesn’t mean we shouldn’t compete for the same business MD and VA get.