Oh, we’ve got a good one for you tonight. As you may recall, the town of Berlin (strategically tucked between Montpelier and Barre) is home to the aptly-named Berlin Mall, whose anchor tenant is a Walmart store. A modestly-sized outlet by the discounter’s gargantuan standards. Well, it plans to expand the store by roughly 50%, which the owners of the Berlin Mall think is just fine and dandy.
This has been in the works for the past two years. But late last month, the mall applied for a tax break from the town of Berlin.
And Berlin said yes. The Town Select Board approved the deal on a 3-1 vote this week. (Warning: Article safely ensconced behind the Mitchell Family Paywall.)
Specifically, the town has granted Berlin Mall LLC a five-year “tax stabilization” deal. Instead of the tax bill going up by 100% as soon as the addition is completed, the bill will increase stepwise in annual increments of 20% — not reaching the full 100% until five years have passed.
Exsqueeze me, but I always thought the purpose of tax breaks was to attract new development — projects that wouldn’t otherwise happen. Well, we all know that’s usually a load of hooey anyway. But in this case, nobody’s even pretending that the tax break is necessary. It’s just a nice little gift from the taxpayers of Berlin to the owners of the mall. Town Administrator Jeff Schulz, who supported the tax break, admitted:
“I think these folks clearly would have done this project if the (stabilization) program did not exist,” he said.
To which I can only respond: WTF?????
In 2011, the town’s voters gave the Select Board the power to grant tax breaks “in hopes of encouraging investment and luring jobs,” according to the Times Argus. The tax stabilization, in Schulz’ own words, “could provide incentive to get someone to do a project where they might not have.”
But but but… you said yourself that the Mall “clearly would have done this project” without the tax break.
And another town rolls over on its belly, giving a free gift to a developer who doesn’t need it.
My congratulations to Jeremy Hansen, the only Select Board member who voted “no” to this senseless giveaway.
Then again, this is exactly what Walmart has come to expect from most towns; and heaven forbid that Berlin should disappoint!
It’s an especially incongruous act, given that by expanding its own square footage, Walmart effectively consumes more of the limited dollars available from that market area, making it less likely that a new retail business will find it worthwhile to locate in Berlin.
So, in effect, the Town is providing a disincentive to new business development.
But comprehending that requires simple common sense, which is sadly in short supply on many Select Boards.
but nothing new; here is a 2004 report from Good Jobs First
http://www.goodjobsfirst.org/s…
this may be the first such arrangement in Vermont
updated nationl info. is available here
http://www.walmartsubsidywatch…
that the Berlin VT select board can be had so cheaply esp since Wal Mart ships all of their Berlin revenue to Arkansas whereas if they were a bit less friendly they may leave and a local dept store with better jobs would keep the revenue in Berlin & VT.
WalMart makes fools of town/city officials on a routine basis but this has to be near the top in the “not the brightest crayons in box” category.
I was the lone vote against this in Monday’s meeting, and I’m glad there are at least a few out there who are as confused as I was. I expect an incentive to be offered before the desirable activity, rather than as a reward once the activity is underway.
The origins of the word incentive can be traced to the Latin incentivus, meaning to set the tune. It appears here in Berlin that someone else is setting the tune, and the residents are sitting nearby, watching the musicians merrily raid the register.
Jeremy
Poor beleaguered Wal-Mart have no money and need the generosity of taxpayers in order to survive. Berlin obviously had no choice but to give Wal-Mart taxpayer’s money in order for the nearly bankrupt Wal-Mart company to merely survive. In fact, Wal-Mart shouldn’t have to pay any taxes, because taxes are Socialism!