The Decatur City Council is offering a private developer $40 million in sales tax rebates and infrastructure incentives to build a retail development in Limestone County - and asking the Limestone County schools to kick in even more by giving up some expected sales tax income.
The problem is that the developer thinks the $40 million isn't enough:
To make the Sweetwater development a reality, though, other government entities much pitch in, Hammon said.
"According to the developer, it's still a little bit short. That's where Limestone County is going to have to come in. (Decatur) can't do anything else."
Note that Decatur is the county seat of Morgan County, so we have the interesting situation of the city council in one county asking a neighboring county to fork over some corporate welfare cash.
So here's the plan they've come up with for Limestone County. They want the county to contribute some portion of the 2% sales tax that will be collected:
The 2 percent Limestone County sales tax that would be collected from the businesses in the Decatur-annexed area at Interstate 65 and I-565 is allocated for Limestone County Schools.
Dr. Tom Sisk, superintendent of Limestone County Schools, was on his way this morning to meet with unknown representatives of the deal when he stopped to make a comment.
"I have never been in a situation where a school system has been asked to help with this kind of economic development," Sisk said.
He did say, however, that the school system "does not have a lot of discretionary revenue."
"We are 108th in funding (statewide) and 13th in size," he said. For Fiscal year 2011-2012, the last one reported, sales tax revenue for Limestone County Schools totaled $14.67 million, according to County Administrator Pam Ball.
Shockingly, at least one County Commissioner thinks this plan is a good idea:
Limestone County Commissioner Gary Daly said the school system is likely to see an additional $1 million per year from the development and should "ante up."
Is this what we've come to? Handing money away to out-of-state companies to lure them here and then asking our already strapped local school systems to help fund it?
This is even worse than it looks. Alabama has no system to track whether taxpayers benefit from these subsidies and no mechanism in place to recoup the money if the businesses don't follow through on the agreement. Thyssen Krupp anyone?
[Recently] The Wall Street Journal reported that ThyssenKrupp, a German manufacturer, decided to sell the largest, and newest, steel plant in America. It cost $5 billion to build and has been open for less than two years. The state of Alabama gave the company $1 billion in subsidies — most of which is now gone for good. That’s a lot of money. That’s crazy money. Which raises the question: How much crazy will it take for this kind of silliness to stop?
Still waiting on Mitt Romney's "You Didn't Build That" tour to swing by all these taxpayer-subsidized developments that spread across North Alabama like poison ivy.
This looks like a sweet deal for the so-called Sweetwater development and a sucker bet for local government.