Reneging on the deal may send the wrong signal to potential new businesses, but what about existing businesses and small ones that are attempting to get started. Why should they not have the same tax breaks? Providing a property tax break could help pay employee salaries or lower prices to be more competitive.
Small-business group starts fight against tax incentives
Petition drive to change city charter targets breaks for retail projects.
By Kate Alexander
AMERICAN-STATESMAN STAFF
Wednesday, September 12, 2007
A coalition of almost 300 small local businesses has launched an effort to prevent tax incentive deals for retail projects by changing Austin's city charter.
The group, Stop Domain Subsidies, announced a petition drive Tuesday to qualify a charter amendment for the ballot in May. Signatures from 5 percent of the city's registered voters, estimated to be between 18,000 and 20,000, are required to get the issue on the ballot.
The drive will start Sept. 25, and the group has six months to obtain the signatures.
By subsidizing one retail operation over another, the "City Council is basically unleveling the playing field," said Johnny Barnett of Austin Unique, which promotes and connects small local businesses.
The proposed prohibition focuses on retail projects and would not affect future deals for large employers, such as the package for Samsung Austin Semiconductor LLC.
The amendment proposal also aims to stop the tax rebates destined for the Domain shopping center, an upscale development in North Austin that includes Neiman Marcus and Tiffany & Co. stores
In 2003, the City Council granted the developers of the Domain sales and property tax rebates that total $37 million to $57 million over 20 years.
Reneging on the agreement with the Domain would send the wrong signal to employers looking to come to Austin, said Dave Porter, senior vice president of economic development for the Greater Austin Chamber of Commerce.
"We don't even want to go down that path," Porter said.
City Council Member Lee Leffingwell said, "There is a certain degree of trepidation with retail-based incentive packages anyway."
He is considering a proposal to change the city's economic development policy so projects such as the Domain would not be eligible for incentives.
kalexander@statesman.com; 445-3618
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