Bye Bye Borders Austin (sales, property tax, vs.)

[jb9152]

Originally Posted by verybadgnome

"IN 2002 the city of Austin planned to extend about $2m in incentives to a developer who wanted to build a new Borders bookstore on a prominent downtown corner."

Shopping: Keeping it local | The Economist

I really can't think of any good reason for their to be subsidies for any type of retail in Austin since we know they will come without incentives anyway.

It actually happens quite frequently, in just about every mid-sized to major city. It's a competition of sorts to attract desired businesses, and "incentives", "subsidies", whatever you want to call them, are one of the tools in the toolbox used by cities' economic development folks.

The problem with Borders is that it didn't react to a changing market very well; the electronic delivery of media has revolutionized publishing. Where there is a desire for "brick and mortar", and "real" books that you can pick up and hold (which I actually prefer!), people seem to be gravitating towards mom-and-pop stores and boutique bookshops moreso than the large chains.

But, in 2002, it probably wasn't as clear where the business was heading, and so the city used some of its ED tools to attract what was likely seen as a desired business to the area.

[jobert]

Originally Posted by llkltk

Okay, Book People I can handle. Half-price books, ugh, dirty old books, no thanks!

I haven't been impressed with the S. Lamar location. I feel like I'm looking through someone's garage when I'm there. They need to renovate, because run-down does not equal "rustic"

[Mrs.JT]

Originally Posted by 10scoachrick

A Trader Joe's would be nice .

Tee hee, snicker, snicker.

Omg, this would be GREAT. (wishful thinking, though, I'm sure) Let's start a petition!

[verybadgnome]

Originally Posted by jb9152

It actually happens quite frequently, in just about every mid-sized to major city. It's a competition of sorts to attract desired businesses, and "incentives", "subsidies", whatever you want to call them, are one of the tools in the toolbox used by cities' economic development folks.

The problem with Borders is that it didn't react to a changing market very well; the electronic delivery of media has revolutionized publishing. Where there is a desire for "brick and mortar", and "real" books that you can pick up and hold (which I actually prefer!), people seem to be gravitating towards mom-and-pop stores and boutique bookshops moreso than the large chains.

But, in 2002, it probably wasn't as clear where the business was heading, and so the city used some of its ED tools to attract what was likely seen as a desired business to the area.

But then you have to take into account that all of the other booksellers in Austin AFAIK in 2002, both independent/local and national chains, came here without incentives.

So why are you gonna put out honey if the bear is gonna head your direction anyway?

Incentives are good for promoting high paying employers to come here that would in turn add to our tax base. Retail is not a primary industry, but rather depends on the core industries for the customers that would spend their paychecks there.

Cities like Buda are different in that they had nothing like Cabela's before and they were competing against other small Texas cities.

Then there is the side issue of fairness. Why should company A in a particular industry get a hand out but not companies B, C and D? And why again are we promoting companies that send more money out of the region? Would have been better to have given such an incentive to BookPeople when looking at the larger economic impact.

[austinnerd]

This again

It's been discussed already that TJ very much wants to open stores in TX, but due to their distribution methodology, it's not just a piece meal thing (i.e. they would never open just an Austin/Dallas/Houston store, they go all in within a region). They are likely coming, but all the petitioning in the world isn't likely to move the process along any faster.

[jb9152]

Originally Posted by verybadgnome

But then you have to take into account that all of the other booksellers in Austin AFAIK in 2002, both independent/local and national chains, came here without incentives.

So why are you gonna put out honey if the bear is gonna head your direction anyway?

Incentives are good for promoting high paying employers to come here that would in turn add to our tax base. Retail is not a primary industry, but rather depends on the core industries for the customers that would spend their paychecks there.

Cities like Buda are different in that they had nothing like Cabela's before and they were competing against other small Texas cities.

Then there is the side issue of fairness. Why should company A in a particular industry get a hand out but not companies B, C and D? And why again are we promoting companies that send more money out of the region? Would have been better to have given such an incentive to BookPeople when looking at the larger economic impact.

Understand, I'm not disagreeing. I'm just pointing out that this goes on a lot. A judgment call gets made as to how to invest those incentive dollars for the best long-term interest of the city and region. It's done, I'm sure, in an analytical *and* political way. In this case, it seems to me that it wasn't very obvious in 2002 that the Borders business model would collapse in a little over 5 years.

[verybadgnome]

Originally Posted by jb9152

Understand, I'm not disagreeing. I'm just pointing out that this goes on a lot. A judgment call gets made as to how to invest those incentive dollars for the best long-term interest of the city and region. It's done, I'm sure, in an analytical *and* political way. In this case, it seems to me that it wasn't very obvious in 2002 that the Borders business model would collapse in a little over 5 years.

That's certainly true. I would have never thought we would be down to just Best Buy for a national electronics retailer. I just worry that our city council sometimes gets too dazzled at what they see as the possibilities for these type of deals.

[10scoachrick]

Originally Posted by verybadgnome

That's certainly true. I would have never thought we would be down to just Best Buy for a national electronics retailer. I just worry that our city council sometimes gets too dazzled at what they see as the possibilities for these type of deals.

No kidding! I won't set foot in a Best Buy after the experiences I've had there(Atlanta location). Heck, I'd go to Conn's first!

[cBach]

Originally Posted by 10scoachrick

No kidding! I won't set foot in a Best Buy after the experiences I've had there(Atlanta location). Heck, I'd go to Conn's first!

Yeah but we got Fry's. Even Californians can appreciate that.

[Austin97]

Originally Posted by jb9152

It actually happens quite frequently, in just about every mid-sized to major city. It's a competition of sorts to attract desired businesses, and "incentives", "subsidies", whatever you want to call them, are one of the tools in the toolbox used by cities' economic development folks.

The problem with Borders is that it didn't react to a changing market very well; the electronic delivery of media has revolutionized publishing. Where there is a desire for "brick and mortar", and "real" books that you can pick up and hold (which I actually prefer!), people seem to be gravitating towards mom-and-pop stores and boutique bookshops moreso than the large chains.

But, in 2002, it probably wasn't as clear where the business was heading, and so the city used some of its ED tools to attract what was likely seen as a desired business to the area.

The incentives are almost always tax rebates. So if the company goes under they wouldnt have gotten the rebates anyway.