Council to consider tax breaks to entice people to move Downtown

[Gaspar]

Just came from downtown an hour ago.  Had to drop by a client to pick up a check.  Long-time Tulsa company.  CFO was watching a webanar on the new healthcare bill when I walked in, and he had that deer in the headlights look.

We got to talking about the financial health of his company.  He said they were doing very very well, cash flow was excellent.  Asked if they had any plans on increasing user count (they use a software product I sell) and his quote was "we're not increasing anything until we figure out what this lunatic in the White House is going to do."

They just paid for a software upgrade to beat the tax deadline, and have the capital to expand and hire, but they are waiting. 

So back to the subject of this thread, I don't think tax manipulation on a local level a pronounced effect until we know what Washington is going to do.

[TheArtist]

Just came from downtown an hour ago.  Had to drop by a client to pick up a check.  Long-time Tulsa company.  CFO was watching a webanar on the new healthcare bill when I walked in, and he had that deer in the headlights look.

We got to talking about the financial health of his company.  He said they were doing very very well, cash flow was excellent.  Asked if they had any plans on increasing user count (they use a software product I sell) and his quote was "we're not increasing anything until we figure out what this lunatic in the White House is going to do."

They just paid for a software upgrade to beat the tax deadline, and have the capital to expand and hire, but they are waiting. 

So back to the subject of this thread, I don't think tax manipulation on a local level a pronounced effect until we know what Washington is going to do.

What specifically is he waiting for "Washington" or the "lunatic in the Whitehouse" to do, or thinking might be done?

As for not hiring, one of the things I have heard over and over is that skyrocketing healthcare costs have been difficult, but in a growing economy (fake though a lot of that growth may have been) often manageable in the past, but now that companies find themselves BOTH in a recession and with healthcare costs that have never stopped rising... they can't hire more and often have to lay off, even if they are holding steady otherwise.  In other words, the path that we, and that guys company, has been on was one that would steadily get worse.  His costs were going to skyrocket no matter what (unless he did not help his employees with healthcare, but then his employees would be having to pay more for it regardless). 

[Gaspar]

What specifically is he waiting for "Washington" or the "lunatic in the Whitehouse" to do, or thinking might be done?

As for not hiring, one of the things I have heard over and over is that skyrocketing healthcare costs have been difficult, but in a growing economy (fake though a lot of that growth may have been) often manageable in the past, but now that companies find themselves BOTH in a recession and with healthcare costs that have never stopped rising... they can't hire more and often have to lay off, even if they are holding steady otherwise.  In other words, the path that we, and that guys company, has been on was one that would steadily get worse.  His costs were going to skyrocket no matter what (unless he did not help his employees with healthcare, but then his employees would be having to pay more for it regardless). 

Don't exactly know.  I think the uncertainty itself is the paralyzing factor. 

[Conan71]

I don't know that there is rational thought to a whole lot of it.  Sort of like the psychological influence of recession.  Start talking about bad times ahead and people horde cash.  If the personal or popular political  paradigm is that things like Obamacare are bad, that impending EPA regs are bad, or fear that increased tax burdens will keep a company's clients from spending money then it must be real.  Therefore, we must proceed cautiously, not hire new people, not make large captial expenditures and plan on surviving.

It doesn't matter what any of us sitting here talking about economic theory say.  The actions and reactions of business owners based on their fears real or percieved is all that matters. 

[OurTulsa]

The City Council collectively seemed to like this idea at their committee meeting.  I'm not sure exactly how it works but it's a tax abatement for the next six years - either it's the entire property tax or the amount of increase realised after sale.  In general, the City gets no direct benefit from property taxes.  The money goes to the County, schools, library...not a penny goes directly to the City of Tulsa.

Hopefully, in six years the residents in this building will have helped raise the desirability of downtown to the point that the raise in mortgage caused by the payment of property taxes is well worth it.

In the end, I think, allowing this property and the two others considered yesterday to forgo property taxes for 6 years is nothing considering their contribution to a revitalizing downtown (reusing infrastructure you and I are already paying for).  The expected increase in value of the property and it's surroundings (that are not churches) and the associated property taxes paid in six years will make this brief pause on property tax payments worth it.

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Looks like it's all property taxes for 6 years.  The other two projects were the new development 'GreenArch' at Greenwood/Archer and the Atlas Life hotel conversion.  According to this agreement the commercial spaces are not exempt from ad velorum?  http://98.175.228.61:8080/SuperContainer/RawData//EMTRDGBH862010114939/10-595-1.pdf?a=1