Herald Journal Columns
Aug. 26, 2002 Herald
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Rumors about bank-clinic project getting out of hand


I enjoy squashing rumors, but generally prefer to do this in the form of news stories ­ arming people with information, and allowing them to draw their own conclusions.

It is my opinion that people are perfectly intelligent and capable of making their own decisions, without my meddling.

Therefore, when it comes to controversial subjects, such as the school site issue, I believe it is my gift to the people of Howard Lake and Waverly to give them all the information I can (without boring them), and then allowing them to decide for themselves what to do with their communities. This is how it should be.

Nevertheless, chronic rumors about the bank/clinic complex are causing me to step out of my normal circles and address this, because it just bugs me that so many people can be led astray, despite my best efforts to inform the public.

Don't eat a baloney sandwich

Don't eat a baloney sandwich if someone asks you to take a bite. That's my best advice to people listening to rumor-spreaders.

Rumors about the bank/ clinic project:

· the city is giving the bank a big financial windfall.

This is false.

Tax increment financing (TIF) has traditionally been a money maker for the city ­ and although the city fronted the cash for clearing the lots at the bank location, it will recoup all this money when all is said and done.

Normally, the city would collect more "profit," so to speak, on this project ­ except it didn't want to cheat its own residents to do this ­ so the city paid a "fair" price for the land it wanted.

This council gave the fairest deal possible to those homeowners that had eminent domain proceedings.

There are literally thousands of cities that use eminent domain when a major development goes through the works.

Only a small town would pay so much more, because people in a small town have a conscience and must live with each other.

Sure, 25 years is a long time for the city to wait to collect the money from the TIF district, but that's the nature of financing when you do this kind of thing.

Besides, the state would not allow Howard Lake to collect the TIF money without the arrangement it has ­ since TIF is designed to refurbish the interior of small towns that are trying to survive. That's what it's for.

The city "gave away" $39,000 in subsidy to the CLINIC (not the bank). Subsidies like this are the norm for competing towns looking for good development.

I find it unsettling that other business owners complain about the bank project when they received better financial deals from the city's Voyager fund (a low interest loan program), or other TIF arrangement, with less criticism and scrutiny than the bank/clinic.

· the city is going to be on the hook for lending its tax-free bond status.

This is completely, utterly false.

It does not affect the credit rating for the city . . . in fact, if every single Ridgeview clinic burned down to the ground tomorrow, the city would STILL "not" be on the hook.

I witnessed the City of Cokato do the identical arrangement with the Cokato Charitable Trust expansion a few years ago, with one big difference.

Cokato almost kissed the Charitable Trust people, and there were miles of smiles from everyone, knowing what a good deal it was for everyone (taxpayer, Charitable Trust, city officials, etc.).

Was Howard Lake happy to help Ridgeview? Sort of, except for the untrue rumors circulating about the council's wisdom in doing this.

Is it reasonable to expect Ridgeview to spend all or most of their expansion money ­ against conventional wisdom of growth versus what they know about the clinic business ­ and sooner than they really wanted to?

Sure, it would be nice to have them spend every dollar here, but it's smart of the council to entice the clinic to expand here NOW, not waiting for what tomorrow will bring.

Howard Lake's growth will come. In the meantime, it sure doesn't hurt to "help" Ridgeview choose Howard Lake now for some expansion, with an eye down the road for more.

· the city has been bending over backwards for the bank.

OK, this may be true ­ but guess what?

The council and mayor are expected to do this ­ even for an existing business.

Cokato helped the Charitable Trust, even though they were an existing business ­ and now Cokato is a mecca of services for seniors, offering absolutely everything.

That's the thing about expansion and development . . . you never know where it might lead you.

Think of the other towns along the strip ­ Cokato with its interior downtown drying up, and other towns that have sparse development that are uncontrolled and erratic.

The cold hard fact is that if you're not moving forward with development, you are going backwards. And small towns can't afford to do this.

The competition for businesses and industry along Highway 12 is almost cut throat among cities along the strip.

More commercial growth translates directly to people's pocket books, with a tax base that is spread across the profit of businesses instead of property owners' wallets.

The boom of development in Howard Lake is the envy of other cities ­ in fact one administrator called Doug Borglund last year, asking him how he did it.

Usually, small cities have to give things away to sweeten the pot for businesses (such as sewer and water access charges or the like), doing almost anything to attract development.

Why do anything? It will happen anyway.

I disagree.

I've been covering small cities for more than 15 years, and have the benefit of seeing what worked ­ and what didn't ­ for other towns.

Good development doesn't happen with a "Why do anything? It will happen anyway" attitude. Sure, you might get lucky, but it's not the right way to do it.

Development should never be accidental, and cities that act that way lose. There are plenty of other fish in the Highway 12 sea!

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