We should not take public tax dollars away from public services to fund private property on State Street

We should not take public tax dollars away from public services to fund private property on State Street

City of Madison’s Economic Development Committee (EDC) had a meeting originally scheduled for July 15, 2020, that was canceled. In this meeting, the EDC would review a resolution and ordinance on whether to approve funds for the Downtown Recovery Program, to reallocate funds from public projects and provide grants of up to $25,000 to State Street businesses.

The EDC will reconvene next month to discuss these items. Below, I have shared my opposition for items 61060 and 60995. I have sent the following public comments as emails to the Mayor, Common Councilmembers, and EDC.

In the meantime, I encourage you to research the topic (I’ve provided links in this article) and:

  • email the EDC, Common Council, and Mayor (edc@cityofmadison.com, allalders@cityofmadison.com, mayor@cityofmadison.com) and you may use my public comments;
  • register in opposition to 61060 and 60995 upon the next scheduled EDC meeting;
  • and attend the virtual meeting to offer your own public comment (you get 3 minutes to speak)

Public Comment for 61060

I am writing in opposition to the approval of 61060, which would appropriate $500,000 from public services and use it for private businesses.

The $500,000 for the Downtown Recovery Program would be pulling funds away from uses for Engineering, the Library, and unrestricted funds for the city. It is morally unethical, especially during a global pandemic, to reallocate funds from public infrastructure and programming towards the benefit of private property.

City departments across the board are already facing a 5% budget cut. Just last week on July 9, 2020, the Madison Public Library Board met to review options to eliminate staff positions and community programming in order to meet a budget cut of $900,000. The Downtown Recovery Program is using $120,000 from the Library-Neighborhood LED Upgrade that could have been reallocated to prevent some of those cuts. The Downtown Recovery Program is further using $275,000 from Engineering-Facilities Horizon List Planning at a time when the Streets Division is facing a $1.4 million cut and the Parks Division is facing an $800,000 cut.

The crux of this issue remains the subsidizing of private property ownership with public tax dollars. The Downtown Recovery Program aims to support small downtown business owners, with 41 business owners indicating that they will have difficulty reopening and may close permanently. But there is at best flimsy evidence that providing public tax dollars to repair buildings would help any of these 41 State Street businesses survive the pandemic. For all we know, we are only helping to repair the buildings, with no guarantee of security and longevity to the business owners, but a guaranteed benefit to the owners of those commercial properties.

*Finally, I wish to call out the manner in which the city is trying to pass the use of public funds for private property. On 7/14/2020, the Economic Development Committee listed 61060 as the appropriation of $500,000 for the Downtown Recovery Program. On 7/15, the EDC changed 61060 on their agenda to state that it was $250,000 for the Downtown Recovery Program and $250,000 for the Downtown Equity Program, with no explanation of what the equity program is and both agendas linked to the same supporting Downtown Recovery Program document. Only today, on 7/20, without earlier notification of the public, is there a revised document explaining that the Downtown Equity Program is a way to help support new entrepreneurs of color to do business downtown. But there is no indication that this $250,000 would go directly into the hands of black and POC entrepreneurs, and not towards paying the rent and building costs of private property owners. And while 61060 now describes a new Downtown Equity Program, it is important to point out that its partner document 60995, which describes $500,000 solely for the Downtown Recovery Program, remains unchanged. There is no document describing how funds will be used for the Downtown Equity Program. And again, the crux of this issue remains the pulling of funds from public infrastructure and using it to subsidize private property.

In conclusion, I am here today in opposition to 61060 and the misuse of public tax dollars for private properties’ benefit.

UPDATE: The City of Madison canceled the 7/15/2020 meeting with the Economic Development Committee shortly before the meeting started. As of 7/20/2020, the City has pushed 61060 and 60995 onward without EDC’s review to the Finance Committee’s meeting this afternoon starting at 4:30. The City has also released a new version of 61060 today with changes describing the Downtown Equity Program.

Public Comment for 60995

I am writing in opposition to 60995, which outlines the use of public tax dollars for repairs on commercial structures housing State Street businesses. 60995 accompanies 61060.

During the pandemic, small businesses have been able to apply for various business grants and loans such as SBA EIDL, PPP, We’re All In This Together, the Ethnic Minorities Grant, and Dane Buy Local. While these grants help small businesses hobble along, the reality is that none of this money gets to the heart of the issue.

For the most part, business grants and loans like PPP only help to subsidize business owners’ rent or offset costs so business owners can pay their rent. Rent is one of the highest costs for most businesses. Yet very few property owners have offered rent abatements or forgiveness during the pandemic. Rent on State Street and in downtown Madison is exorbitantly high, and private property owners continue to profit even when their tenants are incapacitated. Whereas loans like PPP direct public tax dollars towards rental costs, the Downtown Recovery Program now seeks to further help private property owners by allocating public tax dollars to those properties. This is happening simultaneously with an affordable housing crisis and the crisis of gentrification in our city. We cannot continue allocating money to the benefit of private property over people.

If we actually want to help businesses, then we need to ask why so many of them are compelled to stay open during a global pandemic when we have yet to flatten the curve. We need to ask what measures should we be taking so that businesses can fully shut down and people can stay safe. Is our answer to this problem really to continue subsidizing private property’s profits?

Instead, we should be looking at examples of other governmental bodies that centered the needs of people during the pandemic. We need to look at examples of governments that gave money directly to people and proposals for rent forgiveness. We need to look at successful measures of implementing rent control and regulation on real estate. These are things that could alleviate the current burdens on people and small businesses.

In conclusion, I am opposed to 60995, and increasing regulation of the funds in this article will not diminish my opposition. The solution is to maintain public tax dollars for public benefit.

Additional Reading Regarding State Street Businesses and Issues of Policing, Surveillance, and Gentrification Nationwide

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