Tax Abatements In Columbus

Liliana Rivera Baiman
Sep 30 · 5 min read

As Backlash to Columbus’ Corporate Handouts Grows, City Council Doubles Down

After decades of Columbus city government gifting millions in tax abatements to wealthy developers and corporations in exchange for promises of job creation, the tide of public opinion on the issue is turning. After Columbus teachers made losses to the school district budget from tax abatements a key issue in their summer campaign for a new union contract, local think tank Policy Matters issued a report finding that some Columbus abatements were simply not worth the cost. Even the traditionally conservative Columbus Dispatch agreed in a late summer editorial that abatements “deserve greater scrutiny”.

Given the growing opposition to such a central pillar of the city’s development strategy, one might reasonably hope that members of City Council would attempt to start a dialogue with residents or ask for constructive feedback on their strategy. Instead, City Council has chosen to double down. They recently issued what has become their annual press release touting the success of abatements, claiming that a “team of economic development experts” on the Tax Incentive Review Council (it doesn’t say who) have signed off on the city’s strategy, and repeating the argument that abatements are necessary to “compete regionally and nationally”. Notably absent from the press release is any mention of the Review Council’s findings that once again, several of the firms receiving incentives failed to follow through on their job creation promises, and that City Council is once again poised to vote to look the other way.

Just how much do our councilmembers love abatements? According to Policy Matters, the taxable value of abated property in Franklin County alone was over $3.2 billion in Tax Year 2017 — higher than any other county in Ohio.

It all sounds so simple: trade tax breaks for jobs. Here’s the problem:

Flawed Assumptions, Failed Accountability

Even if you take the city and Review Committee’s “jobs created” numbers at face value, the entire argument for these incentives is built on the assumption that those jobs wouldn’t have been created without an abatement.

Multiple studies confirm that this assumption is entirely incorrect.

The studies estimate, in fact, that between 75% and 98% of the time, the company in question would have made the exact same decision without the abatement. So even if you read these numbers in the most generous possible way for proponents of tax incentives, three out of four times the abatement in question is an unnecessary handover of tax dollars that could have been spent improving infrastructure, transit, schools, or other city services — but instead will pad the profits of a private entity with our public dollars.

Even when a legally required review of abatements reveals that a developer hasn’t lived up to their end of the contract, allowing the city to terminate or renegotiate the abatement — this City Council simply changes the terms of the contract to meet the needs of the developer, rather than reducing or revoking the tax break.

Money Talks

It is City Council’s job to manage our city budget responsibly and make sure Columbus really works for all of us. But Columbus City Council doesn’t listen to working families, our children’s teachers, or well-researched studies. Why won’t they listen?

Money talks, and campaign contributions tell us that our current leaders are bought and paid for by the very people who benefit from abatements. An analysis by the Columbus Dispatch found that more than half of the 20 largest contributors to the campaigns of city officials are developers or have links to companies with city business interests, with more than 60% of the 8 million dollars in campaign contributions raised between 2014 and 2017 coming from less than 4% of donors. Les Wexner is CEO of the powerful Columbus Partnership. The Wexners ALONE have given more than $265,000 to City Council incumbents and Mayor Ginther since 2014. Six of the current 7 council members were first appointed by these same interests rather than elected, and it shows.

It’s long past time for the people of Columbus to have a say in how our city is run. The “Columbus Way” is only working for a few at the top. We can do better!

A New Way Forward

Columbus is at a fork in the road. Residents are fed up with tax policies that prioritize a few special interests at the expense of our neighborhoods. Instead of managing our city budget responsibly and making sure Columbus really works for all of us, our elected officials are doubling down on giving millions away to wealthy corporations and developers. The reality is, this City Council has a record of success for big developers and wealthy corporations, and a record of failure for working families.

The good news is, there is another path — one that begins at the polls on November 5th.

Our campaign believes that many times when developers and corporations come calling with hands outstretched, we should simply say no. Especially when those corporations are subsidiaries of the sixth most profitable corporation in the entire country. Or when that same corporation has been sued by the city for its alleged role in the opioid epidemic.

Not all incentives are as egregious. Those tax abatements that are considered need far stricter scrutiny, and should be undertaken with much more concern for long-term impacts on communities. A $15 an hour wage requirement is a starting point but does not go far enough. Any incentives we provide should include requirements for employee benefits, paid leave policies, labor peace, local hiring, and comprehensive Community Benefits Agreements (such as Milwaukee’s Community-Oriented, Responsible and Equitable [CORE] Development Zones).

We don’t need to incentivize expensive condos in the Short North. We don’t need to give city property away for pennies on the dollar to developers. We need someone on City Council who isn’t bought and paid for. We need someone who will stand up for working families. We need someone who isn’t just interested in reacting to problems, but has a proactive vision for our city — ensuring one good job for every Columbus resident with living wages, access to childcare, and benefits, connecting our city with transit expansion and infrastructure improvements, and building a city we can live in by shifting our development focus to affordable housing and tenants rights.

Join us in lifting up the voices of Columbus working families and prioritizing policies that center the welfare of our communities instead of policies that center corporate welfare. Our city has the resources to raise standards for the many and not the few, it’s only a matter of priorities.

Sign up to get involved, donate and Vote Liliana Rivera Baiman for Columbus City Council on November 5th!

Liliana Rivera Baiman

Written by

Candidate for City Council in Columbus, Ohio.

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