Dallas is throwing $1.5 million at big name retailers hoping to lure them to vacant downtown locations merchants abandoned long ago.
“Our hope is that this gets the momentum going, and we’ll have a strong downtown well into the future,” said Mayor Tom Leppert
SMU Cox School of Business
expert Mike Davis
reviewed city back up documents on the program.
“It’s a very extreme proposal to try to get development downtown,” said Davis. “They’re doing more than just making public improvements, they’re making private improvements.”
The program offers to finish out the interior of rentable store locations and pay Realtor commissions for directing targeted retailers to the locations.
“That’s money that’s going to go from the taxpayers into the pockets of a specific broker,” said Davis.
The city’s two-page wish list of merchants includes H & M, Cole Haan, Williams Sonoma and other stores more likely to be found at The Galleria or North Park.
The incentive money approved by the Dallas City Council Wednesday comes from the Downtown Connection Tax Increment Finance District, which includes parts of downtown and uptown. But the money will only be spent in roughly two square blocks of Main and Commerce Streets between St. Paul and Akard surrounding Neiman Marcus
“We need some more retail, we need some more foot traffic, and this is really the way to do it to insure that we continue to have retail and keep the retailers that we’ve got now,” said Councilmember Angela Hunt, who represents downtown Dallas.
A similar city program to recruit downtown business recently did attract Joseph A. Bank on Commerce Street. But several other stores that opened with city subsidies have already closed. “I think we have every reason to be suspicious that these bureaucrats can do a better job of picking winners than people who are playing with their own money,” said Davis.
Representatives of two civilian city employee unions said the city should be focused on preserving existing city employees and services in the face of a $190 million budget shortfall that threatens to eliminate nearly 800 civilian jobs.
Mayor Leppert said a lack of investment in the past has left the city is a weak position and incentives are needed to get private investment flowing.
“And then we’ll have a strong tax base and hopefully be in better situation in the next downturn than we are in this one,” Leppert said.
Published at 6:03 PM CDT on Jun 25, 2009