I attended the city council candidate forum as a guest this week at the Alpena Rotary Club. I was pretty much on my best behavior and listened intently to what the candidates had to say, but I left disappointed.
The candidates spoke of getting jobs for Alpena and how the Great Recession was abating in Northeast Michigan. The only problem is the unemployment rates remain high and property values still are declining. There was no mention of the study that said the sewer system requires tens of millions of dollars to bring it up to snuff. There wasn't a peep about consolidation of government in spite of the operating expenses of the city exceed those of any other unit in the five county area. There was nothing about a plan or strategy to lure in new jobs but a great deal was said about how Alpena Township landed Meijer and county commissioners continue their pursuit of the drone project.
One of the candidates, Cindi Johnson, said during her time on the planning commission they passed rules that allowed for home "cottage" businesses like hair dressing and dog grooming. I liked the juxtaposition of the two industry types. In the same period, zoning for industry was tightened.
Only Michael Nunneley said greater funding of Target Alpena was on his agenda. Target Alpena was a major player in landing Meijer.
Let's get to the crux of the problem facing these council candidates - taxes are too high and zoning doesn't allow for the ready access of property for industrial users. As a consequence, industrial and large retail operations shy away from the city.
As an example, the new Meijer facility will encompass about 200,000 square feet of floor plan. To build this at $100 to $150 (estimate obtained from a general contractor ) per square foot you would have $20,000,000 to $30,000,000 in building costs. There is a 15 mill difference between the city and Alpena Township property tax rates, or $300,000-$450,000 difference in taxes every year.
When you consider fire and police protection is about the same, you discover the zoning was quickly finessed for them by township officials and the tax difference is significant for a building which literally is right next to the city.
Not one of the candidates talked about tax abatement in relationship to this issue nor did anyone speak to streamlining the months long zoning procedures in the city. To get growth, city council has to want it. To satisfy that want, there has to be change.
One of the candidates thought that with the loss of industrial jobs in the area the community now has a more "diversified" economy. We do, but we don't have any jobs to fill.
My point is that in order to grow, the city must get structured "with on the shelf" development sites that are "shovel ready" for potential developers. Unfortunately, we don't have any. The North Industrial Park is for light industrial only. A tax abatement of $300-450,000 each year must be offered just to have an offer equal to the township.
Such an abatement pales in comparison, say to that of the State of Pennsylvania, which recently offered Royal Dutch Shell more than $2 billion in incentives for an ethylene plant. Shell officials haven't decided yet.
This isn't "build it and they will come." Development structuring is the very basis of industrial development and the candidates, with the exception of Nunneley, don't have a clue as to how to create jobs if their comments at the forum are any indication of their proposed direction.
As a business guy who has been involved in trying to grow Alpena for decades, I'm not looking for candidates who mouth platitudes about job creation, I'm searching for a change in the structure of the zoning policies within the city to allow for growth.
Too often we are seeing prospects come to town to look for sites but can find none within the city limits. A hotel site on the waterfront is but one example. The city owns prime real estate for such a venture but because of the city charter, it makes development of those sites harder. Why not consider changing the charter so we might land that hotel?
If the city were a business we would be tracking its deferred maintenance costs and declining sales for more than a decade. In corporate America, this double decline would be a signal to sell out to a larger entity or to close down to avoid bankruptcy. The signals are there.