Saturday, April 16, 2011

"Not-business-friendly' Post #19: Dashing Pacific and a clueless Toledo council

Yesterday we learned that the Dashing Pacific Group is 'reassessing' their interest in the Marina District. This certainly comes as no surprise to me, though it seems that members of Toledo City Council still don't get it.

From Mayor Mike Bell's letter to City Council:

Dashing Pacific Group has advised the City that they are reassessing their interest in purchasing the 69 acres in the Marina District. Therefore, I am requesting that Council cancel the Economic Development Committee hearing scheduled for Tuesday, April 19th, and refer the Ordinance authorizing a sale agreement back to the Administration at the April 19th Council meeting.

After discussing, last Tuesday, 'draconian' (to use a frequently heard term these days) conditions for the sale of the property, city council members sent a very strong - and negative - message to all investors who might even remotely consider this area for their developments and dollars.

Does council not understand that people with millions of dollars ready for investment have a plethora of rusted-out cities and empty properties from which to choose? They can have their pick of locations and sites and, because of the economy, can usually ask for tax breaks or other 'incentives' from cities - and get them. In our case, Dashing Pacific asked for nothing except to purchase the property.

But council couldn't resist catering to special interests in a vain attempt to look important and curry the votes of certain groups. Even after learning that their 'stuck on stupid' conditions could jeopardize the deal, they're still insisting that they're doing what is 'right' for the community.

Really? Dictating to private investors what kind of employees they can have risks everything for the entire city while trying to placate the union workers who make up only about 13% of the workforce. It's certainly NOT in the best interests of all the residents to put deed restrictions on a sale that would prohibit 87% of the workforce from participating.

From the news article:

Mr. Copeland said he is pro-business — and pro-citizens of Toledo — and that he makes decisions based on “what affects the citizens of Toledo.”

The loss of the development would have a much bigger impact on the 'citizens' than any requirement for union labor at the job site. What part of that equation does union boss Phil Copeland not understand?

And then there was this from the district councilman:

Adam Martinez said, “I don’t think Toledoans have any issue with the global marketplace and competing. The mayor is certainly very focused on economic development and moving at the speed of business. I think a lot of times he gets caught up in that.”

But the mayor may not understand that council members have the responsibility to make sure “we’re protecting our tax base and citizens,” Mr. Martinez said.

Of course businesses 'move at the speed of business.' If they don't, they fail. The failure to grasp this basic concept is another big part of the problem on city council. Business shouldn't have to wait for self-important politicians to figure out how to carve our special conditions to benefit their friends just to be able to go forward with a plan - and certainly not in the economy we currently have in Toledo. Perhaps this is why businesses don't even try in this community?!?

But for Martinez to think he's "protecting our tax base and citizens" just shows how warped his perspective is. He's risking the bigger picture of overall development and a business-friendly reputation to try to guarantee favors for only a small portion of the community - his union friends.

But the arrogance and hubris of Councilman Joe McNamara takes the cake:

Councilman Joe McNamara placed the blame for the setback on the Bell administration, which he said failed to introduce the investors to council and did not prepare them for the public scrutiny the deal would face.

“The mayor had a relationship with the investors, but council did not,” he said. “There is clearly a cultural difference in how business is conducted in China and the United States and I think the Bell administration did a poor job of communicating that.”

You didn't introduce us - what a whiny, childish, unprofessional attitude! The message McNamara is sending is coming through loud and clear: you didn't cater to us, so we're not going to let you get what you want Mayor - and the investors be damned!

And to say that the Bell Administration didn't 'prepare' Dashing Pacific for the 'public scrutiny'??? International investors are most definitely cognizant of the public scrutiny - what they didn't expect is that a community so desperate for investment and potential growth would have representatives on council who were more interested in protecting a small group of friends than in doing what is best for the community as a whole - or that these same petty representatives would jeopardize a deal because of an imagined slight.

Did these people not learn anything from the Westgate fiasco and Costco? And they wonder why companies have little or no interest in doing business here.

District 6 Council member Lindsay Webb said:

“This is still on the table, in my opinion,” she said.

“I think this is an attempt to scare the public and members of council out of asking the questions that must necessarily be asked.”

Well, just because YOU think something is still viable doesn't mean Dashing Pacific agrees with you. But to state this is a scare tactic to try to prevent questions is beyond naive and further demonstrates the total disconnect between the global business world and the inane ideas of council.

If council were just asking questions, that would be one thing, but they're not. They're issuing not-so-thinly veiled threats that unless the investors cater to their small-minded demands, they won't be able to purchase the property and spend millions turning it into something profitable.

And then there was this priceless gem:

Councilman Mike Craig, whose district includes the area to be sold, said cultural differences are getting in the way of a business deal.

“They need to understand, in the United States, in a development this big, you have lots and lots of partners,” Mr. Craig said.

He said he opposed putting a restriction in the deed transfer requiring the use of union labor, as area construction unions are seeking, but said the Chinese investors should meet with the Northwestern Ohio Building and Construction Trades Council and negotiate.

Apparently Craig doesn't realize that in a free society - like we supposedly have here - the 'partners' are the ones brought into the deal voluntarily, not forced upon you by self-interested and egotistical government officials.

But that's not all. Even George Sarantou, who identifies himself as a Republican, went so far as to 'suggest' that Dashing Pacific go directly to the unions to prostrate themselves:

Councilman George Sarantou called for the Chinese investors’ representative, Mr. Prephan, to meet with the trades union representatives so they can show their involvement in other big projects, such as the Huntington Center arena.

Why? Perhaps Dashing Pacific isn't ready to meet with potential workers yet? For goodness sake - they've not even gotten ownership of the property. What a bunch of hypocrites - complaining from one side about not moving at the speed of business while insisting on the other side that the developer meet with building trades before they've even gotten their drawings of the site completed.

Are we fully cognizant yet about how 'not-business-friendly' this council truly is?

Here's some advice for council: It's certainly appropriate to ask for prior developments the individuals have worked on. It's certainly appropriate to evaluate the price they're willing to pay against the marketable value of the property. It's certainly appropriate to ensure they have the financial wherewithal to meet the purchase obligation and to actually do something with the property.

It's NOT appropriate to insist that your friends get the contracts, that your union supporters get the jobs or that the development fit your wants and desires rather than what can actually be successful and produce revenue for the owners and the city tax coffers.

And it's NOT appropriate to assume with such arrogance that you - without an iota of experience running a business - know better than they do what will and will not work.

Apologize for your stuck-on-stupid, anti-business posturing, sell the property and then get out of the way. Even if Dashing Pacific doesn't do anything with the property for the next several years, selling it for several million is better than letting it just sit waiting for something you deem to be 'more worthy' or for a developer who will cater to your trivial, small-minded and irrelevant demands.


James said...

If the Marina District were such a great purchase, even Donald Trump would have bought it long ago. But even he knows better not to deal with Toledo City Council and its union-run councilmen/women. I hope Council will eventually get out of their "stuck on stupid" thinking and approve the sale to Dashing. Toledo needs the money and Lucas county can then count on collecting property taxes from the dormant land.

Chuck Greer said...

Maggie, I find myself with the belief that the city council, to a person(educated as they are, self-described) are too ignorant (far worse than merely stupid) to care if people see this as a travesty of the first order. If all we can muster at this point, those of us citizens of Toledo who actually care, is to clench our teeth and shake our heads in disgust, we are doomed, doomed! Yet it is hard to do much else after all this.

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